UBS reported a turnaround to profitability after facing losses in the previous two quarters, surpassing expectations for the first quarter. The surge in profits was driven by increased revenues in wealth management. Following a lackluster start to the year, UBS shares rose by 8.9% at 8:48 a.m. London time, partially recovering from losses incurred in April. Despite a remarkable 51.7% surge in shares last year, the performance in 2024 has been subdued.
The bank attributed its improved financial performance to lower expenses and the benefits of consolidating Credit Suisse, which it acquired in June 2023. UBS posted a net profit of $1.8 billion in the first quarter, surpassing the consensus forecast of $721.4 million from an LSEG poll.
UBS continues to navigate the complex integration of Credit Suisse. It anticipates completing the merger of UBS AG and Credit Suisse AG into a single U.S. intermediate holding company in the second quarter, followed by the merger of its Swiss entities in the third quarter.
In the first quarter, the bank recorded group revenue of $12.74 billion, surpassing expectations and marking an increase from $10.86 billion in the previous quarter. Revenue in its flagship Global Wealth Management unit surged by 28% to $6.14 billion.
The bank’s CET1 capital ratio, a key measure of liquidity, stood at 14.8%, up from 14.4% in the previous quarter.
Group CEO Sergio Ermotti commented, “This quarter marks the return to reported net profits and further capital accretion, a testament to the strength of our business and client franchises and our ability to deliver significant progress on our integration plans while actively optimizing our financial resources.”
