UBS reported its first outcomes because the deal to purchase Credit score Suisse.
Fabrice Coffrini | Afp | Getty Photographs
UBS reported a 52% annual drop in internet revenue on Tuesday amid a legacy litigation matter, however maintained it’s a “supply of stability” for its purchasers during times of excessive uncertainty.
These are the financial institution’s first outcomes since saying its takeover of rival Credit score Suisse.
UBS stated internet revenue got here in at $1.03 billion for the primary quarter, coming in effectively under analyst expectations of a internet revenue close to $1.75 billion for the interval, in accordance with Refinitiv.
The hit in internet earnings got here from elevated provisions of $665 million following a U.S. residential mortgage-backed securities litigation matter.
Chatting with CNBC’s Geoff Cutmore, UBS CEO Sergio Ermotti — who resumed his put up on April 5 — stated, “We’re in superior discussions. Hopefully we are able to shut this 15-year outdated chapter very quickly.”
Ermotti additionally described the most recent outcomes as “very stable.”
“We noticed some inflows coming from Credit score Suisse, however, most significantly, we proceed to see even after the transaction, we noticed inflows, so the demonstration that our purchasers consider we’re a supply of stability.” he instructed CNBC.
“We’re a part of the answer and never a part of the issue,” he added.
Listed below are different highlights of the quarter:
- Revenues reached $8.75 billion vs 9.38 billion a 12 months in the past
- Working bills have been $7.2 billion from $6.6 billion a 12 months in the past
- CET 1 capital ratio, a measure of financial institution solvency, got here in at 13.9% vs 14.1% a 12 months in the past
The lender additionally stated that it attracted $28 billion in internet new cash in its world wealth administration unit, of which $7 billion have been registered within the final 10 days of March — after the announcement of its acquisition of Credit score Suisse.
Credit score Suisse Deal
UBS shares have jumped greater than 10% because the information that it was shopping for its embattled Swiss competitor final month. On the time, UBS stated that the deal, brokered by Swiss regulators, would create a “main world wealth supervisor” with greater than $5 billion in complete invested property.
Nevertheless, analysts at Barclays stated that the market is “considerably underestimating” the complexity of integrating Credit score Suisse inside UBS, Reuters reported. Ermotti instructed CNBC on Tuesday that the merger ought to be accomplished inside the second quarter.
“Within the subsequent couple of weeks I’ll redefine our goal working mannequin for the longer term, (I) additionally come out with some organizational bulletins and readability,” he stated, including that the merger with Credit score Suisse shouldn’t be a “dangerous” transaction and can ship for shareholders.
