UBS posts $1.1 bln net profit in Q2, easily beating forecast
Adds detail on shares in paragraph 3, comment from analysts in paragraphs 8-10
By Dave Graham
ZURICH, Aug 14 (Reuters) -UBS UBSG.S on Wednesday reported a net profit of $1.14 billion for the April-June period, comfortably surpassing analysts' forecasts as Switzerland's largest bank enters a new stage in the integration of its one-time rival Credit Suisse.
The net profit attributable to shareholders compared with the $528 million forecast by analysts in a company-provided poll for what were the bank's first results since UBS completed its formal legal merger with Credit Suisse in May.
Shares in UBS were expected to rise at opening, according to premarket indications by bank Julius Baer.
UBS acquired its longtime competitor last year in a rescue that was engineered by Swiss authorities when Credit Suisse collapsed after a string of financial setbacks and scandals.
In a statement, UBS CEO Sergio Ermotti said that the first-half results reflected the "significant progress" the bank had made since closing the Credit Suisse acquisition.
"We are well positioned to meet our financial targets and return to the levels of profitability we delivered before being asked to step in and stabilise Credit Suisse," he added.
"We are now entering the next phase of our integration, which will be critical to realise further substantial cost, capital, funding and tax benefits."
Revenues and operating expenses outperformed consensus expectations, and Deutsche Bank analysts said in a research note that the upside result was driven by UBS's investment bank and its non-core and legacy division.
"Furthermore, capital was a touch ahead, cost reductions are quicker-than-expected and net inflows were decent across Global Wealth Management but not in Asset Management," they said.
"Hence, UBS continues to deliver post Credit Suisse takeover but the uncertainty around capital (return) remains high."
UBS said it had achieved $0.9 billion of additional gross cost savings, reaching around 45% of its cumulative annualised gross cost saving ambitions.
The bank has reduced non-core and legacy risk-weighted assets by 42% since the second quarter of last year, including an $8 billion decline quarter-on-quarter, it added.
GEOPOLITICAL TENSIONS
UBS said the macroeconomic outlook was clouded by ongoing conflicts, geopolitical tensions and the upcoming U.S. elections. It expected these uncertainties to persist for the foreseeable future, and that they would likely lead to higher market volatility than in the first half of the year.
The bank said it was seeing positive investor sentiment and continued momentum in client and transactional activity.
It also saw moderate net interest income headwinds from ongoing mix shifts in Global Wealth Management and the effects of the Swiss National Bank's second rate cut, not yet captured in UBS's deposit pricing in Personal & Corporate Banking.
The bank said it expected to incur in the third quarter around $1.1 billion of integration-related expenses and that the pace of gross cost savings would decline modestly sequentially. Integration-related expenses should be partly offset by around $0.6 billion accretion of purchase accounting effects, it said.
UBS reported a nearly $29 billion profit during the second quarter of last year due to a huge one-off gain reflecting how the acquisition costs were far below Credit Suisse's value.
Swiss authorities oversaw the first merger of two global systemically important banks - as designated by the Financial Stability Board - in the first half of last year.
After that, UBS posted two consecutive quarters of losses due to the cost of absorbing its rival.
Investors warmed to the takeover, by this summer pushing up the value of UBS's shares by more than two-thirds since it bought Credit Suisse in March 2023. However, UBS shares have since lost ground during recent turmoil in global markets.
Analysts are watching UBS's absorption of Credit Suisse closely, and Ermotti said in May any delay to the technological integration of the two banks could erode planned cost savings.
Markets are also watching how Swiss authorities move forward with plans to tighten banking regulation as they seek to ensure there is no repeat of the Credit Suisse meltdown.
The Swiss government in April presented a raft of so-called "too big to fail" proposals, sketching out how UBS would need to hold additional capital to ward against mishaps in future.
Although the Swiss finance minister has suggested the sum could be between $15 billion and $25 billion, it remains unclear exactly how much it will be, and UBS has flagged "serious" concern about the increased capital requirements.
Reporting by Dave Graham; Additional reporting by Miranda Murray and Rachel More; Editing by Jacqueline Wong
متعلقہ اثاثے
تازہ ترين خبريں
دستبرداری: XM Group کے ادارے ہماری آن لائن تجارت کی سہولت تک صرف عملدرآمد کی خدمت اور رسائی مہیا کرتے ہیں، کسی شخص کو ویب سائٹ پر یا اس کے ذریعے دستیاب کانٹینٹ کو دیکھنے اور/یا استعمال کرنے کی اجازت دیتا ہے، اس پر تبدیل یا توسیع کا ارادہ نہیں ہے ، اور نہ ہی یہ تبدیل ہوتا ہے یا اس پر وسعت کریں۔ اس طرح کی رسائی اور استعمال ہمیشہ مشروط ہوتا ہے: (i) شرائط و ضوابط؛ (ii) خطرہ انتباہات؛ اور (iii) مکمل دستبرداری۔ لہذا اس طرح کے مواد کو عام معلومات سے زیادہ کے طور پر فراہم کیا جاتا ہے۔ خاص طور پر، براہ کرم آگاہ رہیں کہ ہماری آن لائن تجارت کی سہولت کے مندرجات نہ تو کوئی درخواست ہے، اور نہ ہی فنانشل مارکیٹ میں کوئی لین دین داخل کرنے کی پیش کش ہے۔ کسی بھی فنانشل مارکیٹ میں تجارت میں آپ کے سرمائے کے لئے ایک خاص سطح کا خطرہ ہوتا ہے۔
ہماری آن لائن تجارتی سہولت پر شائع ہونے والے تمام مٹیریل کا مقصد صرف تعلیمی/معلوماتی مقاصد کے لئے ہے، اور اس میں شامل نہیں ہے — اور نہ ہی اسے فنانشل، سرمایہ کاری ٹیکس یا تجارتی مشورے اور سفارشات؛ یا ہماری تجارتی قیمتوں کا ریکارڈ؛ یا کسی بھی فنانشل انسٹرومنٹ میں لین دین کی پیشکش؛ یا اسکے لئے مانگ؛ یا غیر متنازعہ مالی تشہیرات پر مشتمل سمجھا جانا چاہئے۔
کوئی تھرڈ پارٹی کانٹینٹ، نیز XM کے ذریعہ تیار کردہ کانٹینٹ، جیسے: راۓ، خبریں، تحقیق، تجزیہ، قیمتیں اور دیگر معلومات یا اس ویب سائٹ پر مشتمل تھرڈ پارٹی کے سائٹس کے لنکس کو "جیسے ہے" کی بنیاد پر فراہم کیا جاتا ہے، عام مارکیٹ کی تفسیر کے طور پر، اور سرمایہ کاری کے مشورے کو تشکیل نہ دیں۔ اس حد تک کہ کسی بھی کانٹینٹ کو سرمایہ کاری کی تحقیقات کے طور پر سمجھا جاتا ہے، آپ کو نوٹ کرنا اور قبول کرنا ہوگا کہ یہ کانٹینٹ سرمایہ کاری کی تحقیق کی آزادی کو فروغ دینے کے لئے ڈیزائن کردہ قانونی تقاضوں کے مطابق نہیں ہے اور تیار نہیں کیا گیا ہے، اسی طرح، اس پر غور کیا جائے گا بطور متعلقہ قوانین اور ضوابط کے تحت مارکیٹنگ مواصلات۔ براہ کرم یقینی بنائیں کہ آپ غیر آزاد سرمایہ کاری سے متعلق ہماری اطلاع کو پڑھ اور سمجھ چکے ہیں۔ مذکورہ بالا معلومات کے بارے میں تحقیق اور رسک وارننگ ، جس تک رسائی یہاں حاصل کی جا سکتی ہے۔
