Ubs, profit down but results above expectations

Slight decline in profit, but results nevertheless above the prevailing forecasts in the run-up. The top management of Ubs, Switzerland's largest bank, expressed satisfaction with the first-quarter figures. As the integration of the acquired Credit Suisse proceeds, the Swiss banking group confirms its resilience, piling up hay and preparing to face further doses of market volatility in the coming months.

Net profit for the first quarter of 2025 is $1.69bn (€1.49bn at current exchange rates), 3.6% lower than the $1.75bn for the same period in 2024. Pre-tax profit is 2.13 billion, down from 2.37 billion a year earlier. Total revenues are 12.55 billion, again down slightly from 12.73 billion twelve months earlier. The Global Wealth Management (this is the group's core business), Investment Bank, and Asset Management divisions all recorded progress in operating profit; the Personal & Corporate Banking division, which is sensitive to falling interest margins, on the other hand, recorded a decrease. Volatility in the markets on the one hand complicated the picture, but on the other hand led to an increase in transaction-related revenues in the quarter and benefited some of the Investment Bank's activities.

The Credit Suisse integration is proceeding according to plan, the group says, with further savings of $900m realised, bringing total cost reductions to $8.4bn, or 65% of the expected total of $13bn. Ubs is also proceeding with its buyback plan, 500 million worth of shares have been repurchased and 2.5 billion has been set aside for buybacks planned for the remainder of 2025. "The strength and size of our globally diversified franchise, coupled with our continued customer focus," said CEO, Sergio Ermotti of Ticino, Switzerland, "contributed to strong momentum in operating momentum in the quarter and net inflows from our asset gathering business. As we begin to tackle the next crucial phase of the integration (of Credit Suisse, ed), I am pleased with the substantial progress we have made so far. The second quarter has started well for the group, says Ubs' top management, but the fact remains that the risk of an escalation in tariffs and increased macroeconomic uncertainty have caused volatility. 'The future economic path is particularly unpredictable,' the bank stresses.

After the release of the institution's data and valuations, the Ubs share price initially went up on the Zurich Stock Exchange, also on the back of the fact that the quarterly net profit exceeded expectations (analysts surveyed by the Awp agency expected an average of EUR 1.30 billion). In the course of the session, the share then entered an up-and-down phase. On the one hand, the Ubs share is driven by the good results, the steps forward in the integration of the Cs, and the buyback; on the other, it is affected by international uncertainties and, in addition, also by a large open question in Switzerland, that of possible stricter capital adequacy regulations. The Swiss government is leaning towards another crackdown; UBS, for its part, has expressed its disagreement and stated that it already has more than sufficient equity as collateral.