UBS has registered a 63% year-on-year jump in Q2 2021 net profit, largely driven by its wealth management business.
Key group metrics
Net profit for the three months to June 2021 was $2bn, versus $1.23bn a year ago and $1.82bn in Q1 2021.
The Swiss bank’s total operating income increased 21% to $8.98bn from $7.4bn over the period. Operating expenses increased 10% to $6.38bn on a year-on-year basis.
Its CET 1 ratio was 14.5% at the end of June 2021. In the prior year, the ratio was 13.3%.
Global Wealth Management
The unit was the largest contributor this quarter, with a 47% jump in pre-tax profit to $1.3bn.
Recurring net fee income soared 30%, mainly as a result of higher average fee-generating assets.
Invested assets rose 4% sequentially to $3.23trn while fee-generating assets grew 7% sequentially to $1.42bn.
Inflows across all regions led to net new fee-generating assets of $25bn.
Profit before tax at the division increased 9% to $668m from $612m.
Global Banking revenues surged 68%, benefitting from Advisory and Capital Market revenues. Global Markets revenues dipped 14%.
The unit’s profit before tax of $255m was 62% higher than the previous year.
Operating income climbed 27% to $666m. The rise was attributed to higher net management fees along with a $37m gain from the sale of the remaining minority investment in Clearstream Fund Centre.
Performance fees slumped 46%, primarily hit by Hedge Fund Businesses. This was offset by Equities business, which reported higher performance fees.
Invested assets grew 5% sequentially to $1.17bn, while net new money was $2.1bn.
UBS Group CEO Ralph Hamers said: “Our growth in the second quarter was underpinned by the relationships we have built and strengthened throughout the pandemic and by the trust our clients placed in our people and in our firm. All business divisions and all regions contributed to our results.
“Our clients invested more with us – in private markets and separately managed accounts. They came to us to finance their homes and their businesses, and to create liquidity buffers for unforeseen events, all of which led to an increase in net new loans year-on-year.”