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October 25, 2022updated 08 Nov 2022 10:39am

UBS Q3 profit plunges 24% amid challenging market

UBS has recorded a slump in its net profit attributable to shareholders for Q3 2022 as markets remained ‘challenging’ but benefitted from wealthy customers channeling new money.

The Swiss bank’s net attributable profit in the three-month-period ended 30 September 2022 stood at $1.73bn, down 24% from $2.28bn in the same quarter last year.

Diluted earnings per share were $0.52 in the quarter, versus $0.63 in the prior year.

Pre-tax profit decreased 19% year-on-year to $2.32bn, while net interest income dropped 6% to $1.6bn.

Total revenues slipped 10% to $8.24bn from $9.12bn.

On the bright side, operating expenses dipped 6% to $5.91bn from $6.29bn, driven by fall in personnel expenses as well as general and administrative expenses.

The bank’s CET 1 capital ratio, a key measure of strength, was 14.4% at the end of September 2022, as against 14.9% in Q3 2021.

UBS also announced plans for share buybacks of nearly $5.5bn in 2022.

Global Wealth Management

The unit sawnet new fee generating assets of $17.1bn, and a 23% year-on-year growth in net interest income driven by rising interest rates.

Total revenues fell 4% to $4.78bn, which was offset by gains from offloading two businesses.

Hit by negative market performance as well as foreign currency effects, recurring net fee income dropped 14%.

Asset Management

The division gained netnew money of $17.9bn.

However, total revenues dropped 13% and net management fees fell 10%.

Performance fees dropped by $19m, primarily in hedge fund businesses and equities.

Investment Bank

Financial market turbulence affected this unit, with total revenues sliding 19%.

Global Banking revenues slumped 58%, while Global Markets revenues dipped 1%.

UBS group CEO Ralph Hamers said: “We delivered a good result of USD 2.3bn PBT in a challenging environment. Our clients turned to us for advice and entrusted us with USD 17bn of net new fee generating assets.

“Our globally diversified and client-centric model combined with a balance sheet for all seasons is a competitive advantage, enabling us to deliver attractive and sustainable returns to shareholders.”

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