UBS reported its first results since the deal to buy Credit Suisse.
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UBS reported $1.03 billion in net profit for the first quarter, down 52% year-on-year amid a legacy litigation matter. These are the Swiss bank’s first results since announcing its takeover of rival Credit Suisse.
Analysts had estimated it would post a net profit of $1.75 billion for the quarter, according to Refinitiv.
The Swiss bank increased its provisions of $665 million following a U.S. residential mortgage-backed securities litigation matter.
“Our solid underlying performance and strong inflows this quarter demonstrate that we continue to be a source of stability for our clients during periods of significant uncertainty,” CEO Sergio Ermotti said in a statement.
Here are other highlights of the quarter:
- Revenues reached $8.75 billion vs 9.38 billion a year ago
- Operating expenses were $7.2 billion from $6.6 billion a year ago
- CET 1 capital ratio, a measure of bank solvency, came in at 13.9% vs 14.1% a year ago
The lender also said that it attracted $28 billion in net new money in its global wealth management unit, of which $7 billion were registered in the last 10 days of March and therefore after the announcement of its acquisition of Credit Suisse.
UBS shares have jumped more than 10% since the news that it was buying its embattled Swiss competitor last month. At the time, UBS said that the deal, brokered by Swiss regulators, would create a “leading global wealth manager” with more than $5 billion in total invested assets.
However, analysts at Barclays said that the market is “significantly underestimating” the complexity of integrating Credit Suisse within UBS, Reuters reported.
In the wake of the deal, UBS announced that Sergio Ermotti, who served as CEO between 2011 and 2020, would return to the post from April 5.
This is a breaking news story and will be updated shortly.