UBS meets expectations with US$2.7 billion Q3 profit

UBS reported a third-quarter net profit of US$2.69 billion on Wednesday, October 28, marking an 8% increase from the previous year and aligning closely with the US$2.71 billion consensus forecast provided by the company. The Swiss bank's success was attributed to net new assets of US$55 billion in global wealth management, which saw inflows of US$18 billion in Asia and US$17 billion in the Americas.

UBS also noted improved profitability in the Americas, with the profit-before-tax margin rising by more than two percentage points. The integration of former rival Credit Suisse is anticipated to be completed by year-end, with UBS projecting cumulative cost savings of around US$13.7 billion by the end of 2026, up from an earlier estimate of US$13.5 billion.

In the quarter, UBS repurchased US$1.8 billion of shares and aims to conclude its share buyback program of US$3 billion in February, a timeline revised from the initial plan to mid-2027. The bank has tied the size and pace of these share buybacks to the outcome of proposed changes to Swiss banking rules following the 2023 Credit Suisse collapse.

Debates surrounding new capital rules for UBS are ongoing in a parliamentary committee and are expected to move to the Lower House floor in December. UBS' chairman has expressed concerns that overly stringent capital requirements could impact the bank's future in Switzerland, and some shareholders have called for the company to exit the country.

UBS hopes that the parliament will reach an agreement that safeguards Switzerland's financial stability without imposing excessive costs on its shareholders, clients, and employees.