UBS' Q3 2017 profit before tax up 39%
- Net profit of CHF 0.9bn, +14% YoY; diluted EPS CHF 0.25
- Adjusted profit before tax CHF 1.5bn, +16% YoY
- CHF 1.0bn adjusted1 profit before tax in global wealth management, +4% YoY, +12% YTD
- Adjusted return on tangible equity 10.2%, 13.3% excluding DTAs
- Fully applied CET1 capital ratio 13.7% and CET1 leverage ratio 3.7%
- UBS confirmed as Diversified Financial Services and Capital Markets industry group leader by Dow Jones Sustainability Index for third year running
UBS delivered good third quarter results with net profit attributable to shareholders up 14% year on year to CHF 946m. Reported profit before tax increased by 39% to CHF 1,221m and adjusted profit before tax increased by 16% to CHF 1,506m. The net tax expense for the third quarter was CHF 272m, including a net write-up of deferred tax assets of CHF 174m mainly driven by higher US profit forecasts beyond 2017. Group annualized adjusted return on tangible equity was 10.2%, or 13.3% excluding deferred tax assets.
Global wealth management adjusted profit before tax rose 4% year over year to CHF 1,041m, with growth in all revenue lines. This performance reflects higher invested asset levels and higher short-term US dollar interest rates, as well as further progress on mandate penetration and loan growth. Personal & Corporate Banking had the highest third quarter annualized net new business volume growth for personal banking in decade. Adjusted profit before tax was CHF 436m, as management actions and client activity mostly offset increased funding cost and interest rate headwinds. Asset Management adjusted profit before tax increased by 11% and its invested assets reached a nine-year high of CHF 744bn. The Investment Bank delivered 3% adjusted1 profit before tax growth, as continued strong Corporate Client Solutions results offset the lower revenues in Investor Client Services in a challenging market environment for flow businesses.
UBS’s capital position remains strong, with a fully applied CET1 capital ratio of 13.7%, a CET1 leverage ratio of 3.7% and total loss-absorbing capacity of CHF 78bn. During the quarter, Fitch Ratings and Scope Ratings upgraded UBS AG to ‘AA–’ (stable outlook). As of September 2017, the Group achieved CHF 1.9bn of annualized net cost savings and is on track to achieve its CHF 2.1bn target by the end of 2017.
“We again saw good results across our business divisions with Asia Pacific as an important driver of profitable growth. We remain focused on disciplined execution and creating long-term value for our shareholders, ” Sergio P. Ermotti, Group Chief Executive Officer
Re-disseminated by The Asian Banker