UBS releases 1Q17 net profit results

April 28, 2017
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UBS releases 1Q17 net profit results

UBS delivered very strong first-quarter results with an adjusted profit before tax of CHF 1,934m, up 42% year on year. Adjusted operating income increased 8%, driven by the Investment Bank, Wealth Management Americas and Wealth Management, and the firm continued to make progress on its net cost reduction program. Despite facing a variety of market conditions and client activity levels, all business divisions and regions contributed to the improvement in performance. Reported pre-tax profit was up 73% year on year to CHF 1,690m.

Net profit attributable to shareholders was CHF 1,269m, up 79% year on year, with diluted earnings per share of CHF 0.33. Group annualized adjusted return on tangible equity was 12.6%, or 17.4% excluding DTA. On a fully applied basis, UBS’s capital position remains strong, with a CET1 capital ratio of 14.1%, a CET1 leverage ratio of 3.55% and total loss-absorbing capacity increased to CHF 74bn.

Global wealth management businesses adjusted1 PBT CHF 1.1bn, up 19% YoY

Invested assets increased 13% to a record CHF 2.2trn year on year, with net new money of CHF 20.5bn. Adjusted net margin increased 2 bps to 20 bps from the prior year.

Wealth Management adjusted1 PBT CHF 727m, up 14% YoY

Very strong performance was driven by higher transaction-based income and lower operating expenses. Net new money was CHF 18.6bn, driven by Europe, with positive contributions from all other regions. Net mandate sales in the quarter were CHF 15.1bn, with mandate penetration increasing to 27.8% of invested assets. Adjusted net margin increased by 2 bps from the prior year to 29 bps.

Wealth Management Americas adjusted1 PBT USD 324m, up 32% YoY

Record first-quarter results reflected higher recurring net fee income and record net interest income. Net new money in the quarter was USD 1.9bn. Managed account assets increased to a record 35.2% of invested assets. Adjusted net margin increased by 2 bps from the prior year to 11 bps. Advisor productivity was industry-leading for both revenues and invested assets.

Personal & Corporate Banking adjusted PBT CHF 437m, up 4% YoY

Strong results benefited from certain items that are not expected to recur and lower operating expenses, mitigating increasing net interest income headwinds. Annualized net new business volume growth for personal banking was a record 6.7%.

Asset Management adjusted PBT CHF 123m, up 12% YoY

Solid results improved on lower operating expenses. Net new money excluding money market inflows was CHF 19.7bn, reflecting strong passive investment capabilities.

Investment Bank adjusted PBT CHF 558m, up 51% YoY

Very strong performance, despite low volatility and uneven client activity levels, was driven by higher revenues in Corporate Client Solutions and good cost management, contributing to a very strong annualized adjusted return on attributed equity of 24%.

Corporate Center – Services recorded an adjusted loss before tax of CHF 207m. Group Asset and Liability Management adjusted1 profit before tax was CHF 63m. Non-core and Legacy Portfolio posted an adjusted loss before tax of CHF 91m.

Re-disseminated by The Asian Banker