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UBS earnings Q3 2022

UBS stories its newest earnings

FABRICE COFFRINI | AFP | Getty Images

UBS on Tuesday reported a web earnings of $1.7 billion for the third quarter of this year, barely above analyst expectations, with the Swiss financial institution citing a difficult surroundings.

Analysts had anticipated a web revenue of $1.64 billion, in response to Refinitiv knowledge. UBS reported a web earnings of $2.3 billion a year in the past.

The Swiss lender had missed expectations within the final quarter when it posted a web revenue of $2.108 billion. The financial institution mentioned on the time the second quarter had been “one of the most challenging periods for investors in the last 10 years” as a result of excessive inflation, the conflict in Ukraine and strict Covid-19 insurance policies in Asia.

UBS mentioned Tuesday these components continued to be in buyers’ minds within the third quarter.

“The macroeconomic and geopolitical environment has become increasingly complex. Clients remain concerned about persistently high inflation, elevated energy prices, the war in Ukraine and residual effects of the pandemic,” Ralph Hamers, CEO of UBS, mentioned in a press release.

UBS CEO: Expect Europe to go into recession

Speaking to CNBC’s Geoff Cutmore, Hamers mentioned, nonetheless, that there have been very robust flows into the business over the quarter, with web new fee-generating property at $17 billion.

Other highlights for the quarter included:

  • Revenues hit $8.3 billion, down from $9.1 billion a year in the past.
  • Operating bills dropped to $5.9 billion, from $6.2 billion a year in the past.
  • CET 1 capital ratio, a measure of financial institution solvency, reached 14.4% versus 14.9% a year in the past.

Its funding banking division noticed revenues down by 19% with the decrease efficiency in fairness derivatives, money equities, and financing income being offset by revenues in overseas change. The Global Wealth Management division additionally reported decrease revenues, down by 4% year-on-year.

However, Personal and Corporate Banking revenues rose over the identical interval on extra useful charges from the Swiss National Bank.

Hamers famous Tuesday that purchasers on its wealth aspect have been in search of various investments and money, and he predicted that exercise on the institutional aspect of its buying and selling unit would stay weak within the fourth quarter.

China’s Xi

UBS is aiming to enhance its business in Asia-Pacific and CEO Hamers mentioned he sees “some opportunities to grow” in China.

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“The confirmation of [China President] Xi for another term is on one side basically the confirmation of consistency going forward, so some of the policies that he has come out with over the last year will most likely be continued,” Hamers mentioned.

He added that the Swiss financial institution appears at China “by virtue of its demographics and some of the dimensions of the economy.” “We think over time it is a very attractive place, so it is a strategic place,” he added.

Elsewhere, Hamers expects a “challenging” time for Europe given the continued power disaster and conflict in Ukraine.

“Europe will have a challenging period, a challenging winter although they have their reserves,” he mentioned, including that the Swiss financial institution expects the area to enter a recession.

Shares of UBS have been up by greater than 4% in late morning European commerce.

“We consider UBS’s Q3 results were reasonably good considering the challenging operating environment although net attributable profit was down 24% compared to the same quarter the year before,” Vitaline Yeterian, senior vp at DBRS Morningstar, mentioned through e-mail.

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