UBS net profit up 71% after two quarters in the red

Swiss banking giant UBS on Tuesday said first quarter net profit rose 71 percent to nearly $1.8 billion after two quarters in the red due to the takeover of Credit Suisse.

Switzerland's biggest bank said turnover increased by 46 percent to $12.7 billion.

A company statement said income of its investment bank -- the largest project in the integration of rival Credit Suisse -- increased by 16 percent due to a more favourable market climate and a good performance of IPOs and mergers and acquisitions.

In March 2023, Swiss authorities strongarmed UBS into the $3.25-billion takeover to prevent Credit Suisse from going under with catastrophic consequences for the global financial system.

The results for the first three months of 2024 were a moment for the bank to review progress since the integration of Credit Suisse.

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"A little over a year ago, we were asked to play a critical role in stabilising the Swiss and global financial systems through the acquisition of Credit Suisse and we are delivering on our commitments," said UBS chief executive Sergio Ermotti.

"This quarter marks the return to reported net profits and further capital accretion -- a testament to the strength of our business and client franchises and our ability to deliver significant progress on our integration plans while actively optimising our financial resources."

The megamerger combined two heavyweight banks pulling in diametrically different directions.

As for the outlook, the bank said that although monetary easing was expected in the eurozone, the United States and Switzerland, "the timing and magnitude of rate cuts by central banks are unclear, as inflation remains above their target range".

"In addition, the ongoing geopolitical tensions, combined with consequential elections in several major economies, continue to create uncertainty," it said.

Source: AFP