Swiss banking giant UBS reported a narrow victory in surpassing fourth-quarter earnings expectations and announced that it intends to restart share buybacks of up to $1 billion in the second half of the year. Despite experiencing a net loss attributable to shareholders of $279 million for the quarter, its second consecutive loss due to the integration costs of rival Credit Suisse, UBS outperformed analyst predictions of a wider net loss of $372 million. The group also intends to propose a dividend per share of $0.70, reflecting a 27% year-on-year increase.
In the third quarter, UBS posted a greater-than-expected net loss, due to $2 billion in expenses associated with the integration of Credit Suisse, although the bank’s strong underlying operating profit before tax outpaced expectations. Since its takeover of Credit Suisse, UBS has experienced a more rapid return of client inflows to the wealth management business of its stricken rival. As UBS embarks on the process of cutting approximately 3,000 Credit Suisse jobs as part of a broader restructuring, the bank has indicated that the full merger is anticipated to be completed by the end of the second quarter.
Throughout 2024, UBS shares experienced a modest start, ending Monday’s trade down 1.5% since the beginning of the year. Total group revenues decreased to $10.86 billion from $11.7 billion in the third quarter, while the CET1 capital ratio, a measure of bank liquidity, increased to 14.5% from 14.4%. UBS also saw $77 billion in net new assets in the Global Wealth Management division and across the personal and corporate banking division since finalizing the acquisition of Credit Suisse in 2023. Despite the challenges posed by a challenging geopolitical and macroeconomic environment, UBS CEO Sergio Ermotti emphasized that the bank has stabilized the franchise and made remarkable progress in the integration.
