UBS has reported its first quarterly profit since buying ailing rival Credit Suisse, marking a sharp turnaround from six months of losses that immediately followed the closure of the rescue deal.
Shares in the Swiss lender surged 10% in Zurich Tuesday after it posted net profit of $1.8 billion for the first three months of 2024 — a 71% increase from a year ago. Combined losses for the June-to-December 2023 period totaled almost $1.1 billion.
CEO Sergio Ermotti said the latest performance was “a testament” to the strength of the bank and its “ability to deliver significant progress” on its integration plans.
Johann Scholtz, an analyst at Morningstar, noted that the results were “much stronger than expected.”
“The market was initially concerned that the Credit Suisse merger would lead to revenue attrition, which would have left cost reduction as the only lever to drive earnings growth,” he said in a note.
In fact, revenue surged 45% from a year ago to $12.7 billion and UBS attracted net new money of $27 billion into its global wealth management business, the bank’s biggest division, in the first quarter. It also realized cost savings of $1 billion, adding to cost cuts of some $4 billion last year.
Source: CNN
