- UBS reported a second-quarter net income of $2.40 billion, exceeding both the previous year’s $1.14 billion and the estimated $2.21 billion.
- Total revenue increased by 1.7% year-over-year to $12.11 billion, surpassing the $11.87 billion estimate.
- Net interest income rose significantly by 28% year-over-year to $1.97 billion, slightly above the $1.94 billion estimate.
- The bank managed to reduce its operating expenses by 5.6% year-over-year to $9.76 billion, better than the anticipated $9.91 billion.
- Pretax profit surged by 49% year-over-year to $2.19 billion, exceeding the estimate of $2.07 billion.
- Wealth Management reported a pretax profit of $1.20 billion, although falling short of the $1.37 billion estimate.
- The Investment Bank’s pretax profit improved by 17% year-over-year to $557 million, above the $539 million estimate.
- Asset Management saw an 18% increase in pretax profit to $153 million, although below the $166 million estimate.
- Earnings per share (EPS) improved significantly to 72 cents from 34 cents year-over-year, beating the 63 cents estimate.
- The Common Equity Tier 1 ratio stood at 14.4%, consistent with expectations and marginally higher than the previous quarter’s 14.3%.
- The cost to income ratio improved to 80.5%, better than the projected 83.8%.
- Return on tangible equity doubled to 11.8% from 5.9% year-over-year, surpassing the 10.8% estimate.
- Wealth Management generated $6.30 billion in total revenue, a 4.1% year-over-year increase, slightly under the $6.32 billion estimate.
- Investment bank revenue rose by 5.8% year-over-year to $2.97 billion, exceeding the $2.74 billion estimate.
- Global Wealth Management attracted $23 billion in net new assets, above the estimated $22.65 billion.
- Integration efforts remain on course, with one-third of client accounts successfully migrated to Switzerland.
- UBS completed $0.5 billion in share buybacks, with plans for up to $2 billion repurchases in the second half of the year.
- Net profit included a net release of provisions and contingent liabilities of $427 million due to resolving a previous Credit Suisse issue, and a $577 million deferred tax benefit.
- The bank achieved an extra $0.7 billion in gross cost savings by downsizing non-core expenditures and realizing cost synergies.
- Client engagement and transaction pipelines indicate strong investor and corporate readiness to invest amid growing confidence in the macroeconomic outlook.
- In the third quarter, UBS expects stable net interest income in Global Wealth Management and Personal & Corporate Banking when measured in CHF, and a low single-digit percentage growth in USD.
- Trading and transactional activities in the next quarter are expected to align with typical seasonal patterns and activity levels.
- Asset Management reported a net outflow of $2 billion in the second quarter, or a $5 billion outflow excluding money market flows and associates.
A look at UBS Group Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 4 | |
| Dividend | 4 | |
| Growth | 3 | |
| Resilience | 2 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.4 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Based on the Smartkarma Smart Scores, UBS Group shows a promising long-term outlook. With strong scores in value and dividend, the company demonstrates financial stability and potential for growth. Additionally, its momentum score indicates positive market sentiment and potential for continued performance. However, UBS Group’s lower resilience score may pose some risks in the face of economic volatility.
UBS Group AG, a financial services provider catering to a wide range of clients, including private individuals, corporations, and institutions, offers a diverse portfolio of services from investment and retail banking to wealth management and asset management. Despite facing some challenges in resilience, the company’s strong value, dividend, and momentum scores suggest a solid foundation for future growth and stability in the competitive financial services industry.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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