UBS Soars with 9% Share Increase

UBS Soars with 9% Share Increase

Raphael Mueller
2 min read

UBS Shares Soar After Reporting Profitable First Quarter

Shares of UBS are surging by 9% following the bank's report of a profitable first quarter, marking a reversal from a two-quarter loss trend. The bank's net profit of $1.8 billion was driven by higher wealth management revenues, reaching $6.14 billion, reflecting a 28% increase. UBS is currently in the process of integrating Credit Suisse, which it acquired in June 2023, and anticipates completing the merger of their U.S. and Swiss entities in the second and third quarters of this year respectively. The bank's CET1 capital ratio stands at 14.8%, and it boasts strong net and underlying profitability. Analyst Johann Scholtz from Morningstar has expressed confidence in UBS's focus on balance sheet management, capital release from Credit Suisse's legacy trading positions, and the potential for increased future fee income due to net inflows into wealth management. UBS Chairman Colm Kelleher has raised concerns about the proposals from Swiss regulators and argued against the perception of the bank being "too big to fail."

Key Takeaways

  • UBS reports profit swing after two quarterly losses, exceeding first-quarter expectations
  • Wealth management revenues and cost reductions contribute to $1.8 billion net profit
  • UBS expects to complete Credit Suisse merger into single US holding company in Q2, Swiss entities in Q3
  • Group revenue at $12.74 billion, up from Q4 2023; Global Wealth Management revenue rises 28% to $6.14 billion
  • UBS focuses on balance sheet management, releasing capital by winding down legacy trading positions
  • Analyst praises strong revenue growth, dismissing concerns about revenue attrition post-merger
  • Swiss regulators may consider increased capital requirements, but UBS expects sufficient capital from fee income and balance sheet management


The surge in UBS shares reflects their return to profitability after two quarters, driven by wealth management revenue growth and cost reductions. The acquisition of Credit Suisse, expected to complete in Q2 and Q3, will allow UBS to focus on balance sheet management and releasing capital from legacy trading positions. This merger may prompt Swiss regulators to consider increased capital requirements, but UBS anticipates sufficient capital from fee income and balance sheet management. Consequences include potential growth in UBS's market share, increased regulatory scrutiny of Swiss banks, and a shift in the Swiss banking landscape. Future developments may see UBS expanding its wealth management services and further distancing itself from the "too big to fail" label.

Did You Know?

  • CET1 Capital Ratio: It is a measure of a bank's financial strength and resilience, indicating the proportion of a bank's capital that consists of common equity tier 1 capital, the most loss-absorbing and highest-quality form of capital.
  • Wealth Management Revenues: Refers to the fees and commissions earned by a bank or financial institution from managing the assets and investments of high-net-worth individuals and families.
  • Legacy Trading Positions: Refers to the remaining positions or investments that a bank or financial institution has inherited from its past activities or acquisitions. These positions may no longer align with the bank's current risk appetite, business strategy, or regulatory requirements.

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