UBS reports its first quarterly profit following the acquisition of Credit Suisse

UBS, the Swiss lender that took over Credit Suisse, has reported its first quarterly profit since the acquisition, signaling a positive turn in its financial performance. The group announced a net profit of $1.8 billion for the first three months of the year, a significant improvement from the previous quarter’s $279 million loss and surpassing analysts’ expectations.

The success was attributed to the strong performance of its wealth management business, which attracted $27 billion in net new assets as clients returned to the lender following the turmoil triggered by the rescue of Credit Suisse. Revenues increased by 15 percent to $12.7 billion, while expenses were trimmed by 5.5 percent. UBS also achieved $1 billion in cost savings during the quarter, with plans to reduce costs by $13 billion by the end of 2026.

UBS CEO Sergio Ermotti expressed confidence in the company’s progress, stating, “This quarter marks the return to reported net profits and further capital accretion — a testament to the strength of our business and client franchises.” Despite the positive results, UBS executives have warned of a challenging integration process following the acquisition, with 2024 expected to be a pivotal year for the company.

However, UBS faces challenges ahead as the Swiss finance department proposed increasing the group’s capital requirements, which could lead to $15-25 billion of additional capital for the bank. Despite these concerns, UBS remains focused on meeting its 2024 capital return targets and has committed to buying back $2 billion of shares from investors.