UBS has published annual economic forecasts
2023.01.31 03:52
UBS has published annual economic forecasts
By Ray Johnson
Budrigannews.com – After the Swiss bank beat estimates in its most recent quarter, UBS Group AG issued a prediction on Tuesday that the year ahead would be “uncertain,” plagued by accelerating inflation and higher interest rates.
The largest wealth manager in the world started a new round of reporting for major European banks, many of which have been cutting costs and jobs as economic growth slows down.
UBS warned that inflation, rising interest rates, and the conflict in Ukraine were clouding the future and were making customers’ moods worse. It warned that lower asset prices and lower customer confidence could hurt its business, but that higher interest rates would also help.
Despite a decline in financial markets, the Swiss bank reported a 23% increase in net profit attributable to shareholders of $1.7 billion for the quarter that just ended. This increase was aided by a decrease in costs. That contrasted with the $1.3 billion average estimate of 21 analysts in a UBS poll.
In a statement, CEO Ralph Hamers said, “We are starting 2023 from a position of strength.”
The consensus estimate was $7.3 billion, but the full-year net profit was $7.6 billion.
Crosstown rival Credit Suisse Group AG will report on February 9 that it reported a quarter-over-quarter pre-tax loss of as much as 1.5 billion francs ($1.63 billion) as a result of substantial withdrawals made by wealthy clients following a series of scandals and losses.
Colm Kelleher, chairman of UBS, has stated that his company has not actively sought to profit from Credit Suisse’s difficulties.
After repurchasing $5.5 billion in 2022, UBS announced plans to repurchase more than $5 billion worth of shares this year.
Additionally, it has proposed increasing the dividend from $0.51 per share in 2021 to $0.55 per share this year.
With strong performance in Switzerland, UBS claimed that it attracted $23.3 billion in net new fee-generating assets in wealth management.
Net new deposits from corporate clients and global wealth management totaled $8 billion in the fourth quarter, compared to $9 billion for the entire year on the bank’s home turf.
“Our operational resilience, capital strength, and capital generation put us in a great position to serve our clients, fund growth, and deliver strong capital returns to shareholders,” Hamers stated. “While the macroeconomic outlook remains uncertain.”
