UBS reports 3Q24 net profit of USD 1.4bn with 6.2trn in invested assets; delivering for clients, executing on integration at pace and investing for growth (Ad hoc announcement pursuant to Article 53 of the SIX Exchange Regulation Listing Rules)
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Key highlights (Graphic:
Key highlights
-
3Q24 PBT of
USD 1.9bn and underlying1 PBT ofUSD 2.4bn demonstrating the strength of our client franchises, diversified business model and global scale; net profit ofUSD 1.4bn , RoCET1 of 7.6% and underlying RoCET1 of 9.4% -
Continued client momentum with
USD 25bn of net new assets in Global Wealth Management, on track to deliver on our ambition of USD ~100bn in NNA for 2024; Group invested assets ofUSD 6.2trn , up 15% YoY; granted or renewed CHF ~35bn in loans inSwitzerland in the quarter -
Strong transactional activity across Global Wealth Management and the
Investment Bank , underlying GWM transaction-based income up 19% YoY, Global Markets revenues up 31% YoY -
Non-core and Legacy RWA reductions remain ahead of plan; with
USD 5bn in 3Q24 andUSD 41bn since 2Q23 -
Delivering on cost-reduction ambitions with additional
USD 0.8bn in gross cost savings realized in 3Q24 and USD ~7.5bn expected for full-year 2024 -
Successful completion of first wave of client account migrations withtransfers in Luxembourg and
Hong Kong in October;Singapore andJapan expected by year-end andSwitzerland in 2025, positioning us well to enhance the client experience and to unlock next phase of significant cost saves toward the end of 2025 and in 2026 - Strong capital position allowed us to voluntarily accelerate the phase-out of the remaining transitional capital adjustments agreed with our regulator, bringing the CET1 capital ratio in line with our guidance; we remain committed to our dividend and buyback ambitions for 2025 and 2026
-
Positioning for long-term growth with investments in our people, products and capabilities, including technology withroll out of 50,000Microsoft 365 Copilot licenses to our employees by
March 2025 , the largest deployment within the global financial services industry to date
“Our performance in the third quarter demonstrates the power of our unique client franchises, global scale and diversified business model. Against a market backdrop that, while constructive, still exhibited periods of high volatility and dislocation, our businesses delivered impressive revenue growth as we maintained strong client momentum, particularly in the
Selected financials for 3Q24
Profit before tax 1.9 USD bn |
Cost/income ratio 83.4 % |
RoCET1 capital 7.6 % |
Net profit 1.4 USD bn |
CET1 capital ratio 14.3 % |
Underlying1
2.4 USD bn |
Underlying1
78.5 % |
Underlying1
9.4 % |
Diluted
0.43 USD |
CET1
4.6 % |
Information in this news release is presented for |
||||
1 Underlying results exclude items of profit or loss that management believes are not representative of the underlying performance. Underlying results are a non-GAAP financial measure and alternative performance measure (APM). Refer to “Group Performance” and “Appendix-Alternative Performance Measures” in the financial report for the third quarter of 2024 for a reconciliation of underlying to reported results and definitions of the APMs. |
Group summary
Strong financial performance
In 3Q24, we reported PBT of
Reported revenues were
Continued franchise strength and client momentum
During the third quarter, we remained close to our clients, guiding them through a market environment that while constructive, also showed signs of dislocation and volatility. Clients continue to value the investment opportunities we provide across our advice platform, as demonstrated by
As a leading provider of credit to Swiss companies and the economy, we are also delivering on our commitments to our home market. In the quarter, we granted or renewed CHF ~35bn of loans in
Transactional activity was strong during the quarter across both private and institutional clients. In GWM, underlying transaction-based income increased by 19% YoY with strong momentum across all regions, led by the
In Global Banking, underlying revenues increased 21% YoY with strong M&A performance in
Ahead of plan on financial and operational integration priorities
We continue to execute on our integration plans, de-risking our balance sheet, and delivering on our cost reduction ambitions.
In 3Q24, we further reduced NCL RWA by
In the quarter, we maintained our cost optimization momentum across the Group, delivering an additional
Since June, we have also significantly advanced our work on migrating wealth management client accounts and data to
With this we are well positioned to enhance the client experience and to unlock further cost reductions toward the end of 2025 and into 2026, as we deliver on our ambition of USD ~13bn in gross cost saves by the end of 2026.
Maintaining strong capital position; expecting to operate at ~14% CET1 capital ratio; remain committed to capital returns ambitions
In the third quarter of 2024, reflecting our strong capital position, completion of legal entity mergers, overall progress on the integration and the winding down of
In connection with the acquisition of the
As these transitional adjustments only applied to
We expect that the adoption of the final Basel III standards in
We expect to complete our planned
Investing for long-term growth in our people, products and capabilities
In addition to meeting the current needs of our clients, executing the integration, and delivering on short term plans, we remain focused on positioning
This includes building on our long-standing AI expertise and industry-leading cloud position to accelerate development and adoption of GenAI solutions that benefit clients and employees.
With the rollout of 50,000 Copilot licenses between now and the end of
In these, and the many other AI deployments that are underway across the entire firm, we are focused on responsible AI. For example, all employees Group-wide are currently completing a ‘Responsible use of Generative AI’ training.
Outlook
In the third quarter of 2024 we saw strong client activity against a market backdrop that, while constructive, still exhibited periods of high volatility and dislocation.
Entering the fourth quarter, we see a continuation of these market conditions sustained by the prospects of a soft landing in the US economy. However, the macroeconomic outlook in the rest of the world remains clouded. In addition to seasonality, the ongoing geopolitical conflicts and the upcoming US elections are creating uncertainties that are likely to affect investor behavior.
In the fourth quarter, we anticipate a mid-single digit decline in net interest income in Global Wealth Management and a low single-digit decline in Personal & Corporate Banking. Non-core and Legacy is expected to generate a quarterly pre-tax loss in line with our earlier guidance.
The Group’s non-personnel costs are expected to show a seasonal sequential uptick. The Group’s quarterly tax rate is expected to be around 35%. Integration-related expenses are expected to be around
As we stay close to clients, helping them navigate this environment, and execute on our priorities, we will continue to invest to drive sustainable long-term value for our stakeholders while maintaining a balance sheet for all seasons.
Third quarter 2024 performance overview – Group
Group PBT
PBT of
Global Wealth Management (GWM) PBT
Total revenues increased by 4% to
Personal & Corporate Banking (P&C) PBT
Total revenues decreased by 8% to
Asset Management (AM) PBT
Total revenues increased by 13% to
Total revenues increased by 22% to
Non-core and Legacy (NCL) PBT
Total revenues decreased by 29% to
Group Items PBT
UBS’s sustainability highlights
We are guided by our ambition to be a global leader in sustainability.We remain committed to supporting our clients in the transition to a low-carbon world, leading by example in our own operations, and sharing our lessons learned along the way.
In September, MSCI reaffirmed our AA ESG rating and we increased our S&P Global Corporate Sustainability Assessment score. These are our first fully consolidated ESG ratings post the acquisition of
To build on our strong foundation, we are evolving our sustainability strategy, based on three pillars:
− Protect: manage our business aligned to our sustainable, long-term strategy;
− Grow: continue to expand our sustainability and impact offering for our clients to meet their evolving needs; and
− Attract: be the bank of choice for clients and employees.
We will communicate further details on our approach in our 2024 Sustainability Report, which will be published on
Selected financial information of the business divisions and Group Items |
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|
For the quarter ended |
||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Total |
Total revenues as reported |
6,199 |
2,394 |
873 |
2,645 |
262 |
(39) |
12,334 |
of which: PPA effects and other integration items1 |
224 |
278 |
|
185 |
|
(25) |
662 |
Total revenues (underlying) |
5,975 |
2,116 |
873 |
2,461 |
262 |
(14) |
11,672 |
Credit loss expense / (release) |
2 |
83 |
0 |
9 |
28 |
0 |
121 |
Operating expenses as reported |
5,112 |
1,465 |
722 |
2,231 |
837 |
(84) |
10,283 |
of which: integration-related expenses and PPA effects2 |
419 |
198 |
86 |
156 |
270 |
(11) |
1,119 |
Operating expenses (underlying) |
4,693 |
1,267 |
636 |
2,076 |
567 |
(74) |
9,165 |
Operating profit / (loss) before tax as reported |
1,085 |
846 |
151 |
405 |
(603) |
45 |
1,929 |
Operating profit / (loss) before tax (underlying) |
1,280 |
766 |
237 |
377 |
(333) |
60 |
2,386 |
|
|||||||
|
For the quarter ended |
||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Total |
Total revenues as reported |
6,053 |
2,272 |
768 |
2,803 |
401 |
(392) |
11,904 |
of which: PPA effects and other integration items1 |
233 |
246 |
|
310 |
|
(8) |
780 |
Total revenues (underlying) |
5,820 |
2,026 |
768 |
2,493 |
401 |
(384) |
11,124 |
Credit loss expense / (release) |
(1) |
103 |
0 |
(6) |
(1) |
0 |
95 |
Operating expenses as reported |
5,183 |
1,396 |
638 |
2,332 |
807 |
(15) |
10,340 |
of which: integration-related expenses and PPA effects2 |
523 |
182 |
98 |
245 |
325 |
(2) |
1,372 |
Operating expenses (underlying) |
4,660 |
1,213 |
540 |
2,087 |
481 |
(13) |
8,969 |
Operating profit / (loss) before tax as reported |
871 |
773 |
130 |
477 |
(405) |
(377) |
1,469 |
Operating profit / (loss) before tax (underlying) |
1,161 |
710 |
228 |
412 |
(80) |
(371) |
2,060 |
|
|||||||
|
For the quarter ended |
||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Total |
Total revenues as reported |
5,953 |
2,517 |
775 |
2,162 |
366 |
(78) |
11,695 |
of which: PPA effects and other integration items1 |
388 |
333 |
|
251 |
|
(14) |
958 |
Total revenues (underlying) |
5,565 |
2,184 |
775 |
1,911 |
366 |
(64) |
10,737 |
Credit loss expense / (release) |
10 |
160 |
0 |
4 |
59 |
5 |
239 |
Operating expenses as reported |
5,017 |
1,400 |
738 |
2,412 |
2,068 |
6 |
11,640 |
of which: integration-related expenses and PPA effects2 |
448 |
174 |
126 |
368 |
920 |
(5) |
2,031 |
of which: acquisition-related costs |
|
|
|
|
|
26 |
26 |
Operating expenses (underlying) |
4,569 |
1,226 |
612 |
2,043 |
1,149 |
(15) |
9,583 |
Operating profit / (loss) before tax as reported |
926 |
957 |
37 |
(254) |
(1,762) |
(89) |
(184) |
Operating profit / (loss) before tax (underlying) |
986 |
798 |
163 |
(136) |
(842) |
(55) |
914 |
1 Includes accretion of PPA adjustments on financial instruments and other PPA effects, as well as temporary and incremental items directly related to the integration. 2 Includes temporary, incremental operating expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the
|
Selected financial information of the business divisions and Group Items (continued) |
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|
Year-to-date |
|||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
|
Total |
Total revenues as reported |
18,395 |
7,089 |
2,416 |
8,199 |
1,664 |
(786) |
|
36,976 |
of which: PPA effects and other integration items1 |
691 |
780 |
|
787 |
|
(37) |
|
2,221 |
Total revenues (underlying) |
17,705 |
6,308 |
2,416 |
7,412 |
1,664 |
(749) |
|
34,755 |
Credit loss expense / (release) |
(2) |
229 |
0 |
34 |
63 |
(2) |
|
322 |
Operating expenses as reported |
15,340 |
4,265 |
2,025 |
6,728 |
2,655 |
(132) |
|
30,880 |
of which: integration-related expenses and PPA effects2 |
1,347 |
540 |
255 |
543 |
837 |
(12) |
|
3,511 |
Operating expenses (underlying) |
13,993 |
3,725 |
1,770 |
6,185 |
1,817 |
(120) |
|
27,370 |
Operating profit / (loss) before tax as reported |
3,057 |
2,594 |
392 |
1,437 |
(1,054) |
(652) |
|
5,773 |
Operating profit / (loss) before tax (underlying) |
3,713 |
2,354 |
647 |
1,193 |
(216) |
(627) |
|
7,063 |
|
||||||||
|
Year-to-date |
|||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Negative goodwill |
Total |
Total revenues as reported |
16,002 |
5,604 |
1,861 |
6,562 |
551 |
(602) |
|
29,979 |
of which: PPA effects and other integration items1 |
574 |
477 |
|
306 |
|
(20) |
|
1,336 |
Total revenues (underlying) |
15,428 |
5,128 |
1,861 |
6,257 |
551 |
(582) |
|
28,643 |
Negative goodwill |
|
|
|
|
|
|
27,264 |
27,264 |
Credit loss expense / (release) |
174 |
398 |
1 |
142 |
178 |
7 |
|
901 |
Operating expenses as reported |
12,663 |
2,996 |
1,649 |
6,302 |
3,304 |
422 |
|
27,336 |
of which: integration-related expenses and PPA effects2 |
516 |
211 |
140 |
529 |
1,024 |
342 |
|
2,763 |
of which: acquisition-related costs |
|
|
|
|
|
202 |
|
202 |
Operating expenses (underlying) |
12,147 |
2,785 |
1,509 |
5,773 |
2,279 |
(122) |
|
24,371 |
Operating profit / (loss) before tax as reported |
3,165 |
2,210 |
211 |
118 |
(2,930) |
(1,031) |
27,264 |
29,006 |
Operating profit / (loss) before tax (underlying) |
3,107 |
1,945 |
351 |
341 |
(1,906) |
(467) |
|
3,371 |
1 Includes accretion of PPA adjustments on financial instruments and other PPA effects, as well as temporary and incremental items directly related to the integration. 2 Includes temporary, incremental operating expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the
|
Our key figures |
|
|
|
|
|
|
|
|
|
|
As of or for the quarter ended |
|
As of or year-to-date |
||||
USD m, except where indicated |
|
|
|
|
|
|
|
|
Group results |
|
|
|
|
|
|
|
|
Total revenues |
|
12,334 |
11,904 |
10,855 |
11,695 |
|
36,976 |
29,979 |
Negative goodwill |
|
|
|
|
|
|
|
27,264 |
Credit loss expense / (release) |
|
121 |
95 |
136 |
239 |
|
322 |
901 |
Operating expenses |
|
10,283 |
10,340 |
11,470 |
11,640 |
|
30,880 |
27,336 |
Operating profit / (loss) before tax |
|
1,929 |
1,469 |
(751) |
(184) |
|
5,773 |
29,006 |
Net profit / (loss) attributable to shareholders |
|
1,425 |
1,136 |
(279) |
(715) |
|
4,315 |
27,645 |
Diluted earnings per share (USD)2 |
|
0.43 |
0.34 |
(0.09) |
(0.22) |
|
1.29 |
8.46 |
Profitability and growth3,4 |
|
|
|
|
|
|
|
|
Return on equity (%) |
|
6.7 |
5.4 |
(1.3) |
(3.4) |
|
6.8 |
52.1 |
Return on tangible equity (%) |
|
7.3 |
5.9 |
(1.4) |
(3.7) |
|
7.4 |
57.7 |
Underlying return on tangible equity (%)5 |
|
9.0 |
8.4 |
4.8 |
1.5 |
|
9.1 |
3.8 |
Return on common equity tier 1 capital (%) |
|
7.6 |
5.9 |
(1.4) |
(3.7) |
|
7.5 |
60.0 |
Underlying return on common equity tier 1 capital (%)5 |
|
9.4 |
8.4 |
4.8 |
1.5 |
|
9.2 |
4.0 |
Return on leverage ratio denominator, gross (%) |
|
3.1 |
3.0 |
2.6 |
2.8 |
|
3.1 |
3.0 |
Cost / income ratio (%)6 |
|
83.4 |
86.9 |
105.7 |
99.5 |
|
83.5 |
91.2 |
Underlying cost / income ratio (%)5,6 |
|
78.5 |
80.6 |
93.0 |
89.3 |
|
78.8 |
85.1 |
Effective tax rate (%) |
|
26.0 |
20.0 |
n.m.7 |
n.m.7 |
|
24.4 |
4.6 |
Net profit growth (%) |
|
n.m. |
(95.8) |
n.m. |
n.m. |
|
(84.4) |
362.5 |
Resources3 |
|
|
|
|
|
|
|
|
Total assets |
|
1,623,941 |
1,560,976 |
1,716,924 |
1,643,684 |
|
1,623,941 |
1,643,684 |
Equity attributable to shareholders |
|
87,025 |
83,683 |
85,624 |
83,265 |
|
87,025 |
83,265 |
Common equity tier 1 capital8 |
|
74,213 |
76,104 |
78,002 |
76,926 |
|
74,213 |
76,926 |
Risk-weighted assets8 |
|
519,363 |
511,376 |
546,505 |
546,491 |
|
519,363 |
546,491 |
Common equity tier 1 capital ratio (%)8 |
|
14.3 |
14.9 |
14.3 |
14.1 |
|
14.3 |
14.1 |
Going concern capital ratio (%)8 |
|
17.5 |
18.0 |
16.8 |
16.4 |
|
17.5 |
16.4 |
Total loss-absorbing capacity ratio (%)8 |
|
37.5 |
38.7 |
36.4 |
35.4 |
|
37.5 |
35.4 |
Leverage ratio denominator8 |
|
1,608,341 |
1,564,201 |
1,695,403 |
1,615,817 |
|
1,608,341 |
1,615,817 |
Common equity tier 1 leverage ratio (%)8 |
|
4.6 |
4.9 |
4.6 |
4.8 |
|
4.6 |
4.8 |
Liquidity coverage ratio (%)9 |
|
199.2 |
212.0 |
215.7 |
196.5 |
|
199.2 |
196.5 |
Net stable funding ratio (%) |
|
126.9 |
128.0 |
124.7 |
120.7 |
|
126.9 |
120.7 |
Other |
|
|
|
|
|
|
|
|
Invested assets (USD bn)4,10 |
|
6,199 |
5,873 |
5,714 |
5,373 |
|
6,199 |
5,373 |
Personnel (full-time equivalents) |
|
109,396 |
109,991 |
112,842 |
115,981 |
|
109,396 |
115,981 |
Market capitalization2,11 |
|
106,528 |
101,903 |
107,355 |
85,768 |
|
106,528 |
85,768 |
Total book value per share (USD)2 |
|
27.32 |
26.13 |
26.68 |
25.75 |
|
27.32 |
25.75 |
Tangible book value per share (USD)2 |
|
25.10 |
23.85 |
24.34 |
23.44 |
|
25.10 |
23.44 |
1 Comparative-period information has been revised. Refer to “Note 2 Accounting for the acquisition of the Credit Suisse Group” in the “Consolidated financial statements” section of the
|
Income statement |
|
|
|
|
|
|
|
|
|
|
|
|
For the quarter ended |
|
% change from |
|
Year-to-date |
||||
USD m |
|
|
|
|
|
2Q24 |
3Q23 |
|
|
|
Net interest income |
|
1,794 |
1,535 |
2,107 |
|
17 |
(15) |
|
5,270 |
5,202 |
Other net income from financial instruments measured at fair value through profit or loss |
|
3,681 |
3,684 |
3,226 |
|
0 |
14 |
|
11,547 |
8,425 |
Net fee and commission income |
|
6,517 |
6,531 |
6,056 |
|
0 |
8 |
|
19,540 |
15,790 |
Other income |
|
341 |
154 |
305 |
|
122 |
12 |
|
619 |
563 |
Total revenues |
|
12,334 |
11,904 |
11,695 |
|
4 |
5 |
|
36,976 |
29,979 |
Negative goodwill |
|
|
|
|
|
|
|
|
|
27,264 |
Credit loss expense / (release) |
|
121 |
95 |
239 |
|
28 |
(49) |
|
322 |
901 |
|
|
|
|
|
|
|
|
|
|
|
Personnel expenses |
|
6,889 |
7,119 |
7,567 |
|
(3) |
(9) |
|
20,957 |
17,838 |
General and administrative expenses |
|
2,389 |
2,318 |
3,124 |
|
3 |
(24) |
|
7,120 |
7,157 |
Depreciation, amortization and impairment of non-financial assets |
|
1,006 |
903 |
950 |
|
11 |
6 |
|
2,804 |
2,341 |
Operating expenses |
|
10,283 |
10,340 |
11,640 |
|
(1) |
(12) |
|
30,880 |
27,336 |
Operating profit / (loss) before tax |
|
1,929 |
1,469 |
(184) |
|
31 |
|
|
5,773 |
29,006 |
Tax expense / (benefit) |
|
502 |
293 |
526 |
|
71 |
(5) |
|
1,407 |
1,346 |
Net profit / (loss) |
|
1,428 |
1,175 |
(711) |
|
21 |
|
|
4,366 |
27,660 |
Net profit / (loss) attributable to non-controlling interests |
|
3 |
40 |
4 |
|
(92) |
(22) |
|
51 |
15 |
Net profit / (loss) attributable to shareholders |
|
1,425 |
1,136 |
(715) |
|
25 |
|
|
4,315 |
27,645 |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
Total comprehensive income |
|
3,910 |
1,614 |
(2,622) |
|
142 |
|
|
5,279 |
25,679 |
Total comprehensive income attributable to non-controlling interests |
|
27 |
18 |
(8) |
|
47 |
|
|
40 |
4 |
Total comprehensive income attributable to shareholders |
|
3,883 |
1,596 |
(2,614) |
|
143 |
|
|
5,239 |
25,675 |
1 Comparative-period information has been revised. Refer to “Note 2 Accounting for the acquisition of the Credit Suisse Group” in the “Consolidated financial statements” section of the |
Information about results materials and the earnings call
UBS’s third quarter 2024 report, news release and slide presentation are available from
Time
04:00 US EDT
Audio webcast
The presentation for analysts can be followed live on ubs.com/quarterlyreporting with a simultaneous slide show.
Webcast playback
An audio playback of the results presentation will be made available at ubs.com/investors later in the day.
Cautionary statement regarding forward-looking statements
This news release contains statements that constitute “forward-looking statements”, including but not limited to management’s outlook for UBS’s financial performance, statements relating to the anticipated effect of transactions and strategic initiatives on UBS’s business and future development and goals or intentions to achieve climate, sustainability and other social objectives. While these forward-looking statements represent UBS’s judgments, expectations and objectives concerning the matters described, a number of risks, uncertainties and other important factors could cause actual developments and results to differ materially from UBS’s expectations. In particular, the global economy may be negatively affected by shifting political circumstances, including as a result of elections, increased tension between world powers, growing conflicts in the
Rounding
Numbers presented throughout this news release may not add up precisely to the totals provided in the tables and text. Percentages and percent changes disclosed in text and tables are calculated on the basis of unrounded figures. Absolute changes between reporting periods disclosed in the text, which can be derived from numbers presented in related tables, are calculated on a rounded basis.
Tables
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