UBS reports 2Q24 net profit of USD 1.1bn with continued client momentum and integration progress (Ad hoc announcement pursuant to Article 53 of the SIX Exchange Regulation Listing Rules)
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Key highlights (Graphic:
Key highlights
-
2Q24 PBT of
USD 1.5bn and underlying 1 PBT ofUSD 2.1bn reflecting client franchise strength and disciplined execution of our strategy and integration plans; net profit ofUSD 1.1bn -
1H24 PBT of
USD 3.8bn and underlying1 PBT ofUSD 4.7bn ; net profit ofUSD 2.9bn , RoCET1 7.5% and underlying RoCET1 of 9.2% -
Continued client momentum with net new assets of
USD 27bn in Global Wealth Management and strong transactional activity in theInvestment Bank ; best second quarter Global Markets revenues on record2 and underlying Global Banking revenues up 55% YoY, significantly outperforming the fee pools across all products -
Non-core and Legacy RWA reduced 42% since 2Q23, including
USD 8bn decline QoQ mainly from active unwinds; underlying operating expenses excluding litigation declined 17% QoQ; revenues ofUSD 0.4bn -
Achieved
USD 0.9bn of additional gross cost savings, reaching ~45% of our total cumulative annualized gross cost save ambition - Completed key legal entity mergers in line with plan, enabling execution of the next critical phase of client migrations to unlock further cost, capital, funding and tax benefits
-
Maintained a balance sheet for all seasons with a strong CET1 capital ratio of 14.9% and CET1 leverage ratio of 4.9%, supporting the execution of our 2024 capital return targets; commenced share repurchases in June with
USD 467m of shares repurchased as of9 August 2024 ; total loss absorbing capacity ofUSD 198bn - Named "World's Best Bank" and “Switzerland’s Best Bank” at Euromoney Awards for Excellence 2024, a testament to the effectiveness of our global strategy, reach and capabilities in serving our clients domestically and around the world
“Our first-half results reflect the significant progress we have made since the closing of the acquisition as we deliver on all of our commitments to stakeholders. We are well positioned to meet our financial targets and return to the levels of profitability we delivered before being asked to step in and stabilize
Selected financials for 2Q24
Profit before tax 1.5 USD bn |
Cost/income ratio 86.9 % |
RoCET1 capital 5.9 % |
Net profit 1.1 USD bn |
CET1 capital ratio 14.9 % |
Underlying1
2.1 USD bn |
Underlying1
80.6 % |
Underlying1
8.4 % |
Diluted
0.34 USD |
CET1
4.9 % |
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 second quarter of 2024 for a reconciliation of underlying to reported results and definitions of the APMs. 2 Since 2013. |
Group summary
Delivered strong performance in a complex market environment
In 2Q24, we reported PBT of
Reported revenues were
Demonstrating continued franchise strength
Clients continue to place trust and value in UBS’s strength, stability and advice as evidenced by
Transactional activity was strong in the quarter, especially among institutional clients. In GWM we delivered transaction-based revenues of more than
In July,
Steady progress on balance sheet and cost reductions with delivery of key integration milestones
We are executing our integration plan, and continue to deliver on all of our commitments.
We reduced Group RWA by
Group LRD decreased by
In 2Q24, we realized an additional
We completed the merger of
3 Loans to privates, corporates and public institutions in P&C and GWM Switzerland, from |
Maintained capital strength and a balance sheet for all seasons
The CET1 capital ratio was 14.9% and the CET1 leverage ratio was 4.9%, supporting the execution of our 2024 capital return targets. We continue to target up to
Following the merger of
Outlook
The macroeconomic outlook continues to be clouded by ongoing conflicts, other geopolitical tensions and the upcoming US elections. We expect these uncertainties to persist for the foreseeable future, and they will likely lead to higher market volatility compared with the first half of the year.
Entering the third quarter, we are seeing positive investor sentiment and continued momentum in client and transactional activity. Also visible are moderate net interest income headwinds from ongoing mix shifts in Global Wealth Management and the effects of the second
As we execute our integration plans, we expect to incur in the third quarter of 2024 around
For the second half of 2024, we estimate Non-core and Legacy will record an underlying pre-tax loss of around
Our diversified business model positions us well to deliver sustainable long-term value for shareholders across various market conditions. We remain focused on supporting our clients while positioning the Group for future growth.
Second quarter 2024 performance overview – Group
This discussion and analysis of results compares the second quarter of 2024, which covers three full months of post-acquisition results, with the second quarter of 2023, which included only one month of post-acquisition results.
Group PBT
PBT of
Global Wealth Management (GWM) PBT
Total revenues increased by 15% to
Personal & Corporate Banking (P&C) PBT
Total revenues increased by 27% to
Asset Management (AM) PBT
Total revenues increased by 32% to
Total revenues increased by 38% to
Non-core and Legacy (NCL) PBT
Total revenues were
Group Items PBT
UBS’s sustainability highlights
Support for Swiss communities affected by the recent storms
Earlier this summer the cantons of
Developing the next generation of talent
Our commitment to attract, develop and retain top talents is a key component of our sustainable performance. Importantly, we have maintained our structured job entry training programs (e.g., apprenticeships, interns and graduates) at the same level as
We are proud of the work done by the UBS Optimus network of foundations and the difference they make to millions of lives every year. Over the past 25 years, the
To recognize this important milestone,
A growing focus on Nature Finance
Nature Finance is a topic of growing interest for our clients and we recently held our first
UBS Asset Management and Planet Tracker launched a guide for investors aimed at maximizing investment in new energy solutions while minimizing their impacts on nature. The guide sets out strategies to support decision makers at every stage of planning, financing and implementation.
UBS Global Wealth Management has joined forces with Rockefeller Asset Management (RAM) to provide clients with exposure to multiyear growth prospects in areas such as wastewater treatment, waste management and plastic recycling, and sustainable aquaculture. The fund focuses on around 50 high conviction small- and mid-cap “improver” stocks, building on GWM’s award-winning CIO research and the ocean expertise of RAM.
Selected financial information of the business divisions and Group Items |
||||||||
|
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 |
6,143 |
2,423 |
776 |
2,751 |
1,001 |
(355) |
|
12,739 |
of which: PPA effects and other integration items1 |
234 |
256 |
|
293 |
|
(4) |
|
779 |
Total revenues (underlying) |
5,909 |
2,166 |
776 |
2,458 |
1,001 |
(351) |
|
11,960 |
Credit loss expense / (release) |
(3) |
44 |
0 |
32 |
36 |
(2) |
|
106 |
Operating expenses as reported |
5,044 |
1,404 |
665 |
2,164 |
1,011 |
(33) |
|
10,257 |
of which: integration-related expenses and PPA effects2 |
404 |
160 |
71 |
143 |
242 |
1 |
|
1,021 |
Operating expenses (underlying) |
4,640 |
1,245 |
594 |
2,022 |
769 |
(34) |
|
9,236 |
Operating profit / (loss) before tax as reported |
1,102 |
975 |
111 |
555 |
(46) |
(320) |
|
2,376 |
Operating profit / (loss) before tax (underlying) |
1,272 |
878 |
182 |
404 |
197 |
(315) |
|
2,617 |
|
||||||||
|
For the quarter ended |
|||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Negative goodwill4 |
Total |
Total revenues as reported |
5,261 |
1,810 |
583 |
2,036 |
162 |
(313) |
|
9,540 |
of which: PPA effects and other integration items1 |
186 |
143 |
|
55 |
|
(6) |
|
378 |
Total revenues (underlying) |
5,075 |
1,667 |
583 |
1,981 |
162 |
(306) |
|
9,162 |
Negative goodwill |
|
|
|
|
|
|
27,264 |
27,264 |
Credit loss expense / (release) |
149 |
221 |
1 |
132 |
119 |
2 |
|
623 |
Operating expenses as reported |
4,085 |
933 |
503 |
2,025 |
536 |
403 |
|
8,486 |
of which: integration-related expenses and PPA effects2 |
68 |
37 |
14 |
161 |
105 |
348 |
|
732 |
of which: acquisition-related costs |
|
|
|
|
|
106 |
|
106 |
Operating expenses (underlying) |
4,017 |
896 |
489 |
1,864 |
432 |
(51) |
|
7,648 |
Operating profit / (loss) before tax as reported |
1,028 |
655 |
79 |
(121) |
(493) |
(717) |
27,264 |
27,695 |
Operating profit / (loss) before tax (underlying) |
909 |
549 |
93 |
(14) |
(388) |
(257) |
|
891 |
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) |
||||||||
|
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 |
12,196 |
4,695 |
1,543 |
5,554 |
1,402 |
(747) |
|
24,642 |
of which: PPA effects and other integration items1 |
467 |
502 |
|
603 |
|
(12) |
|
1,559 |
Total revenues (underlying) |
11,729 |
4,193 |
1,543 |
4,951 |
1,402 |
(735) |
|
23,083 |
Credit loss expense / (release) |
(4) |
146 |
0 |
26 |
35 |
(2) |
|
201 |
Operating expenses as reported |
10,228 |
2,800 |
1,303 |
4,496 |
1,818 |
(48) |
|
20,597 |
of which: integration-related expenses and PPA effects2 |
928 |
342 |
169 |
387 |
568 |
(1) |
|
2,392 |
Operating expenses (underlying) |
9,300 |
2,458 |
1,134 |
4,109 |
1,250 |
(47) |
|
18,205 |
Operating profit / (loss) before tax as reported |
1,972 |
1,748 |
241 |
1,032 |
(451) |
(698) |
|
3,844 |
Operating profit / (loss) before tax (underlying) |
2,433 |
1,588 |
410 |
816 |
117 |
(687) |
|
4,677 |
|
||||||||
|
Year-to-date |
|||||||
USD m |
Global Wealth Management |
Personal & Corporate Banking |
Asset Management |
Investment Bank |
Non-core and Legacy |
Group Items |
Negative goodwill4 |
Total |
Total revenues as reported |
10,049 |
3,087 |
1,086 |
4,401 |
185 |
(524) |
|
18,284 |
of which: PPA effects and other integration items1 |
186 |
143 |
|
55 |
|
(6) |
|
378 |
Total revenues (underlying) |
9,863 |
2,943 |
1,086 |
4,346 |
185 |
(517) |
|
17,906 |
Negative goodwill |
|
|
|
|
|
|
27,264 |
27,264 |
Credit loss expense / (release) |
164 |
237 |
1 |
139 |
119 |
2 |
|
662 |
Operating expenses as reported |
7,646 |
1,597 |
911 |
3,891 |
1,235 |
416 |
|
15,696 |
of which: integration-related expenses and PPA effects2 |
68 |
37 |
14 |
161 |
105 |
348 |
|
732 |
of which: acquisition-related costs |
|
|
|
|
|
176 |
|
176 |
Operating expenses (underlying) |
7,578 |
1,560 |
897 |
3,730 |
1,130 |
(108) |
|
14,787 |
Operating profit / (loss) before tax as reported |
2,239 |
1,253 |
174 |
372 |
(1,169) |
(942) |
27,264 |
29,191 |
Operating profit / (loss) before tax (underlying) |
2,121 |
1,147 |
188 |
478 |
(1,064) |
(412) |
|
2,457 |
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 |
|
11,904 |
12,739 |
10,855 |
9,540 |
|
24,642 |
18,284 |
Negative goodwill |
|
|
|
|
27,264 |
|
|
27,264 |
Credit loss expense / (release) |
|
95 |
106 |
136 |
623 |
|
201 |
662 |
Operating expenses |
|
10,340 |
10,257 |
11,470 |
8,486 |
|
20,597 |
15,696 |
Operating profit / (loss) before tax |
|
1,469 |
2,376 |
(751) |
27,695 |
|
3,844 |
29,191 |
Net profit / (loss) attributable to shareholders |
|
1,136 |
1,755 |
(279) |
27,331 |
|
2,890 |
28,360 |
Diluted earnings per share (USD)2 |
|
0.34 |
0.52 |
(0.09) |
8.51 |
|
0.86 |
8.82 |
Profitability and growth3,4,5 |
|
|
|
|
|
|
|
|
Return on equity (%) |
|
5.4 |
8.2 |
(1.3) |
153.8 |
|
6.8 |
88.7 |
Return on tangible equity (%) |
|
5.9 |
9.0 |
(1.4) |
170.3 |
|
7.5 |
98.9 |
Underlying return on tangible equity (%)6,7 |
|
8.4 |
9.9 |
4.8 |
2.8 |
|
9.2 |
5.4 |
Return on common equity tier 1 capital (%) |
|
5.9 |
9.0 |
(1.4) |
177.5 |
|
7.5 |
106.4 |
Underlying return on common equity tier 1 capital (%)6,7 |
|
8.4 |
9.9 |
4.8 |
2.9 |
|
9.2 |
5.8 |
Return on leverage ratio denominator, gross (%) |
|
3.0 |
3.1 |
2.6 |
2.8 |
|
3.1 |
3.1 |
Cost / income ratio (%)8 |
|
86.9 |
80.5 |
105.7 |
88.9 |
|
83.6 |
85.8 |
Underlying cost / income ratio (%)6,8 |
|
80.6 |
77.2 |
93.0 |
83.5 |
|
78.9 |
82.6 |
Effective tax rate (%) |
|
20.0 |
25.8 |
n.m.9 |
1.3 |
|
23.6 |
2.8 |
Net profit growth (%) |
|
(95.8) |
70.6 |
n.m. |
n.m. |
|
(89.8) |
568.2 |
Resources3 |
|
|
|
|
|
|
|
|
Total assets |
|
1,560,976 |
1,606,798 |
1,716,924 |
1,677,953 |
|
1,560,976 |
1,677,953 |
Equity attributable to shareholders |
|
83,683 |
84,777 |
85,624 |
85,455 |
|
83,683 |
85,455 |
Common equity tier 1 capital10 |
|
76,104 |
77,663 |
78,002 |
78,597 |
|
76,104 |
78,597 |
Risk-weighted assets10 |
|
511,376 |
526,437 |
546,505 |
556,603 |
|
511,376 |
556,603 |
Common equity tier 1 capital ratio (%)10 |
|
14.9 |
14.8 |
14.3 |
14.1 |
|
14.9 |
14.1 |
Going concern capital ratio (%)10 |
|
18.0 |
17.7 |
16.8 |
16.5 |
|
18.0 |
16.5 |
Total loss-absorbing capacity ratio (%)10 |
|
38.7 |
37.4 |
36.4 |
34.9 |
|
38.7 |
34.9 |
Leverage ratio denominator10 |
|
1,564,201 |
1,599,646 |
1,695,403 |
1,677,877 |
|
1,564,201 |
1,677,877 |
Common equity tier 1 leverage ratio (%)10 |
|
4.9 |
4.9 |
4.6 |
4.7 |
|
4.9 |
4.7 |
Liquidity coverage ratio (%)11 |
|
212.0 |
220.2 |
215.7 |
175.2 |
|
212.0 |
175.2 |
Net stable funding ratio (%) |
|
128.0 |
126.4 |
124.7 |
117.6 |
|
128.0 |
117.6 |
Other |
|
|
|
|
|
|
|
|
Invested assets (USD bn)4,12,13 |
|
5,873 |
5,848 |
5,714 |
5,530 |
|
5,873 |
5,530 |
Personnel (full-time equivalents) |
|
109,991 |
111,549 |
112,842 |
119,100 |
|
109,991 |
119,100 |
Market capitalization2,14 |
|
101,903 |
106,440 |
107,355 |
69,932 |
|
101,903 |
69,932 |
Total book value per share (USD)2 |
|
26.13 |
26.44 |
26.68 |
26.48 |
|
26.13 |
26.48 |
Tangible book value per share (USD)2 |
|
23.85 |
24.14 |
24.34 |
24.13 |
|
23.85 |
24.13 |
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 |
|
|
|
|
|
1Q24 |
2Q23 |
|
|
|
Net interest income |
|
1,535 |
1,940 |
1,707 |
|
(21) |
(10) |
|
3,475 |
3,095 |
Other net income from financial instruments measured at fair value through profit or loss |
|
3,684 |
4,182 |
2,517 |
|
(12) |
46 |
|
7,866 |
5,198 |
Net fee and commission income |
|
6,531 |
6,492 |
5,128 |
|
1 |
27 |
|
13,023 |
9,734 |
Other income |
|
154 |
124 |
188 |
|
24 |
(18) |
|
278 |
258 |
Total revenues |
|
11,904 |
12,739 |
9,540 |
|
(7) |
25 |
|
24,642 |
18,284 |
Negative goodwill |
|
|
|
27,264 |
|
|
(100) |
|
|
27,264 |
Credit loss expense / (release) |
|
95 |
106 |
623 |
|
(11) |
(85) |
|
201 |
662 |
|
|
|
|
|
|
|
|
|
|
|
Personnel expenses |
|
7,119 |
6,949 |
5,651 |
|
2 |
26 |
|
14,068 |
10,271 |
General and administrative expenses |
|
2,318 |
2,413 |
1,968 |
|
(4) |
18 |
|
4,731 |
4,033 |
Depreciation, amortization and impairment of non-financial assets |
|
903 |
895 |
866 |
|
1 |
4 |
|
1,798 |
1,391 |
Operating expenses |
|
10,340 |
10,257 |
8,486 |
|
1 |
22 |
|
20,597 |
15,696 |
Operating profit / (loss) before tax |
|
1,469 |
2,376 |
27,695 |
|
(38) |
(95) |
|
3,844 |
29,191 |
Tax expense / (benefit) |
|
293 |
612 |
361 |
|
(52) |
(19) |
|
905 |
820 |
Net profit / (loss) |
|
1,175 |
1,764 |
27,334 |
|
(33) |
(96) |
|
2,939 |
28,371 |
Net profit / (loss) attributable to non-controlling interests |
|
40 |
9 |
3 |
|
352 |
|
|
48 |
11 |
Net profit / (loss) attributable to shareholders |
|
1,136 |
1,755 |
27,331 |
|
(35) |
(96) |
|
2,890 |
28,360 |
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
Total comprehensive income |
|
1,614 |
(245) |
26,467 |
|
|
(94) |
|
1,369 |
28,300 |
Total comprehensive income attributable to non-controlling interests |
|
18 |
(5) |
(2) |
|
|
|
|
13 |
11 |
Total comprehensive income attributable to shareholders |
|
1,596 |
(240) |
26,469 |
|
|
(94) |
|
1,356 |
28,289 |
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 second quarter 2024 report, news release and slide presentation are available from
Time
03:00 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, terrorist activity and conflicts in the
Rounding
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Tables
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Investor contact
Media contact
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ubs.com
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