$UBSG (+1.8%) UBS generates billions in profit

The big bank exceeds analysts' estimates with its profit for the third quarter.

Cost-cutting and revenue growth have enabled UBS to post a quarterly result well above expectations. From July to September 2024, the big bank posted a profit of USD 1.43 billion, clearly exceeding analysts' average estimate of USD 740 million.

In the prior-year period, restructuring costs in connection with the Credit Suisse takeover had caused the wealth management giant to post a loss for the first time in six years. The high transaction volumes in the business with wealthy private clients and in investment banking led to an increase in income in the third quarter of 2024, although interest income fell, as UBS announced on Wednesday.

https://www.ubs.com/global/de/investor-relations/financial-information/quarterly-reporting.html

1. revenue development: UBS generated total revenues of USD 12.33 billion in the third quarter of 2024, an increase of 5% compared to the previous year, mainly due to higher fee and commission income and increased interest income.

2. profit growth: Net profit amounted to USD 1.43 billion, a significant increase compared to a loss of USD 715 million in the same quarter of 2023.

3. cost reduction: operating costs decreased by 12% to USD 10.28 billion, supported by reduced integration costs following the acquisition of Credit Suisse

4. capital ratio: CET1 capital ratio was 14.3%, which remained stable after a voluntary amortization of the remaining purchase price allocation adjustments of USD 3.4 billion.

5. cost/income ratio: The cost/income ratio fell to 83.4% (previous year: 99.5%), supported by higher income and lower integration costs.

6. integration of Credit Suisse: The integration is on track with cost savings of USD 6.8 billion in annualized terms by the end of 2024, towards a target of USD 13 billion by the end of 2026.

7. wealth management: UBS Global Wealth Management reported revenues of USD 6.2 billion in the quarter, supported by active client transactions and portfolio management fees.

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Own position: 682 shares at ~14.07 CHF, mostly from the share program as a former employee. CHF 14.07 does not correspond to the real price, but is higher.

Shares will continue to be held, position to be gradually reduced from CHF 35.