UBS Group AG, a prominent Swiss banking institution, announced that its net profit for the third quarter reached $1.43 billion, a significant improvement from the previous year's adjusted loss of $715 million. Earnings per share amounted to $0.43, contrasting sharply with last year's loss of $0.22 per share. This result surpassed the average analyst expectation, which was $0.35 per share, as per Thomson Reuters data; it is noteworthy that these estimates typically exclude extraordinary items.
The company reported an operating profit before tax of $1.93 billion, a notable turnaround from the previous year's loss of $184 million. The underlying profit before tax also saw a substantial increase, reaching $2.39 billion, compared to $914 million in the prior year.
In a strategic move to enhance efficiency, UBS reduced its group operating expenses by 12% from the previous year, bringing them down to $10.28 billion. Underlying operating expenses were reduced by 4% due to integration efforts and efficiency initiatives.
Total revenues for the third quarter increased by 5% to $12.33 billion from $11.70 billion last year. When assessed on an underlying basis, revenues climbed 9% from the previous year to $11.67 billion, driven by robust transactional activity and consistent fee income, which outweighed the anticipated challenges in net interest income. However, net interest income fell by 15% from last year, settling at $1.79 billion.
For the upcoming fourth quarter, UBS projects a mid-single-digit decline in net interest income within its Global Wealth Management division and a low single-digit decrease in its Personal & Corporate Banking sector. Additionally, the Non-core and Legacy division is anticipated to record a pre-tax loss, consistent with prior guidance.
Looking towards the future, UBS expressed confidence in meeting its target of around $100 billion in net new assets (NNA) by 2024.
