Financial Results

UBS Embarks On $2 Billion Stock Buybacks, Eyes Future After Credit Suisse Deal

Editorial Staff April 2, 2024

UBS Embarks On $2 Billion Stock Buybacks, Eyes Future After Credit Suisse Deal

As stated before, the bank is targeting a return on equity of up to 15 per cent by the end of 2026. UBS has been in the process of integrating Credit Suisse in one of the biggest bank M&A deals since the 2008 financial crash.

UBS, the world’s largest international wealth manager, today said that from April 3 it plans to start buying back up to $2 billion in shares.

As previously communicated, the Zurich-listed bank said it expected to repurchase up to $1 billion of its stocks, starting once UBS’s acquisition of Credit Suisse is wrapped up.

That deal is scheduled for the end of the second quarter, it said in a statement.

“Our ambition is for share repurchases to exceed our pre-acquisition level by 2026,” the bank said. 

By making the buybacks, UBS hopes to improve its return on equity. The bank reported a fourth-quarter return on equity (on an underlying basis, based on common equity Tier 1 capital) of 4.7 per cent. The lender said it intends to maintain a reported return on CET1 capital of about 15 per cent by the end of 2026, rising to about 18 per cent in 2028. In Q4 2023, UBS logged a pre-tax loss of $751 million, including credit loss costs of $136 million.

In total, more than 298.5 million UBS shares were repurchased via a separate trading line on the SIX Swiss Exchange as part of the 2022 share repurchase program, launched on March 31, 2022. This block accounted for 8.62 per cent.

In late March, UBS said it agreed to sell $8 billion of senior secured financing facilities to Apollo, a private capital firm, as it cuts some of the investment bank connected to its purchase of Credit Suisse a year ago.

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