Although the integration of the acquired Credit Suisse business continues, UBS said it is on track to reach the levels of profitability it delivered before being asked to stabilize its Swiss rival last year. It logged net new assets in its global wealth management arm. Investment bank earnings rose sharply in the quarter.

UBS today logged a pre-tax profit, on an underlying basis, of $2.06 billion for the second quarter of 2024, more than double the $891 million result achieved a year earlier. The bank said it had progressed significantly from integrating the Credit Suisse business acquired last spring. 

Within its flagship global wealth management business, UBS said underlying pre-tax profit was $871 million, versus $909 million a year before. There was a large improvement in the investment banking side, with UBS chalking up an underlying pre-tax result of $412 million, contrasting with a loss of $14 million in the second quarter of 2023. Corporate and personal banking also improved: pre-tax profit, on an underlying basis, was $710 million, from $549 million a year earlier, UBS said in a statement.

The group is enjoying strong momentum, it said. UBS booked net new assets of $27 billion in global wealth management and “strong transactional activity” in the investment bank. It had a record second-quarter result for revenues on its global market business, while global banking revenues surged 55 per cent on a year ago.

Net new fee generating assets were $16 billion; in the first six months of 2024, net new assets stood at $54 billion, and on track to deliver on the group’s guidance of about $100 billion of net new assets per annum through 2025.

Invested assets in the wealth management arm rose by $15 billion from Q1 2024 to $4.038 trillion.

“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 Credit Suisse. We are now entering the next phase of our integration, which will be critical to realize further substantial cost, capital, funding and tax benefits,” Sergio Ermotti, group chief executive, said in a statement. 

UBS said it had a cost/income ratio of 86.9 per cent; on an underlying basis, the ratio was 80.6 per cent at end June this year. 

The bank said it had a “strong” Common Equity Tier 1 ratio – a standard international measure of a bank’s shock-absorber capital – of 14.9 per cent. Non-core and legacy business risk-weighted assets have fallen 42 per cent since the second quarter of 2023, including a drop of  $8 billion from the first quarter of 2024.

Looking ahead, UBS said that as it continues to integrate the Credit Suisse business, in the third quarter of 2024 it expects to incur around $1.1 billion of integration-related costs, while the pace of gross cost savings will decline modestly sequentially. Integration-related expenses should be partly offset by around $600 million accretion of purchase accounting effects.  

As reported in a separate article today, UBS has donated $25 million to provide a 25 per cent match for donations made to the UBS Optimus Foundation Anniversary Impact Appeal. The foundation is marking its 25th anniversary.