< /p> Logo of the Swiss bank UBS.
Zurich – In the first quarter, the profit of the largest Swiss bank UBS fell by 52 percent to roughly one billion dollars (about 21.2 billion CZK). The financial institution is now preparing to take over its smaller rival Credit Suisse, which has run into trouble. UBS has set aside $665 million for lawsuits related to the bank's role in selling mortgage-backed securities before the financial crisis. The company stated this in its announcement today.
Fifteen analysts polled by UBS estimated first-quarter earnings at $1.7 billion. Revenue fell to $8.75 billion from $9.38 billion a year ago.
As the world's largest asset manager, UBS also reported an inflow of $42 billion from clients in the first three months of the year. Its flagship wealth management division raised $28 billion in net new money, $7 billion of which came in the last ten days of March, following the Credit Suisse takeover announcement. For comparison, Credit Suisse clients withdrew about $53 billion from their bank in the quarter. At the end of March, UBS managed assets totaling $4.16 trillion. It was still $3.96 trillion at the end of December.
UBS also warned that geopolitical tensions and recent concerns about liquidity in the banking sector are reducing client activity and could affect new money in the coming months. Retaining both clients and assets will be a key task for Sergio Ermotti, who has returned as UBS chief executive to oversee the Credit Suisse takeover and restructuring.
Credit Suisse is Switzerland's second-largest bank. But in March, it ran into such serious problems that it began to threaten the financial stability of the global banking sector. Therefore, the Swiss government, the central bank and the regulatory authorities intervened in the matter, which negotiated the rescue of the bank so that it will be taken over by its larger domestic rival UBS for three billion Swiss francs (more than CZK 71 billion). He will also receive losses of up to five billion francs.