UBS posted a pretax profit of approximately $3.6 billion for the third quarter of the year, marking a 27% increase compared to the same period last year. This figure aligns closely with analysts' expectations. The Zurich-based banking giant experienced significant inflows into its global wealth management division, contributing to a net profit of $2.7 billion, also in line with estimates.
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The bank's common equity tier (CET) 1 capital ratio, an indicator of its solvency, increased to 14.7%, up from 14.4% in the previous quarter. Strong performance in wealth management was highlighted by net new assets totaling $55.1 billion at the quarter's end, alongside client commitments amounting to $12.5 billion across its wealth management and asset management segments.
In its earnings release, UBS stated that the integration of Credit Suisse is progressing as planned, with expectations to achieve cumulative cost savings of $13.7 billion, surpassing previous forecasts of $13.5 billion.
However, UBS is currently engaged in discussions with the Swiss government regarding new capital buffer proposals intended to safeguard taxpayers from potential banking crises. The Swiss parliament's upper house recently voted to increase UBS's Common Equity Tier 1 capital requirement to 90%, translating to approximately $16 billion in additional collateral. UBS currently holds around 45% and is pushing for a requirement of no more than 50%.
UBS CEO Sergio Ermotti expressed concerns about the implications of these new requirements on the bank's competitiveness, stating that maintaining a 90% level would hinder its ability to remain a strong market player. He emphasized the importance of the bank's diversified global business model in responding to client expectations.