UBS tightens investment banking belt as earnings slide continues

Video Credit: Reuters Studio
Published on October 22, 2019 - Duration: 01:53s

UBS tightens investment banking belt as earnings slide continues

Swiss bank UBS is axing high-paying investment banking staff after a disappointing performance at the division prompted a 16% slide in third-quarter net profit and put the group's 2019 profit goals further out of reach.

Francis Maguire reports.

Advertisement

UBS tightens investment banking belt as earnings slide continues

Swiss bank UBS announced job cuts for high-paying investment banking staff on Tuesday (October 22).

Third-quarter net profit fell 16% due to a poor performance in the division, And put the group's 2019 profit goals further out of reach.

Chief Executive Sergio Ermotti announced a further $90 million in annual cost savings at the investment bank.

It follows a prolonged performance dip as wealthy clients hold back from trading and negative rates eat into margins..

The bank's share price is down 16% in the past year and hit a six-year low in August.

One positive came through its flagship global wealth management unit.

The bank brought in net new money of $15.7 billion through the division, which recently hired former Credit Suisse high-flier Iqbal Khan as a joint manager.

City Index Market Analyst Ken Odeluga.

(SOUNDBITE) (English) CITY INDEX MARKET ANALYST, KEN ODELUGA, SAYING: "Investment banking is very, very challenged and we can now get an idea as to why there was so much drama over this new hire for the wealth management division, which was the revenues that shone in UBS's earnings." UBS leads a charge of European bank earnings for investors to consider.

With the likes of Credit Suisse due to report soon.

(SOUNDBITE) (English) CITY INDEX MARKET ANALYST, KEN ODELUGA, SAYING: "There's clearly a push at UBS and Credit Suisse and other major European banks to bring a greater focus on wealth management and that sort of implicates particular regions, particularly in Asia where we see the bulk of the growth from UBS' previous quarter coming from." British banks Barclays and RBS due to reports results later this week.

While Credit Suisse and Deutsche Bank are due to follow suit on October 30th.

You are here


💡 One News Page Knowledge: Other News Mentions


Switzerland

Federal republic in Central Europe
Swiss startup Climeworks has been a pioneer in efforts to capture carbon dioxide from the air and store it in underground rock formations. | Image courtesy of..
2 days ago • The Verge
Terrorist attacks inspired by the Islamic State group remain likely in Europe, with Switzerland not invulnerable to such threats, says the Federal...
3 days ago • WorldNews
The "unique" antique was taken by an organised crime group from a collection in Switzerland, police said.
Credit: BBC News - Published 1 week ago

A large Trump rally in Ocala, Florida, looked nothing like a Zurich music festival, though social posts claim otherwise.
Credit: USATODAY.com - Published 1 week ago


Credit Suisse

Multinational investment bank
Credit Suisse CEO Thomas Gottstein discusses the highlights from the bank's third-quarter earnings. ......
2 days ago • WorldNews

Asia

Continent
U.S. Secretary of State Mike Pompeo wrapped up a five-nation visit of Asia in Vietnam Friday, repeating the theme that the U.S. is against China's encroachment..
10 hours ago • WorldNews
Asian markets are mostly lower Thursday in the aftermath of Wall Street’s big losses a day earlier, sparked by growing pessimism over the...
2 days ago • WorldNews
Sony has announced more details about how its PlayStation Plus Collection will work in a new blog post. The service will launch alongside the console in the US..
2 days ago • The Verge


Related videos from verified sources

Post Bank Earnings: What Investors Should Know About The Sector 01:38
Video credit: The Street - Published on October 16, 2019 

Market Wrap: Buffett Is Bullish on Bank of America 00:57
Video credit: The Street - Published on October 15, 2019 

You might like