LONDON — UBS on Tuesday reported a fall in quarterly profit, however beat analyst expectations and set ambitious new profitability targets as a part of a strategic replace.
The Swiss financial institution posted internet profit attributable to shareholders of $1.35 billion for the fourth quarter. This was down from $1.64 billion a yr earlier, and likewise decrease than the $2.28 billion reported the earlier quarter.
Analysts had forecast UBS to submit internet revenue attributable to shareholders of $863 million, in accordance to the consensus printed by the financial institution.
The figures take the financial institution’s full-year profit to $7.46 billion, above a company-compiled consensus of $6.98 billion.
However, UBS’ backside line was hit by a rise of $740 million in litigation provisions for a French cross-border tax case. In late December, the financial institution filed an enchantment with France’s Supreme Court in opposition to a call by a Paris appeals court docket to uphold a cash laundering conviction.
Here are different highlights for the third quarter:
- CET 1 ratio, a measure of financial institution solvency, reached 15.0% versus 14.9% in the earlier three months.
- Operating revenue got here in at $8.73 billion versus $9.1 billion in the earlier quarter.
- Return on fairness, a measure of economic efficiency, stood at 8.9% from 15.3% in the third quarter of 2021.
New targets
“We are aiming to create sustainable worth via the cycle. Reflecting our improved working efficiency over the past two years, we’ve up to date our monetary targets, whereas our capital steerage stays unchanged,” the financial institution stated in an announcement accompanying the outcomes.
In its first main strategic replace since CEO Ralph Hamers took the reins in Nov. 2020, UBS stated it is going to intention for $6 trillion in invested belongings throughout its world wealth administration, asset administration and private and company banking divisions.
Meanwhile the financial institution set the goal vary for its return on CET1 capital at 15-18% and cost-to-income ratio at 70-73%. The financial institution may even intention for 10-15% progress in profit earlier than tax at its wealth administration enterprise.
“Our new aspirations, targets and targets will place us to stay up to our goal, higher serve shoppers, deploy know-how in differentiated and impactful methods, and open our ecosystem for new and current shoppers,” CEO Ralph Hamers added in an announcement.
UBS proposed a dividend to shareholders of fifty cents per share for 2021, rising from 37 cents in 2020, and goals to purchase again $5 billion price of its personal shares in 2022. Buybacks supply a means for companies to return money to shareholders — together with dividends — and normally coincide with an organization’s inventory pushing larger as shares get scarcer.
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