A tailor-made start for the new UBS boss Ralph Hamers: Thanks to the stock market boom, the largest Swiss bank increased its profits by 54 percent to 6.6 billion dollars last year. The institute thus achieved the best result since 2015. According to a survey by the bank, analysts had expected a surplus of 5.9 billion dollars. “Our strong result in 2020 is clear evidence of the fundamental strength of our market position,” said Hamers on Tuesday at his earnings premiere. Nevertheless, he promised changes. “We have to remain agile and make UBS even fitter for the future,” said the Dutchman, who had taken over the helm at the beginning of November from long-time company director Sergio Ermotti.
With the first annual financial statements of a large European investment bank, the Zurich financial institution has set the bar high. Trading in stocks, bonds and currencies in particular was booming. But also in the core division, asset management for wealthy private customers, as well as in business with professional investors such as pension funds (asset management), the bank sometimes earned massively more. Only in the business with smaller Swiss private and corporate customers did the result fall because value adjustments for credit risks hit the office. Overall, UBS was one of the winners of the coronavirus crisis with its good performance in recent quarters. The pandemic caused many customers to reallocate their investment positions or take up new funds. That made for a hefty fee income at the bank. Assets under management in wealth management and asset management climbed to a record $ 4.1 trillion.
Previously, the Wall Street houses had already shone thanks to leaps in earnings in their capital market sectors. For example, Morgan Stanley, which is most comparable to the major Swiss banks UBS and Credit Suisse, achieved record results. Experts assume that Deutsche Bank, which plays a leading role especially in bond trading, has also significantly increased its income in investment banking. The largest German financial institution presented its figures in early February.
In view of the good result, UBS boss Hamers wants to distribute billions to the shareholders. He announced a new share buyback program. Own titles worth up to four billion Swiss francs are to be bought back over three years. After the boom in 2020, analysts expect the institute's profits to decline this year. The bank itself was only cautious about the further course of business. Seasonal factors are likely to lead to increased customer activity in the first quarter of 2021 and have a positive effect on the earnings situation. At the same time, the coronavirus pandemic could have a dampening effect.
