Axel Weber Doesn't Sound too Optimistic

Axel Weber, UBS Chairman

Axel Weber, UBS Chairman

The turbulences on the markets have the investors in a stranglehold and banks are going amiss millions in trading income. In its report on the first quarter, UBS said the period witnessed the lowest-ever transaction volume, with little hope for an improvement soon.

Customers are protecting their cash because of the insecurity on the financial markets, even in wealth management, Axel Weber told «CNBC» in an interview.

Uncertainty Remains

All is not over, Weber thinks, hoping that a calmer market will tempt investors to become more active again, adding that this scenario might have begun in the second quarter. But the indicators all pointed towards a continuation of the uncertainty in the markets, Weber said.

The demand by regulators on banks to hold more capital is a headache for the big banks. With a difficult economic environment and financial uncertainty, profitability isn't what banks might want it to be and hence they face problems to improve their capital base.

Too Early to Tighten Monetary Policy

Asked about the monetary policy of the European Central Bank (ECB), Weber said there was no alternative to the expansive policy adopted by the institute, because the economy in Europe was still weak, unlike the one of the U.S. To tighten the reigns now would be a mistake according the UBS Chairman Weber. The ECB was likely to wait what effect the measures would have.


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