UBS' quarterly profit edged higher after the Swiss kept spending in check. Both its flagship wealth unit and investment bank recorded lower profits.
Swiss-based UBS' net profit for the second quarter edged 1 percent higher to $1.39 billion, the bank said in a statement on Tuesday. Revenue eased one percent, which the Swiss bank handily offset by slashing spending by more than $165 million, or 3 percent.
«Our goals remain unchanged: to deliver sustainable and profitable long-term growth while investing in our businesses and providing attractive shareholder returns,» CEO Sergio Ermotti said. He is behind a wealth-centered strategy that hones in on the super-rich or those with more than $50 million.
Less Profit at Bank's Flagship
But profit at the Swiss bank's flagship wealth unit dropped by 17 percent. Wealthy Asian and U.S. clients shunned trading and inked fewer loans, leading to a drop in revenue. UBS also won fewer fees because clients the overall level of assets dropped.
At its investment bank, profit before tax dropped 20 percent. UBS said favorable showings from its dealmaking arm, especially advisory and equity capital markets, helped. By contrast, revenue from equities, foreign exchange trading, rates, and credit softened.
Wealth Strategy
UBS' is coming off a 27 percent tumble in the first quarter – which it termed its toughest in years. Shareholders haven't been enthusiastic about its wealth strategy following a mega-merger last year. Crosstown rival Credit Suisse, which reports the quarter on June 30, won more investor plaudits after emerging from a three-year revamp similar to UBS'
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