UBS profits are run by legacy legal costs as it nears Credit Suisse union

April 26, 2023: On Tuesday, UBS reported a 52% annual drop in net profit amid a legacy litigation matter but looked after it as a “source of stability” for its clients in periods of high uncertainty.

These are the bank’s initial results since announcing its takeover of rival Credit Suisse.

UBS stated that net profit came in at $1.03 billion for the initial quarter, coming in well below analyst anticipation of a net profit of almost $1.75 billion for the period, according to Refinitiv.

The hit in net income came from surged provisions of $665 million after a U.S. residential mortgage-backed protection litigation matter.

Speaking to Geoff Cutmore, UBS CEO Sergio Ermotti, who resumed his post on April 5, stated, “We are in advanced discussions. Therefore, we can close this 15-year-old chapter very soon.”

Ermotti also described the recent results as “very solid.”

“We saw some inflows income from Credit Suisse, but, most importantly, keeping to see even following the transaction, we experience inflows, so the demonstration that our customers believe we are a source of stability,” he stated.

“We are included in the solution and not included in the problem,” he added.

The lender said that it attracted $28 billion in net recent money in its global wealth management unit; $ 7 billion were included in the last ten days of March after it acquired Credit Suisse.