UBS posts surprise Q4 profit on asset-management business

UBS Group AG posted a surprise rise in fourth-quarter profit as its wealth-management arm attracted billions of new client money, a move that offsets a slump at its investment bank amid macroeconomic headwinds.

The Swiss bank UBS, UBSG, reported a net profit of $1.65 billion in the three months to the end of December, up from $1.35 billion for the same period a year earlier.

Revenue was $8.03 billion compared to $8.71 billion in the fourth quarter of 2021.

The bank's net profit was $1.28 billion and revenue was $7.98 billion, according to analysts consensus provided by the company.

UBS took $23.3 billion in net new fee-generating assets at its key wealth management business in the quarter, at a time when its local rival Credit Suisse Group AG struggled with client withdrawals.

It added that the profit before tax at wealth management jumped 88% to $1.06 billion.

It attracted 25 billion in net new money at its asset-management business, according to UBS.

The profit before tax fell to around $100 million, down 84%, as dealmaking slumped.

The bank cited persistent inflation, slow central bank tightening, the Ukraine war and geopolitical tensions that affected asset-pricing levels and investor sentiment in the year.

While the macroeconomic outlook remains uncertain, our operational resilience, capital strength and capital generation puts us in a great position to serve our clients, fund growth and deliver strong capital returns to shareholders, Chief Executive Ralph Hamers said.

The common equity tier 1 ratio, a measure of financial strength, was 14.2% at the end of December, down from 14.4% at the third quarter.

The company said it would propose a dividend of $0.55 for 2022, an increase of 10% year-on-year.

The lender said it would remain committed to a progressive dividend and expects to repurchase more than $5 billion of shares in 2023, after $5.6 billion in 2022.