UBS, Switzerland’s biggest bank, posted an unexpected rise in net profit on Friday despite CEO Sergio Ermotti giving a cautious outlook and highlighting that low volatility had hurt certain sectors of the bank.
Here are some of the key metrics:
- Q2 net profit: 1.174 billion Swiss francs ($1.21 billion), up 14 percent on a year earlier. 879 million Swiss francs was the estimate, according to Reuters.
- Q2 revenues: 7.27 billion Swiss francs vs. estimate of 7.23 Swiss francs, according to Reuters.
“We are highly concentrated of course in the FX (foreign exchange), we are one of the leaders in the FX business and volatility levels on all major currencies has been extremely low so we are suffering on that side,” UBS Chief Executive, Sergio Ermotti, told CNBC on Friday.
While Ermotti explained he was “very happy” with the bank’s overall business mix, he suggested geopolitical uncertainty was likely to put the most pressure on investors and clients in the near term.
“There is a divergence between the activity levels of wealth management clients versus what we see on the institutional side and it is well explained by the low volatility levels,” he added.
In the three months to end-June UBS attracted net new money, a closely watched indicator of future earnings in private banking, of 13.7 billion francs at its wealth management division and posted net outflows of $6.4 billion at its U.S. brokerage unit.
—Additional reporting by Reuters.
UBS CEO Sergio Ermotti says bank is suffering from low volatility despite earnings beat