UBS Post Profit Beat from Trump Tarifs but ‘Material Risk’ Outlook Darks

Swiss veteran UBS Bottom line defeated expectations amidst fast returns in investment banking while warning on Wednesday As a global trade impact to broaden American tariffs, it attempts to curb the decline of standing stock.

The net profit for shareholders is estimated to $ 1.692 billion in the first quarter, compared to an average forecast of $ 1.359 billion in the LSEG pole of analysts. Group Revenue on Stretch had an expectations of an analyst of $ 12.99 billion at a distance of $ 12.557 billion.

Other first quarter highlights include:

• Return to tangible equity reached 8.5% in the fourth quarter, vs. 3.9%.
• CET 1 capital ratio, a measure of bank solvency, 14.3%, unchanged from the December quarter.

The lender said that it increased the revenue of his investment banking branch’s global market unit by 32% year-on-year, which is largely “inspired by high customer activity and FX in equity in all fields.” It also gained a 15% increase in transaction-based growth in income in its major global wealth management unit.

Speaking to CNBC’s Caroline Roth on Wednesday, UBS CEO Sergio Earmoti recognized the “challenging atmosphere” in the first quarter, with “certainly extremely unstable” in the first few weeks in April, which grew more than 30%in transactions of more than the Covid -19 levels.

In severe, the lender posted $ 1.629 billion in his net interest income (NII)-the difference between earnings from earnings and payment on investment and deposit-16% year-to-year and 11% from the fourth quarter, guidance for further decline in the June quarter.

“In the second quarter, we expect the net interest income (NII) to decompose a gradual decline in the Global Wealth Management, and we see a similar decline in the NII of individual and corporate banking in Swiss Frank. In US dollars, NIIs of individual and corporate banking are expected to increase the NII of individual and corporate banking,” said the UBS. “

Investors are curious to these matrix because European banks infection in an atmosphere of monetary ease, especially in Switzerland, combing a strong frank and depressed inflation, with 0.25%lower with interest rates.

Erymoti said he is “not extremely concerned” about the interest rate movements.

“I think we are now in a situation where it is almost a neutral, quite boring area,” he said. “If the rates go up or down from here in Swiss Frank, we are going to see a possible pick up in NII. But it is ahead of time to talk about what and when it will be physical.”

Separately, UBS confirmed on Wednesday that it has completed $ 500 million in the stock buyback and intended to pursue a $ 2.5 billion reproach for the remaining 2025.

“Overall a decent set of results, non-core benefits and trading activity in both IB and GWM, extended trading activity, which may not all be durable, while NII has again missed expectations,” said UBS analysts said.

The lender shares were up 1.64% at 08:30 pm at London.

This month was removed by market capitalization as continental Europe’s largest bank Banks centenderUBS, with the Log of Log of Logs of Logs, has faced a share of about 10% a year after the UBS implemented the tariff of the White House on the global trade partners.

Switzerland faces 31% of duty if it fails to agree on a more consent trade deal in early July by the end of Washington’s 90-day recurrence. Comparatively, the European Union was killed in the American Levi with 20%.

The tension with Washington and a potential recession for the world’s largest economy have trouble for Swiss banking veteran and its money containing global wealth management division, with almost half of the assets of UBS centered in the area of ​​widespread America last year.

The UBS said on Wednesday, “Rapid and significant changes for trade tariffs, increased the risk of growth and widely increased macroeconomic uncertainty.” “With a wide range of potential consequences, the economic route is further especially unexpected. The possibility of high tariffs on global trade presents a physical risk for global development and inflation, cloudy interest rate approach.”

This flagged the possibility of “forward spikes in instability” as the markets remain sensitive to the development of new tariffs, given that “long -term uncertainty would affect the spirit and delays businesses and investors in significant decisions on strategy, capital allocation and investment.”

“You look at the last 10 days, I think there is a little fatigue. I think investors are now waiting for a waiting-and-looking mode. Markets are settled … people are waiting for important news,” UBS ‘Emoti told CNBC. “But I hope that the spikes of evaporation will return to return as positive or negative news.”

The picture of the long-term profitability of the UBS has been dark from the questions on the needs of the possible new-and more Dracian-Put from Swiss authorities, who have interrogated the situation since Swiss Titan’s “very big failure”. Non -collapsed domestic rival credit suis absorptionTransactions – A politician dubbed the “century deal” – UBS has dropped the passage of maximum resistance against further sanctions, which argues that it will reduce its competition as an already adequately capitalized unit.

“UBS’s lobbying is both visible and infallible. It is clearly echoing in various places. But once again: Federal Council cannot be afraid by lobbying, but should also represent the interests of taxpayers,”

“A goal of the Federal Council is: that in a crisis situation, a UBS that is systematically important is solved. This means that systematically important parts of the bank can be separated in Switzerland.

UBS is expected to join the Swiss Federal Council on any proposed capital requirement change in June.

Speaking about the UBS obstacles of competition in a broader Swiss regulatory environment, Erymoti said, “We are not a magician. We are not able to be competitive and provide an engine of development for the financial center, but also for the economy, if the regulatory structure is not competitive.”