Switzerland’s biggest bank UBS has announced a surprise quarterly loss in its investment banking division due to a fall in trading.
That overshadowed the fact that for the first time since early 2008 UBS’s wealthy clients increased the amount of money they entrusted it with – a key goal in turning the bank around.
Third-quarter net profit at UBS was higher than forecast, but that was due to a hefty tax credit.
UBS was the second big European bank to report quarterly figures after local rival Credit Suisse disappointed investors last week as slow share trading also hit its investment banking business.
The weak investment banking results set a worrying trend for other European banks reporting later this week like Germany’s Deutsche Bank, as well as Spain’s BBVA and Santander.
UBS, which needed a government bailout in the credit crisis and was hit hard by a US tax probe, was able to attract 1.2 billion Swiss francs of new money to its wealth management operations from super-rich clients, particularly in Asia.