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UBS asset management receives $24.1 bn in long-term net inflows

USB asset management

The bank’s assets managed for affluent clients hit a record $2.5 trillion

Multinational investment bank and asset management company UBS’s high net worth clients added $15.7 billion in new money for the last quarter, media reports said. 

The inflow increased assets managed for affluent clients to a record $2.5 trillion, UBS said in a statement. With that, the UBS’ asset management unit received $24.1 billion in long-term net inflows. UBS asset management is the global investment arm of the UBS group. 

Chief Executive Officer Sergio Ermotti said in the statement, “We continue to take actions to grow profitability.” UBS plans to revamp its investment bank to enhance its underperforming business, according to media reports. 

Political uncertainties such as Brexit and the US-China trade war, in addition to stricter government regulations, led to a loss of  $47 million loss at its investment bank in the fourth quarter last year. UBS plans to form a securities and trading unit by merging its investment bank’s core equities division with smaller foreign exchange, rates and credit trading (FRC). 

The restructuring is expected to cost the bank $100 million, but would reduce annual expenses by $90 million over time. In August, Ermotti hired former Credit Suisse CEO Iqbal Khan to co-manage the bank’s wealth management unit—making him a potential successor. 

UBS’d pre-tax profits in the third quarter fell to $203 million from $489 million in the same period last year. The drop is below analysts’ expectations at $290 million. The bank recorded an overall third quarter net profit of $1.05 billion. Its revenue in merger and acquisition advisory, equity and debt capital markets businesses reduced 19 percent, media reports said. 

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