Amid the ongoing uncertainty over proposed changes to Switzerland’s capital requirements, UBS has reported an 8% year-on-year rise in third-quarter net profit, reaching USD 2.69 billion.
The Swiss banking giant has also accelerated its share buyback programme with one caveat: the pace and scale of similar mechanisms in the future will remain conditional on the outcome of the banking rules overhaul proposed by the Guy Parmelin government.
The result was broadly in line with expectations, compared with an analyst consensus forecast of USD 2.71 billion in a UBS poll. The bank repurchased USD 1.8 billion of shares during the quarter and now plans to complete its USD 3 billion buyback programme by February, earlier than its previous target of mid-2027.
The Parmelin government introduced the capital rules after the 2023 collapse of Credit Suisse and its emergency takeover by UBS, which was engineered with state support.
Switzerland’s biggest bank is assessing the long-term implications of the proposals for its ability to compete internationally from its Swiss base.
Chief Executive Officer Sergio Ermotti told analysts that UBS was in no rush to act, as any new requirements would take time to implement.
The proposed rules are being debated by a Swiss parliamentary committee and are expected to reach the lower house in December. The upper house proposed measures in September that UBS described as unacceptable.
The bank’s chairman has warned that UBS would need to carefully consider its future in Switzerland if the final requirements proved too harsh.
Some investors have also called for the lender to leave the country.
Ermotti said UBS’s Swiss identity remained an advantage but was not the primary reason clients chose the bank.
“Being a bank that has a DNA of Swissness, that is rooted in Switzerland, is a big advantage, but it’s not the reason why our clients are banking with us,” he said.
UBS said it hoped parliament would reach a solution that safeguarded Switzerland’s financial stability without imposing undue costs on its shareholders, clients and employees.
The bank added that it remained strategically committed to its diversified business model and global and regional footprint.
UBS’s third-quarter performance was also supported by USD 55 billion in net new assets in its global wealth management business. The inflows included USD 18 billion in Asia and USD 17 billion in the Americas.
“Profitability in the Americas also improved, with the profit-before-tax margin increasing by more than two percentage points,” the bank said.
The integration of Credit Suisse remains on track for completion by the end of 2026.
UBS now expects cumulative cost savings from the integration to reach around USD 13.7 billion by the end of the year, up from its previous estimate of approximately USD 13.5 billion.
Staff numbers fell by almost 1,500 full-time employees during the quarter as the integration progressed. UBS also said employees were running more than 12,700 personal artificial intelligence (AI) agents, while the bank continued investing in the technology.
The lender’s cost-income ratio improved to 72.3% at the end of the third quarter, compared with 77% a year earlier.
In conclusion, UBS stated that macroeconomic volatility, geopolitical tensions, and political uncertainty kept investor sentiment measured.