UBS earnings: q4 2020
3 min readLONDON — UBS, the world’s biggest prosperity supervisor, has documented net cash flow of $1.71 billion for the fourth quarter of 2020, a 137% soar on the yr prior to.
Analysts had predicted profits to arrive in at $967 million for the a few-month period, according to Refinitiv. It will come just after the Swiss financial institution claimed web cash flow of $2.1 billion for the third quarter of past yr.
Double-digit profit advancement in UBS’ wealth management and asset management divisions contributed to the quarterly performance.
The financial institution also revealed that it would restart shopping for back its shares. It announced a new a few-12 months system in which it strategies to invest in up to 4 billion Swiss francs ($4.5 billion) of shares, $1 billion of which will be bought during the first quarter of 2021. Buybacks supply a way for companies to return cash to shareholders — together with dividends — and ordinarily coincide with a firm’s stock pushing increased as shares get scarcer.
At a time when banking companies have been discouraged from paying out dividends, UBS also announced it will suggest a 2020 dividend of $.37 for each share.
The final results are the initial under the leadership of Ralph Hamers, who took around as the new main government officer on Nov. 1.
Speaking to CNBC on Tuesday, Hamers highlighted a “history quantity in invested property of much more than 1 trillion (dollars) in the asset manager and a lot more than 3 trillion (dollars) in the wealth supervisor.”
“And essentially that reveals you the success of UBS, which is (a) really robust asset manager, extremely sturdy wealth manager, (and) if the markets are repositioning, you see that Financial investment Banking does really effectively,” he advised CNBC’s Joumanna Bercetche.
Economic uncertainty on the again of Covid-19
In spite of beating analyst expectations with its final results, UBS was careful on the economic outlook.
“On the a single aspect evidently there is some gentle at the close of the tunnel with the vaccination applications,” Hamers said.
But he included: “On the other aspect we are in weighty lockdowns, unquestionably also listed here in Europe, so you never know what the serious impression on the overall economy is and how the economy will essentially get out of this pandemic.”
The start out of 2021 has been clouded by tighter social restrictions, predominantly in Europe, exactly where governments have also been criticized for a gradual roll out of Covid-19 vaccines. There are also issues above new variants of coronavirus which are more transmissible and foremost to bigger infections concentrations.
“The latest developments, including economic and political conditions in some massive economies and geopolitical tensions, have once more raised queries close to the condition and tempo of the restoration,” the lender explained in its outcome statement.
Listed here are some other vital metrics from the results:
- Running cash flow arrived in at $8.1 billion, vs . $8.9 billion at the finish of the third quarter.
- Widespread fairness tier 1 capital ratio (CET1) — a metric of lender solvency — was 13.8% versus 13.5% in the past quarter.
- Return on tangible equity — a metric of profitability — hit 12.9%, in comparison with 16.2% in the prior quarter.
UBS shares are up all-around 3% given that the start out of the calendar year.
