Speaker 1: Bloomberg Audio Studios, podcasts, radio news bumper results from UBS.
Speaker 1: The share is currently up seven point eight percent, this
Speaker 1: after the Zurich based Lander return to profit after two
Speaker 1: loss making quarters. The robust set of results will be
Speaker 1: abuse for the CEO, Sergio er Mootti, as he grapples
Speaker 1: with a tightening regulatory outlook in Switzerland, and he's been
Speaker 1: speaking to Bloomberg TV's Francine Laqua and Motty began by
Speaker 1: highlighting the strength recently in the bank's performance.
Speaker 2: Well, very please with the governmentum we start the year.
Speaker 2: I think that first of all, we are making very
Speaker 2: good progress on our integration plans, but also it was
Speaker 2: great to see a very strong return on the profitability,
Speaker 2: both on a reported basis but also a very strong
Speaker 2: underlying profits. We also see good momentum with clients with
Speaker 2: inflows across our businesses, and our capital is strong, so
Speaker 2: allowing us to continue to pursue our.
Speaker 3: Capital return plans.
Speaker 4: And also the investment bank was actually quite strong, better
Speaker 4: than expected. Again, what does it tell you about you know,
Speaker 4: what you can see in the future. Is it a
Speaker 4: one off or actually is a path ahead better?
Speaker 2: Actually, it's a good momentum. You May remember in the
Speaker 2: four quarter we also had a very strong performance in banking.
Speaker 2: As we integrate a new colleagues from credits Wich on
Speaker 2: our platform, we start to see the pipeline developing we
Speaker 2: are able to execute and so it's very much aligned
Speaker 2: with our expectations of improving the mix between our markets
Speaker 2: business and our banking business in the investment bank.
Speaker 4: So in the investment bank where you see the bigges strength.
Speaker 4: I know we also heard about possible you know job
Speaker 4: losses in Asia. Is Asia at the moment weaker than
Speaker 4: for example, parts of the US and investment bank.
Speaker 2: No, I think that we reinforced our franchises globally. I
Speaker 2: think that, of course we are still going through across
Speaker 2: the entire bank. We are still a lot of work
Speaker 2: to be done to restructure the businesses and to bring
Speaker 2: them back into even stronger profitability.
Speaker 3: So I think that is a good momentum.
Speaker 2: We achieve almost a ten percent return on CIT one,
Speaker 2: which is still a third or fifty percent away from
Speaker 2: our final targets, so still work to be done. We
Speaker 2: always say that twenty twenty four is an important year,
Speaker 2: and as we now approach the end of May, we're
Speaker 2: going to execute on our legal entity mergers, which allow
Speaker 2: us to unlock in the future further cost savings.
Speaker 4: An important year twenty twenty four, because it's also more
Speaker 4: difficult year to twenty twenty three.
Speaker 3: No, because is.
Speaker 2: More First of all, we have two huge milestones, the
Speaker 2: merger of our legal entities and the second one we
Speaker 2: start to do the migration of clients from the credit
Speaker 2: switch platforms into the UBS platforms. So this is very technical,
Speaker 2: still requires a lot of support and people to do that.
Speaker 2: But as we start to do that, we can unlock
Speaker 2: some cost savings, but also unlock capital savings, funding savings,
Speaker 2: and therefore you know, achieving our final targets to achieve
Speaker 2: thirteen billions of savings by the end of twenty twenty
Speaker 2: six forty.
Speaker 3: This year we do.
Speaker 2: Expect half of that being achieved, so six and a
Speaker 2: half billions.
Speaker 4: So when you look at global wealth, I mean the
Speaker 4: outlook talks about interest rate cuts. Again, how do you
Speaker 4: worry about, you know, things that are outside your control, well.
Speaker 3: Things that aretside our control. You know, we always need
Speaker 3: to wonder what can.
Speaker 2: Happen on the geopolitical front, what can happen on any
Speaker 2: sudden change in the macroeconomic pictures.
Speaker 3: So I think that.
Speaker 2: We do indeed a factor in our outlook for NII.
Speaker 2: For example, three rate cuts in the US cup, two
Speaker 2: rate cuts in Switzerland.
Speaker 3: This can change.
Speaker 2: If it changes, may be beneficiary to our NII, but
Speaker 2: maybe the underlying macroeconomic event is not so positive. So
Speaker 2: you know, we need to always assess well, we are
Speaker 2: prepared for any scenario.
Speaker 3: We stay focused on executing on our plan.
Speaker 2: But also we have you know, a balance sheet for
Speaker 2: all seasons, allowing us to really manage any any unexpected event.
Speaker 4: So when you look at market volatility, it's a little
Speaker 4: bit unusual to see as much market volatility or even
Speaker 4: pricing on the fact how do you describe.
Speaker 2: The markets, Well, it's a kind of market volatility around
Speaker 2: bonds and ten years. But if I look on effects,
Speaker 2: I look at equities many other anset classes, the volatility
Speaker 2: is not there.
Speaker 3: It's more subdute. We saw more client.
Speaker 2: Activity, but let's not forget that there is a little
Speaker 2: bit of seasonality factor in the first quarter, so we
Speaker 2: need to really see how in the next quarter things
Speaker 2: are going to play out. We have to remember that
Speaker 2: we are still facing in the in the in the
Speaker 2: foreseable future, big elections coming, and how this is going
Speaker 2: to then play out into the sentiment of clients.
Speaker 3: Still still open and that will be very regionally.
Speaker 4: Again, if you look at pipelines you see a difference.
Speaker 2: Yeah, very originally, but you know nowadays things in every
Speaker 2: region can affect others, so I think that.
Speaker 3: Things are quite fluid.
Speaker 4: Is Europe weaker than the rest of the world.
Speaker 3: Well, Europe is still not growing.
Speaker 2: If I look at our businesses, of course, it's still
Speaker 2: somehow clear that the real growth is mainly driven by
Speaker 2: the US, and and and Asia. I'm also very pleased
Speaker 2: with our performance in Switzerland. But when I look at
Speaker 2: Europe in general, is still not so constructive.
Speaker 4: I mean there you know, talks about possible of course
Speaker 4: integration or em and A of banks in Spain. I
Speaker 4: don't know whether you see yourself as kind of like
Speaker 4: the original M and A for different reasons. What are
Speaker 4: you expecting of a consolidation wave.
Speaker 3: I continue to.
Speaker 2: Think that it's over time, is going to be is
Speaker 2: necessary to see more consolidation in the European banking We
Speaker 2: may be seen as a playbook or a reference point
Speaker 2: going forward on how to merge two larger banks. But
Speaker 2: eventually what we've see right now in Spain at least
Speaker 2: is a scenario which you go through first mainly domestic consolidation,
Speaker 2: and this is a prerequisite later on maybe to expand
Speaker 2: this into a more European framework. Now, in order to
Speaker 2: do that, you need to have a banking union model.
Speaker 2: You need also some regulatory and it's not even regulatory,
Speaker 2: I would say, it's political decisions about how Europe wants
Speaker 2: to see its financial markets and banking.
Speaker 3: Markets being managed.
Speaker 2: But over time, in order to stay competitive visa VI,
Speaker 2: non banking financial institutions, to stay competitive visa VI, new
Speaker 2: entrants that are not necessarily just banks, banks do need
Speaker 2: to create economy of skills so that they can invest
Speaker 2: and stay relevant to their clients.
Speaker 1: So that was the CEO of UBS, Sergio or Maati,
Speaker 1: speaking there to Bloomberg's Francin Laqua after the bank's latest
Speaker 1: results out this morning showing that return to profit after
Speaker 1: two loss making quarters.
Speaker 4: They discussed there, of course the strength and the wealth
Speaker 4: managements and the investment bank. This as the bank has
Speaker 4: been signaling that it has another one point three billion
Speaker 4: dollars worth of costs linked to the integration of credit
Speaker 4: Suite in the second quarter,