UBS Group Q3 Earnings Call Highlights

Key Points

• UBS reported strong third-quarter results: net profit reached $2.7 billion, while underlying pre-tax profit rose 14% year over year to $4.1 billion. Revenue increased 10%, supported by broad-based gains and cost control.
• Credit Suisse integration is nearing completion. UBS has delivered $13.2 billion in gross cost reductions and expects to exceed its $13.5 billion target, reaching approximately $13.7 billion by year-end.
• Wealth management remained a major growth driver, attracting $55 billion in net new assets during the quarter and $128 billion year to date. UBS also plans to repurchase another $1.2 billion of shares over the next three months.

UBS Group NYSE: UBS reported third-quarter 2026 net profit of $2.7 billion, or $0.85 per share, as gains across its core businesses and continued Credit Suisse integration savings supported revenue growth that outpaced expenses.

On an underlying basis, pre-tax profit rose 14% year over year to $4.1 billion, according to Group CFO Todd Tuckner. The bank reported a 16.7% return on CET1 capital and a 68.7% cost-income ratio for the quarter. Revenue increased 10%, while UBS said its core franchises, excluding litigation, produced four percentage points of positive operating leverage on 3% higher revenue and lower costs.

“Our strong third quarter performance once again demonstrated the benefits of our diversified global business model and disciplined execution,” Group CEO Sergio Ermotti said. He said the bank’s year-to-date return on CET1 capital was 17% and that UBS was increasingly confident it could outperform its 2026 exit-rate return target while achieving an exit-rate cost-income ratio below 70%.

Credit Suisse Integration Nears Completion

UBS said it has delivered $13.2 billion of gross cost reductions through the end of the third quarter, including $600 million during the period. It expects another $500 million of reductions in the fourth quarter, bringing the total to about $13.7 billion, above its $13.5 billion target.

The group recorded $452 million of integration costs in the quarter, along with a $346 million charge related to repurchasing roughly $10 billion of high-cost Credit Suisse liabilities. Tuckner said the debt repurchase would accelerate the reduction of funding drag in the Non-core and Legacy unit while supporting future net interest income in Global Wealth Management and Personal & Corporate Banking.

UBS expects about $500 million of integration-related expenses in the fourth quarter as it completes the program by year-end. The bank said the final cost-to-achieve multiple should be around 1.1 times at historical foreign-exchange rates, in line with prior guidance.

Headcount stood at 110,000 at quarter-end, down 2% from the preceding quarter and 30% below the 2022 baseline. UBS said that, excluding litigation, variable compensation and currency effects, group operating expenses have declined nearly 30% over that period.

Wealth Management Draws $55 Billion of Net New Assets

Global Wealth Management generated pre-tax profit of $2 billion, up 11% from a year earlier. Excluding nearly $200 million of litigation-related releases that benefited the prior-year period, pre-tax profit rose 25%, UBS said.

The division attracted $55 billion of net new assets during the quarter, representing a 4.5% annualized growth rate and bringing year-to-date net new assets to $128 billion. UBS said momentum was broad-based, led by Asia-Pacific and the Americas. It also recorded $13 billion in net new fee-generating assets, while client activity helped produce $6 billion of net new loans and $2 billion of net new deposits.

• In the Americas, pre-tax profit rose 28% and the profit margin reached 16%, supported by record revenue. Net new assets totaled $17 billion and net new loans were $4 billion.
• In Asia-Pacific, pre-tax profit increased 19% and the profit margin was 45%. UBS said net new assets and net new fee-generating assets grew at annualized rates of 9% and 8%, respectively.
• In EMEA, excluding litigation, pre-tax profit increased 39%, while the region generated $9 billion in net new assets.
• In Switzerland, wealth-management pre-tax profit excluding litigation rose 34%, and net new assets totaled $12 billion.

Global Wealth Management revenue rose 8%. Recurring net fee income increased 9% to $3.8 billion, while transaction-based income climbed 4% to $1.3 billion. Net interest income rose 8% to $1.8 billion. UBS expects low-single-digit sequential growth in wealth-management net interest income during the fourth quarter, supported by higher rates and lending growth.

Swiss Banking and Investment Bank Results

Personal & Corporate Banking delivered pre-tax profit of CHF 813 million, up 22%, its strongest quarter since the Credit Suisse acquisition. Revenue rose 4%, operating expenses declined 5%, and UBS reported an underlying pre-tax return on equity above 18%.

The unit benefited from having clients on a single platform and from retiring legacy infrastructure, Tuckner said. Despite Switzerland’s zero-interest-rate environment, net interest income increased 2% from a year earlier and 3% sequentially, driven by lending momentum. UBS expects Swiss-franc net interest income in the division to increase slightly in the fourth quarter.

Asset Management posted pre-tax profit of $300 million, up 6%, while operating expenses fell 14%. Net new money was negative $5 billion, reflecting money-market outflows and institutional portfolio rebalancing following consolidation of the custody platform. However, UBS said its Unified Global Alternatives business attracted a record $12.5 billion of quarterly commitments, lifting invested assets to $371 billion.

The Investment Bank reported pre-tax profit of $854 million, up 9%, and a pre-tax return on equity of 18%. Global markets revenue increased 17% to a third-quarter record of $2.5 billion, led by a 22% increase in equities revenue. Global banking revenue declined 21% to $670 million compared with a record prior-year quarter, as a 44% increase in equity capital markets revenue was more than offset by lower leveraged capital markets and advisory revenue.

UBS said client engagement and origination activity remained strong in advisory and capital markets, supporting a robust pipeline. Assuming constructive market conditions, it expects sequential growth in global banking revenue in the fourth quarter, while transaction volumes in global markets are expected to show typical seasonal moderation.

Capital Returns and Swiss Regulatory Debate

UBS repurchased $4.8 billion of shares year to date and accrued $2.8 billion for its dividend. Ermotti said the bank intends to repurchase another $1.2 billion of shares over the next three months to complete its current program. The company plans to provide its 2027 capital-return plans with fourth-quarter results.

The CET1 capital ratio was 14.7% at the end of September, while the CET1 leverage ratio was 4.6%. UBS expects to end 2026 at or close to its approximately 14% CET1 capital target, including a potential accrual for the initial portion of intended 2027 buybacks.

Ermotti also addressed the Swiss parliamentary debate over banking regulation, criticizing proposals that he said could excessively tighten capital requirements already among the strictest globally. He said UBS would continue to engage with policymakers but would not discuss potential contingency actions until regulations are finalized.

“We are not going to just carry unnecessary capital for the next few years,” Ermotti said during the question-and-answer session, adding that UBS expects to return to “business as usual” from Jan. 1, 2027, following the completion of the integration.

About UBS Group (NYSE:UBS)

UBS Group AG is a Switzerland-based global financial services company serving private, institutional and corporate clients. The company provides wealth management, asset management, investment banking and personal and corporate banking services. Its offerings include investment advice, portfolio management, lending, securities and foreign exchange services, financial planning, and banking products for individuals and businesses.

UBS operates through four principal business areas: Global Wealth Management, Personal & Corporate Banking, Asset Management and the Investment Bank.

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