UBS today reported a net profit of 1.5 billion Swiss francs ($1.54 billion) for the first three months of 2018, slightly higher than analysts had expected. Across the bank's investment banking division, revenue from equity trading rose 17 per cent in the first quarter, while revenue from corporate customer solutions rose 15 per cent. Although the market has fluctuated since the beginning of the year, the market has supported investment banking. On the other hand, Xiaobai Maimai Inc's income from fixed income, interest rate, fell 11% compared with a year ago.
Highlights of the financial report
Net profit:1.5 billion Swiss francs ($1.54 billion), compared with 1.2 billion Swiss francs in the same period in 2017
Income:7.7 billion Swiss francs ($7.89 billion), compared with 7.5 billion Swiss francs in the same period in 2017
Earnings per share: 0.39 Swiss francs (US $0.40), compared with 0.33 Swiss francs in the same period in 2017
Despite a 19% increase in net profit in the first quarter of this year, UBS shares opened low in early trading on Monday. Because some analysts are unhappy with the performance of some of UBS's divisions, UBS has been cautious about the next quarter when it released its earnings forecasts. UBS warned that it could face higher funding costs related to long-term debt and regulatory business in the second quarter of 2018 than in the same period in 2017. It also referred to the threat to investor confidence posed by geopolitical tensions and rising protectionism.
Speaking to CNBC, Sergio Ermotti, chief executive of UBS, said he was very satisfied with the start of the year. He also said UBS has proved that it can achieve good results in different market environments. Asked if he was worried that market conditions would shift and affect the performance of investment banks in the second quarter, Ermotti said that despite some seasonal factors, he expected the situation in the second quarter of 2018 to be similar to that of the previous two years.
In a speech to the CNBC, Ermotti also said that as the yield on 10-year US Treasuries approached the threshold of 3 per cent, which is seen as a benchmark for the global bond market and seen by many market leaders as a watershed in debt and equity bull-bear markets. If the uptrend continues, the market's interest in the bond market will outweigh its confidence in the stock market, which is not good for banks.
As of press time, UBS was down nearly 3 per cent. The turnover reached 33 million dollars.
(this article is produced by Futu Information compilation team, compiled / Chen Jiannan, proofread / Huang Ruixue)