UBS Turns To Profit In Q4, Hikes Dividend, Plans $3 Bln Buyback; But Stock Down

UBS

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(RTTNews) - UBS Group AG reported Tuesday a profit in its fourth quarter, compared to prior year's loss, benefited by increased revenues. The Swiss banking major also raised its dividend, and announced up to $3 billion share buyback program.

Meanwhile, the shares were losing around 5 percent in the trading on the Switzerland stock ecxchange, as well as around 6 percent in pre-market activity on the NYSE.

Sergio Ermotti, Group CEO, said, "In 2025, we will continue to execute on the next phase of the integration with discipline and deliver on our priorities. We are confident in our ability to substantially complete the integration by the end of 2026, achieve our financial targets, and fulfill our growth initiatives as we position UBS for a successful future."

Looking ahead, to the first quarter, the company projects a low-to-mid single digit percentage sequential decline in net interest income in Global Wealth Management and around a 10 percent sequential decline in Personal & Corporate Banking.

Further, the company said its Board of Directors, for the 2024 financial year, plans to propose a dividend of $0.90 per share, an increase of 29 percent from last year. Subject to approval at the Annual General Meeting, scheduled for April 10, the dividend will be paid on April 17 to shareholders of record on April 16.

UBS also said it plans to repurchase $1 billion of shares in the first half of 2025, and aims to repurchase up to an additional $2 billion of shares in the second half of 2025.

The company also maintained ambition for share repurchases in 2026 to exceed full year 2022 levels.

UBS further confirmed financial targets and ambitions for 2026 exit rate and 2028, and said it is well positioned to deliver long-term growth and higher returns.

The firm is also on track to deliver around $13 billion gross cost reductions by end-2026. Around $2.5 billion of gross cost saves are expected in 2025.

Regarding Credit Suisse, UBS noted that the integration is on track with all key 2024 milestones achieved significantly reducing the execution risk of the acquisition.

For the fourth quarter, UBS' net profit attributable to shareholders was $770 million or $0.23 per share, compared to prior year's loss of $279 million or $0.09 per share.

Profit before tax was $1.0 billion and underlying profit before tax was $1.77 billion.

Total revenues for the quarter grew 7 percent to $11.64 billion from last year's $10.86 billion. On an underlying basis, revenues increased 6 percent, reflecting the strength, scale and geographic diversity of core businesses.

Net interest income, meanwhile, dropped 12 percent from last year to $1.84 billion.

In Switzerland, UBS Group shares were trading at 30.20 francs, down 5 percent.

In pre-market activity on the NYSE, the shares were at $32.96, down 5.7 percent.

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