UBS Q3 profit rises, Credit Suisse integration nears completion, cost savings exceed expectations

According to Jinse Finance APP, UBS (UBS.US) released its Q3 2026 financial report on October 28. Net profit attributable to shareholders was $2.69 billion for the quarter, an increase of 8% year-on-year, slightly below the company’s consolidated analyst forecast of around $2.71 billion; diluted earnings per share were $0.85 (compared to $0.76 in the same period last year). Pre-tax profit was $3.587 billion, up 27% year-on-year; excluding special items, underlying pre-tax profit was $4.077 billion, an increase of 14% year-on-year. Total revenue was $13.35 billion, up 5% year-on-year.

By business segment, global wealth management underlying revenue grew 8% year-on-year to $6.898 billion, with recurring net fee income up 9% and net interest income up 8%. Net new assets for the quarter were $55.1 billion, with an annualized growth rate of 4.5%, driven most strongly by Asia Pacific and the Americas; group invested assets reached $7.3 trillion. The investment bank set a record for Q3 underlying revenue, with global markets revenue growing 17% to $2.548 billion, and equities up 22%. Pre-tax profit in the Americas rose 28% year-on-year, with pre-tax profit margin improving by more than 2 percentage points to 16%. UBS Swiss personal and corporate bank saw net new loans of 3.3 billion Swiss francs and net new deposits of 1.8 billion Swiss francs.

In terms of capital and returns, the CET1 capital ratio was 14.7% (14.8% in the same period last year, 14.4% in the previous quarter), and the CET1 leverage ratio was 4.6%. The cost-to-income ratio was 72.3%, and the underlying basis was 68.7%. Share buybacks totaled $1.8 billion for the quarter, and UBS plans to complete its $3 billion buyback program before the fourth quarter results announcement, instead of by mid-2027 as previously stated; it also continues to accrue dividends with a “double-digit percentage” increase.

Credit Suisse integration nearly complete: cumulative gross cost savings reached $13.2 billion (an additional $600 million in the third quarter). The bank added that the integration of former rival Credit Suisse is progressing as planned and is expected to be completed by the end of the year. By the end of 2026, cumulative cost savings are expected to be about $13.7 billion, higher than the previous forecast of about $13.5 billion. Around 90% of legacy IT applications slated for decommissioning have already been taken offline. The company said the nine-month underlying RoCET1 was 16.7%, and the underlying cost-income ratio was 69.6%, with a view to surpassing the 2026 target exit-rate underlying RoCET1 of around 15%.

Looking ahead to the fourth quarter, UBS expects trading volumes to show “more typical seasonal declines”; global markets will face year-on-year pressure due to last year’s high base, which included gains from disposals; global banking revenue is expected to increase quarter-on-quarter; and wealth management net interest income to show low single-digit quarter-on-quarter growth.

CEO Sergio Ermotti said that in an increasingly complex market environment, results again reflect the advantages of a diversified global business model and disciplined execution.

As integration work progressed, the number of full-time employees declined by nearly 1,500 in the quarter. UBS stated the bank now operates more than 12,700 private AI agents and will continue to invest in this technology.

The bank is linking the scale and speed of share repurchases to the outcome of Swiss banking regulatory reforms, initiated after the 2023 collapse of Credit Suisse and the emergency government-orchestrated takeover by UBS.

UBS Group’s new capital rules are currently being debated in a parliamentary committee and are expected to be submitted to the lower house for consideration in December. The Swiss Federal Assembly proposed relevant rules last month, but UBS believes these rules are unacceptable.

UBS’s chairman has warned that if capital requirements become too stringent, the bank will need to seriously consider its future in Switzerland, and some shareholders have even called for UBS to exit the country.

In its earnings report, UBS said it hopes parliament can find a solution that supports Swiss financial stability without imposing excessive costs on UBS shareholders, clients, and employees.