Shares in UBS have surged following the release of solid second-quarter results and the announcement of the bank’s integration with the domestic bank of Credit Suisse. At 0731 GMT, shares were trading 5.0% higher at CHF23.26, after seeing an increase of over 7% earlier in the session.
Analysts consider the integration of Credit Suisse’s Swiss bank to be a favorable move for UBS, as it allows them to maintain the crown jewel and consistent moneymaker of their former rival. Citi analyst Andrew Coombs stated in a note, “We believe this is the best outcome.”
UBS reported a net profit of $28.88 billion for the second quarter, which includes nearly $29 billion in negative goodwill resulting from the Credit Suisse acquisition earlier this year. As part of the deal, UBS has raised its cost-saving estimate to $10 billion, up from the previous target of $8 billion. The bank has also noted an improvement in client sentiment and momentum in transactions among wealth management clients.
Deposit flows have exceeded expectations, with net new money in wealth management even turning positive in the current quarter to date. More updates will be provided by UBS with the release of third-quarter results, followed by a more extensive strategic update with fourth-quarter and full-year earnings.