UBS posts better-than-expected Q4 profits, announces share buyback

The investment bank also highlighted the €60bn increase in net new fee-generating assets during the year and "strong" capital position.

It also guided towards share buybacks of over $5bn in 2023.

"Our performance proves that our strategy is the right one. Clients turned to us for advice and stability, resulting in USD 60bn of net new fee-generating assets for the full year and USD 23bn in the fourth quarter," group chief executive officer, Ralph Hamers, said.

Quarterly net income was up by 23% to $1.65bn thanks in part to a 35% jump in net interest income at its Global Wealth Management unit driven by higher interest rates.

Total revenues meanwhile fell 8% to $8.03bn and total net interest income by 10% to $1.59bn.

Profits before tax at the GWM arm surged by 88% in comparison to the year earlier quarter and were up 51% in Personal and Corporate Banking to reach CHF504m.

But in Asset Management they plummeted 63% to $124m and at the Investment Bank by 84% to $112m.

"In 2022, the combined impact of persistent inflation, rapid central bank tightening, the Russia–Ukraine war, and other geopolitical tensions affected asset pricing levels and investor sentiment," UBS said in a statement.

"As clients repositioned their investments in response to interest rate increases, we captured demand for higher yield

through our savings products, certificates of deposit and money market funds."

Its cost:income ratio for the three months ending on 31 December came in at 75.8% and at 72.1% for all of 2022, against guidance for 70-73%.

The lender finished the year with a common equity tier one capital ratio of 14.2%.

As of 1126 GMT, shares of UBS were off by 3.22% to CHF19.21, but near their best levels since late 2015.