UBS CEO: this is one of the worst quarters in years
The stock markets are doing well again. But the Swiss bank UBS does not notice this. Sergio Ermotti, CEO of UBS, states. According to him, the turnover of UBS in the first quarter of 2019 is one of the least in recent years.
According to Ermotti, there are some reasons for the disappointing result in the first quarter. He said about that:
"We have macro-level and geopolitical challenges, as we all know. But there was a lack of any positive element in the first quarter."
First quarter 2018 was still excellent
Last year, in the first quarter of 2018, the Swiss bank had another excellent quarter. Then the bank recorded a profit growth of 19 percent. This growth was partly due to the excellent performance of the investment bank division. Ermotti said about that:
"Last year the investment bank division achieved an extraordinary result. So it is logical that we do a little less this year. But in the current environment, although stock markets have recovered, there is not a lot of confidence among our institutional and private clients."
The CEO added:
"The Chinese market has risen 25 percent, Hong Kong is higher, the US is higher, but the volumes that support that are not there."
Central bank policy does not help
Ermotti also discussed the policy of central banks. Both the ECB and the Fed have indicated that a more flexible monetary policy is being pursued. The Fed said yesterday that it will leave interest rates unchanged and that there will be no interest rate increases this year.
According to the UBS CEO, this policy is a new headwind for the bank. He stated:
"It is a new headwind compared to our expectations for the year. We assumed that the Fed would continue its policy of raising interest rates. And the ECB has also changed its position."
Source: CNBC