UBS: UBS: Credit Suisse Integration Hits Cruising Speed

A robust start to 2025 suggests UBS is wringing meaningful value from the Credit Suisse deal faster than skeptics expected.Swiss bank UBS opened 2025 with a net profit of $1.7 billion for the first quarter, underpinned by a profit before tax of $2.1 billion, according to a media release on Wednesday.Total invested assets edged up to $6.2 trillion, highlighting the breadth of the franchise even as clients grappled with early-April market volatility.Real Test in SummerGroup RoCET1 was 9.6 percent (11.3 percent underlying), and the CET1 capital ratio was a sturdy 14.3 percent, leaving UBS comfortably above regulatory minimums.With capital ratios solid and buybacks back on the agenda, the real test will be whether the wealth behemoth can sustain momentum if trade-war chatter and rate-cut timing keep markets on edge through the summer.Wealth Engine Fires on All CylindersGlobal Wealth Management (GWM), the bank's crown jewel, booked $7 billion of net new assets, while underlying GWM revenues leapt 32 percent year-on-year on higher transaction income.New loan production topped 40 billion francs, with half granted in Switzerland, and fee momentum stayed firm despite macro jitters.Credit Suisse Integration Delivering Early SynergiesCost actions tied to last year's emergency takeover of Credit Suisse are translating quickly to the bottom line. UBS reported $0.9 billion in exit-rate gross cost saves, bringing cumulative savings to $8.4 billion - 65 percent of its $13 billion 2026 target. Swiss branch consolidation finished ahead of schedule, and the first wave of client account migrations is slated for early Q2.Meanwhile, the Non-core & Legacy wind-down trimmed risk-weighted assets by $7 billion to $34 billion, reducing drag on capital.Capital Returns Regain MomentumHaving already repurchased $0.5 billion of shares in Q1, UBS earmarked a further $2.5 billion for buybacks over the rest of 2025, equivalent to roughly 10 percent year-on-year growth in total shareholder payout when combined with dividends.Doubling Down on Tech and GenAIUBS said it «continued to invest in technology and growth,» highlighting the rollout of Microsoft Copilot to 50,000 employees, migration to the cloud, and select GenAI pilots.The bank claimed cloud usage is now above 75 percent, supporting efficiency gains even as total IT spend rises.Outlook: Tariffs, Rates, and Volatility Cloud Q2Management struck a cautious tone: «Rapid and significant changes to trade tariffs, heightened risk of escalation, and increased macro-economic uncertainty» could rattle clients.UBS expects net interest income in GWM and Personal & Corporate Banking to slip sequentially by low- to mid-single-digit percentages in Q2 (in $ terms).«Engine of Economic Growth»Pull-to-par revenues on Credit Suisse-acquired instruments - forecast at $0.6 billion - should offset roughly half of an expected $1.1 billion integration-expense charge next quarter.Yet CEO Sergio Ermotti remained upbeat: «We continue to focus on supporting clients, delivering on our financial targets, and acting as an engine of economic growth in the communities we serve.»More to follow.