Bloomberg Audio Studios, podcasts, radio news bumper results from UBS. The share is currently up seven point eight percent, this after the Zurich based Lander return to profit after two loss making quarters. The robust set of results will be abuse for the CEO, Sergio er Mootti, as he grapples with a tightening regulatory outlook in Switzerland, and he's been speaking to Bloomberg TV's Francine Laqua and Motty began by highlighting the strength recently in the bank's performance.
Well, very please with the governmentum we start the year. I think that first of all, we are making very good progress on our integration plans, but also it was great to see a very strong return on the profitability, both on a reported basis but also a very strong underlying profits. We also see good momentum with clients with inflows across our businesses, and our capital is strong, so allowing us to continue to pursue our.
Capital return plans.
And also the investment bank was actually quite strong, better than expected. Again, what does it tell you about you know, what you can see in the future. Is it a one off or actually is a path ahead better?
Actually, it's a good momentum. You May remember in the four quarter we also had a very strong performance in banking. As we integrate a new colleagues from credits Wich on our platform, we start to see the pipeline developing we are able to execute and so it's very much aligned with our expectations of improving the mix between our markets business and our banking business in the investment bank.
So in the investment bank where you see the bigges strength. I know we also heard about possible you know job losses in Asia. Is Asia at the moment weaker than for example, parts of the US and investment bank.
No, I think that we reinforced our franchises globally. I think that, of course we are still going through across the entire bank. We are still a lot of work to be done to restructure the businesses and to bring them back into even stronger profitability.
So I think that is a good momentum.
We achieve almost a ten percent return on CIT one, which is still a third or fifty percent away from our final targets, so still work to be done. We always say that twenty twenty four is an important year, and as we now approach the end of May, we're going to execute on our legal entity mergers, which allow us to unlock in the future further cost savings.
An important year twenty twenty four, because it's also more difficult year to twenty twenty three.
No, because is.
More First of all, we have two huge milestones, the merger of our legal entities and the second one we start to do the migration of clients from the credit switch platforms into the UBS platforms. So this is very technical, still requires a lot of support and people to do that.
But as we start to do that, we can unlock some cost savings, but also unlock capital savings, funding savings, and therefore you know, achieving our final targets to achieve thirteen billions of savings by the end of twenty twenty six forty.
This year we do.
Expect half of that being achieved, so six and a half billions.
So when you look at global wealth, I mean the outlook talks about interest rate cuts. Again, how do you worry about, you know, things that are outside your control, well.
Things that aretside our control. You know, we always need to wonder what can.
Happen on the geopolitical front, what can happen on any sudden change in the macroeconomic pictures.
So I think that.
We do indeed a factor in our outlook for NII. For example, three rate cuts in the US cup, two rate cuts in Switzerland.
This can change.
If it changes, may be beneficiary to our NII, but maybe the underlying macroeconomic event is not so positive. So you know, we need to always assess well, we are prepared for any scenario.
We stay focused on executing on our plan.
But also we have you know, a balance sheet for all seasons, allowing us to really manage any any unexpected event.
So when you look at market volatility, it's a little bit unusual to see as much market volatility or even pricing on the fact how do you describe.
The markets, Well, it's a kind of market volatility around bonds and ten years. But if I look on effects, I look at equities many other anset classes, the volatility is not there.
It's more subdute. We saw more client.
Activity, but let's not forget that there is a little bit of seasonality factor in the first quarter, so we need to really see how in the next quarter things are going to play out. We have to remember that we are still facing in the in the in the foreseable future, big elections coming, and how this is going to then play out into the sentiment of clients.
Still still open and that will be very regionally.
Again, if you look at pipelines you see a difference.
Yeah, very originally, but you know nowadays things in every region can affect others, so I think that.
Things are quite fluid.
Is Europe weaker than the rest of the world.
Well, Europe is still not growing.
If I look at our businesses, of course, it's still somehow clear that the real growth is mainly driven by the US, and and and Asia. I'm also very pleased with our performance in Switzerland. But when I look at Europe in general, is still not so constructive.
I mean there you know, talks about possible of course integration or em and A of banks in Spain. I don't know whether you see yourself as kind of like the original M and A for different reasons. What are you expecting of a consolidation wave.
I continue to.
Think that it's over time, is going to be is necessary to see more consolidation in the European banking We may be seen as a playbook or a reference point going forward on how to merge two larger banks. But eventually what we've see right now in Spain at least is a scenario which you go through first mainly domestic consolidation, and this is a prerequisite later on maybe to expand this into a more European framework. Now, in order to do that, you need to have a banking union model.
You need also some regulatory and it's not even regulatory, I would say, it's political decisions about how Europe wants to see its financial markets and banking.
Markets being managed.
But over time, in order to stay competitive visa VI, non banking financial institutions, to stay competitive visa VI, new entrants that are not necessarily just banks, banks do need to create economy of skills so that they can invest and stay relevant to their clients.
So that was the CEO of UBS, Sergio or Maati, speaking there to Bloomberg's Francin Laqua after the bank's latest results out this morning showing that return to profit after two loss making quarters.
They discussed there, of course the strength and the wealth managements and the investment bank. This as the bank has been signaling that it has another one point three billion dollars worth of costs linked to the integration of credit Suite in the second quarter,