UBS profit rises 88% in Q1

Profit rises to 1.98 billion Swiss francs, or about $2.1 billion, from 1.05 billion francs in the first quarter of 2014

The Swiss bank UBS said on Tuesday that its first-quarter profit rose 88 per cent on gains in its investment bank and its wealth management business amid a sharp increase in the value of the Swiss franc.

For the three months ended March 31, UBS said profit rose to 1.98 billion Swiss francs, or about $2.1 billion, from 1.05 billion francs in the first quarter of 2014. The results exceeded analysts' expectations, according to Reuters.

In January, the Swiss National Bank abruptly abandoned a cap on the Swiss franc against the euro, causing the value of the franc to surge.

Volatility in currencies, combined with negative interest rates in parts of Europe, had been expected to affect the results of larger Swiss lenders, such as UBS, which conducts its business in a variety of currencies, but reports its results in francs.

But UBS and its rival Credit Suisse both reported higher quarterly results, benefiting from an uptick in market activity, particularly increased foreign exchange transactions by clients.

"I'm pleased with the strong quarter. We stayed close to our clients, we stayed disciplined on risk and we delivered across all businesses and regions," Sergio P Ermotti, the chief executive of UBS, said in a news release. "The results again demonstrate the benefits of a strategy defined early and executed with a focus on long-term value creation."

UBS said that its adjusted pretax profit, which excluded items that the bank's management says are not representative of the underlying performance of its business, was 2.27 billion francs. In the first quarter, adjusted profit exclude gains on sales of real estate and a subsidiary, UBS said. Revenue rose 22 per cent to 8.84 billion francs in the first quarter, from 7.26 billion francs in the same period a year earlier.

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