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UBS reports 53% higher profits in Q2 2015 than last year

Last updated: 22:30 27 Jul 2015 BST, First published: 20:30 27 Jul 2015 BST

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Shares of the UBS AG (NYSE:UBS) were trading 1.5% lower on Monday even as the Swiss banking group said it earned a net profit of CHF1.2 billion or US$1.25 billion for the second quarter 2015, up 53% compared to the same period in 2014.

Unadjusted earnings increased by 35.8% to 1.63 billion Swiss francs, UBS said in a statement, adding that all regions and sectors contributed to these strong results.

In a statement, UBS’s CEO Sergio Ermotti welcomed the fact that the institution has "maintained its momentum” despite the challenges of the market.

Still, the unenthusiastic shareholder response to the results might be explained by the banking group’s more cautious outlook. UBS said that seasonal effects could affect revenues and profits in the third quarter, notwithstanding geopolitical instabilities.

The wealth management division posted a pretax profit of CHF 769 million, which is the second best Q2 result since 2009.

The investment bank unit earned CHF617 million before tax; Wealth Management Americas generated earnings of CHF231 million while retail banking and corporate division has a profit before tax of CHF414 million.

The operational product (sales equivalent) amounted to CHF 7.81 billion, against 7.14 billion in the second quarter 2014.

In all, net new money inflows in the wealth management unit reached CHF 8.4 billion between April and end of June, said UBS in a statement. However, the sum is less than those recorded in previous quarters (14.4 billion in Q1 2015 and 10.7 billion in Q2 2014).

At the end of June and three months, UBS had 3% fewer assets under management than the same period last year.

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