UBS nears pre-acquisition profitability as integration pays off
Return on CET1 capital approaches pre-acquisition levels; record IB and wealth performance, but U.S. adviser attrition persists.
UBS · Earnings Call · 2026-07-29
The long-awaited payoff
Three years after the emergency acquisition of Credit Suisse, UBS Group AG is finally showing the market why the deal made sense. In the first half of 2026, the group achieved a return on CET1 capital of around 17%, and Sergio Ermotti told investors that the firm is "close to achieving the same level of profitability UBS had prior to the acquisition." “we are close to achieving the same level of profitability UBS had prior to the acquisition” — Sergio Ermotti, Group CEO · 2026-07-29 The second quarter delivered an underlying pretax profit of $3.9 billion, up 45% year-on-year, with revenues up 16% to $13.3 billion.
As expected, the journey was not a straight line, it required a lot of hard work from my colleagues at UBS and painful decisions. Now these efforts are paying off and the extraordinary patience and support of our shareholders is starting to be rewarded.
The engine is the integrated "One Bank" model, which drove record Net new fee generating assets and a new all-time high in Mandate penetration. Group invested assets reached a record $7.3 trillion, with GWM net new assets of $36 billion in the quarter. The Invested assets growth is increasingly recurring, giving management confidence in the durability of the franchise. Client momentum was broad-based, with double-digit revenue growth across all GWM regions, and Asia Pacific stood out with pretax profit up 48% and a 45% pretax margin.
The Investment Bank as a capital-light machine
The Investment Bank posted record second-quarter revenues of $3.7 billion, up 31%, with a pretax profit of $1.2 billion and a return on equity above 23%. Crucially, this growth came without material balance sheet expansion. CFO Todd Tuckner highlighted the role of prime brokerage: "I think the prime brokerage has been one area that is also differentiating us from certain of our peers." “I think the prime brokerage has been one area that is also differentiating us from certain of our peers.” — Todd Tuckner, Group CFO · 2026-07-29 The capital-light nature of the outperformance, combined with disciplined resource allocation, allows UBS to fund growth while maintaining a CET1 ratio of 14.4% and a cost/income ratio of 70% — already ahead of the exit target trajectory. This is exactly the model the market wants to see from a post-integration UBS: scale without capital-intensive leverage.
Still the U.S. wealth question
The group's success is not without blemishes. The U.S. wealth management business continues to lose financial advisers, a legacy of the compensation changes implemented earlier. Management acknowledges the lag effect: "we do expect further NNA headwinds through the first half of 2026, after which we expect net recruiting outflow impacts to materially taper." “we do expect further NNA headwinds through the first half of 2026, after which we expect net recruiting outflow impacts to materially taper.” — Todd Tuckner, Chief Financial Officer · 2026-02-04 and "we are certainly not satisfied with the net movement we've seen around our advisers." “we are certainly not satisfied with the net movement we've seen around our advisers.” — Todd Tuckner, Chief Financial Officer · 2026-02-04 Yet the same call highlighted a record number of advisers choosing to stay and retire at UBS, and the firm expects positive net new assets from the Americas for the full year.
The Swiss integration is nearly complete, with more than 90% of legacy applications decommissioned and cumulative cost savings of $12.6 billion. The bank is now returning capital, announcing a new $3 billion buyback with at least $1 billion to be executed over the next three months. As Todd Tuckner put it: "Our strong second quarter results underscore our earnings power with broad-based growth across each of our core franchises, led by Global Wealth Management and the Investment Bank." “Our strong second quarter results underscore our earnings power with broad-based growth across each of our core franchises, led by Global Wealth Management and the Investment Bank.” — Todd Tuckner, Group CFO · 2026-07-29 That momentum positions UBS to potentially exceed its 2026 exit rate targets, subject to the Swiss parliament's deliberations on capitalization of foreign subsidiaries and the pace of the buyback.