Switzerland Today
Greetings from Zurich!
The main talking point of the day is the losses posted by Switzerland’s lone universal bank, UBS, in the third quarter. More on that later.
But first the other news of the day.
In the news: wolf packs to be culled, robots vs humans and helping a Parkinson’s patient to walk again.
- The canton of Graubünden wants to shoot four entire wolf packs, comprising 27 individual wolves, under new hunting laws that allow preventative culls.
- Human-like robots are developing fast but are still unable to match the range of skills from their flesh and blood peers, says the Federal Institute of Technology ETHZ.
- A Swiss designed neuroprosthetic, that electrically stimulates the spinal chord, has helped a Parkinson’s patient to walk again.
Number crunching
The fusion of UBS and Credit Suisse is producing a catalogue of eye-watering, and sometimes confusing numbers.
UBS has just reported a third quarter net loss of $785 million (CHF707 million), compared to a $29 billion profit just three months previously.
The yo-yoing financial results of Switzerland’s sole surviving global universal bank resemble those of the Swiss central bank, which regularly reports huge profits and losses from year to year.
This is a consequence of buying cross-town rival Credit Suisse in a CHF3 billion flash sale in March, followed by the complex task of merging the two giants.
The $29 billion second quarter profit simply highlighted the bargain price that UBS paid for its rival, reflecting the difference between the price tag and the real value of Credit Suisse at the time.
But the popping of champagne corks has been followed by a hangover. Shedding 4,000 full time posts in the last quarter (13,000 for the whole year to date) has left UBS with a $2.2 billion restructuring bill and the first quarterly loss since 2017.
Had the mega-bank buyout never happened, UBS says it would have reported a $1.1 billion pre-tax profit in Q2 and $844 million in Q3.
A final noteworthy figure is the $22 billion of net new assets deposited by rich clients into UBS’s wealth management unit.
The collapse of Credit Suisse was sealed by a bank-run that saw tens of billions of assets flee the sinking ship in the last months of its existence.
UBS says that former Credit Suisse clients account for two-thirds of the $33 billion of fresh assets attracted across all business units in the last three months.
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