UBS Group Q4 Earnings & Revenues Increase Y/Y, Credit Loss Expenses Up

Core Viewpoint - UBS Group AG reported a significant turnaround in its financial performance for the fourth quarter of 2024, achieving a net profit of $770 million compared to a net loss of$279 million in the same quarter of the previous year [1][2]. Financial Performance - The total revenues for the fourth quarter increased by 7% year over year to $11.6 billion, while annual revenues rose by 19$48.6 billion [3]. - Operating expenses decreased by 10% year over year to $10.4 billion, contributing positively to the overall financial results [3]. - The company reported total credit loss expenses of$229 million, which represented a 68% increase from the previous year [3]. Business Division Performance - Global Wealth Management's operating profit before tax for the fourth quarter was $867 million, a significant increase from$280 million in the prior-year quarter [4]. - Asset Management's operating profit before tax rose by 4.9% to $128 million compared to the same quarter last year [4]. - The Investment Bank unit reported an operating profit before tax of$479 million, recovering from an operating loss of $190 million in the previous year [5]. Capital Position - Total assets decreased by 3.6$1.57 trillion [6]. - The return on Common Equity Tier 1 (CET1) capital improved to 4.2% as of December 31, 2024, compared to negative 1.4% a year earlier [6]. - Risk-weighted assets declined by 8.7% year over year to $498.5 billion, while CET1 capital fell by 8.5$71.4 billion [6]. Capital Distribution - For 2024, UBS plans to propose a dividend of 90 cents per share, pending approval at the Annual General Meeting scheduled for April 10, 2025 [7]. - The company is committed to a progressive dividend policy, with an expected increase of around 10% in the ordinary dividend per share for 2025 [8]. - UBS completed a $1 billion share repurchase in the fourth quarter of 2024 and plans to repurchase an additional$1 billion in the first half of 2025, with up to $2 billion more in the second half [8]. Integration and Cost Savings - UBS is making significant progress with the integration of Credit Suisse, achieving all integration milestones in 2024 and reducing execution risks [9][11]. - The company delivered an additional$0.7 billion in gross cost savings in the reported quarter, totaling $3.4 billion for 2024, and aims for$13 billion in gross cost savings by the end of 2026 [9][10].