The most obvious effect for the Swiss bank is growth in scale that would have required many years of painstaking work building relationships with clients if it had been achieved organically.
In it first anniversary of the historic acquisition of its former rival Credit Suisse by UBS Group, it is becoming clear how advantageous the deal was for the bank. To begin with, its market capitalization reached more than US$100 billion; the highest level in almost 16 years and consolidated its leading role in global wealth management.
The most obvious effect for the Swiss lender It is growth in scale that would have required many years of painstaking work building relationships with clients. if it had been achieved organically. From overnight, client funds managed by its wealth management unit increased by about a fifth part of US$3.4 billion at that time, according to the Bloomberg agency.
That puts it almost in line with Morgan Stanley, which has around $5 billion in its wealth management division. even if UBS is larger in most places outside the United States.
The actions
The momentum in the UBS share price was not guaranteed a year ago, when the emergency rescue was announced negotiated by the Swiss government. Shares of the Zurich-based bank initially fell as much as 16% the next day amid uncertainty over what the deal would mean for UBS, which brought its valuation below US$60 billion.
The nerves did not last long because investors noted the bargain price, the presence of a government guarantee and the immediate boost in the scale of Credit Suisse’s client book. Some observers called it the deal of the century.
In the 12 months since, UBS leadership has returned the collateral, divested much of the assets of Credit Suisse does not want to and has begun the task of figuring out how the merger can boost its ambitions.
With the scale added by the Credit Suisse deal came another boost. The bank is now looking to grow the assets invested in its wealth management unit to more than US$5 trillion by the end of 2028, which is equivalent to an expansion of approximately US$1.2 trillion over the current level.
The core of UBS is the business of looking after the cash piles of the global rich, with the amount of client money under management towering over its regional competitors..
Source: Ambito
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