Swiss banking giant UBS missed profit forecasts for the third quarter after it took another Swfr1.84 billion (£1.2 billion) hit on likely fines and legal costs.
It said quarterly profits rose from Swfr577 million to Swfr762 million — short of the near Swfr800 million that analysts had been predicting.
But the shares were down only 1 per cent after chief executive Sergio Ermotti said: “We are actively addressing litigation and regulatory matters and have a better estimate of how to address these issues.”
Almost all the extra charges came from the investment bank, which UBS has been slimming down as it concentrates more on private banking and wealth management.
It did not break down the charges but analysts said much of the total would relate to the upcoming settlement with global regulators over the alleged rigging of foreign exchange benchmarks.
UBS and five other banks — including Barclays, HSBC and Royal Bank of Scotland — are in talks with the Financial Conduct Authority and US regulators to reach a deal that could cost them hundreds of millions of pounds.
Ermotti said: “Three years since introducing our strategy, the business is far stronger, its earnings power is much greater and our absolute and relative capital position speaks for itself. That gives us every confidence in our ability to deliver on our capital returns policy.”
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He added: “At the start of the fourth quarter, many of the underlying challenges and geopolitical issues that we have previously highlighted remain, and in some cases have intensified. A number of new concerns have arisen, including fear of risks related to the ebola virus.”Reuse content