Union Bank of Switzerland soars to pounds 1bn: Warning that 1994 will not be so good

UNION Bank of Switzerland, one of the big three Swiss banks, increased its profits by 68.9 per cent to SFr2.3bn ( pounds 1.08bn) in 1993 on the back of buoyant securities markets, but warned that 1994 would not be so easy.

UBS earns a third of its profits overseas, and although it does not break down the figures geographically it is understood that London makes up a third of these profits.

Robert Studer, UBS chief executive, said the 1994 forecast for profits before provisions was well above its medium-term target, but a result similar to 1993 was not expected.

'Our 1994 budget is, as far as operating results are concerned, well above the target figures we had penned into our 1993/96 medium- term planning. We do not, however, expect a result along the lines of 1993,' Mr Studer said.

Alison Deuchars, an analyst with Lehman Brothers, said: 'You would expect a bank with that size of trading operation to have had a very good year. This year, trading will be very difficult in the short term. UBS's earnings growth will have to be driven by falling provisions (against bad debts).'

UBS stood out from many of its international competitors by increasing its interest income by 6.2 per cent, to SFr3.6bn. International banks suffered a narrowing of margins in the second half of 1993, reversing the trend towards wider margins over the past few years.

UBS said interest on arrears continued to increase. 'Difficult economic conditions are making themselves felt in this sector,' it said.

Trading income grew by 73.5 per cent to SFr2.9bn, a third of this from dealing in derivatives. Swiss Bank Corporation and Credit Suisse are more heavily dependent on derivatives trading, but UBS said it was expanding in this area.

The biggest contribution to profits was from services, including investment management, at SFr4bn. UBS's UK fund management operation is now second only in size to Mercury Asset Management.

The bank is increasing the dividend on bearer shares from SFr29 to SFr32, and on registered shares from SFr5.8 to SFr6.4.

Total assets grew by 16.7 per cent to SFr311.3bn, while capital and reserves amounted to SFr21.7bn.

The price of bearer shares stood SFr26 lower at SFr1,451 by mid-morning after falling to SFr1,415. Dealers said investors had speculated ahead of the results that UBS might introduce a singe share category and that the terms would have raised the market value of the bearer by 10 per cent.

Start your day with The Independent, sign up for daily news emails
Sport
England's women celebrate after their 3rd place play-off win against Germany
Women's World CupFara Williams converts penalty to secure victory and bronze medals
Arts and Entertainment
Ricardo by Edward Sutcliffe, 2014
artPortraits of LA cricketers from notorious suburb go on display
News
newsHillary Clinton comments on viral Humans of New York photo of gay teenager
Arts and Entertainment
The gang rape scene in the Royal Opera’s production of Gioachino Rossini’s Guillaume Tell has caused huge controversy
music
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Assistant / Buyer

£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...

Recruitment Genius: Customer Service Advisor

£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

Day In a Page

The Greek referendum exposes a gaping hole at the heart of the European Union – its distinct lack of any genuine popular legitimacy

Gaping hole at the heart of the European Union

Treatment of Greece has shown up a lack of genuine legitimacy
Number of young homeless in Britain 'more than three times the official figures'

'Everything changed when I went to the hostel'

Number of young homeless people in Britain is 'more than three times the official figures'
Compton Cricket Club

Compton Cricket Club

Portraits of LA cricketers from notorious suburb to be displayed in London
London now the global money-laundering centre for the drug trade, says crime expert

Wlecome to London, drug money-laundering centre for the world

'Mexico is its heart and London is its head'
The Buddhist temple minutes from Centre Court that helps a winner keep on winning

The Buddhist temple minutes from Centre Court

It helps a winner keep on winning
Is this the future of flying: battery-powered planes made of plastic, and without flight decks?

Is this the future of flying?

Battery-powered planes made of plastic, and without flight decks
Isis are barbarians – but the Caliphate is a dream at the heart of all Muslim traditions

Isis are barbarians

but the Caliphate is an ancient Muslim ideal
The Brink's-Mat curse strikes again: three tons of stolen gold that brought only grief

Curse of Brink's Mat strikes again

Death of John 'Goldfinger' Palmer the latest killing related to 1983 heist
Greece debt crisis: 'The ministers talk to us about miracles' – why Greeks are cynical ahead of the bailout referendum

'The ministers talk to us about miracles'

Why Greeks are cynical ahead of the bailout referendum
Call of the wild: How science is learning to decode the way animals communicate

Call of the wild

How science is learning to decode the way animals communicate
Greece debt crisis: What happened to democracy when it’s a case of 'Vote Yes or else'?

'The economic collapse has happened. What is at risk now is democracy...'

If it doesn’t work in Europe, how is it supposed to work in India or the Middle East, asks Robert Fisk
The science of swearing: What lies behind the use of four-letter words?

The science of swearing

What lies behind the use of four-letter words?
The Real Stories of Migrant Britain: Clive fled from Zimbabwe - now it won't have him back

The Real Stories of Migrant Britain

Clive fled from Zimbabwe - now it won’t have him back
Africa on the menu: Three foodie friends want to popularise dishes from the continent

Africa on the menu

Three foodie friends want to popularise dishes from the hot new continent
Donna Karan is stepping down after 30 years - so who will fill the DKNY creator's boots?

Who will fill Donna Karan's boots?

The designer is stepping down as Chief Designer of DKNY after 30 years. Alexander Fury looks back at the career of 'America's Chanel'