by Ariane Luthi

ZURICH (Reuters) – UBS reported third-quarter net profit up 74% on Wednesday, with the bank well above expectations thanks to higher revenue amid financial market volatility caused by customs turmoil.

UBS’s group share net profit reached $2.5 billion (2.14 billion euros) in the quarter while analysts on average expected $1.29 billion, according to an analyst consensus compiled by UBS.

The bank, however, said macroeconomic uncertainties, the strength of the Swiss franc and rising U.S. tariffs were clouding the outlook for the Swiss economy.

UBS expects deal activity to remain healthy in the fourth quarter, but noted that “sentiment can change quickly when confidence in the outlook is tested.”

A prolonged shutdown of the US administration could delay capital market activities.

The dissolution of legal provisions amounting to $688 million, mainly related to the resolution of the Credit Suisse residential mortgage-backed securities case and a UBS case in France, contributed to the increase in profits in the third quarter.

UBS attracted $38 billion to its global wealth management division and $18 billion to asset management, bringing total invested assets to nearly $7 trillion.

Strong fund inflows in Asia more than offset fund outflows in America, where UBS applied this week for a national bank charter.

In UBS’s investment banking division, revenue jumped 52% year-on-year in global banking and 14% in trading, marking a record third quarter for both businesses as deal activity resumed.

The integration of its former rival, Credit Suisse, has progressed, UBS said in a statement, adding that more than two-thirds of customer accounts opened in Switzerland have been transferred.

(Written by Ariane Luthi; Etienne Breban, edited by Kate Entringer)

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