UBS (NYSE: UBS), the Swiss investment bank, reported its seventh consecutive quarterly loss last week yet improved over the first three months of the calendar year.
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UBS posted a second-quarter loss of 1.4 billion Swiss francs ($1.3 billion) in an improvement over the first three months of the year. The second quarter result was more than three times the 395-million franc loss for the same period in 2008, when UBS was also riddled with writedowns of $5.1 billion. The company cites its
The bank, once the largest wealth manager in the world, said outflows of money rose sharply in the quarter as investors withdrew assets. The net new money outflow in the quarter was 39.4 billion francs ($37 billion), compared with 14.9 billion francs in the first quarter.
UBS endured a credit charge of 1.2 billion francs, restructuring charges of 582 million francs and a goodwill impairment charge of 492 million francs related to the announced sale of UBS Pactual. Excluding the own credit, goodwill impairment and restructuring charges, operational profit before tax would have been 971 million.
The UBS Pactual deal is expected to close in the third quarter.
Operating income increased to 5.8 billion francs from 5 billion in the previous quarter, while operating expenses increased 9% to 7.1 billion from 6.5 billion last quarter.
Wealth Management & Swiss Bank recorded a pre-tax profit of 932 million francs, compared with 1.1 billion last quarter. Excluding restructuring charges, pre-tax profit for the second quarter would have increased 16% from the prior quarter.
Wealth Management Americas recorded a pre-tax loss of 221 million francs compared with a pre-tax loss of 35 million francs. The second quarter included restructuring charges of 152 million francs, whereas the first quarter included a goodwill impairment charge of 19 million francs related to the announced sale of UBS Pactual. Excluding these charges, the pre-tax loss for second quarter 2009 would have been 69 million francs compared with a first quarter pre-tax loss of 16 million francs.
Global Asset Management recorded a pre-tax profit of 82 million francs compared with a pre-tax loss of 59 million francs. Excluding a goodwill impairment charge in the first quarter of 191 million francs in relation to the announced sale of UBS Pactual and restructuring charges in both quarters, pre-tax profit in the second quarter would have decreased by 30 million francs, or 22%. Increased performance fees were more than offset by higher personnel expenses.
The Investment Bank recorded a pre-tax loss of 1.8 billion francs compared with a pre-tax loss of 3.2 billion last quarter. The
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