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General view of the UBS building in Manhattan on June 5, 2023 in New York City.
Eduardo Munoz Alvarez | View Press | Corbis News | Getty Images
UBS on Thursday posted a second-quarter profit of $28.88 billion in its first quarterly earnings since Switzerland’s largest bank completed its takeover of stricken rival Credit Suisse.
Analysts had projected a net profit of $12.8 billion for the three months to the end of June, according to a Reuters poll.
UBS said the result primarily reflected $28.93 billion in negative goodwill on the Credit Suisse acquisition. Negative goodwill represents the fair value of assets acquired in a merger over and above the purchase price. UBS paid a discounted 3 billion Swiss francs ($3.4 billion) to acquire Credit Suisse in March.
UBS delayed reporting its second-quarter results — initially scheduled for July 25 — until after completing the Credit Suisse takeover on June 12. The full integration of the Credit Suisse business is expected to take several years.
Earlier this month, UBS announced that it had ended a 9 billion Swiss franc ($10.24 billion) loss protection agreement and a 100 billion Swiss franc public liquidity backstop that were put in place by the Swiss government when it took over Credit Suisse in March.
In the previous quarter, UBS suffered a surprise 52% annual drop in net profit due to a legacy litigation issue relating to U.S. mortgage-backed securities.
UBS shares closed Wednesday’s trade up nearly 30% since the turn of the year, according to Eikon.
This is a breaking news story, please check back later for more.
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