| UBS reported weaker-than-expected profit in the second quarter, as the global market sell-off kept wealthy clients on the sidelines and institutional investors pulled funds.reported net income of $US2.1 billion , compared with analyst estimates of $US2.4 billion. The quarter was affected by lower revenues at the key wealth management business, outflows in asset management and investment banking results that also trailed expectations.
The asset management division suffered $US12.1 billion in outflows as investors exited equities during the turbulent quarter. The unit’s revenue included a gain from the sale of UBS’s stake in a Japanese real-estate venture partly held with Mitsubishi. UBS also cited lower compensation costs at the investment bank, as the market declines cooled what had been a fierce bidding contest for talent.
UBS confirmed its plans to buy back about $US5 billion in shares this year, with more than $US3 billion already completed in the first half.The lender also signalled the potential for higher litigation provisions relating to a long-running French tax evasion case, and said that in general, the bank continued to be “exposed to a number of significant claims and regulatory matters”.