UBS Targets Profitability Boost, More Buybacks — Update

By Adria Calatayud

UBS Group said it plans to buy back $3 billion of its own stock this year and signaled more repurchases could follow, as it set targets that call for a profitability boost after its integration of Credit Suisse.

The Swiss bank is entering the final year of its integration of Credit Suisse, a former cross-town rival that it acquired in 2023 in a rescue deal orchestrated by Swiss authorities, confronting uncertainty about the extent to which its home country will hike capital requirements.

Switzerland's government last year proposed an overhaul of the country's banking rules that would substantially increase requirements on UBS to set aside capital, in a move aimed at preventing a repeat of a Credit Suisse-style crisis. UBS has pushed back against the proposals, saying they would put its business model at risk and place a heavy burden on the Swiss economy.

UBS said Wednesday that it aimed to do more buybacks beyond the $3 billion it plans for this year, but that their amount would depend on clarity around Switzerland's future regulatory regime and its financial performance. It hiked its dividend by 22% to $1.10 a share.

Analysts expected UBS to buy back $3.38 billion of its own stock this year and declare a dividend of $0.99 a share, according to consensus estimates compiled by the bank.

Last year, the bank completed stock repurchases valued at $3 billion and paid out a dividend of $0.90 a share.

The integration of Credit Suisse is on track to be completed by the end of the year, UBS said. The bank said it was on track to achieve 2026-end targets it set after the deal and that it identified additional cost savings of $500 million that would take its cumulative savings by the end of the year to $13.5 billion, up from $13 billion previously.

"As we approach the last mile of the integration, I am confident in our ability to capture the remaining synergies by the end of the year," UBS Chief Executive Sergio Ermotti said.

The bank also set new 2028 ambitions for a return on common equity Tier 1, or CET1, capital--a measure of profitability--of about 18% and a cost-to-income ratio--a gauge of a bank's efficiency--of around 67%. UBS previously targeted to end 2026 with an underlying return on CET1 capital of about 15%, with an underlying cost-to-income ratio below 70%.

The new targets would take UBS's return on CET1 capital above the 17% it achieved in 2022, the year before the Credit Suisse acquisition reshaped the group.

The bank reported a net profit of $1.2 billion for the fourth quarter compared with $770 million for the same period a year before. Analysts forecast net profit at $919 million, according to consensus estimates compiled by the bank.

Revenue was up 4% at $12.145 billion, against consensus expectations of $11.72 billion.

UBS said its core global wealth management unit brought in $8.5 billion in net new assets last quarter, with large outflows in the Americas offset by inflows elsewhere.

The bank said it expected a low single-digit percentage decline in first-quarter net interest income at its global wealth management unit, and the metric to be broadly stable in dollar terms in its personal-and-corporate banking business.

Market conditions remain largely constructive entering 2026, but continued geopolitical and economic-policy uncertainties mean sentiment can change quickly and trigger spikes in volatility, UBS said.

Write to Adria Calatayud at adria.calatayud@wsj.com

(END) Dow Jones Newswires

February 04, 2026 02:02 ET (07:02 GMT)