UBS (UBS) said its third-quarter profits rose 32% year over year to 762 million Swiss francs (CHF), or CHF 0.20 per share, vs. CHF 577 million, or CHF 0.15 per share, a year ago. (In dollars, this represents a jump to roughly $805 million vs. $609 million in Q3’13.)
Revenue grew roughly 10% to CHF 6.9 billion (or $7.3 billion) from CHF 6.3 billion (or $6.7 billion) in the year-ago period.
The Swiss-based bank noted that these result included net charges of more than CHF 1.8 billion tied to provisions for litigation, regulatory and related, as well as a net tax benefit of CHF 1.3 billion.
“I am very pleased with our underlying performance for the quarter, which again demonstrates the strength of our franchise. At the same time, we are actively addressing litigation and regulatory matters,” said UBS Group CEO Sergio Ermotti, in a press release.
“Three years since introducing our strategy, the business is far stronger, its earnings power is much greater and our absolute and relative capital position speaks for itself,” Ermotti explained. That gives us every confidence in our ability to deliver on our capital returns policy.”
UBS said that its advisors in Europe, Asia-Pacific and other regions outside the Americas had total sales of CHF 2.03 billion, or $2.15 billion, up 11% from a year ago. Net income for the group was CHF 707 million, or $747 million, a 27% from a year ago.
There are 4,286 advisors outside the Americas, and they brought in CHF 9.8 billion (or $10.4 billion) in net new client assets vs. CHF 10.7 billion last quarter and CHF 5 billion in the year-ago period.
In the Americas, total sales in Q3’14 were $1.92 billion, up 10% from a year ago. Profits improved about 17% year over year to $254 million — about one-third of what they were outside the Americas.
In the United States, Canada and Latin America, UBS’ operations included 7,114 financial advisors, down five from the prior quarter and down 23 from a year ago.
The Americas reps brought in $4.8 billion in net new assets vs. outflows of $2.5 billion last quarter and inflows of $2.1 billion in Q3’13. Including interest and dividend income (which some rival wirehouses report), the group had new assets of about $10.5 billion, vs, $3.2 billion in the prior quarter and $7.5 billion in Q3’13.
“The business’ annualized net new money growth rate was slightly below the target range,” UBS said in its third-quarter report.
Yearly revenue per advisor in the Americas (or average annual fees and commissions) stands at $1,079,000, up 1% from $1,068,000 in 2Q’14 and up 9% from $994,000 in 3Q’13.
Invested assets per FA are currently $143 million, unchanged from the prior quarter and 11% higher than a year ago.
Bank of America-Merrill Lynch (BAC) said recently that its advisors have average yearly production of $1,077,000, while Morgan Stanley (MS) reported that its FAs are averaging about $932,000 per annum on average client assets of $124 million. (This is the second quarter during which UBS Americas’ advisors topped those of Merrill, and Morgan Stanley, in average production.)
Total client assets for the UBS Americas’ wealth unit are $1.067 trillion, down 1% for the quarter but up 10% year over year. Invested assets total $1.016 trillion.
The group says that loans extended to advisors as part of recruiting deals is about $3 billion, while other loans to advisors total $388 million. These figures were roughly flat compared with the prior period.
“Managed account assets increased by $2 billion to $338 billion and comprised 33% of total invested assets as of Sept. 20, 2014, unchanged from June 20, 2014,” the company explained.