UBS Group says it plans to grow sales of banking products and lower its level of recruitment loans to advisors in the Americas.
The firm, which released its first-quarter earnings last week, said its overall net income rose 80% from a year ago to nearly $1.3 billion as the global bank and wealth-management firm saw clients add over $20.6 billion to their accounts worldwide.
Its wealth management business in the Americas increased its total operating income by 8% from last year to $2.05 million thanks to higher recurring net fee income, net interest income and transaction-based income. The group’s pretax profit soared 42% year over year to $302 million.
While by some measures the U.S.- and Latin America-based financial advisors continue to top the charts, its FA headcount is shrinking.
As of March 30, the group has 6,986 registered reps, down from 7,025 in December and 7,145 a year ago.
As CFO Kirt Gardner said on a conference call, “Last year, we introduced a new operating model in Wealth Management Americas, and we now focus more on increasing retention and productivity and are de-emphasizing recruiting.”
Gardner says that compared to rivals like Morgan Stanley, Wells Fargo and Bank of America, UBS has a lower level of sales of bank products. Part of the reason for this, he points out is that, these competitors serve as the “primary bank” for its wealth clients – a role that UBS does not have.
Going forward, the firm is “doing a number of things to address that,” he says, such as growing the number of loans to clients.