What You Need to Know
- The bank's wealth management business in the Americas had a 23% year-over-year jump in pretax profits to $487 million
- Its advisor headcount of 6,335 represents a decline of 161 from a year ago but a gain of 30 from year-end.
- Like rival Morgan Stanley, UBS took a hit from the default of the investment firm Archegos.
UBS says its wealth management business in the Americas had a 23% year-over-year jump in pretax profits to $487 million for the first quarter of 2021, thanks to strong growth across advisory, lending, structured products and alternative investments.
Net new fee-generating assets in the Americas totaled $17.2 billion as of March 31, and invested assets in UBS Americas’ wealth unit hit $1.6 trillion in the latest period, up from $1.2 trillion a year ago but flat versus the fourth quarter.
UBS is no longer reporting net new money for its Global Wealth Management business, or the business unit’s regions worldwide, in its quarterly reports. Full-year flows will continue to be included in its annual reports.
The number of wealth advisors in the Americas declined by 161 from last year’s 6,496 to 6,335. But the Q1 figure was up 30 from 6,305 advisors as of Dec. 31, 2020.
Meanwhile, Q1 revenue per advisor grew 9% from a year ago to $1.6 million.
“It was a quarter in which our clients continued to put their trust in us for advice, for solutions, for thought leadership, and our results show the strength of our business,” UBS Group CEO Ralph Hamers said in a brief earnings video posted on the firm’s website.
Archegos Default Damage
During the first quarter, UBS took a hit tied to the troubled investment firm Archegos Capital Management and reported an unexpected $774 million loss for the period overall.
The UBS Q1 results factored in a trading loss “in relation to the default of a single prime brokerage client,” Hamers said, without referring to Archegos by name. “We’re taking this very seriously, with appropriate measures,” he said.