Banking Earnings Roundup: UBS Posts Net Loss, Deutsche Bank Ahead of Expectations

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on Oct 30, 2012

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Banking Earnings Roundup: UBS Posts Net Loss, Deutsche Bank Ahead of Expectations

Switzerland’s biggest bank UBS AG (NYSE:UBS) released its third quarter results this morning (Oct 30), reporting a massive net loss of 2.2 billion francs (£1.5 billion) attributable to shareholders. The bank plans to cut about 10,000 jobs and retreat from capital-intensive trading to boost profitability. The British bank Standard Chartered (LON:STAN), which also published its interim statement for the third quarter today, reported that its operating profit for the nine months ended September 30 grew by a “mid single digit” rate. The quarterly results of Deutsche Bank (NYSE:DB) were the most positive, with the bank’s net income surpassing analysts’ expectations.

**UBS Posts a Net Loss of 2.2 Billion Francs**
In a press release, the Swiss UBS reported a 2.2 billion francs net loss attributable to shareholders in the third quarter, compared to a profit of 425 million francs in the second quarter. Bloomberg reports that for the same period in 2011, UBS posted a profit of 1.02 billion francs.
Commenting on the third-quarter results, UBS CEO Sergio Ermotti pointed out that the bank was “now able to take further decisive action to transform the firm and position it for future success.” Bloomberg reports that UBS plans to save about 3.4 billion Swiss francs in additional annual costs by the end of 2015 by means of reducing headcount to about 54,000. In addition, the Swiss bank plans a reorganisation which will result in restructuring charges of 3.3 billion francs over the next three years.

**Standard Chartered’s Operating Profit Grows by Less Than 10 Percent**
The British Standard Chartered reported that its revenue for the first nine months of 2012 grew at a “high single digit rate, maintaining the trajectory seen in the first half.” The London-based bank, which was fined $340 million for helping Iranian clients launder money, is aiming at a ninth consecutive year of record net income. “Standard Chartered has continued to perform strongly in the third quarter of 2012,” noted Peter Sands, Standard Chartered’s CEO in a company press release. “Although the environment remains turbulent, we are in the right markets and continue to see good momentum across our businesses and geographies.” The “geographies” in question include emerging markets, with BusinessWeek reporting that the British bank is expanding in Africa, India and China where the economies are outpacing Europe and the US in terms of growth.

**Deutsche Bank Reports Third-Quarter Profit Growth**
!m[](/uploads/story/667/thumbs/pic1_inline.png)Deutsche Bank in turn reported that in the third-quarter of 2012, net income attributable to shareholders grew to €747 million (£601 million), relative to a profit of €725 million reported a year earlier. On a per share basis, quarterly earnings were €0.78, higher than €0.74 in the previous year. “In the third quarter, we delivered a strong operating result which was supported by an improvement in market conditions,” said Deutsche Bank in a statement, adding that it would maintain a cautious approach in the near term due to the uncertain macroeconomic environment. The results beat expectations, with Bloomberg reporting that analysts had forecast a 22 percent drop.