UBS Returns To Profit But Faces Higher Outflows By Clients (UBS)

Swiss Bank UBS AG (NYSE: UBS), which suffered huge losses during the credit crisis, has reported profit for the first time in more than a year. The company has recently reported results for the fourth-quarter However, it also reported that some of its wealthy clients accelerated the rate of withdrawals in the fourth-quarter.

The bank stock fall by as much as 4.3 percent in Swiss trading, on the back of news that net redemptions in its wealth management units stood at $42.3 billion (45.2 billion francs), up sharply from 26.6 billion francs in the previous quarter.

UBS earned a profit of 1.21 billion francs in the fourth-quarter. The last time UBS reported a profit was in the third-quarter of 2008. The return to profitability can be attributed to lower costs linked to company’s debt, and also a tax credit.

“All divisions are profitable, and now UBS needs to work on its image and reputation so that clients’ withdrawals reverse,” said Teresa Nielsen, an analyst at Vontobel Holding AG in Zurich who has a “buy” rating on UBS.