GENEVA (AP) - Switzerland's biggest bank UBS AG posted a US$1 billion (S$1.23 billion) net profit in the first quarter on Tuesday lifted by strong showings from its investment bank and management for wealthy clients.
The results posted by the bank, based in Zurich, were down 4.5 per cent from the comparable period a year ago. Still, it was a major turnaround from the US$2 billion loss the bank posted for the fourth quarter of 2012 in the wake of a series of lawsuits, scandals and a wave of restructuring.
"While it is too early to declare victory, we have shown our business model works in practice," Chief Executive Sergio Ermotti said.
"Although markets improved, we still saw challenges, so I am very pleased with our performance."
Mr Ermotti said the bank's capital cushion as demanded by global and Swiss regulations rose to 10 per cent "and our leading capital cushion continues to be a competitive advantage for the bank."
In the first quarter, the investment bank saw a profit of 977 million francs (S$1.28 billion) before taxes and the wealth management arm posted a profit 664 million francs before taxes.
UBS offered a cautionary outlook on the rest of the year, due mainly to Europe's continuing problems.
"While market participants showed renewed interest early in the first quarter, events in Europe served as a reminder that many of the underlying challenges related to structural issues remain unsolved," the bank said.
"The absence of further sustained and credible improvements to the eurozone sovereign debt situation," it said.
"European banking system issues, ongoing geopolitical risks, and the outlook for growth in the global economy together with an increasing focus on unresolved US fiscal issues would continue to exert a strong influence on client confidence, and thus activity levels, in the second quarter of 2013."