UBS has seen healthy client money inflows in its Asian business in the first quarter and expects those operations to grow at a faster pace than its units in other regions, the group's finance chief told Reuters on May 03. He also said that UBS's pipeline of merger and acquisition deals had trebled from the year-ago period, providing some hope for its investment banking unit which had burdened the bank's first-quarter results earlier on the day. "In wealth management, we've seen yet another good quarter in net new money growth coming out of Asia. It's a very good number again," Chief Financial Officer Clive Standish said in a telephone interview, without being more specific.
Swiss-based UBS beat expectations with a solid rise in first-quarter profits, but its shares sank as a drop in investment banking income made the world's largest wealth manager cautious for its full-year outlook.
"We are by nature reasonably cautious people," Standish said in the interview. But he said that the fact that its M&A pipeline had grown substantially boosted the position of its investment bank later in the year.
"Our pipeline has trebled compared to what it was this time last year. Converting that to completing transactions ... who knows? But the opportunities are therefore a lot bigger too." On its longer-term strategy in Asia, Standish said the bank was targeting such core markets as Taiwan, South Korea, Hong Kong and China. With market deregulation increasing and the emerging economies expected to outpace those in Europe, these business lines should also surpass UBS's other regions. UBS was also still confident on its European wealth management initiative, in which it is setting up branch offices in Germany, France, Italy, the United Kingdom and Spain to attract wealthy clients' money in their home regions.
"We've seen very strong growth, particularly in Germany and the United Kingdom. We would see that business continuing to expand (organically) and if there are opportunities for bolt-on acquisitions ... we would continue to do so," Standish said.
He also said UBS still expected these so-called on-shore banking operations - where it targets clients keen on opening a Swiss bank account but who do not want to take their assets abroad - to break even by 2006.
UBS took in 21.2 billion francs in net new money in its huge wealth management operations in the January-March period, up from 13.3 billion in the previous quarter, helped by strong inflows in Europe, Asia, as well as the United States.
UBS last year spent around 1 billion francs to boost its already world-leading private banking franchise, buying up smaller players in Europe and elsewhere.
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