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BANK

UBS surprises with high first quarter profit

Swiss big bank UBS has reported a net profit of 988 million francs in the first three months of the year, far more than analysts had expected.

UBS surprises with high first quarter profit
Analysts were surprised by the size of the profit. Photo: UBS

The bank returned to profit after recording big losses at the end of last year in connection with the Libor rate-fixing scandal.

In the final quarter of last year UBS lost 1.9 billion francs. For the year as a whole losses totaled 2.2 billion. This included a 1.4 billion franc fine related to the Libor scandal.

But profit from January to March was down 4.5 percent on the same period last year.

AFP said the result was higher than expected by analysts polled by Swiss agency AWP, which had predicted on average a net profit of 510 million Swiss francs.

UBS said in a statement the bank had strong results across all its businesses, with very strong results in the Investment Bank division, which UBS is currently restructuring.

Wealth management had delivered the highest levels of quarterly net new money since 2007 and the highest quarterly profit since 2009.

Commenting on the results, CEO Sergio Ermotti said, “While it is too early to declare victory, we have shown our business model works in practice.”

“Although markets improved, we still saw challenges, so I am very pleased with our performance.”

Rival bank Credit Suisse last week posted a net profit for the first quarter of 1.3 billion francs – up from 44 million francs in the same period of 2012. 

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BANK

Deutsche Bank to pay $130m to settle US bribery probes

Deutsche Bank will pay $130 million to settle a foreign bribery probe and fraud charges in precious metals trading, US officials announced on Friday.

Deutsche Bank to pay $130m to settle US bribery probes
A woman walks past the offices of Deutsche Bank in London. Photo: Tolga Akmen / AFP
The bribery case relates to illegal payments and to false reporting of those sums on the bank's books and records between 2009 and 2016, the Department of Justice said in a press release.
   
The bank “knowingly and wilfully” kept false records after employees conspired with a Saudi consultant to facilitate bribe payments of over $1 million to a decision maker, the DOJ said.
   
In another case, the bank paid more than $3 million “without invoices” to an Abu Dhabi consultant “who lacked qualifications… other than his family relationship with the client decision maker,” the DOJ said.
   
In addition to criminal fines and payments of ill-gotten gains, Deutsche Bank agreed to cooperate with government investigators under a three-year deferred prosecution agreement.
 
   
In the commodities fraud case, Deutsche Bank metals traders in New York, Singapore and London between 2008 and 2013 placed fake trade orders to profit by deceiving other market participants, the DOJ said.
   
The agreement took into account Deutsche Bank's cooperation with the probes, DOJ said.
   
“Deutsche Bank engaged in a criminal scheme to conceal payments to so-called consultants worldwide who served as conduits for bribes to foreign officials and others so that they could unfairly obtain and retain lucrative business projects,” said Acting US Attorney Seth D. DuCharme of the Eastern District of New York.
   
“This office will continue to hold responsible financial institutions that operate in the United States and engage in practices to facilitate criminal activity in order to increase their bottom line.”
   
“We take responsibility for these past actions, which took place between 2008 and 2017,” said Deutsche Bank spokesperson Dan Hunter, adding that the company has taken “significant remedial actions” including hiring staff and upgrading technology to address the shortcomings.
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