In April of last year, assets worth 3.6 billion euros flowed out of UBS's asset management, more than any other European fund house, according to a statistic from the fund analysis and rating service Morningstar, initially cited by the British newspaper «Financial Times» (paywall).

Forces of Integration

According to statistics, European clients withdrew 430 million euros from the Swiss bank's funds as early as March last year.

Morningstar analysts explicitly pointed to the forces of integration that the acquisition of Credit Suisse (CS) has brought to UBS's fund business.

Change in Leadership

In this context, there have also been fund name changes and closures, which can also statistically translate into outflows, as reported by finews.ch. Furthermore, according to the report, there have apparently been portfolio reallocations in the core Global Wealth Management (GWM) division, the most important client of UBS Asset Management.

As a result, UBS Asset Management must now live with the stigma of being the largest but the «worst-selling» provider in Europe, at least temporarily. This could further increase the pressure for changes: last March, Aleksandar Ivanovic replaced former fund head Sunni Harford and has since restructured the management team.

There were also reports in the media of a harsh cost-cutting measure of more than 300 million U.S. dollars.

Overall Positive

In the last quarter of 2023, around 12 billion dollars in client funds flowed out of UBS Asset Management, pre-tax profit was 5 percent lower than the previous year, while costs increased by a third.

However, in the first quarter of 2024, the division reported a 54 percent higher income of 776 million dollars and 21 billion dollars in new client funds. According to Morningstar, cumulative net inflows for the first four months of the year are also positive, with UBS recording inflows of 8.4 billion euros and CS Asset Management recording outflows of 5.8 billion euros.

The question is whether this is enough for some relief.