The tariff dispute, the trade war, and – last but not least – the prospect of new capital adequacy regulations: the list of uncertainties that UBS has to deal with is long.

This list does not even include the ongoing challenges associated with the continued integration of Credit Suisse. The migration of CS clients is expected to be finalized by year-end.

Investors Shift Portfolios

However, one aspect of the uncertainty and the associated higher volatility in particular is also driving the big bank's business. Activity has increased significantly, which is also reflected in fee income.

The uncertainty caused by the Trump administration has prompted investors to rebalance their portfolios, which has given the trading departments of global banks a boost in business.

UBS has already benefited from significantly higher client activity in the first quarter. This trend has continued since early April, at the start of the second quarter, following U.S. President Trump's intensified back-and-forth over the tariff dispute.

High Volatility

«We experienced a huge short-term increase in client activity and volatility in the first few days of April,» said UBS CEO Sergio Ermotti in a conference call on Wednesday. The volume was 30 percent higher than at the height of the pandemic. «That was quite extraordinary.» The environment has since returned to normal. However, he expects volatility to remain high, with swings on the markets both upwards and downwards.

Uncertainty Has a Price

For companies, and therefore also for their banks, the uncertainties also mean serious problems. The UBS boss warned that growing concerns over trade policy could lead to companies postponing investments and fees for business deals falling.

«It will depend on developments on the customs front,» Ermotti continued. «Uncertainty has a price. Investors and companies could scale back their investment plans.»

Fact-Based Decision

With regard to regulation and the discussion about capital adequacy requirements that will soon begin, Ermotti took a wait-and-see approach.

«It is very important that any decision is made on the basis of facts and not on the basis of myths or other ideological issues,» he said. «The consequences of these changes are far more significant for the competitiveness not just of UBS, but of the Swiss financial center as a whole», he reiterated, restating his well-known position.

The outcome of the political process is uncertain and here, too, «a long period of uncertainty will come at a cost.»

Ermotti wants to remain pragmatic and not speculate about possible outcomes at the end of the process. The priority is integration and that UBS is there for its clients and offers good services. «We will focus on what lies within our own control.»

By Wednesday afternoon, the UBS share had lost some of its initial gains and was trading at 25.02 francs (+0.2 percent).