UBS’s ratings are driven by the resilience of the group’s business model which is centered on its strong global wealth management franchise and its position as a leading universal bank in its home market of Switzerland. Asset management and focused investment banking activities further support and complement the overall business offering. Under various operating conditions, the group’s businesses have demonstrated their ability to generate solid earnings. To address ongoing market volatility and the challenging revenue environment, UBS is pursuing tactical cost measures.

While the wealth management industry faces challenges such as margin compression, changing customer needs and increasing regulation, the group’s strong franchise and long-term focus means that the business continues to grow profitably. Efforts to enhance the client experience and improve efficiency as well as an active client segment strategy should help UBS mitigate industry headwinds.

Management remains committed to sustaining the group’s balance sheet strength, ensuring that UBS is well-positioned against relatively demanding Swiss too-big-to-fail requirements which are applicable from 1 January 2020. Ongoing litigation and regulatory costs remain a risk – not only in terms of financial impact but also in terms of reputational damage.

Download the updated issuer rating report.