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UBS on a high after surge in fees

Katherine Griffiths
Tuesday 08 February 2005 20:02 EST
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A PICKUP in financial markets and healthy inflows from wealthy clients has propelled UBS to its best year.

The Swiss banking group yesterday reported an "extremely" good start to 2005, sending its shares to a six-year high. Fourth-quarter net profits beat forecasts by rising to 2.021bn Swiss francs (pounds 890m), boosting annual earnings to a record Sfr8.089bn, up 29 per cent from 2003.

Rising fee income from private clients, corporate finance and underwriting, as well as higher trading revenue offset the effects of the falling US dollar. Peter Wuffli, the chief executive, said: "We've set a high bar for 2005. Whether we can exceed it or not ... will also depend on the development of world markets."

A rebound in equities revenue helped the investment banking division post a bumper fourth quarter with pre-tax profits of Sfr1.229bn, up 72 per cent from the previous three months. Earnings for the full year rose to Sfr4.54bn, the highest since 2000.

The results promise healthy bonuses for UBS's 6,000 investment bankers in London. The bank said bonuses and other incentives across the group rose 17 per cent last year from 2003.

UBS said it had no plans for large takeovers and will buy back up to Sfr5bn worth of shares this year, its seventh share buy-back programme. It proposed raising its dividend to Sfr3 a share from Sfr2.60 in 2003.

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