UBS Wealth Management Americas reported that profits were up 17% year-over-year, boosted in part by record advisor productivity.
The Swiss-owned firm said profits rose to $254 million for the third quarter from $218 million for the same period a year ago.
Total revenue for the unit increased to $1.919 billion from $1.748 billion for the year-ago period, a 10% increase. At the same time expenses climbed 9%, rising to $1.664 billion from $1.531 billion. The single largest cost was financial advisor compensation, which grew 10%, increasing to $737 million from $667 million.
The rise in profits was due in part to growth in fee-based assets and advisor productivity. Recurring income grew to $1.473 billion from $1.329 billion, an 11% increase.
UBS' advisor ranks shrank by five from the previous quarter and 23 from the previous year to fall to 7,114. Meanwhile revenue per advisor grew 9% year-over-year, increasing to $1.079 million for the quarter from $994,000 for the year-ago period.
UBS' wirehouse rivals have also been increasing advisor productivity. Morgan Stanley said that revenue per advisor was $932,000 for the third quarter while Merrill Lynch reported $1.07 million per advisor for the same period. Unlike UBS and Morgan, Merrill has been growing its advisor force this year.
UBS said that client assets for the unit rose to $1.067 trillion from $969 billion, a 10% increase. UBS reported net new money of $4.9 billion for the quarter, an improvement after a loss of $2.5 billion for the previous quarter.
Companywide, UBS said profits rose 32%, reaching 762 million Swiss francs from 577 million francs. Total operating income from the Zurich-based company grew 10%, rising to 6.876 billion francs from 6.261 billion francs. Costs soared 26% due to litigation expenses, climbing to 7.430 billion francs from 5.906 francs.
"I am very pleased with our underlying performance for the quarter, which again demonstrates the strength of our franchise," said CEO Sergio Ermotti in a statement. "At the same time, we are actively addressing litigation and regulatory matters. Three years since introducing our strategy, the business is far stronger, its earnings power is much greater and our absolute and relative capital position speaks for itself. That gives us every confidence in our ability to deliver on our capital returns policy."
Earnings-per-share rose to 0.20 francs from 0.15 francs.
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