(AWP) Also the big bank UBS (UBSG 7,766 0.08%) is under the spell of the coronavirus crisis. So far, however, there have been no major disruptions to customer services, CFO Kirt Gardner said on Wednesday at a conference of the US investment bank Morgan Stanley (MS 30.75 -9%) in London.
In addition, large volumes were successfully managed in all areas, especially in retail.
At the same time, however, there was also a significant increase in margin calls, Gardner said. These are margin calls to investors for their commitments, which are called up by the banks or brokers.
You would see daily liquidity calls, Gardner said. So far, UBS had seen few losses in the Lombard loan portfolio.
No liquidity crisis feared
There was also a heavy burden on US dollar liquidity, which increased the stress for the banks. However, he does not expect a liquidity crisis for the industry due to the corona virus crisis, said the CFO.
The extent of the impact of the crisis on the economy as a whole cannot yet be estimated, Gardner said. The industry is meanwhile in exchange with the SNB (SNBN 4185 -1.06%). And for the companies that have been hit the most, he expects monetary authorities to take decisions on aid measures by the end of the week or at the latest over the weekend.
UBS sees itself as well capitalized to deal with a difficult stress scenario. The major bank will also continue to lend to individuals or businesses and support investments, Gardner said. “Financial services will be crucial to support the economy during this emerging public health crisis and because of the economic shock.”
Emissions market more or less too
The big bank had also been adapting well to the new circumstances. Following the example in Asia, where the spread of the coronavirus had started, the alternative was switched to: instead of physically advising customers face to face. It was put into IT and the business as a whole was not inhibited.
With regard to the business, he also said that UBS would continue to focus on lending, especially Lombard loans and mortgages. The demand will be there later in the year.
With regard to areas, he said that investment banking, which had to accept a massive drop in profits in 2019, had shown itself to be more resilient than the market at the start of 2020 and despite the crisis. Among other things, the bank is very satisfied with its pipeline for the primary market. However, this is currently more or less too. You have to wait for now.
GV takes place
The Annual General Meeting will take place on April 29 as planned. The event should be broadcast via live stream.
The industry event in London lasts three days. The (new) CEO Thomas Gottstein and his CFO David Mathers will speak on (tomorrow) Thursday.
You can find the complete history of UBS here. »
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