UBS records its first quarterly profit since acquiring Credit Suisse

UBS Bank reported net income for the January-March period more than double estimates, recording its first quarterly profit since taking over rival Credit Suisse.

The group’s wealth management unit announced on Tuesday recording net new assets worth $27 billion for the first quarter of the year, compared to about $22 billion for the previous three months.

UBS also said it achieved additional cost savings of $1 billion in the first quarter, bringing the total savings achieved since the merger to $5 billion. The group aims to achieve another $1.5 billion in savings by the end of the year.

Net income attributable to shareholders in Switzerland’s largest banks amounted to $1.8 billion, which is better than the estimate presented by the company, which amounted to $602 million and profits of $1 billion in the same period of the previous year.

The merger between the two banks, which was managed by the Swiss authorities who feared the collapse of Credit Suisse after a series of scandals, took place last June. UBS incurred financial losses during the next two quarters due to the costs of absorbing the operations of its competitor.

UBS shares rose 40% over the past year.

With this merger, UBS’s balance sheet expanded to more than $1.6 trillion, nearly twice the size of the Swiss economy, alarming regulators who fear dire consequences if the bank gets into trouble.

The Swiss government recently put in place plans to monitor the performance of banks that it deems “too big to fail,” and it is expected to impose stricter capital rules over the next few years.