UBS Group AG: Second Quarter 2026 Interim Report Summary
Business Context and Reporting Period
This Form 6-K reports the unaudited interim consolidated financial results for UBS Group AG for the six-month period ended June 30, 2026, and the quarter ended June 30, 2026. Starting in 2026, UBS publishes semi-annual interim reports prepared in accordance with IAS 34, while quarterly reports for Q1 and Q3 follow UBS Group accounting policies consistent with IFRS but without full IAS 34 notes. The reporting period reflects the final phase of the integration of Credit Suisse, with the global migration of client accounts completed in March 2026.
Key Financial Metrics
| Metric (USD) | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 |
|---|---|---|---|---|
| Total Revenues | 13,700 m | 12,112 m | 27,943 m | 24,668 m |
| Operating Profit Before Tax | 3,594 m | 2,193 m | 7,434 m | 4,325 m |
| Net Profit Attributable to Shareholders | 2,800 m | 2,395 m | 5,840 m | 4,087 m |
| Diluted EPS | 0.87 | 0.72 | 1.81 | 1.23 |
| Return on Equity (ROE) | 12.3% | 10.9% | 12.8% | 9.4% |
| Cost/Income Ratio | 72.9% | 80.5% | 72.7% | 81.4% |
| Common Equity Tier 1 (CET1) Ratio | 14.4% | 14.4% | 14.4% | 14.4% |
| Liquidity Coverage Ratio (LCR) | 177.3% | 182.3% | 177.3% | 182.3% |
| Net Stable Funding Ratio (NSFR) | 115.1% | 122.4% | 115.1% | 122.4% |
Material Changes vs. Prior Period
- Revenue Growth: Total revenues increased 13% year-over-year (YoY) in Q2 2026, driven by a $874m increase in net fee and commission income and a $721m increase in combined net interest income and fair value income. Underlying revenues grew 14% YoY.
- Profitability: Operating profit before tax rose 64% YoY to $3.6bn. Underlying operating profit increased 38% YoY to $3.9bn, reflecting revenue growth and a $410m decrease in integration-related expenses and purchase price allocation (PPA) effects.
- Expense Management: Operating expenses increased 2% YoY to $10.0bn, primarily due to higher personnel expenses ($404m increase) driven by performance awards and financial advisor compensation. However, underlying expenses decreased by $639m YoY due to significant reductions in integration costs.
- Divisional Performance:
- Investment Bank: Operating profit surged 106% YoY to $1.2bn, driven by Global Markets (up 32%) and Global Banking (up 6%).
- Global Wealth Management: Operating profit increased 56% YoY to $1.9bn, supported by higher net interest income and fee income.
- Non-core and Legacy: Loss before tax narrowed to $203m from $250m, with an 88% reduction in underlying operating expenses compared to the 2022 baseline.
- Capital and Liquidity: CET1 capital decreased by $0.8bn to $72.5bn, primarily due to a new $3.0bn capital reserve for share repurchases. The CET1 ratio remained stable at 14.4%. LCR and NSFR remained well above regulatory requirements.
Guidance, Outlook, and Risks
- Integration Progress: UBS is on track to complete the integration of Credit Suisse by the end of 2026. Cumulative gross cost savings reached $12.6bn, with an ambition of $13.5bn by year-end. Over 90% of legacy IT applications are no longer in use.
- Capital Returns: UBS completed a $3bn share repurchase program in July 2026 and initiated a new program to repurchase up to $3bn by Q2 2027. The company plans to repurchase at least $1bn in the next three months, subject to maintaining a CET1 ratio of around 14%.
- Outlook: Management expects Global Wealth Management net interest income to increase modestly in Q3 2026. Personal & Corporate Banking net interest income is expected to be flat to slightly higher. Market conditions are described as broadly constructive but face uncertainty from geopolitical developments and volatile energy prices.
- Risks and Contingencies:
- Regulatory: Revisions to Swiss anti-money laundering laws take effect October 2026. Basel III implementation adjustments in the EU and UK are ongoing but expected to have limited direct impact.
- Litigation: UBS estimates future losses from litigation and regulatory matters (not covered by existing provisions) to be in the range of $0bn to $1.5bn. Significant matters include legacy Credit Suisse issues, Madoff-related claims, and foreign exchange/benchmark rate litigation.
- Geopolitical: Exposure to conflict zones (Middle East, Russia/Ukraine) remains limited, but macroeconomic uncertainty persists.
Key Facts for Investor Verification
- Share Repurchase Execution: Verify the pace and volume of the new $3bn share repurchase program and its impact on the CET1 capital ratio.
- Integration Cost Savings: Monitor the realization of the remaining $0.9bn in gross cost savings to reach the $13.5bn annualized target by year-end 2026.
- Non-core and Legacy Wind-down: Track the reduction of risk-weighted assets (RWA) in the Non-core and Legacy division, which has already achieved a 68% reduction since Q2 2023.
- Regulatory Capital Add-ons: Assess the impact of phased-in capital add-ons related to the Credit Suisse acquisition, estimated to add ~$6bn to Tier 1 capital requirements over the phase-in period ending 2030.
- Litigation Provisions: Review updates on specific litigation matters (e.g., Madoff, ATA, Credit Suisse financial disclosures) that could impact the $0-$1.5bn estimated loss range.