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UBS stops bleeding client money in Q3

Third-quarter net profit at UBS was 1.664 billion Swiss francs ($1.72 billion), the world's second-largest wealth manager said on Tuesday, beating a forecast of 1.225 billion francs.

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Switzerland's biggest bank UBS has stopped bleeding client money for the first time since early 2008, meeting a key turnaround goal earlier than anticipated, though investment banking reported a third-quarter loss.                                           

Third-quarter net profit at UBS was 1.664 billion Swiss francs ($1.72 billion), the world's second-largest wealth manager said on Tuesday, beating a forecast of 1.225 billion francs in a Reuters poll even as low trading activity in its foreign exchange and rates businesses ate up investment bank earnings.                         

UBS, which needed a government bailout in the credit crisis and was hit hard by a US tax probe, was able to attract 1.2 billion Swiss francs of new client money to its wealth management operations, though there were no net inflows into asset management.                                           

"We are optimistic that an uptick in the fourth quarter will benefit all of our business divisions. We remain confident about our future and believe that we are on track to achieve our medium-term goals," said chief executive Oswald Gruebel, who was dragged out of retirement to turn around the bank.                                            

The Swiss bank's capital position remained strong as it reported a Tier 1 ratio of 16.7%, against 16.4% at the end of the second quarter.                                           

UBS said at the end of last month it would need to keep dividends on hold for some time to meet new capital requirements without rising capital and avoid the need to raise fresh funds.
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