Figures published by the Swiss bank in a document alongside its second-quarter results on July 29 showed that net outflows in fixed income rose from Sfr3.8 billion in the first quarter of 2016 to Sfr4.4 billion in the latest three-month period. This marked the fourth quarter in a row of outflows and compared with Sfr2.4 billion in inflows a year ago.
Across equities, multi-asset and O’Connor, which likewise made it four quarters of outflows, a net Sfr2.9 billion was pulled, up from Sfr0.5 billion in the first quarter and compared with inflows of Sfr4.1 billion a year earlier.
That left the asset management division as a whole with Sfr7.7 billion of net outflows, excluding money market flows, over the quarter compared with Sfr9 billion in inflows a year earlier, which the bank attributed to asset allocation moves by investors.
UBS group chief executive officer Sergio Ermotti said on an earnings call: “Clearly, we are not immune to the challenges facing the active asset management industry, such as highly risk-averse clients and the continuing shift from active to passive.”
Management fees at the funds division were largely unchanged year on year at Sfr458 million in the second quarter, while performance fees of Sfr24 million rose from Sfr20 million a year earlier. This was despite the sale of UBS’s Alternative Fund Services business to Japan’s MUFG Investor Services in the fourth quarter of 2015.
Adjusted second-quarter pre-tax profits rose 10% from Sfr134 million to Sfr148 million.
Additional reporting by Vivek Ahuja