UBS reported last week that the costs of the well-advertised expansion of its investment banking business, including prime brokerage, wiped out profits in the fourth quarter of last year.
The Swiss bank says that, despite the rising costs of fulfilling its ambitions, 2007 had started well and it raised the dividend paid to shareholders.
UBS endured a 47 per cent slump in net income during the fourth quarter, though it says underlying profit and revenue were exceeded expectations, with growth storming in both its investment banking and wealth management businesses.
Last year’s results were affected by income from the sale of three private banks and a hedge fund unit.
Fourth quarter net profit for the fourth quarter of last year was up by 19 per cent year-on-year to CHF 3.15 billion, with financial business rising 18 per cent to just over CHF 3 billion.
The bank has unveiled a new three-year share buy-back programme and is predicting continuing growth in emerging markets.
Investors have expressed concern about rising costs at UBS and shares in the company, and the share price dipped in the immediate aftermath of the results.