UBS Group AG has decided to exit $5 billion in assets it manages for rich customers as it sorts out the pieces of Credit Suisse it doesn’t want.
The lender moved the assets from its wealth management division to its wind-down unit during the third quarter, it said in its quarterly report published Tuesday. In addition, it reclassified $30 billion worth of assets in the wealth unit as “related to non-strategic relationships.”
UBS has been going through Credit Suisse’s clients and their assets since closing the emergency takeover of the smaller rival in June as it seeks to ensure the acquired businesses conform with its more conservative risk approach. The lender has already said it plans to cut back Credit Suisse’s investment bank and put its bankers through a “culture filter” to weed out undesirable practices.
The assets shifted out of the wealth unit in the third quarter contributed to a 3% drop in invested assets at the division on the previous period, UBS said on Tuesday. The lender also said it has stabilized Credit Suisse’s wealth management business as the unit chalked up the first positive client flows in a year and half.
UBS’s newly created wind-down unit, known as non-core and legacy, widened its quarterly pretax loss to $1.93 billion in the quarter from $478 million in the previous period. That led UBS to its first quarterly loss in almost six years.
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