UBS, the Zurich-based bank and wealth manager, reported a 4% drop in advisor headcount quarter-over-quarter in the Americas as it continues to see attrition in a competitive talent market and strong recruitment packages.
In its second-quarter earnings report Wednesday, UBS reported advisor headcount in the Americas at 5,773 and 9,473 globally, showing an overall 6% decline quarter-over-quarter. The firm is one of the few wealth managers that continues to report a quarterly advisor headcount.
The drop is not necessarily unexpected, having been forecast by Todd Tuckner, UBS’s chief financial officer, on prior calls when discussing the firm’s move to right-size compensation and improve profitability. However, the bank’s CFO and CEO Sergio Amotti stressed they are continuing to recruit actively and are seeing success in keeping many of their current advisors on through retirement thanks to a retention program put in place a few years ago.
Overall, net profits were up for the firm, hitting $2.4 billion in the second quarter compared to $1.1 billion in the same quarter last year. UBS attributed the rise partly to trading revenue from the bank managing volatile markets.
The global wealth division, the bank’s biggest business line, was up only slightly to $1.2 billion in the quarter compared to $1.16 billion in the comparable quarter.
In answering analyst questions on Wednesday, CEO Amotti said its wealth division in the Americas is supported by its various business lines and regional footprint, but that it’s “fair to say” the division is “not yet where we should be in terms of profitability.”
“But as you could see from the recent developments, we are tackling the issue,” he said. “We are convinced that in the medium-term, we will be able to achieve a double-digit mid-teens kind of return on pretax profit margins. And that being then a base to go to a higher end.”
Amotti also said, however, that it would be difficult for the bank to close the margin gap with peers, partly because they “are benefiting from ancillary activities around their wealth management business, which contributes to a higher margin.”
In the analyst Q&A period, CFO Tuckner attributed some of the advisor headcount decline to the second quarter, which is typically more active for financial advisor movement. He said UBS would continue pitching its shared banking services to advisors and its investments in technology.
“The availability of best-in-class CIO insight and joint teaming with the investment bank is giving us a competitive advantage,” he said.
The attrition numbers follow the heads of Raymond James and Ameriprise, saying on earnings calls that rich recruiting packages and advisory valuations, in part driven by private equity, are one reason for the competitive talent market.
UBS leadership has been on record within the past two years, citing interest in acquiring a U.S. wealth manager to expand its presence in the region. However, it noted that it first wanted to complete its integration of Credit Suisse. The bank continues working through that integration after agreeing to buy the failing bank in March 2023 and completing the merger in May 2024.
“The integration of Credit Suisse continues to be on track,” Vitaline Yeterian, an analyst at Morningstar DBRS, wrote in a note Wednesday. “The Group is in the process of migrating its CS client accounts, and the migration of accounts should be fully completed in the first quarter of 2026.” Yeterian called the results strong, but noted the regulatory issues the bank faces in Switzerland.
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