UBS Chief Executive Ralph Hamers discovers an underwhelming solution to his U.S. wealth management stalemate.
- The Swiss bank will lend more to rich clients and seek new ones through a digital platform.
- The Dutchman’s plans anticipate UBS providing more mortgages and business loans to U.S. wealth customers through its existing network of financial advisers.
- Independently, Hamers is set to launch a mobile app to target affluent clients, those with assets valued at $250,000 to $2 million.
- The move should help boost margins in UBS’s least profitable businesses. The Americas division of the bank’s wealth management posted a 20% Q3 pre-tax profit margin, less than what the Swiss, European, and Asian units’ averages.
- That’s because U.S. financial advisers are remunerated based on market standards with hefty commissions for selling products like mutual funds.
Harmers’ plan to provide more banking products such as mortgages and bypass advisers fully through an online offering that could weaken their bargaining power.
UBSG up +0.31%