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UBS' new financial targets aren't likely to enthuse investors. The Swiss bank's room to maneuver has become very limited. finews.com looks at how UBS has lowered its sights.

Juerg Zeltner, until last month the long-standing head of UBS' flagship wealth unit, made headlines last year with an unusual call: stop bringing the bank fresh money, unless you plan to put it to work.

While the Swiss bank has posted perfectly respectable results, Zeltner's words are reflected in the earnings but also in lowered targets: UBS can only eke out growth steps. Bake in the rising cost of compliance and regulation to the equation and higher profits can only be wrung out with constant cost cuts. Ultimately, UBS will have to spend dramatically more on technology and its infrastructure.

finews.com parses UBS' new straitjacketed reality:

1. Damp Squib Goals

UBS' first financial targets in four years illustrate how the bank is lowering its sights: less new money in its showcase private bank, and a lower net interest margin in its heavyweight Swiss business, as finews.com reported separately.

2. Mega-Merger

The combination of its flagship private bank with a U.S. brokerage for a combined 2.3 billion Swiss franc in assets is ultimately a reaction to the wealth business' hasher climate. The new super-unit will allow UBS to eke out more spending cuts, in the hope of at least protecting its net margins.

Bringing the U.S. business onto a unified wealth management platform it launched in the rest of the world would bolster savings considerably for UBS. The bank wants to do so, according to several insiders, but has few illusions that it could be done quickly or efficiently due to the fundamentally different nature of the U.S. private bank.

3. Every Last Drop

With growth prospects slim, UBS is looking everywhere for ways to pad its revenue. It began charging some clients to hold euros, as finews.com reported exclusively, and lifted fees in its Swiss business for credit card and foreign exchange transactions. The measures illustrate how UBS is prepared to test the price sensitivity of its clients for a revenue fillip – successfully.

4. Tech Savings

To be sure, UBS is also splashing out a cool 1 billion francs for technology over the next three years – a massive commitment that runs counter to spending cuts. Or does it? UBS is putting at least 10 percent of annual revenue towards these types of investments, both to offer clients a smoother ride – but also to make UBS faster, more effective, and cheaper in the long run.