UBS won’t return to a policy of more risk to boost its share price, said Axel Weber. Asset management however will remain an integral part of its business, the chairman of the bank added.
Edith Piaf’s famous «Non, je ne regrette rien» probably is a fairly accurate description of what UBS Chairman Axel Weber told «NZZ» newspaper in an interview after yesterday’s annual general meeting: No, there’s nothing the management of the bank wants to change. The strategy in France is in the interest of shareholders. Bonus payments: we have a good compensation system. The performance of the executive: we shouldn’t just take the share price as a measure of success.
Dashed Hopes
Apart from the strategy employed to avoid paying a huge fine in France, shareholders seem also increasingly unhappy about the share price, which has barely budged for years. The refusal to back the leaders of the bank in yesterday’s confidence vote was clear enough.
The share price plunged during the financial crisis and UBS’s decision to seek the help of the Swiss government. Since then, the price of the stock has fluctuated roughly between 10 and 20 francs and last year for instance it fell significantly. Hopes that the bank may return to a more active business strategy were dashed however: «Growth, boosted through an increase in risks and by expanding our balance isn’t and won’t be what we’re looking for,» he told the newspaper.
Asset Management Set to Stay
Weber didn’t say much about the rumors that Switzerland’s largest bank may sell or merge its asset management with that of a rival bank, apart from: «Asset management is a key unit of UBS and we believe that this business model belongs to UBS.»
Whether this comment excludes the option to work more closely with a rival, remains to be seen.
