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In response to the global banking stress that led to Credit Suisse’s collapse in March 2023, Swiss authorities endorsed the acquisition by UBS. This move left UBS as the only global bank in Switzerland, significantly increasing its size relative to the country’s economy. The Swiss authorities are currently investigating the crisis to ensure UBS remains solvent. Critics and a government review have suggested that authorities bear some responsibility for the crisis.
The merger has had financial implications for UBS as well. The bank reported its first post-merger quarterly loss due to $2.2 billion in takeover-related costs, resulting in a shareholder net loss of $785 million. Despite this setback, UBS shares have rebounded with a six-month trading gain of 26%. TipRanks has given the stock a Moderate Buy rating, predicting an average price of $30.58.
To ensure proper oversight, unnamed third parties will monitor the integration process between UBS and Credit Suisse. However, UBS declined to comment on FINMA’s supervision and the ongoing integration process.
UBS Group AG (SIX:UBSG) has been under a microscope following its merger with Credit Suisse, but there are reasons for investors to remain optimistic. According to InvestingPro, the management has been actively buying back shares, indicating their confidence in the company’s value. Moreover, despite a turbulent period, UBS has maintained its dividend payments for 12 consecutive years, providing a steady return for its stockholders.
On the real-time data front, UBS boasts a market capitalization of $79,756.09M USD, reflecting its significant presence in the global banking sector. The company’s price to earnings (P/E) ratio stands at a low 2.49, suggesting it is undervalued compared to its earnings. Furthermore, the company has experienced a considerable price uptick over the last six months, with a total return of 29.07%, exceeding the performance of many peers in the industry.
InvestingPro offers additional tips and insights for UBS and other companies. With over ten additional tips for UBS alone, investors can gain a comprehensive understanding of the company’s performance and potential risks.
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