UBS private bank net inflows slowed in emerging markets in Q3

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UBS, the world’s largest private bank for the rich, said net inflows from wealthy clients in emerging markets slowed in the third quarter.

Bloomberg reports that net new money growth in the three months through September for UBS’s emerging markets division, defined as including Russia, eastern Europe, the Middle East, Africa and India, was 1.8%, down from 8.1% a year earlier, the bank reported Tuesday. Net inflows from clients in the Asia-Pacific division grew at less than half the pace of the prior-year period.

UBS is focusing on affluent clients in developing economies as government debt loads and a crackdown on offshore tax evasion cloud prospects in Europe. UBS ranked No. 1 globally by client assets by Scorpio Partnership, is also boosting business with ultra-wealthy families with at least $56m of investable assets.

The slowdown in net new money was primarily a result of 'deleveraging', with lower demand for Lombard loans, CFO Tom Naratil told investors and reporters on a conference call Tuesday. A Lombard loan is usually defined as credit granted against securities pledged as collateral.

UBS defines net new money growth as net client inflows over the quarter as a percentage of assets under management reported at the end of the previous quarter.

Customers became more cautious about borrowing and making transactions due to the debate over whether the Federal Reserve would reduce the pace of its monthly securities buying during the quarter, Naratil said.

To access the complete Bloomberg article hit the link below:

UBS Reports Slowdown in Emerging Market Wealth Inflows

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image: © Martin Abegglen

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