For nearly 24 months now UBS Wealth Management has been on a winning streak. Recruiting was uniquely robust in 2021 and 2022 and the fruits of that labor is finding itself onto the balance sheet of the bank.
While top line headcount ticked just a bit lower, executives described the move to be associated with call center reductions and departures; not advisors.
During a recent conference call with analysts, UBS executives revealed that the company’s call centers had been hit particularly hard by employee departures. They suggested that many of the employees who left had been with the firm for a long time and had accumulated a wealth of knowledge and experience.
UBS is not the only financial services firm to experience a decline in headcount in recent years. Many banks and investment firms have been cutting jobs as they seek to reduce costs and adapt to changing market conditions.
However, UBS executives say they remain committed to providing high-quality service to their clients despite the challenges posed by staff reductions.
The bank’s chief financial officer, Kirt Gardner, mentioned during an earnings call on Tuesday that the firm’s call centers experienced high attrition rates during the pandemic. This resulted in a reduction of about 1,000 employees, or 2.5% of the bank’s workforce, he added.
Gardner also stated that the bank has been increasing its investments in digital channels and automation in order to enhance the client experience and reduce costs.
UBS has been working on reducing costs as it seeks to boost profitability, and the bank’s CEO, Ralph Hamers, announced in January that UBS will aim to cut $1 billion in costs over the next three years.
The bank’s Wealth Management Americas unit saw a decrease of 137 advisors in the first quarter of 2021, resulting in a total of 6,628 financial advisors, according to UBS’s earnings release on Tuesday. However, the bank’s overall wealth management business experienced a net increase of 40 advisors during the quarter.
UBS’s global wealth management business reported $19.7 billion in net new assets for the quarter, a figure that beat analysts’ estimates by almost $2 billion.
The global unit reported total revenues at $4.79 billion, which fell short of analysts’ prediction of $4.9 billion, according to a Bloomberg report. The net income figure of $1.03 billion for the global unit also fell short of expectations of $1.86. On Tuesday, the company’s shares had dropped by mid-morning almost 3% from the market open price to $19, according to Yahoo Finance.