(Bloomberg) -- UBS Group AG was expecting one of the worst quarters in recent history due to the turmoil in global markets. But those very swings also played a key role in buttressing its results.
Rich Asians, daunted by the prospect of portfolio losses, gave up more trading control to their wealth managers. The rise in so-called investment mandates, where clients hand over lump sums and let the bank manage the money for a fee, proved far more lucrative than having customers pay per trade.
“Market volatility and the outperformance of managed solutions are driving the adoption of investment mandates among UBS private clients,” said Amy Lo, co-head of wealth management for Asia Pacific. Wealthy clients in the region accounted for almost three-quarters of new money last quarter, helping offset a plunge in investment banking revenue.
Asia-Pacific flows into wealth management were an unprecedented $16 billion, while invested assets at the division grew to a record $405 billion in the quarter, according to a company presentation on Thursday.
UBS is now starting to merge its U.S. wealth-management unit and investment bank to capture more activity from the ultra-rich.
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