UBS CEO Sergio Ermotti warned on Tuesday that risk appetite remained low among clients after reporting weak client inflows.
The bank is focusing on its wealth management business and scaling back its trading activities significantly, shutting down its fixed income business.
"Clients' risk appetite is extremely low and interest rate margins are very low too. We need to see structural changes in [the] macro-economic environment to see more [client] activity and taking more risk," Ermotti told CNBC. He said the biggest risk to client activity were geopolitical events or a repeat of last year's U.S. fiscal cliff discussions which could continue to put pressure on margins.
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