(Bloomberg) -- UBS Group AG shares rose the most in two months as analysts at BNP Paribas Exane recommended buying on expectations the Swiss lender will increase share buybacks.
The stock gained as much as 3.8% to be among the best performers in Europe on Friday, as Exane analysts including Jeremy Sigee lifted their rating to outperform from neutral.
Market concerns around the impact of a revision to Swiss capital rules are overplayed, according to Sigee. Uncertainty around the changes, expected in the first half of this year, has weighed on the shares, yet the release of capital from UBS’s foreign subsidiaries may “neutralize the most threatening element of the proposals,” he wrote in a note to clients.
While UBS is not expected to have the new capital rules in time for full-year results next month, it “may be able to give more clarity on capital release from foreign subsidiaries, which could give important reassurance to the market,” Sigee said.
Exane lifted its price target to 35 Swiss francs from 27.5, with its updated forecasts including bigger share buybacks. The stock changed hands for 28.76 francs in the latest trading on Friday.
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