By Christine Chen and Scott Murdoch
SYDNEY, Nov 9 (Reuters) – UBS Chief Executive Sergio Ermotti said on Monday a sharp correction in AI stocks over the last few weeks had been a reaction to excessively high hopes that investors had had for the sector.
Speaking at a UBS conference in Sydney, Ermotti said recent US midterm election results and the global debate about the implications of building up infrastructure could lead to delays in the AI sector delivering outcomes.
“And the market until very recently — of course in the last few weeks we saw some correction — has been pricing perfection.”
Ermotti said while he was optimistic AI development would generate positive economic outcomes, that he personally believed “the timing on how quickly we will get there, it’s a little bit exaggerated.”
Trillions of dollars of world stock market value were wiped out last week over fears that Democratic election victories would bring tighter US regulations for the AI industry, though Wall Street equities mostly rallied on Friday.
Ermotti added that some aspects of UBS’ own implementation of AI into its operations had been “slowed down” by the integration of Credit Suisse, which it agreed to acquire in a Swiss government-brokered rescue in 2023.
The collapse of Credit Suisse has also left UBS facing the prospect of tougher regulation in Switzerland, and the Zurich-based lender is assessing the long-term consequences of proposed new capital requirements for its ability to compete from its Swiss base.
On Monday, he described the country’s response to the situation as “extremely emotional” and “idiosyncratic”, contrasting it to authorities in the US and Europe that he said recognised the unintended consequences of over-regulation.
(Reporting by Christine Chen and Scott Murdoch in Sydney; Editing by Edwina Gibbs)
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