The loss helped drive a $554 million drop in revenue at the global markets business, overshadowing what would otherwise have been a surge from equity derivatives and cash equities. Even with the Archegos hit, UBS reported better-than-expected first quarter profit of $1.82 billion as wealth management income climbed.

Switzerland’s largest bank had remained quiet on the collapse of Bill Hwang’s family office for weeks, even as its biggest rival, Credit Suisse Group AG, unveiled a $5.5 billion hit and Japan’s Nomura Holdings Inc. also warned of steep losses. While Goldman Sachs Group Inc., JPMorgan Chase & Co. and Wells Fargo all managed to limit or avoid hits, Morgan Stanley was criticized by some investors and analysts for revealing a $911 million loss during its earnings.

UBS fell as much as 4% in early Zurich trading, leading European bank stocks lower.

The “Archegos losses have taken the shine of these results,” JPMorgan analysts Kian Abouhossein and Amit Ranjan wrote in a note.

The turmoil at Credit Suisse had afforded UBS Chief Executive Officer Ralph Hamers a period of relative calm, even as the bank fights a $4.5 billion penalty in France and the new CEO himself saw his short tenure complicated by a Dutch probe into his role in a money-laundering case at his former employer ING Groep NV. Hamers said UBS expects an additional $87 million trading loss in the second quarter from exiting its remaining Archegos exposure in April.

“We are all clearly disappointed and are taking this very seriously,” the CEO said. “A detailed review of our relevant risk management processes is underway and appropriate measures are being put in place to avoid such situations in the future.”

Hamers, speaking in a Bloomberg Television interview, said that the bank would be seeking more transparency from family offices and other big clients at the wealth management division, though there are no plans to cut back the prime brokerage business as Credit Suisse plans to do. Some lenders were blindsided by the positions that Hwang had accumulated before the meltdown.

The Archegos impact also overshadowed a strong quarter at the bank’s key wealth management business, where UBS benefited from higher average fee-generating assets and transaction fees, compensating for a decline in net interest income. The unit, led by Iqbal Khan and Tom Naratil, posted better-than-expected pretax profit of $1.41 billion, , the bank said in a statement on Tuesday. It gave a mixed outlook for the second quarter, warning of lower seasonal activity while saying higher asset prices should have a positive effect on recurring fee income.

Momentum continued with $36 billion in net inflows comprised of fee-generating assets. UBS has decided to no longer report the broader metric of net new money, which includes idle deposits and custody assets. The bank issued $11 billion in net new loans in the first quarter, following a year of $26 billion in issuance leading the bank to meet its target early.

Trading Impact

At the investment bank, the Archegos hit drove down equities revenue by 20%, though it would have gained 48% excluding the hit. Fixed income trading declined about 37%.

Hamers, six months into the job, is taking a deep look at where he can cut costs and digitalize operations, including in the high-touch business of serving the world’s wealthiest people. He wants to use artificial intelligence to target how to sell more products to the world’s wealthy and rethink what markets the bank operates in, with a heavy focus on Asia.

The implementation of new initiatives are expected to provide $1 billion in gross saving per year by 2023. The bank will also take a restructuring charge of $300 million in the second quarter related to their implementation.

As part of his digital plans, Hamers replaced the chief operating officer position with that of chief digital and information officer. UBS named Mike Dargan to that role, joining the group executive board on May 1, according to a separate statement. He has been head of group technology at the Zurich-based bank since joining in 2016.