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(Bloomberg) -- The incoming US administration’s potential move to raise tariffs on trading partners could combine with conflicts around the globe to increase risk in financial markets next year, according to the chief executive of UBS Group AG.

“The acceleration of geopolitical events coupled with escalation on the macroeconomic fronts - tariffs, protectionism — it’s definitely something that has to be watched,” Sergio Ermotti said in a Bloomberg Television interview on the sidelines of Abu Dhabi Finance Week on Monday. “It’s still very uncertain, we’re going to see a lot of volatility in markets.”

As CEO of one of the world’s largest wealth managers, Ermotti said that he’s advising clients to be well diversified in the current environment and that he doesn’t see much risk appetite at the moment. For now, consumers and the economy and “still resilient” despite uncertainty around the economic and political outlook.

“I am relieved and surprised to see how all these geopolitical events haven’t really triggered any chain events and consequences also in financial markets,” Ermotti said. “Inflation seems to be under control for the time being, and potential deregulation in the US could foster M&A activity — that could be beneficial for markets and the economy.”

Ermotti also addressed the upcoming parliamentary report in Switzerland, UBS’s home market, on the causes of the collapse of Credit Suisse. UBS bought its former rival in an emergency takeover in March last year, though it is now facing sharply higher capital requirements on account of its increased size.

“We hope that the necessary transparency will be provided on the reasons that CS went down,” Ermotti said. “We do believe that it’s absolutely crucial to understand that before moving into any changes of regulation or any steps that could undermine the competitiveness of the financial center.”