Ubs Group Ag · SIX:UBSG
Ubs — UBS AG (Amna, Amnd, Amtr, Amub, BDCX, BDCZ, Cefd, DJCB, Esus, Fedl, HDLB, Ifed, Iwdl, Iwfl, Iwml, Mlpb) — Q4 2009 Earnings Presentation
29 slides from Ubs's earnings presentation, Feb 9, 2010
Slide 1: Fourth Quarter 2009 Results
Fourth Quarter 2009 Results February 9, 2010
Slide 2: Cautionary statement regarding forward-looking statements
Cautionary statement regarding forward-looking statements This presentation contains statements that constitute "forward-looking statements," including but not limited to management's outlook for UBS's financial performance and statements relating to the anticipated effect of transactions and strate
Slide 3: FY 2009: a transformative year for UBS
FY 2009: a transformative year for UBS Profitable Well capitalized Clear strategic direction Tier 1 capital ratio increased to 15.4% from 11.0% a year ago FINMA leverage ratio improved to 3.9% from 2.5% a year ago Total assets reduced by 33% and risk-weighted assets by 32% in 2009 Net profit of CHF
Slide 4: 4Q09 overview
4Q09 overview Net profit of CHF 1.2 billion and diluted EPS of CHF 0.31 Positive operating performance across all business divisions Disappointing net new money outflows Invested assets broadly stable at CHF 2.2 trillion Tier 1 capital ratio of 15.4% Balance sheet down 9% Costs down significantly Ac
Slide 5: 4Q09 - performance by division
4Q09 - performance by division (CHF million) WM&SB WMA Global AM IB CC UBS Income 2,778 1,394 537 2,191 (698) 6,202 Credit loss (expense) / recovery (9) 1 (70) (83) Own credit (24) (24) Total operating income 2,769 1,395 537 2,097 (703) 6,095 Personnel expenses 1,059 946 139 1,020 160 3,323 Non-pers
Slide 6: 2009 pre-tax results - reported versus adjusted
2009 pre-tax results - reported versus adjusted (2,561) (2,023) (1,403) (791) 297 1,359 3,920 As reported Adjusted Own credit Pactual Restructuring MCNs 2009 Group pre-tax profit from continuing operations Adjustments 4,234 220 668 (3,485) (276) CC IB WM&SB WMA Global AM (CHF million)
Slide 7: Revenues
Revenues (CHF million) 1Q09 2Q09 3Q09 4Q09 CHF 5.7 billion quarterly run-rate from stable sources of revenues - net fee and commission income and income from interest margin businesses 4,241 4,502 4,530 4,438 1,321 1,302 1,201 1,229 (1,291) 1,006 1,640 1,049 699 (1,040) (1,605) (621) Fee and commiss
Slide 8: Operating expenses - 4Q09 versus 3Q09
Operating expenses - 4Q09 versus 3Q09 (1,355) 178 6,359 5,183 1,859 3,323 4,678 1,681 (18%) Personnel expenses fell on increased proportion of deferred variable compensation for 2009 Non-personnel expenses increased from prior quarter on higher provisions, professional fees and other G&A expenses 3Q
Slide 9: Operating expenses - 2009 versus 2008
Operating expenses - 2009 versus 2008 (CHF billion) 14.1 9.3 23.4 1.7 3.5 28.6 Significant items1 Personnel expenses - variable Non-personnel expenses Personnel expenses excl. variable 13.0 7.2 20.2 3.0 1.9 25.2 1 Significant items include restructuring charges (2008/2009), Pactual divestment relate
Slide 10: Headcount 2009 development
Headcount 2009 development Headcount reduced by 3,790 during 4Q09 Full year headcount reduction of 12,550: ~9,900: re-sizing ~600: sale of UBS Pactual ~500: sale of branches to Stifel ~1,600: sale of India Service Centre Achieved 2010 target of ~65,000 (FTE) 4Q09 development (FTE) (1,153) (752) (56)
Slide 11: Wealth Management & Swiss Bank
Wealth Management & Swiss Bank Performance in 4Q09 continued cost reductions more than offset decline in revenues revenues slightly declined from prior quarter driven by property fund valuation impact of CHF 88 million in 4Q, partly offset by lower internal interest charges Continuing interest margi
Slide 12: WM&SB - Invested assets
WM&SB - Invested assets 4Q09 4Q09 NNM outflows affected by Italian tax amnesty, CHF 8.5 billion Pactual divestment-related withdrawals, CHF 3.2 billion NNM outflows also reflect Client advisor attrition Concerns about Swiss banking secrecy Seasonal effects Positive net new money in Asia Pacific regi
Slide 13: WM&SB - Net new money
WM&SB - Net new money (CHF billion) Italian Tax Amnesty Related to Pactual divestment Exit businesses Client advisor attrition Concerns about banking secrecy Consumption Deleveraging Diversification Reputation Outflows related to client advisor attrition slowing, but will continue to be a drag in th
Slide 14: WM&SB - International clients
WM&SB - International clients Hiring initiatives under way, but 1Q10 still expected to show slight net reduction in number of client advisors Client advisors at 3,182 down 25% from 2008 Invested assets per CA has gradually increased as the number of advisors has fallen 2009 year-end: 196m 2008 avera
Slide 15: Wealth Management Americas
Wealth Management Americas New leadership in place with some additional key positions filled in January Improved profitability in 4Q09, but contribution from some one-off items and lower performance-related personnel expenses Financial advisors at 7,084 down 3% from 3Q and 18% from 2008 including di
Slide 16: Global Asset Management
Global Asset Management Operating income Pre-tax profit 1Q09 2Q09 (CHF million) 4Q09 3Q09 Invested assets 2009 575 68 583 (25) (46) 11 Dec 08 NNM Market FX / Other Divest. Dec 09 +8 bn or 1% (CHF billion) 502 530 567 537 (59) 82 130 284 Improved profitability in 4Q09 reflecting lower personnel expen
Slide 17: Investment Bank
Investment Bank Pre-tax profit Pre-tax profit of CHF 0.3 billion Operating expenses at CHF 1.8 billion are CHF 0.7 billion lower than previous quarter Decrease in personnel expenses reflects increased proportion of deferred performance awards Balance sheet reduced by further 11% to CHF 992 billion (
Slide 18: Investment Bank revenues
Investment Bank revenues Equities revenues 3Q09 4Q09 948 (18%) FICC revenues 3Q09 4Q09 496 IBD revenues 3Q09 4Q09 698 746 7% (CHF million) (CHF million) (CHF million) Own credit losses of CHF 24 million include the effect of reallocation to Corporate Center Further decrease in credit loss expense Eq
Slide 19: Capital position
Capital position Tier 1 capital ratio 15.4% Core Tier 1 capital ratio 11.9% 32% reduction in risk- weighted assets during 2009 to CHF 207 billion FINMA leverage ratio improved to 3.9% from 3.5% prior quarter and 2.5% a year ago 4Q08 1Q09 2Q09 25.8 21.5 25.2 24.2 24.6 7.4 7.7 7.4 7.4 7.2 33.2 29.2 32
Slide 20: Total assets development
Total assets development (33%) 2,542 2,015 1,341 398 450 408 216 348 775 261 312 958 100 51 66 501 854 335 Lending Collateral trading Trading portfolio Other assets Positive replacement values 4Q08 4Q09 2Q07 (CHF billion) Total assets reduced by further 9% in 4Q09 During full year 2009: Total assets
Slide 21: UBS
2 UBS
Slide 22: Appendix
Appendix
Slide 23: Performance by division - Full Year
Performance by division - Full Year (CHF million) WM&SB WMA AM IB CC UBS Income 11,523 5,546 2,137 6,856 394 26,456 Credit loss (expense) / recovery (133) 3 0 (1,698) (5) (1,832) Own credit (2,023) (2,023) Operating income 11,390 5,550 2,137 3,135 389 22,601 Personnel expenses 5,197 4,231 996 5,568
Slide 24: WM&SB - Pro-forma results under new structure
WM&SB - Pro-forma1 results under new structure 2009 Pro-forma1 results 11.4 4.2 7.6 3.8 2.7 1.5 Retail & Corporate Wealth Management Operating income Profit before tax 1 Pro forma / preliminary estimates, based on new reporting structure effective 1.1.2010. Profit before tax excludes restructuring c
Slide 25: Tier 1 capital
Tier 1 capital BIS RWA Tier 1 ratio Total capital Total ratio Regulatory capital CHF billion 30.9.09 Net P&L attributable to shareholders MCN2 impact Own shares Other Risk reduction Impacts on Tier 2 capital 31.12.09 31.6 1.2 (0.3) (0.5) (0.2) 31.8 211 (4) 207 15.0% 15.4% 19.4% 19.8% 40.9 1.2 (0.3)
Slide 26: Balance sheet and funding
Balance sheet and funding Asset funding, 31 Dec 2009 (CHF billion) Assets Cash & banks Loans Trading assets Collateral trading Other assets1 67 307 232 180 144 Due to banks Deposits Long term debt Trading liabilities Money market Total equity Other Collateral trading 65 410 192 52 47 72 43 48 Liabil
Slide 27: Exposure to monoline insurers, by rating
Exposure1 to monoline insurers, by rating USD billion Credit protection on US sub-prime RMBS CDOs2 of which: from monolines rated investment grade (BBB and above) of which: from monolines rated sub-investment grade (BB and below) Total 31.12.09 14.2 5.1 2.8 2.3 Notional amount3 Fair value of CDSs5 p
Slide 28: Student loan auction rate securities
Student loan auction rate securities USD million US student loan auction rate securities Carrying value as of 30.9.09 10,553 1 Includes USD 7.5 billion (CHF 7.7 billion) at carrying value of student loan ARS that were reclassified to "Loans and receivables" from "Held for trading" in fourth quarter
Slide 29: Reclassified assets
Reclassified assets 31.12.09, CHF billion Monoline protected assets1 US student loan and municipal auction rate securities US reference linked notes CMBS/CRE (excl. interest-only strips) Leveraged Finance 6.5 8.2 1.0 1.6 0.8 1.0 Ratio of carrying to notional value 86% 88% 86% 82% 30% 90% Carrying va