Ubs Group Ag · SIX:UBSG

Ubs — Q4 2024 Earnings Presentation

48 slides from Ubs's earnings presentation, Feb 4, 2025

  1. Slide 1: Full-year and fourth quarter 2024 Results and investor update

    Full-year and fourth quarter 2024 Results and investor update 4 February 2025

  2. Slide 2: Important information

    Important information 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, statements relating to the anticipated effect of transactions and strategic initiat

  3. Slide 3: Agenda

    Agenda FY24 & Investor update Q&A 4Q24 results Sergio P. Ermotti, Group CEO Todd Tuckner, Group CFO 2

  4. Slide 4: 2024 key messages

    2024 key messages Delivered strong full-year Net profit 5.1bn financial performance Underlying profit before tax 8.8bn Underlying RoCET1 8.7% Franchise strength continues to drive Group invested assets 6.1trn, +7% YoY, GWM NNA 97bn, AM NNM 45bn, client momentum IB underlying revenues +23% YoY, CHF >

  5. Slide 5: Continued positive operating leverage in 4Q24 on higher revenues and lower costs

    Continued positive operating leverage in 4Q24 on higher revenues and lower costs Underlying, bn Revenues Operating expenses Profit before tax Underlying 4Q24 FY24 +6% PBT 1.8bn 8.8bn 11.1 (6%) 10.4 9.7 RoCET1 7.2% 8.7% 9.1 +198% Cost / 81.9% 79.5% income 1.8 Reported Net profit 0.8bn 5.1bn 0.6 EPS 0

  6. Slide 6: 4Q24 net profit at 0.8bn, with integration continuing at pace

    4Q24 net profit at 0.8bn, with integration continuing at pace Profits m ~0.5bn expected Underlying in 1Q251 576 +198% 628 1,768 640 o/w tax: (268m) 1,047 (93) (1,296) 770 592 ~1.1bn expected (277) in 1Q25 4Q23 Revenues CLE Opex 4Q24 Non-underlying Non-underlying 4Q24 Tax 4Q24 PBT PBT revenues2 expen

  7. Slide 7: Global Wealth Management

    Global Wealth Management Underlying USD m, except where indicated 4Q24 3Q24 4Q23 QoQ YoY Underlying 4Q24 vs. 4Q23 Total revenues 5,942 5,975 5,395 (1%) +10% PBT 1,147m, +84% Net interest income 1,657 1,590 1,550 +4% +7% Total revenues 5,942m, +10% driven by increases in Recurring net fee income 3,26

  8. Slide 8: Personal & Corporate Banking (CHF)

    Personal & Corporate Banking (CHF) Underlying CHF m, except where indicated 4Q24 3Q24 4Q23 QoQ YoY Underlying 4Q24 vs. 4Q23 Total revenues 1,810 1,818 1,833 0% (1%) PBT 572m, (18%) Net interest income 994 1,008 1,085 (1%) (8%) Recurring net fee income 357 363 332 (1%) +8% Total revenues 1,810m, (1%)

  9. Slide 9: Asset Management

    Asset Management Underlying USD m, except where indicated 4Q24 3Q24 4Q23 QoQ YoY Underlying 4Q24 vs. 4Q23 Total revenues 766 873 825 (7%) PBT 224m, +20%; +33% excluding net gains from (12%) disposals Net management fees 709 755 745 (6%) (5%) Performance fees 44 46 52 (3%) (15%) Total revenues 766m,

  10. Slide 10: Investment Bank

    Investment Bank Underlying USD m, except where indicated 4Q24 3Q24 4Q23 QoQ YoY Underlying 4Q24 vs. 4Q23 Total revenues 2,547 2,461 1,864 +3% +37% PBT 452m with revenues +37% Global Banking 675 555 566 +21% +19% Advisory 260 220 191 +18% +36% Global Banking revenues +19% Capital Markets 415 336 375

  11. Slide 11: Non-core and Legacy

    Non-core and Legacy Underlying Underlying 4Q24 vs. 4Q23 USD m, except where indicated 4Q24 3Q24 4Q23 QoQ YoY PBT (606m) Total revenues (58) 262 145 n.m. n.m. Credit loss expense / (release) 6 28 15 Total revenues (58m) driven by funding costs Operating expenses 541 567 1,037 (5%) (48%) Credit loss e

  12. Slide 12: A balance sheet for all seasons as a key pillar of our strategy

    A balance sheet for all seasons as a key pillar of our strategy USD bn, except where indicated USD bn, except where indicated 4Q24 3Q24 4Q23 QoQ YoY 4Q24 3Q24 4Q23 QoQ YoY Total assets 1,565 1,624 1,717 (4%) (9%) Regulatory capital o/w: Cash and balances at central banks 223 243 314 (8%) (29%) CET1

  13. Slide 13: Strong execution in 2024, delivering ahead of plan

    Strong execution in 2024, delivering ahead of plan Underlying RoCET1 Cumulative gross cost saves Non-core and Legacy RWA CET1 capital ratio 8.7% 7.5bn 63bn ~14% 14.3% ~5.9bn Mid-single digit 41bn FY24 FY24 actual YE24 YE24 actual YE24 based YE24 actual Guidance YE24 actual guidance guidance on natur

  14. Slide 14: Investor update

    Investor update 36 UBS

  15. Slide 15: Executing on our proven strategy to deliver for all stakeholders

    Executing on our proven strategy to deliver for all stakeholders − Balance sheet for all seasons and strong capital position Balance sheet for − Disciplined risk management and resource usage with focus on sustainable growth in all seasons asset gathering businesses − Capital efficient business mode

  16. Slide 16: Unique globally diversified model focused on asset gathering businesses

    Unique globally diversified model focused on asset gathering businesses Revenue mix by business vs North American and European GSIBs Revenue mix by region UBS1 North American & European GSIB average2 UBS3 APAC Americas ~60% ~20% EMEA 46bn WM + AM WM + AM Switzerland Wealth and Asset Management Perso

  17. Slide 17: On track to substantially complete integration by end-2026

    On track to substantially complete integration by end-2026 2023 – 2024 2025 – 2026 2027+ ✓ 2024 key achievements Key priorities 58% ✓ Completed parent and Swiss − Substantially complete the migration of Swiss Driving Gross cost saves bank mergers and established Business by year-end 2025, with all r

  18. Slide 18: Continuing to invest in technology to drive business outcomes

    Continuing to invest in technology to drive business outcomes Key priorities Modernizing technology for a 73% 99.999% 100k strong foundation on public and private cloud desktops in Microsoft‘s largest availability maintained achieved Cloud VDI deployment Continuing the integration 800+ 16PB 46k jour

  19. Slide 19: On track to deliver on our cost and profitability ambitions in our core businesses

    On track to deliver on our cost and profitability ambitions in our core businesses Underlying cost / income ratio Underlying RoAE GWM P&C AM IB 85% ~15% 80% 78% <70% 73% <70% 10% 57% 59% <50% (5%) 2H23 FY24 2026 2H23 FY24 2026 2H23 FY24 2026 2H23 FY24 Through- exit rate exit rate exit rate the cycle

  20. Slide 20: Well placed to balance resiliency, growth and attractive capital returns

    Well placed to balance resiliency, growth and attractive capital returns Balance sheet Sustainable Share 1 for all seasons 2 growth 3 Dividends 4 buybacks − ~14% CET1 capital ratio − Ample capacity for return- − USD 0.90 ordinary dividend per − Delivered USD 1bn of buybacks in accretive growth share

  21. Slide 21: Rebuilding profitability and positioning for sustainable growth post-integration

    Rebuilding profitability and positioning for sustainable growth post-integration Group underlying return on CET1 capital Illustrative Underlying cost / income 72%1 91% 80% <70% ratio ~18% 17% ~15% ~13% ~10% 9% 3% FY22, 2H23 FY24 FY25e FY26e 2026e FY28e, reported exit rate reported Forward-looking gu

  22. Slide 22: Growth in core business profitability to drive returns

    Growth in core business profitability to drive returns Underlying RoCET1 Illustrative ~15% ~10% 8.7%    ~     Accelerated Underlying Tax rate ~23% Cost saves + Underlying Tax rate ~20% cost saves, pre-tax loss higher pre-tax loss continued ex-litigation volumes and ex-litigation business less

  23. Slide 23: Achieved 58% of gross cost save ambition, on track to ~13bn by year-end 2026

    Achieved 58% of gross cost save ambition, on track to ~13bn by year-end 2026 Cumulative annualized exit rate Underlying Cumulative integration- gross cost reductions operating expenses related expenses2 USD bn / % of expected cumulative total USD bn USD bn / % of expected cumulative total (~10%) / (

  24. Slide 24: GWM – Unrivaled scale with interconnected global franchises

    GWM – Unrivaled scale with interconnected global franchises Capitalizing on our long-term Americas Switzerland EMEA APAC strategic advantages Invested assets1 Size and scale Global reach and capabilities 2.1 0.7 0.7 0.7 trn trn trn trn Differentiated solutions Technology and innovation Safety and se

  25. Slide 25: GWM – Capitalizing on integration and growing the platform

    GWM – Capitalizing on integration and growing the platform Select 2024 2025-2026 Ambitions achievements priorities Stay close to clients and Capitalize on scale Restore US profitability grow the platform through integration and position for growth >5trn 4.9bn Invested assets Underlying PBT by 2028 L

  26. Slide 26: GWM Americas – Strong franchise with upside on profitability

    GWM Americas – Strong franchise with upside on profitability Strong client franchise supported Taking action to improve operating leverage and Key levers by advice-led solutions profit sustainability As of 31.12.24 PBT margin 1 Build on strong positioning with UHNW and Family Offices 2.1trn 2 Drive

  27. Slide 27: GWM Americas – Set to deliver ~15% PBT margin by 2027 (1/2)

    GWM Americas – Set to deliver ~15% PBT margin by 2027 (1/2) 1 2 3 Build on strong positioning with Drive targeted growth in HNW Continuing to build out UHNW and Family Offices and Core Affluent banking infrastructure (multidisciplinary solution teams) Revenues per >$100m net worth client, Invested a

  28. Slide 28: GWM Americas – Set to deliver ~15% PBT margin by 2027 (2/2)

    GWM Americas – Set to deliver ~15% PBT margin by 2027 (2/2) 4 5 Streamlined and strategically aligned Improve ROI in technology while investing in platforms structure to drive growth and feeder channels GWM US Increased frequency of Regionally aligned client-facing business deployments Regions units

  29. Slide 29: P&C – A core pillar of our strategy and reliable partner to the Swiss economy

    P&C – A core pillar of our strategy and reliable partner to the Swiss economy Select 2024 2025-2026 Ambitions achievements priorities Stay close Capitalize on Drive productivity and to our clients integration benefits efficiency CHF 2.7bn Underlying PBT Continue providing Opportunities from Optimize

  30. Slide 30: AM – Driving focused growth and improving operating leverage

    AM – Driving focused growth and improving operating leverage Select 2024 2025-2026 Ambition achievements priorities Deliver differentiated Capture alternatives Drive efficiencies and and scalable offering growth opportunity transform the platform 45bn NNM Further scale SMA and Unlock benefits from C

  31. Slide 31: IB – Integration complete, unlocking opportunities for long-term value

    IB – Integration complete, unlocking opportunities for long-term value Select 2024 2025-2026 Ambition achievements priorities Unlock full value of Support clients and Resource Record integration grow market share discipline Market share in Cash Equities1 Deliver added products, Build on market share

  32. Slide 32: NCL – Run-down well ahead of schedule

    NCL – Run-down well ahead of schedule Reducing complexity Underlying operating expenses excl. litigation Risk-weighted assets bn bn (52%) ~6.1 86 66% books closed Op. since June 2023 Risk 30 4Q24 Target: >95% by YE26 annualized: 2.2bn ~44 41 2.7 42% ~1.8 Credit and 56 27 ~25 ~29 IT apps decommission

  33. Slide 33: Disciplined management of capital, liquidity and funding

    Disciplined management of capital, liquidity and funding 4Q24 Capital 14.3% 13.5% - Group CET1 ratio to remain ~14%, total going concern to increase to Group Parent bank ~18% by 2029 CET1 capital ratio CET1 capital ratio1 - 13bn of capital repatriated in 4Q24 to UBS AG; 7bn from Credit Suisse Intern

  34. Slide 34: Balance sheet optimization funds profitable growth

    Balance sheet optimization funds profitable growth Risk-weighted assets bn CET1 14.3% 14.3% ~14% capital ratio Basel III finalization ~1bn ~5 ~510 8 ~15 ~0 +/- 499 500 (7) Increases in core businesses expected to be broadly offset o/w: ~(10) by decreases in NCL − FRTB +9bn1 − Credit-risk (1)bn YE24

  35. Slide 35: Reiterating our financial targets and long-term ambitions

    Reiterating our financial targets and long-term ambitions Financial Capital Ambitions targets guidance long-term Underlying RoCET1 RoCET1, reported ~15% 2026 exit rate ~14% CET1 capital ratio ~18% by 2028 Underlying cost / income GWM invested assets <70% ratio 2026 exit rate >4.0% CET1 leverage rati

  36. Slide 36: Appendix

    Appendix 35

  37. Slide 37: UBS Group results

    UBS Group results USD m, except where indicated 4Q24 3Q24 4Q23 FY24 FY23 Total revenues 11,635 12,334 10,855 48,611 40,834 Negative goodwill 27,264 Credit loss expense / (release) 229 121 136 551 1,037 Operating expenses 10,359 10,283 11,470 41,239 38,806 Operating profit / (loss) before tax 1,047 1

  38. Slide 38: 4Q24 overview of financial performance by business division

    4Q24 overview of financial performance by business division USD m, except where indicated UBS Group GWM P&C AM IB NCL Group Items Total revenues as reported 11,635 6,121 2,245 766 2,749 (58) (188) of which: PPA effects and other integration items1 656 200 258 202 (4) of which: losses related to inve

  39. Slide 39: FY24 overview of financial performance by business division

    FY24 overview of financial performance by business division USD m, except where indicated UBS Group GWM P&C AM IB NCL Group Items Total revenues as reported 48,611 24,516 9,334 3,182 10,948 1,605 (975) of which: PPA effects and other integration items1 2,877 891 1,038 989 (41) of which: losses relat

  40. Slide 40: 4Q24 Global Wealth Management results by region

    4Q24 Global Wealth Management results by region Americas Switzerland EMEA APAC 23% 375 63% 349% 304 296 152% 271 Underlying profit before tax 214 181 m 85 60 4Q23 4Q24 4Q23 4Q24 4Q23 4Q24 4Q23 4Q24 4Q24 Underlying cost / income ratio 92% 64% 75% 67% Invested assets bn 2,109 749 655 665 Net new asset

  41. Slide 41: Maintaining a strong capital position

    Maintaining a strong capital position 185.4bn 37.2% 12.2% Gone concern: 97.7bn Gone concern: 19.6% Gone concern: 6.4% Total loss-absorbing capacity: 25.5% Total loss-absorbing capacity: 8.75% Going concern: 87.7bn Going concern: 17.6% Going concern: 5.8% o/w CET1 o/w CET1 o/w CET1 Going concern: 14.

  42. Slide 42: CET1, RWA and LRD QoQ walk

    CET1, RWA and LRD QoQ walk CET1 capital Risk weighted assets bn bn (4%) (4%) 519.4 1.0 2.2 0.0 498.5 (8.3) (0.1) (14.6) 74.2 (1.0) (0.9) 71.4 (1.8) (0.1) 3Q24 Credit and Non- Market risk Operational Currency 4Q24 counterpartycounterparty- risk effects credit risk related risk Leverage ratio denomina

  43. Slide 43: FY24 RWA YoY walk

    FY24 RWA YoY walk Risk-weighted assets bn CET1 capital ratio 14.3% 14.3% 547 (15) 0 499 (33) o/w: − NCL credit risk (25bn) − P&C credit risk (5bn) − GWM credit risk (3bn) 31.12.23 Currency effects Model updates and Asset size and other 31.12.24 methodology changes 42

  44. Slide 44: PPA pull to par overview and revenue recognition

    PPA pull to par overview and revenue recognition Accretion of PPA adjustments on financial instruments Recognized Estimated amortization profile4 Expected future P&L Opening balance Remaining balance USD bn 2023–2024 releases at 31.12.24 2025 2026 2027+ as of 12.6.23 (close)2 to be recognized3 FX ra

  45. Slide 45: Invested asset split

    Invested asset split Global Wealth Management Asset Management 4Q24 4Q24 4,182bn 4,182bn 1,773bn 1,773bn Hedge Funds 3% 11% Others 5% 10% Other Other 17% Associates 5 8% 5% GBP 9% CHF Real Estate & 5 Alternatives 5% Private Markets 9% 13% EUR MM instruments 6% 9% EUR Fixed Income - MM Multi-asset &

  46. Slide 46: Revenue and expense currency mix

    Revenue and expense currency mix Total revenues1 Operating expenses1 % % 2 6 4 9 11 13 2 12 13 6 15 15 23 10 6 8 3 5 3 3 2 12 2 4 8 9 14 3 12 5 1 5 26 29 40 22 30 95 33 88 11 70 69 64 53 51 43 46 41 35 3 5 GWM P&C AM IB Group GWM P&C AM IB NCL Group USD CHF GBP EUR Other 1 Based on estimated currenc

  47. Slide 47: FY22 combined cost baseline

    FY22 combined cost baseline FY22 USD bn Operating expenses UBS sub-group (IFRS)1 24.9 Credit Suisse sub-group (US GAAP)2,3 19.1 UBS sub-group exclusions4 (0.3) Credit Suisse sub-group exclusions3,5 (2.0) Commission expense reclassification3,6 (1.1) FY22 combined cost baseline 40.6 • of which: ~34.5b

  48. Slide 48: Cautionary statement regarding forward-looking statements

    Cautionary statement regarding forward-looking statements Cautionary statement regarding forward-looking statements | This report contains statements that constitute “forward-looking statements”, including but not limited to management’s outlook for UBS’s financial performance, statements relating t

UBS Group — Q4 2024 Earnings Presentation on 6ix