Slide 1: First quarter 2011 results
First quarter 2011 results First quarter 2011 results April 26, 2011
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: 1Q11 highlights
1Q11 highlights CHF 1.8 billion net profit attributable to shareholders Diluted EPS CHF 0.47; return on equity 15.5% Over CHF 20 billion net new money for the Group; CHF 11.1 billion for Wealth Management CHF 1.0 billion pre-tax profit excluding own credit1 for the Investment Bank CHF 1.8 billion FI
Slide 4: 1Q11 – performance by business division
1Q11 – performance by business division (CHF million) WM&SB WMA Global AM IB CC UBS Income 2,891 1,346 496 3,577 163 8,473 Credit loss (expense) / recovery 2 1 1 (1) 3 Own credit1 (133) (133) Total operating income 2,893 1,347 496 3,445 163 8,344 Personnel expenses 1,285 1,005 259 1,871 (13) 4,407 N
Slide 5: Net profit attributable to shareholders 1Q11 vs. 4Q10
Net profit attributable to shareholders 1Q11 vs. 4Q10 144 167 376 (630) 448 (895) 660 19 1,807 1,663 (CHF million) 4Q10 Operating income Own Credit loss Personnel Non- Tax Non- 1Q11 excluding own credit1 expenses expenses personnel expense / controlling credit and credit expenses (benefit) interests
Slide 6: 1Q11 operating expenses
1Q11 operating expenses Higher personnel expenses more than offset reduced litigation provisions Operating expenses (adjusted)1 6,180 6,210 6,124 Personnel costs comparable to 1Q10 levels 5,991 2% 5,844 – 1Q11 personnel expenses include CHF 467 million related to the amortization of bonus awards g
Slide 7: Changes to reporting – effective 1Q11
Changes to reporting – effective 1Q111 Income lines split into interest, fees, trading and other income WM&SB, WMA Additional information on loans and customer deposits WM&SB, WMA Comparison with the prior year quarter IB Certain commodities businesses moved from Equities to FICC IB Risk management
Slide 8: Wealth Management
Wealth Management Pre-tax profit increased 40% on higher income and lower expenses Operating income and pre-tax profit Operating income up 7% on improved client activity and higher interest income 1,904 1,803 1,928 Reported costs down 4% mainly due to lower G&A expenses – 4Q10 included CHF 40 mi
Slide 9: Wealth Management – revenues
Wealth Management – revenues Revenues up 7% on higher interest income and increased client activity 847 833 827 825 Invested assets (CHF billion) 810 1Q11 786 787 791 vs 4Q10 768 1,958 1,892 1,903 1,892 1,919 1,819 1,758 1,795 18% 170 153 1,756 146 157 170 178 182 258 145 154 311 303 305 312 309 335
Slide 10: Wealth Management – gross margin
Wealth Management – gross margin1 Significant improvement in the quarter Fees Trading +3 bps +1 bp Interest +2 bps 99 95 98 91 92 93 89 92 (bps) 2008 2009 2010 1Q10 2Q10 3Q10 4Q10 1Q11 Pricing Lending Pricing realization and price grid Significant increase in loan volume realignment efforts continue
Slide 11: Wealth Management – invested assets and NNM by region
Wealth Management – invested assets and NNM by region1 31.3.11 invested assets 1Q11 net new money CHF 791 billion CHF 11.1 billion Europe2 308 (0.5) Asia Pacific 173 4.1 Switzerland 171 5.3 Emerging 139 2.2 markets3 o/w UHNW4 316 7.5 1 Invested assets and net new money based on client domicile 2 Inc
Slide 12: Retail & Corporate
Retail & Corporate Stable profits, low credit loss expenses Operating income and pre-tax profit Operating income up 4% as lower credit loss expenses offset lower revenues 978 965 – Revenues down 2% as lower interest income 931 was partly offset by higher transactional fees – Credit loss expenses t
Slide 13: Retail & Corporate – loan portfolio
Retail & Corporate – loan portfolio Over 70% of loans outstanding are secured by residential mortgages Loans, gross (31.3.11) Loans secured by residential property (31.3.11) Distribution Distribution of 100% = CHF 136 billion of loans exposure fraction2 along LTV1 along LTV 11% <1% <1% 4% 5% 8% 14%
Slide 14: Wealth Management Americas
Wealth Management Americas Pre-tax profit of CHF 111 million Operating income down 2% (up 2% in USD Operating income and pre-tax profit terms) as currency effects offset higher fee and commission income 1,362 1,379 Operating expenses decreased 12% (9% in 1,347 USD terms), mainly due to lower lit
Slide 15: Wealth Management Americas – operating income
Wealth Management Americas – operating income Currency effects offset increase in underlying USD fee & commission income CHF million USD million YoY YoY (1%) QoQ +13% QoQ (2%) +2% 1,485 1,422 1,449 1,362 1,379 1,350 148 1,338 1,347 1,324 1,285 131 127 150 127 146 118 135 141 144 389 399 391 380 371
Slide 16: Wealth Management Americas – financial advisor productivity
Wealth Management Americas – financial advisor productivity Improved financial advisor productivity in US dollar terms Revenue per FA, annualized (thousand) CHF USD 872 855 776 761 781 736 793 790 782 813 838 795 724 689 655 595 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 Invested assets per FA (million
Slide 17: Global Asset Management
Global Asset Management Strong net new money Operating income and pre-tax profit Operating income decreased 8% – Net management fees decreased primarily in 542 521 A&Q, Global Real Estate and Fund Services 496 – Performance fees decreased by CHF 19 million compared with a very strong 4Q10 Operat
Slide 18: Investment Bank
Investment Bank CHF 1 billion pre-tax profit excluding own credit1 Operating income excluding own credit1 Pre-tax profit and cost / income ratio 4,136 Cost / income ratio excluding own credit1 Cost / income ratio (as reported) 3,506 3,578 604 124 478 466 2,686 91 79 102 76 2,229 71 2,165 910 1,703 1
Slide 19: Equities revenues (vs. 1Q10)
Equities revenues (vs. 1Q10) Increase in cash and prime services revenues partly offset by lower derivatives revenues Cash: strong performance in Asia Pacific 1,365 and the US partially offset by lower 1,310 1,255 89 revenues in Europe, Middle East and Africa 101 49 231 296 945 235 Derivatives:
Slide 20: FICC revenues (vs. 1Q10)
FICC revenues (vs. 1Q10) Strong credit revenues; macro disappointed 2,165 Macro: 258 – FX revenues marginally down on lower client 1,801 activity 241 1,703 50 – Good results in non-linear rates were offset by 206 a decline in linear rates due to market 502 uncertainty and poor liquidity 744 73 C
Slide 21: Investment banking revenues (vs. 1Q10)
Investment banking revenues (vs. 1Q10) Strong advisory results more than offset by lower equity capital markets revenues 910 Advisory: revenues increased 31% versus a market fee pool increase of 21% 296 Capital markets: 604 – Equities: revenues declined 33% due to 466 lower participation in IPO’
Slide 22: Corporate Center
Corporate Center Pre-tax profit of CHF 116 million The revaluation of our option to buy the SNB StabFund contributed CHF 192 million in 1Q11 – Option fair value CHF 1.9 billion (USD 2.1 billion) on 31.3.11 Revaluation of UBS’s option to buy the SNB StabFund: contribution to UBS results 293 231 168
Slide 23: Capital position – Basel 2
Capital position – Basel 2 CHF 1.4 billion of core tier 1 capital accretion in 1Q11 17.8% 17.9% Basel 2 risk-weighted assets 16.4% 16.7% increased CHF 4.5 billion to CHF 15.4% 16.0% 203.4 billion as at 31.3.11 15.3% 15.6% 14.2% USD 500 million hybrid tier 1 13.0% instrument with first call date
Slide 24: Capital position – Basel 2.5
Capital position – Basel 2.5 Pro-forma Basel 2.5 tier 1 ratio of 12.6% on 31.3.11 Basel 2.5 RWAs of CHF 279 billion for the Group Basel 2 Basel 2.5 CHF billion Change RWAs RWAs Wealth Management & Swiss Bank 43 44 0 Wealth Management Americas 23 25 1 Global Asset Management 3 4 0 Investment Bank 1
Slide 25: Movements in IFRS equity
Movements in IFRS equity of which of which attributable to IFRS equity Total attributable to non-controlling UBS shareholders interests (CHF million) 31.12.10 51,863 46,820 5,043 Net profit 1,809 1,807 2 Foreign currency translation of foreign operations (OCI) (78) (182) 104 Financial investments av
Slide 26: Appendix
Appendix 3% UBS
Slide 27: Invested assets
Invested assets Wealth Management Retail & Corporate 11 5 7 (CHF billion) (CHF billion) 768 3% 791 1% 2 0 136 (1) 138 Dec 10 NNM Market FX / Other Mar 11 Dec 10 NNM Market FX / Other Mar 11 Wealth Management Americas Global Asset Management 4 21 6 7 (13) (2) (CHF billion) (CHF billion) 689 700 559 5
Slide 28: BIS regulatory capital (Basel 2)
BIS regulatory capital (Basel 2) Core Core BIS Tier 1 Tier 1 tier 1 tier 1 RWA capital ratio (CHF billion) capital ratio 31.12.10 198.9 30.4 15.3% 35.3 17.8% Net P&L attributable to shareholders 1.8 1.8 Own credit (not eligible for capital) 0.1 0.1 1 2 Other incl. FX (0.5) (0.8) Change in RWAs 4.5 3
Slide 29: Hybrid tier 1 instruments outstanding
Hybrid tier 1 instruments outstanding1 Amount Issue date Interest rate First call date Coupon payment 2 3 USD 500m 26.6.01 7.247% 26.6.11 Semi-annual (2Q, 4Q) 2 EUR 1,000m 11.4.08 8.836% 11.4.13 Annual (2Q) EUR 1,000m 15.4.05 4.28%2 15.4.15 Annual (2Q) 2 USD 1,000m 12.5.06 6.243% 12.5.16 Semi-annual
Slide 30: Asset funding – 31 March 2011
Asset funding – 31 March 2011 Assets Liabilities and equity Cash, CBs, due from banks 43 Due to banks 34 Money market Financial investments paper issued 55 available-for-sale 71 Cash collateral on securities lent CHF 116 billion and repurchase agreements 104 Cash collateral on securities collateral
Slide 31: Balance sheet development
Balance sheet development Assets Total excl. PRVs CHF 933 billion 2,275 428 2,015 160 854 1,458 1,461 1,341 1,356 1,317 1,291 774 504 517 146 422 419 401 359 Positive RVs (CHF billion) 312 192 185 176 173 167 157 Other assets 1 584 232 229 224 246 229 236 348 Trading portfolio 180 188 199 211 205 22
Slide 32: Exposure to monoline insurers, by rating
Exposure to monoline insurers, by rating 1 Credit Fair value Fair value valuation Fair value Notional of of CDSs adjustment of CDSs amount3 underlying prior to as of after CVA assets CVA (USD billion) 31.3.11 Credit protection on US sub-prime RMBS CDOs2 0.7 0.2 0.5 0.4 0.1 of which: from monolines r
Slide 33: Student loan auction rate securities
Student loan auction rate securities Inventory Client holdings Par value Par value of maximum of maximum Carrying value Carrying value required required as of 31.3.11 as of 31.12.10 purchase purchase (USD million) as of 31.3.11 as of 31.12.10 US student loan auction rate securities 9,6681 9,784 9 63
Slide 34: Reclassified assets
Reclassified assets Ratio of Notional Carrying carrying to Fair value value value notional 31.3.11 (CHF billion) value US student loan and municipal auction rate securities 5.0 4.2 4.4 89% Monoline protected assets 6.1 5.7 5.3 87% Leveraged finance 0.5 0.4 0.4 77% US reference linked notes 0.5 0.4 0