Slide 1: Third quarter 2017 results
Third quarter 2017 results October 27, 2017
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: Reported PBT up 39% to 1.2bn
Reported PBT up 39% to 1.2bn Strong profit growth Solid returns Strong capital position Net profit 946m, diluted EPS 0.25 10.2% adjusted RoTE CET1 capital ratio 13.7%; LR 3.7% PBT 1,221m, adjusted PBT 1,506m 13.3% adjusted RoTE excl. DTA TLAC 78bn; CET1 capital 33bn Strong adjusted pre-tax profit gr
Slide 4: Global WM – Profit before tax up 4%, YTD up 12%
Global WM1 – Profit before tax up 4%, YTD up 12% Continued strength in the world's leading wealth management business Growth across all revenue lines m +4% 121 14 72 1,041 1,001 12 (180) 3Q16 PBT Transaction- Net interest Recurring net Other income / Costs 3Q17 PBT based income income fee income CLE
Slide 5: Asia Pacific – Driving profitable growth
Asia Pacific – Driving profitable growth Capturing growth and delivering operating leverage Operating income Profit before tax Net new money m m bn ~500bn invested assets +10% +37% 10% NNM growth1 3,502 1,140 33 3,185 +64% +9% 832 15%1 +6% (1)% +31% 8%1 +13% 9M16 9M17 9M16 9M17 9M17 Wealth Managemen
Slide 6: Committed to sustainable performance
Committed to sustainable performance Delivering long-term value to our stakeholders Solid performance in a variety Strong capital Recognized as an industry of market conditions and credit ratings leader in sustainability Return on tangible equity excl. DTA UBS AG long-term credit ratings1 Dow Jones
Slide 7: UBS Group AG results (consolidated)
UBS Group AG results (consolidated) CHF m, except where indicated 3Q16 4Q16 1Q17 2Q17 3Q17 Total operating income 7,029 7,055 7,532 7,269 7,145 Total operating expenses1 6,152 6,308 5,842 5,767 5,924 Profit before tax as reported 877 746 1,690 1,502 1,221 of which: net restructuring expenses (444) (
Slide 8: Global WM
Global WM Building on strong 1H17 with YTD profits up 12% 20 20 19 19 Net margin 17 PBT up 4%, mainly driven by APAC and as we transition to our bps 1,050 1,041 new model in the US 1,001 1,013 Profit 871 before tax m Operating income up 6% Net interest income up 8% on higher USD rates 3,747 3,
Slide 9: Global WM – Regional performance
Global WM – Regional performance Americas1 Asia Pacific Switzerland Europe Emerging markets 6,861 advisors 1,028 advisors 735 advisors 1,282 advisors 668 advisors 17% 7% 166 51% Invested 387 9% assets 1,164 30.9.17, 200 bn 15% 345 Profit contribution 34% 21% 17% 15% 14% LTM2 40 38 38 38 41 35 37 36
Slide 10: Personal & Corporate Banking
Personal & Corporate Banking Management actions and client activity partly offset net interest headwinds Net interest 161 161 157 157 154 margin bps Management actions helped to stabilize net interest margin 473 437 436 Profit 395 379 before tax m Transaction-based income up 4%; highest quarter
Slide 11: Asset Management
Asset Management Good operating leverage and continued strong net inflows 9 10 7 8 8 Net margin bps 156 153 PBT up 11%; 4% operating leverage 138 133 Profit 123 before tax m 481 499 450 479 494 Operating income up 3% Operating 44 31 36 38 26 Net management fees up 4%, driven by a higher asset
Slide 12: Investment Bank
Investment Bank Resilient performance driven by continued strength in CCS 558 Profit 419 352 342 344 before PBT up 3% as higher CCS revenues offset a challenging tax quarter for FRC; costs stable m 1,936 2,098 1,796 1,919 1,800 CCS up 35%, driven by strong ECM; growth in all regions Operating 718
Slide 13: Corporate Center
Corporate Center Profit before tax 3Q16 4Q16 1Q17 2Q17 3Q17 (234) (269) (479) (654) (764) Corporate Center total (m) Corporate Center results by unit (m) Services Operating income (66) (59) (18) (20) (70) Operating expenses 148 216 189 117 322 o/w before allocations 1,830 2,028 1,983 1,912 2,122 2 o
Slide 14: Cost reduction
Cost reduction Achieved 1.9bn; on track to achieve 2.1bn target by year-end Cost base and net cost reductions bn 0.9bn1 1.0bn1 16.3 15.6 15.0 ~0.5 ~0.6 ~0.7 8.6 ~0.2 7.8 ~0.5 FY13 FY15 FY15 FY16 Sep-17 annualized exit rate CC in scope CC and BDs in scope Cost base for net cost reduction program (CC
Slide 15: Net tax expense and deferred tax assets (DTAs)
Net tax expense and deferred tax assets (DTAs) Net tax expense Tax loss DTAs1,2 m bn, 30.9.17 3Q17 9M17 Net deferred tax expense/(benefit) US UK CH Other Total (174) (174) with respect to net additional DTAs Recognized 7.9 0.1 0.0 0.1 8.1 8.1 of which: US (224) (224) of which: Switzerland (CH) 50 50
Slide 16: US tax loss DTAs
US tax loss DTAs Higher US profit forecast supports additional DTA recognition Recognized US tax loss DTA balance m 7,955 2242 7,940 ~752 (510) 510 (illustrative) 8171 6,581 (156) 156 31.12.15 31.12.16 30.9.17 31.12.17 Recognized US DTA closing balance Hypothetical deferred tax expenses related to U
Slide 17: Capital and leverage ratios (fully applied)
Capital and leverage ratios (fully applied) CHF 0.7bn CET1 capital accretion; 3.7% CET1 leverage ratio Loss-absorbing capacity Capital ratio1 Leverage ratio bn %, bn %, bn Total loss- 1.1.20 78.4 32.9% 1.1.20 absorbing Capital ratio Leverage ratio capacity (TLAC) 73.8 31.2% requirements requirements
Slide 18: Appendix
Appendix &%% UBS
Slide 19: Wealth Management
Wealth Management Strong growth momentum; continued operating leverage 27 29 27 26 Net margin 21 bps 727 PBT up 9%, YTD PBT up 12% with particularly strong 643 691 701 Profit 5731 momentum in APAC before tax 511 m 1,809 1,782 1,929 1,882 1,915 Operating 334 314 479 416 373 Operating income up 6% w
Slide 20: Wealth Management Americas (USD)
Wealth Management Americas (USD) Continued income momentum; investing for future growth 13 13 11 11 12 Net margin bps PBT down 4% as we continue to invest for the future; 367 358 324 330 351 YTD PBT up 13% Profit before tax m 1,988 2,049 2,053 2,132 2,126 Operating 390 348 Income up 7%, YTD up 9%
Slide 21: Swiss SRB leverage ratio requirements
Swiss SRB leverage ratio requirements UBS leverage ratio balance1 Requirements Meeting 1.1.20 requirements TLAC-eligible debt • 3.22% (28.5bn) existing UBS Group AG TLAC bonds2 2.0% • 15.9bn long-term debt maturing before 1.1.20 not counted in total loss absorbing capacity6 which may be replaced upo
Slide 22: Performance targets, expectations and ambitions
Performance targets, expectations and ambitions Ranges for sustainable performance over the cycle Net new money growth rate 3-5% Wealth Management Adjusted cost/income ratio 55-65% Expectation: 10-15% annual adjusted pre-tax profit growth for combined businesses over Wealth Management Net new money
Slide 23: Regional performance
Regional performance bn Americas Asia Pacific EMEA Switzerland Global Total 3Q16 3Q17 3Q16 3Q17 3Q16 3Q17 3Q16 3Q17 3Q16 3Q17 3Q16 3Q17 WM 0.1 0.1 0.5 0.6 0.9 0.9 0.4 0.4 (0.0) (0.0) 1.8 1.9 WMA 1.9 2.1 - - - - - - - - 1.9 2.1 P&C - - - - - - 1.0 1.0 - - 1.0 1.0 Operating AM 0.1 0.1 0.1 0.1 0.1 0.1
Slide 24: Adjusted results
Adjusted results Adjusting items FY16 3Q16 4Q16 1Q17 2Q17 3Q17 m Operating income as reported (Group) 28,320 7,029 7,055 7,532 7,269 7,145 of which: WM 21 WMA 10 10 Gains on sale of financial assets available for sale P&C 102 IB 78 78 107 Gains/(losses) on sales of subsidiaries and businesses WM (23
Slide 25: Important information related to this presentation
Important information related to this presentation Use of adjusted numbers Unless otherwise indicated, “adjusted” figures exclude the adjustment items listed on the previous slide, to the extent applicable, on a Group and business division level. Adjusted results are a non-GAAP financial measure as