UBS Group AG · SIX:UBSG
UBS — Q4 2010 Earnings Presentation
39 slides from UBS's earnings presentation, Feb 8, 2011
Slide 1: Form 6-K Report of Foreign Private Issuer
UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 6-K REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR 15d-16 UNDER THE SECURITIES EXCHANGE ACT OF 1934 Date: February 8, 2011 Commission File Number: 1-15060 UBS AG (Registrant’s Name) Bahnhofstrasse 45, Zurich, S
Slide 2: Form 6-K presentation materials note
This Form 6-K consists of the presentation materials related to the Fourth Quarter 2010 Results of UBS AG, which appear immediately following this page.
Slide 3: Fourth quarter 2010 results
Fourt h quarter 2010 res ults Febr uar y 8, 2011 Fourt h quarter 2010 res ults
Slide 4: Cautionary statement regarding forward-looking statements
Cauti onary s tatement regar ding fo rward - looking s tatements Th is pr esentati on contains stat em ent s th at co nsti tute "forwar d-looking s tatements ," including b ut not lim ited to management's outloo k for UBS 's f inancial perfo rmance and s tatements r elating to the anticipated eff ec
Slide 5: 2010 highlights
2010 highli ghts Revenues excluding own cr edit1 of CHF 32.6 bi llion, + 23% YoY 5 5% of revenues ex cl uding own cr edi t generated in 1H1 0 and 45% i n 2H10 2H10 was marked b y low levels of client acti vity and the s trengt hening of the Swis s f ranc Operati ng expenses of CHF 24.6 bill ion, (2%
Slide 6: 4Q10 highlights
4Q10 highli ghts 1 Own credit on financial li abi lities desig nated at fair val ue CHF 1.3 bill ion net pr ofit att ributabl e t o shar eh olders , diluted E PS CH F 0.33 P re -tax prof it of CHF 1.2 billi on includes own credit1 ch ar ges of CHF 0.5 bi llion Oper at ing income up 7% on in cr eased
Slide 7: 4Q10 performance by business division
4Q10 - per for mance by bus iness divi sion 1 Tr eas ury acti vities an d other cor porate items 2 Own cr edit on f inancial liabilit ies des ignated at f ai r value 3 Oper at ing pro fit f rom cont inuing oper ations befor e t ax
Slide 8: Net profit attributable to shareholders 4Q10 vs. 3Q10
Net prof it attri butable to s hareholder s 4Q1 0 vs. 3 Q10 3Q10 Own cr edi t1 Tax expens e / (b en ef it) 4 Q10 Pers onnel expens es No n -con trolli ng interes ts Credit los s expenses Operating income excl. own credit and credit lo ss es Non - per s onnel expenses 1 Own credi t on fi nan ci al li
Slide 9: 4Q10 operating expenses
4Q10 operating ex pen ses 1 Adjus tment it em s excluded f rom ex pen ses as r ep orted: 1Q1 0: pers onnel res tru ct uring char ges CHF 21 millio n 2Q10: pers onnel r estr ucturi ng charges CHF 8 milli on credit, n on -per so nnel res tructur ing charges CHF 127 m illion, UK Bank P ayroll Tax CHF 2
Slide 10: FY10 personnel expenses
FY10 pers onnel expens es T he bonus pool f or 20 10 was CHF 4 ,319 mill ion, down 10% fr om 20091 PVT R and ot hers 2 1,550 Bonus expense f or 201 0 perfor mance year 2,685 Am ortizatio n of pr ior year awar ds 1 ,471 2010 bon us poo l 4,319 T he total amount of unr eco gnized awar ds related to al
Slide 11: FY10 operating expenses
FY10 operati ng expenses We ach ieved our f ixed cost target of less than CHF 20 billion in 2010 1 I ncludes grid - bas ed fi nanci al adviso r (F A) compens ation, ot her for mulaic F A co mp and commit ments and ad vances related to recruited F As 2 Excludi ng si gnificant n on-recurri ng items :
Slide 12: Wealth Management - revenues
Wealth Management - revenues I ncreased r evenues on improv ed cl ient tradin g act ivity, par tly off s et by fur ther s trengt hen ing of t he Swis s f ranc Int er est Fees excl. br okerage T rading & brokerage Oth er income and CLE 18% (3% ) 0% 4Q10 vs 3Q10 ( CHF milli on) I nvested as sets ( CHF
Slide 13: Wealth Management results
(CHF mil lion) Wealth Management F Y10: 5,023 FY09: 5,19 1 (3% ) (CHF millio n) Operati ng expenses Operating income and pre - tax prof it Continued NNM inf lows fr om UHNW clients and As ia Pacific r eg ion with each recor ding > CHF 10 billi on NNM in 20101; NNM out flows in E urope ( CHF billi on
Slide 14: Wealth Management - gross margin
Wealth Management - gros s m ar gin1 ( bps ) 1 Operati ng income befor e credit lo ss (expens e) or recovery ( annualized) / aver age i nvested as sets . Gr oss margi n excludes valu at ion adjus tments on a pro per ty f und of zero in 4Q10 and 3Q10 , CHF 17 mil lion in 2Q1 0, CHF 28 mil lion in 1 Q
Slide 15: Wealth Management - client advisors and invested assets
Wealth Management - cl ient advis ors and inves ted ass ets Medium -term tar get remains 4,700 client ad viso rs
Slide 16: Retail & Corporate
Retail & Corpor at e ( CHF mil lion) H igher int er est and trading i nco me; higher cr edit los s es (CHF millio n) Credit l oss expens es I nco me before cr ed it los s expens es increased 2% to CHF 99 5 milli on Credit los s expenses totaled CHF 6 3 millio n due to charges for a small number o f
Slide 17: Wealth Management Americas
Wealth Management Am er icas CHF 33 milli on pre -tax los s as increas e i n litigati on provi sion s of fs et increas e i n revenues Revenues up 3% (7% in USD t er ms ) on hi gher managed account fees , net inter es t in com e an d trans act ion revenues Operating ex pen ses increas ed 2 % (6 % in
Slide 18: Global Asset Management
Global As set M anagement Incr eas e in r ev enu es acros s al l bus iness lines Higher per for mance fees, m ai nly in A& Q Expens es u p on higher per s onnel expenses , in th e cont ex t of hig her perf ormance fees Includes CHF 9 mi llion of sever an ce cos ts (CHF mi llion) Net new money ( CHF
Slide 19: Investment Bank - pre-tax performance 4Q10 vs. 3Q10
Inves tment Bank - pre -tax perfor mance 4Q10 vs . 3Q10 I nvestm en t Bank ing prod uced h igher r evenu es , es peci al ly in equity capit al markets Eq uities an d FICC revenues impr oved modes tly f rom th e t hird quar ter Own cr ed it1 charge of CHF 509 mil lion in 4 Q10 vs. ch ar ge of CHF 3 8
Slide 20: Equities revenues
Equit ies r ev enu es Cash: higher comm iss ion i ncome acr os s all r egions Derivatives : Deri vatives r evenues im proved wit h an increas e i n new bus iness activity E quity - linked revenues were bro adl y in line wi th the las t quarter on sl ightly hi gher client activi ty Pr ime s er vices:
Slide 21: FICC revenues
FICC revenues Macr o: FX r ev enu es ro se on im proved cus tomer acti vity Rates r evenues wer e l ar gely in li ne with the pr ior qu ar ter as gains in non -linear inter est r ates and un winds of exis ting pos iti ons par tially of fs et lower l inear revenues Credit: r evenues f ell as cont inu
Slide 22: Investment banking revenues
Inves tment banking revenues Ad visor y: 19% increas e in revenues as the qu ar ter inclu ded several l ar ge trans actions Cap ital markets : E quities : revenues increas ed fivef old, ref lecting s trong er deal act ivity acros s all regio ns and i mproved m ar ket s hare1 FI CC: r evenues incr ea
Slide 23: Capital position
Capit al posi tion Basel 2 r is k -wei ghted ass ets down CHF 9 bil lion to CHF 199 billi on as at 3 1.12.10 Pr o- form a Bas el 2.5 tier 1 ratio o f approx imately 12.7% as at 3 1.12.10: Addi tional RWAs of appro ximately CHF 70 billion Ad ditional deducti ons t o tier 1 capit al of appr oximately
Slide 24: Movements in IFRS equity
Movements in IFRS equity of which oF Bien attributable to IFRS equity Total attributable to non-controlling interests UBS shareholders (CHF million) eS Soa Net profit 1,310 1,290 21 Foreign currency transation of foreign operations (OC) (550) (280) (271) Financial investments available-for-sale (OC!
Slide 25: Funding: public benchmark bonds raised in 2010
Over CHF 15 bi llion equivalent of publ ic bench mark bonds r ai sed in 2 010 Average matur ity of 5.5 years Thi s exceeded the CHF 11 bi llion of long -term s traight debt (CHF 6 billion of which pub lic) that m at ured dur ing 2010 p lus CHF 3 billio n of s ubord inated and hybr id tier 1 deb t th
Slide 26: Appendix
Appendix ef UBS
Slide 27: FY10 performance by business division
FY10 - per for mance by bus iness divi sion 1 Tr eas ury acti vities an d other cor porate items 2 Own cr edit on f inancial liabilit ies des ignated at f ai r value 3 Oper at ing pro fit f rom cont inuing oper ations befor e t ax
Slide 28: Pre-tax profit from continuing operations FY10 vs. FY09
Pre -tax prof it fr om continu ing operati ons - FY10 vs . FY09 WM &S B WM A Glo bal AM CC1 I B Gr oup 1 T reasu ry activiti es and oth er corpor ate items 2 Own credit o n financial li ab ilities desi gnated at fair value, goodwill impairm en t charges , rest ructur ing charges and UK Bank Payrol l
Slide 29: Headcount
Headcount 1 Tr eas ury acti vities and other cor porate item s 1 F TE s
Slide 30: Invested assets
Inves ted ass ets Wealth Management Wealth M anagement Amer icas Glob al Ass et M an agem ent Retail & Corpor ate
Slide 31: BIS regulatory capital (Basel 2)
31.12.10 BIS regulator y capital (Bas el 2) 1 I ncludes CHF 0.7 bill ion due to changes in own s hare r el at ed com ponents , CH F 0.1 bil lion due to n et neg at ive for ei gn curr ency ef fects an d CHF 0.2 bil lion due to ot her tier 1 changes 2 I ncludes CHF 0.7 billi on due to changes in own s
Slide 32: Asset funding - 31 December 2010
126% cover age CHF 69 billio n sur plus CHF 124 bi llion collater al sur plus Ass et f unding - 31 Decem ber 2010 As s et s L iabilit ies and equit y Cas h, CBs, d ue from banks 44 Loans 263 T rading p ortf olio as sets 229 Cash col lateral on s ecuriti es bor rowed and r ev er se r epurchas e agr e
Slide 33: Balance sheet development
Balance s heet devel opment 1 I ncluding cas h collateral on d er ivative tr ansactions . Refer to the "Balance s heet" s ection UBS's 4Q10 r epo rt f or inf ormati on about changes made to the pres entation o f Other as s et s and Ot her liabili ties 2 Including financial li abi lities desig nat ed
Slide 34: Exposure to monoline insurers, by rating
Expos ure1 t o monolin e i nsur ers , by rati ng (USD billion) Credit pr otection on US su b -prime RM BS CDOs2 o f which: f rom monolines rated in ves tment grade (BBB and above) of which: fr om mon olines rated s ub- investm ent grade (BB and below) Tot al 31.12.10 11. 9 2.7 1.1 1.6 No tional amou
Slide 35: Student loan auction rate securities
Student lo an aucti on rate s ecu rities (US D milli on) US student loan auction r at e s ecurit ies Carr ying value as of 30.9 .10 10,769 1 I ncludes USD 4.5 bi llion ( CHF 4.2 bill ion) at carr ying valu e of s tudent loan ARS t hat were reclas sif ied to "Lo ans and r eceivables " fro m "Hel d fo
Slide 36: Reclassified assets 31.12.10
Reclas sif ied ass ets 31.12.10 ( CHF billi on) M onoli ne protected as sets US s tudent lo an and municipal auction rate s ecur ities US ref erence linked notes CMBS / CRE (excl. i nterest -only s trips ) L everaged fi nance 5. 3 4.5 0.5 0.1 0 .4 0.7 Ratio of car rying to notional v al ue 86% 88% 8
Slide 37: Sovereign exposures to selected European countries
Sovereign expo sur es to s elected E uropean countr ies Our gros s sov er eign expos ures to Greece, Ir eland, Por tugal and Spain ar e immater ial, and our g ros s s overeign ex posur e to It al y, while larg er , is commens urate with i ts r ating and the s ize of i ts econom y On a net basi s, ou
Slide 38: Form 6-K incorporated by reference
This Form 6-K is hereby incorporated by reference into (1) each of the registration statements of UBS AG on Form F-3 (Registration Numbers 33-153882; 333-156695; and 333-156695-01 to -17) and Form S-8 (Registration Numbers 333-57878; 333-50320; 333-49216; 333- 49214; 333-49212; 333-49210; 333-103956
Slide 39: Signatures
SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. UBS AG By: /s/ Louis Eber Name: Louis Eber Title Group Managing Director By: /s/ Sarah M. Starkweather