Ubs Group Ag · SIX:UBSG
Ubs — Q1 2009 Earnings Presentation
29 slides from Ubs's earnings presentation, May 5, 2009
Slide 1: First Quarter 2009 Results
First Quarter 2009 Results May 5, 2009
Slide 2: Caution regarding forward looking statements
Caution regarding forward looking statements This presentation contains statements that constitute “forward-looking statements”, including but not limited to statements relating to the anticipated effect of transactions described herein, risks arising from the current market crisis and other risks s
Slide 3: Recent developments
Recent developments ♦ Update on strategic positioning provided at the AGM – Focus on international wealth management and the Swiss banking business alongside global expertise in investment banking and asset management – Integrated business model remains fundamentally attractive ♦ Adjusting the size
Slide 4: Group highlights
Group highlights 1Q08 4Q08 1Q09 Net profit attributable to UBS shareholders (CHF m) (11'617) (9'563) (1'975) Diluted earnings per share (CHF) (5.27) (3.02) (0.57) Total assets (CHF bn) 2'233 2'015 1'861 Risk-weighted assets (CHF bn) 335.4 302.3 277.7 Tier 1 ratio (%) 7.4 11.0 10.5 Net new money - WM
Slide 5: Performance by division – 1Q09
Performance by division – 1Q09 (CHF m) WM&SB WMA Global AM IB CC UBS Income 3'011 1'408 502 (295) 827 5'454 Credit loss (expense) / recovery (119) 1 (1'017) (1'135) Own credit 651 651 Total operating income 2'892 1'409 502 (661) 827 4'970 Personnel expenses 1'213 1'082 226 1'185 257 3'963 Non-person
Slide 6: Group income
Group income (CHF m) Fee and Interest Trading Treasury Total operating commission margin businesses activities and income excl. businesses other credit loss 6'105 4'784 4'241 1'540 1'321 1'182 (640) (2'387) (3'094) (5'617) 4Q08 1Q09 5
Slide 7: Group operating expenses
Group operating expenses (CHF m) ♦ Personnel expenses (1%) – 4Q included reversal of accruals for performance related compensation 815 (486) ♦ Non-personnel expenses – G&A lower across all categories (2'199) 1'836 ♦ Significant items in 1Q09 – goodwill impairment CHF 631m 6'562 6'528 – Severance cos
Slide 8: Group cost savings and personnel reduction
Group cost savings and personnel reduction ♦ Approx. CHF 650m of restructuring charges and severance costs expected in 2Q09 after CHF 184m booked in 1Q09 Group expenses (CHF bn) Group personnel1 (FTE thousands) ~77.5 ~7 ~ (10) 28.6 ~ 67.5 ~4 3.5 ~6.5 1.7 ~17 ~3.5 23.4 ~14.5 3.5 - 4.0 savings < 20 9.
Slide 9: Invested assets
Invested assets WM&SB (CHF bn) 1'062 (24) 26 944 (23) 955 934 (2%) (11%) Dec 08 NNM Market Currency Mar 09 4Q Avg 1Q Avg WM Americas (CHF bn) 16 704 (30) 43 658 673 644 5% (7%) Dec 08 NNM Market Currency Mar 09 4Q Avg 1Q Avg Global AM (CHF bn) 642 24 576 (8) (15) 575 576 0% (10%) Dec 08 NNM Market C
Slide 10: Net new money
Net new money (CHF bn) 3Q08 4Q08 1Q09 ♦ WM&SB – net outflows CHF 23.4bn from CHF 60.4bn in 4Q08 16.2 ♦ WM Americas – net inflows CHF (7.7) 16.2bn from CHF 2.2bn in 4Q08 (23.4) ♦ Global AM – net outflows CHF 7.7bn from CHF 27.6bn in 4Q08 Jan 09 Feb 09 Mar 09 ♦ The majority of outflows were recorded f
Slide 11: Balance sheet and leverage ratio
Balance sheet and leverage ratio ♦ Assets excluding PRVs and FX effects reduced by CHF 90 bn or 8% in 1Q09 ♦ Reductions mainly in trading portfolio and collateral trading ♦ FINMA Leverage ratio at 2.56% FINMA adjusted (CHF bn) As reported under IFRS average assets 2,542 2,487 2,275 2,233 2,080 2,015
Slide 12: Group regulatory capital
Group regulatory capital Tier 1 BIS Tier 1 Total Total capital RWA ratio capital ratio CHF billion and % 31.12.08 33.2 302.3 11.0% 45.4 15.0% Net P&L attr. to shareholders (2.0) Net P&L not eligible for capital (0.6) Own shares (1.1) MCN coupon (0.4) Other / FX 0.1 Group RWA (24.6) 31.03.09 29.2 277
Slide 13: Wealth Management & Swiss Bank
Wealth Management & Swiss Bank Pre-tax profit ♦ Pre-tax profit excluding impact from (CHF m) US cross-border case down 26% 1'959 ♦ Revenues down on reduced asset based and transactional fees and 1'452 lower interest income ♦ Credit loss expenses were CHF 119m in 1'077 1Q09 versus CHF 354m in 4Q08 91
Slide 14: Wealth Management Americas
Wealth Management Americas Pre-tax profit ♦ Pre-tax loss of CHF 35m due to lower (CHF m) fees on lower average asset levels, lower interest income and increase in 273 personnel expenses ♦ NNM inflows of 16.2bn driven by 180 recruiting of financial advisors (+153) (35) ♦ Expenses include goodwill imp
Slide 15: Global Asset Management
Global Asset Management Pre-tax profit ♦ Revenues up CHF 24m or 5% driven by (CHF m) higher institutional fees, mainly in A&Q 330 ♦ Expenses impacted by – Goodwill impairment charge of CHF 191m 236 related to the announced sale of UBS Pactual 132 – Accruals for incentive-based compensation (44%) – R
Slide 16: Investment Bank
Investment Bank Pre-tax profit ♦ Improved performance in underlying (CHF m) businesses, notably in the equities business and the rates and emerging markets within FICC ♦ Reduced losses on risk positions from (3'162) businesses being exited compared with 4Q, but still significant impact (8'096) – CVA
Slide 17: Investment Bank revenues
Investment Bank revenues Investment banking Sales & Trading – Equities Sales & Trading – FICC (CHF m) (CHF m) (CHF m) 2'048 1'371 557 528 304 231 (1'970) (3'720) (19'013) 1Q08 4Q08 1Q09 1Q08 4Q08 1Q08 1Q08 4Q08 1Q09 ♦ Advisory revenues down ♦ Positive revenues in all ♦ FICC impacted by significant 3
Slide 18: Q&A
Q&A The times are uncertain. The relationship isn’t. 17
Slide 19: Appendix
Appendix
Slide 20: Identified risk concentrations
Identified risk concentrations Of which Of which Net exposure Net exposure Total P&L trading P&L impairment 31.12.08 31.03.09 1Q09 USD billion 1Q09 charge 1Q09 Leveraged Finance 4.0 3.31 (0.4)2 (0.1) (0.4) Monoline 5.3 4.53 (1.7) (1.7)4 (0.0) 9.3 7.8 (2.1) (1.7) (0.4) 1 The Leveraged Finance net exp
Slide 21: SNB transaction
SNB transaction Valuation as of 30 September 2008 Positions Positions priced before priced after Total USD bn AR published AR published US sub-prime 4.0 1.6 5.5 US Alt-A 1.5 0.8 2.4 US prime 1.2 0.7 1.9 US RLN program 5.8 0.0 5.8 US CRE / CMBS 3.4 2.6 6.0 Student loans 0.5 0.0 0.5 Other positions 8.
Slide 22: SNB transaction / MCN – P&L items
SNB transaction / MCN – P&L items (CHF m) 4Q08 1Q09 Cost of the option to purchase the equity in the fund and subsequent FV (CC) (3'511) (302) Expense for contingent issuance of UBS shares to SNB (CC) (607) Price differences on the securities sold (IB) (771) (232) Loss on hedges subject to trading r
Slide 23: Exposure to monoline insurers
Exposure1 to monoline insurers2 Credit Fair value of Fair value of Fair value of Notional valuation underlying CDSs5 prior to CDSs after amount3 adjustment as CDOs4 CVA CVA USD billion of 31.3.09 Credit protection on US RMBS CDOs 8.0 1.1 6.9 4.8 2.1 of which from monolines rated investment grade (BB
Slide 24: Auction rate securities inventory and P&L
Auction rate securities inventory and P&L Net exposures Net exposures P&L USD billion as of 31.12.08 as of 31.3.09 1Q09 US student loan auction rate securities 8.4 10.9 0.1 US municipal auction rate securities 0.5 1.4 0.0 US taxable auction preferred securities 0.8 1.5 0.0 US tax-exempt auction pref
Slide 25: Client holdings auction rate securities – maximum repurchase
Client holdings auction rate securities – maximum repurchase Buyback period Par value of Par value of Holdings of max. required max. required Remaining unpurchased holdings Institutional purchase as purchase as of private Clients clients at 31.12.08 at 31.3.09 31.10.2008 to 2.1.2009 to 30.6.2010 to
Slide 26: Personnel reduction by division
Personnel reduction by division (FTE) (720) (110) (69) (705) 27 77'783 (1'577) 76'206 Dec 08 WM&SB WM Global IB CC Mar 09 Americas AM 25
Slide 27: WM&SB - Swiss clients
WM&SB - Swiss clients Revenues ♦ Revenues declined 308m or 16% on (CHF m) lower interest income, as well as reduced asset based and transactional fees 2'026 1'927 1'619 (16%) (20%) 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 vs. 4Q08 vs. 1Q08 Revenues (CHF m) 2'026 1'927 1'619 (16%) (20%) Invested assets (CHF bn)
Slide 28: WM&SB - International clients
WM&SB - International clients Revenues ♦ Revenues declined 186m or 12% on (CHF m) lower fee income and declined interest income following reduced volumes in lombard lending business 2'178 ♦ Gross margin stable at 89 bps 1'579 1'393 (12%) (36%) 1Q08 4Q08 1Q09 1Q08 4Q08 1Q09 vs. 4Q08 vs. 1Q08 Revenues
Slide 29: Corporate Center
Corporate Center Pre-tax profit ♦ 1Q09 includes (CHF m) – MCN gain of CHF 524m 3'981 – SNB fund call option loss of CHF 302m – Gain on buy-back of subordinated bonds of CHF 304m 631 ♦ 4Q08 included approx. CHF 3.4bn negative impact from SNB transaction and related MCNs, while 1Q08 included a gain of