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: May 7, 2024
UBS Group AG
(Registrant's
 
Name)
Bahnhofstrasse 45, 8001 Zurich, Switzerland
(Address of principal executive office)
Commission File Number: 1-36764
UBS AG
(Registrant's
 
Name)
Bahnhofstrasse 45, 8001 Zurich, Switzerland
Aeschenvorstadt 1, 4051 Basel, Switzerland
 
(Address of principal executive offices)
Commission File Number: 1-15060
 
Credit Suisse AG
(Registrant's
 
Name)
Paradeplatz 8, 8001 Zurich, Switzerland
(Address of principal executive office)
Commission File Number: 1-33434
Indicate by check mark whether the registrants file or will file annual
 
reports under cover of Form 20-F or Form
40-
F.
Form 20-F
 
☒
 
Form 40-F
 
☐
 
 
This Form 6-K consists of the
 
First Quarter 2024 Report of UBS Group
 
AG, which appears immediately following
this page.
 
edgarq24ubsgroupagp3i0
 
 
 
UBS
 
Group
First quarter
 
2024 report
 
 
 
 
 
Corporate calendar UBS Group AG
Information about future publication dates is available
 
at
ubs.com/global/en/investor-relations/events/calendar.html
Contacts
Switchboards
For all general inquiries
 
ubs.com/contact
Zurich +41-44-234 1111
London +44-207-567
 
8000
New York +1-212-821 3000
Hong Kong +852-2971 8888
Singapore +65-6495 8000
Investor Relations
UBS’s Investor Relations team manages
relationships with institutional investors,
research analysts and credit rating agencies.
 
ubs.com/investors
Zurich +41-44-234 4100
New York +1-212-882 5734
Media Relations
UBS’s Media Relations team manages
relationships with global media and
journalists.
ubs.com/media
Zurich +41-44-234 8500
mediarelations@ubs.com
London +44-20-7567 4714
 
ubs-media-relations@ubs.com
New York +1-212-882 5858
 
mediarelations@ubs.com
Hong Kong +852-2971 8200
sh-mediarelations-ap@ubs.com
Office of the Group Company Secretary
The Group Company Secretary handles
 
inquiries directed to the Chairman or to
other members of the Board of Directors.
UBS Group AG, Office of the Group
Company Secretary
PO Box, CH-8098 Zurich, Switzerland
sh-company-secretary@ubs.com
Zurich +41-44-235 6652
Shareholder Services
UBS’s Shareholder Services team, a unit
of the Group Company Secretary’s office,
manages relationships with shareholders
and the registration of UBS Group AG
registered shares.
 
UBS Group AG, Shareholder Services
PO Box, CH-8098 Zurich, Switzerland
sh-shareholder-services@ubs.com
Zurich +41-44-235 6652
US Transfer Agent
For global registered share-related
inquiries in the US.
Computershare Trust Company NA
PO Box 43006
Providence, RI, 02940-3006, USA
Shareholder online inquiries:
www.computershare.com/us/
investor-inquiries
Shareholder website:
computershare.com/investor
Calls from the US
 
+1-866-305-9566
Calls from outside the US
+1-781-575-2623
TDD for hearing impaired
+1-800-231-5469
TDD for foreign shareholders
+1-201-680-6610
Imprint
Publisher: UBS Group AG, Zurich, Switzerland | ubs.com
Language: English
 
© UBS 2024. The key symbol and UBS are among
 
the registered and unregistered
trademarks of UBS. All rights reserved.
1.
UBS
 
Group
4
7
2.
UBS business divisions
 
and Group Items
18
21
24
26
28
30
3.
Risk, capital, liquidity and funding,
and balance sheet
32
38
48
49
52
4.
Consolidated
financial statements
54
5.
Significant regulated subsidiary and
sub-group information
93
Appendix
96
101
103
104
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report
 
2
Terms used in this report, unless the context requires otherwise
“UBS,” “UBS Group,” “UBS Group
 
AG consolidated,” “Group,”
 
“the Group,” “we,” “us”
 
and “our”
UBS Group AG and its consolidated subsidiaries
“UBS AG” and “UBS
 
AG consolidated”
 
UBS AG and its consolidated subsidiaries
“Credit Suisse AG” and “Credit
 
Suisse AG consolidated”
Credit Suisse AG and its consolidated subsidiaries
“Credit Suisse Group“ and “Credit Suisse Group
 
AG consolidated”
Pre-acquisition Credit Suisse Group
”Credit Suisse”
Credit Suisse AG and its consolidated subsidiaries,
 
Credit Suisse
Services AG, and other small former Credit
 
Suisse Group entities
now directly held by UBS Group AG
“UBS Group AG” and “UBS
 
Group AG standalone”
 
UBS Group AG on a standalone basis
“Credit Suisse Group AG” and
 
“Credit Suisse Group AG standalone”
 
Credit Suisse Group AG on a standalone basis
“UBS AG standalone”
 
UBS AG on a standalone basis
“Credit Suisse AG standalone”
Credit Suisse AG on a standalone basis
“UBS Switzerland AG” and “UBS
 
Switzerland AG standalone”
UBS Switzerland AG on a standalone basis
“UBS Europe SE consolidated”
 
UBS Europe SE and its consolidated subsidiaries
“UBS Americas Holding LLC” and
 
“UBS Americas Holding LLC consolidated”
UBS Americas Holding LLC and its consolidated subsidiaries
“Capital Release Unit (Credit Suisse)”
The Capital Release Unit division of Credit Suisse
 
AG and its
consolidated subsidiaries
 
“Corporate Center (Credit Suisse)”
The Corporate Center division of Credit Suisse AG
 
and its
consolidated subsidiaries
 
“Investment Bank (Credit Suisse)”
The Investment Bank division of Credit Suisse AG and
 
its
consolidated subsidiaries
 
“Swiss Bank (Credit Suisse)”
The Swiss Bank division of Credit Suisse AG and
 
its consolidated
subsidiaries
 
“1m”
One million, i.e., 1,000,000
“1bn”
One billion, i.e., 1,000,000,000
“1trn”
One trillion, i.e., 1,000,000,000,000
In this report, unless the context requires otherwise,
 
references to any gender shall apply to all genders.
Alternative performance measures
An alternative performance measure (an APM) is a financial measure of historical or
 
future financial performance,
financial position
 
or cash
 
flows other
 
than a
 
financial measure
 
defined or
 
specified in
 
the applicable
 
recognized
accounting standards
 
or
 
in other
 
applicable regulations.
 
We
 
report
 
a
 
number of
 
APMs
 
in
 
the discussion
 
of
 
the
financial and
 
operating performance
 
of the
 
Group, our
 
business divisions
 
and Group
 
Items. We
 
use APMs
 
to provide
a
 
more
 
complete
 
picture of
 
our
 
operating performance
 
and
 
to
 
reflect
 
management’s view
 
of
 
the
 
fundamental
drivers
 
of
 
our
 
business
 
results. A
 
definition
 
of
 
each
 
APM,
 
the
 
method
 
used
 
to
 
calculate
 
it
 
and
 
the
 
information
content are presented
 
under “Alternative performance measures”
 
in the
 
appendix to this
 
report. Our APMs
 
may
qualify
 
as
 
non-GAAP
 
measures
 
as
 
defined
 
by
 
US
 
Securities
 
and
 
Exchange
 
Commission
 
(SEC)
 
regulations.
 
Our
underlying results are APMs and are non-GAAP
 
financial measures.
›
Refer to the “Group performance” section of this report and to “Alternative performance measures” in the
appendix to this report for additional information about underlying results
Comparability
Comparative information in this report is presented
 
as follows.
Profit
 
and
 
loss
 
information
 
for
 
the
 
first
 
quarter
 
of
 
2024
 
and
 
the
 
fourth
 
quarter
 
of
 
2023
 
is
 
presented
 
on
 
a
consolidated basis, each
 
including Credit
 
Suisse data
 
for three
 
months. Information for
 
the first
 
quarter of
 
2023
includes pre-acquisition UBS data only.
 
Balance
 
sheet
 
information
 
as
 
at
 
31 March
 
2024
 
and
 
31 December
 
2023
 
includes
 
UBS
 
and
 
Credit
 
Suisse
consolidated information, prior balance sheet
 
dates reflect pre-acquisition UBS information
 
only.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report
 
3
Our key figures
As of or for the quarter ended
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
Group results
Total revenues
 
12,739
 
10,855
 
8,744
Credit loss expense / (release)
 
106
 
136
 
38
Operating expenses
 
10,257
 
11,470
 
7,210
Operating profit / (loss) before tax
 
2,376
 
(751)
 
1,495
Net profit / (loss) attributable to shareholders
 
1,755
 
(279)
 
1,029
Diluted earnings per share (USD)
2
 
0.52
 
(0.09)
 
0.32
Profitability and growth
3,4,5
Return on equity (%)
 
8.2
 
(1.3)
 
7.2
Return on tangible equity (%)
 
9.0
 
(1.4)
 
8.1
Underlying return on tangible equity (%)
6
 
9.6
 
4.8
 
8.7
Return on common equity tier 1 capital (%)
 
9.0
 
(1.4)
 
9.1
Underlying return on common equity tier 1 capital (%)
6
 
9.6
 
4.7
 
9.8
Return on leverage ratio denominator, gross (%)
 
3.1
 
2.6
 
3.4
Cost / income ratio (%)
 
80.5
 
105.7
 
82.5
Underlying cost / income ratio (%)
6
 
77.2
 
93.0
 
81.7
Effective tax rate (%)
 
25.8
n.m.
7
 
30.7
Net profit growth (%)
 
70.6
n.m.
 
(51.8)
Resources
3
Total assets
 
1,607,120
 
1,717,246
 
1,053,134
Equity attributable to shareholders
 
85,260
 
86,108
 
56,754
Common equity tier 1 capital
8
 
78,147
 
78,485
 
44,590
Risk-weighted assets
8
 
526,437
 
546,505
 
321,660
Common equity tier 1 capital ratio (%)
8
 
14.8
 
14.4
 
13.9
Going concern capital ratio (%)
8
 
17.8
 
16.9
 
17.9
Total loss-absorbing capacity ratio (%)
8
 
37.5
 
36.5
 
34.3
Leverage ratio denominator
8
 
1,599,646
 
1,695,403
 
1,014,446
Common equity tier 1 leverage ratio (%)
8
 
4.9
 
4.6
 
4.4
Liquidity coverage ratio (%)
9
 
220.2
 
215.7
 
161.9
Net stable funding ratio (%)
 
126.4
 
124.7
 
117.7
Other
Invested assets (USD bn)
4,10,11
 
5,848
 
5,714
 
4,184
Personnel (full-time equivalents)
 
111,549
 
112,842
 
73,814
Market capitalization
2,12
 
106,440
 
107,355
 
74,276
Total book value per share (USD)
2
 
26.59
 
26.83
 
18.59
Tangible book value per share (USD)
2
 
24.29
 
24.49
 
16.54
1 Comparative-period information has been revised.
 
Refer to “Note 2 Accounting for the
 
acquisition of the Credit Suisse Group”
 
in the “Consolidated financial statements” section
 
of the UBS Group Annual
 
Report
2023, available under “Annual reporting” at ubs.com/investors, for more information.
 
2 Refer to the “Share information and earnings per share”
 
section of this report for more information.
 
3 Refer to the “Targets,
capital guidance and ambitions” section of
 
the UBS Group Annual Report 2023, available
 
under “Annual reporting” at ubs.com/investors, for more information about our performance targets.
 
4 Refer to “Alternative
performance measures” in the appendix
 
to this report for
 
the definition and calculation method.
 
5 Profit or loss information for
 
each of the first quarter
 
of 2024 and the
 
fourth quarter of 2023
 
is presented on a
consolidated basis, including for each quarter Credit Suisse data for three months and for the purpose of the calculation of
 
return measures has been annualized multiplying such by four.
 
Profit or loss information for
the first quarter of
 
2023 includes pre-acquisition UBS data
 
for three months and for
 
the purpose of the
 
calculation of return measures has
 
been annualized multiplying such
 
by four.
 
6 Refer to the “Group
 
performance”
section of this report for more information about underlying results.
 
7 The effective tax rate for the
 
fourth quarter of 2023 is not a meaningful measure,
 
due to the distortive effect of current unbenefited tax losses
at the former Credit Suisse entities.
 
8 Based on the Swiss systemically relevant bank framework as
 
of 1 January 2020. Refer to the “Capital management” section
 
of this report for more information.
 
9 The disclosed
ratios represent quarterly averages for the quarters presented and are calculated based on an average of 61 data points in the first quarter of 2024, 63 data
 
points in the fourth quarter of 2023 and 64 data points in
the first quarter
 
of 2023. Refer
 
to the “Liquidity
 
and funding management”
 
section of this
 
report for more
 
information.
 
10 Consists of invested
 
assets for Global
 
Wealth Management,
 
Asset Management and
Personal & Corporate Banking. Refer to “Note 32 Invested assets and net new money” in the “Consolidated
 
financial statements” section of the UBS Group Annual Report 2023, available under “Annual
 
reporting”
at ubs.com/investors,
 
for more information.
 
11 Starting with the second
 
quarter of 2023,
 
invested assets include invested
 
assets from associates
 
in the Asset
 
Management business division,
 
to better reflect
 
the
business strategy. Comparative figures
 
have been restated to reflect this change.
 
12 In the second quarter of 2023, the calculation of
 
market capitalization was amended to reflect total
 
shares issued multiplied by
the share price at the end of the period. The calculation was previously based on total shares outstanding multiplied by the share price at the
 
end of the period. Market capitalization was increased by USD 10.0bn as
of 31 March 2023 as a result.
 
 
UBS Group first quarter 2024 report |
UBS Group | Recent developments
 
4
UBS Group
Management report
Recent developments
Integration of Credit Suisse
In the first quarter of 2024, we made
 
substantial progress related to the
 
integration of Credit Suisse. We expect
 
to
complete the merger of UBS AG and Credit Suisse AG on 31 May 2024, following operational testing and subject
to remaining regulatory approvals. The transition to a single US intermediate holding company is also planned for
the second quarter
 
of 2024 and
 
the merger of Credit
 
Suisse (Schweiz) AG
 
and UBS Switzerland AG
 
continues to
be planned for the third quarter of
 
2024. Completing the mergers of our significant legal
 
entities is a critical step
in enabling us
 
to unlock the
 
next phase of
 
the cost, capital,
 
funding and tax
 
benefits we expect
 
to realize in
 
the
second half of 2024 and by the end of 2025
 
and into 2026. These mergers will also facilitate
 
Credit Suisse Wealth
Management client migrations to UBS infrastructure across
 
our businesses, which we expect to
 
commence in the
second half of 2024.
 
We have achieved USD 5bn of exit rate gross cost savings, compared with the 2022 combined cost base of Credit
Suisse and UBS,
 
out of the
 
USD 13bn of exit
 
rate gross cost
 
savings that we
 
aim to achieve
 
by the end
 
of 2026.
Cost savings are likely to decrease
 
from the per quarter rate
 
of around USD 1bn and we aim
 
to achieve USD 1.5bn
of additional exit rate gross cost savings in the
 
remainder of 2024.
During the first
 
quarter of 2024,
 
Non-core and Legacy
 
continued to exit
 
positions and
 
reduced risk-weighted
 
assets
by USD 16bn
 
and the
 
leverage ratio
 
denominator by
 
USD 49bn. UBS
 
and entities
 
associated with
 
Apollo Global
Management
 
(Apollo)
 
and
 
Atlas
 
SP
 
Partners
 
(Atlas)
 
entered
 
into
 
agreements
 
to
 
conclude
 
an
 
investment
management agreement and
 
a transition
 
services agreement
 
with Atlas
 
SP. As
 
part of
 
these agreements,
 
Apollo
has also
 
purchased USD 8bn
 
of senior
 
secured financing
 
facilities. We
 
recognized a
 
net gain
 
of USD 272m
 
from
these
 
transactions.
 
Credit
 
Suisse
 
AG
 
recognized
 
a
 
net
 
loss
 
of
 
USD 0.9bn.
 
The
 
difference
 
primarily
 
reflects
adjustments that UBS Group
 
made under IFRS Accounting
 
Standards as part of
 
the purchase price allocation
 
at the
closing of the acquisition of the Credit Suisse
 
Group.
 
On 6 May
 
2024, Credit
 
Suisse (Schweiz)
 
AG repaid
 
further funding
 
drawn under
 
the Emergency
 
Liquidity Assistance
(ELA) facility, reducing
 
the amount of
 
funding outstanding under
 
the ELA
 
from CHF
 
19bn to CHF
 
9bn as of
 
that
date. The remaining CHF 9bn are expected
 
to be repaid in the coming months.
Regulatory and legal developments
Swiss Federal Council releases its report on systemically
 
important banks
In April
 
2024, the
 
Swiss Federal
 
Council released
 
its report
 
on banking
 
stability that
 
evaluates the
 
regulation of
systemically important banks.
 
The report
 
includes a
 
comprehensive review
 
of the
 
acquisition of the
 
Credit Suisse
Group
 
and
 
concludes
 
that
 
the
 
existing
 
Swiss
 
too-big-to-fail
 
(TBTF)
 
regime
 
must
 
be
 
further
 
developed
 
and
strengthened. The
 
Swiss Federal
 
Council proposes
 
to introduce
 
a broad
 
package of
 
measures, focused
 
on three
areas: strengthening prevention, strengthening liquidity and expanding the crisis
 
toolkit.
 
Preventive measures include
 
proposals to strengthen
 
the capital base,
 
to improve resolvability
 
and tighten capital
requirements
 
for
 
global
 
systemically
 
important
 
banks
 
(G-SIBs),
 
including
 
the
 
introduction
 
of
 
forward-looking
elements for institution-specific Pillar 2 capital surcharges
 
and increased capital adequacy requirements for foreign
participations.
 
The Swiss Federal
 
Council also recommended
 
preventive measures related
 
to corporate governance,
such as a senior management regime and stricter regulations
 
regarding bonuses. To strengthen liquidity, the Swiss
Federal Council intends to significantly expand the potential for the
 
Swiss National Bank to provide more liquidity
in a
 
crisis. Furthermore,
 
the Swiss
 
Federal Council
 
reiterated its
 
support for
 
the introduction
 
of a
 
public liquidity
backstop. To expand
 
the crisis toolkit,
 
the Swiss Federal
 
Council proposed measures
 
that aim to minimize
 
legal risks
associated with the execution of resolution
 
measures.
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Recent developments
 
5
In the first half
 
of 2025, the Swiss
 
Federal Council is expected
 
to present two packages
 
to implement the
 
proposed
measures:
 
one
 
with
 
changes
 
at
 
the
 
ordinance
 
level,
 
which
 
can
 
be
 
adopted
 
by
 
the
 
Swiss
 
Federal
 
Council,
 
and
another,
 
which
 
will
 
be
 
submitted
 
to
 
the
 
Parliament,
 
with
 
proposed
 
legislative
 
amendments.
 
The
 
Swiss
 
Federal
Council has
 
stated that
 
when drafting
 
these two
 
packages it
 
will take
 
into account
 
the findings
 
of the
 
Parliamentary
Investigation Committee concerning
 
the role of the Swiss authorities
 
in the rescue of the Credit Suisse
 
Group. Due
to the broad range of possible outcomes, the impact of the proposals on UBS can be fully assessed only when the
implementation details become clearer.
 
FINMA publishes ordinances with implementing
 
provisions for the revised Swiss Capital Adequacy
 
Ordinance
In
 
March
 
2024,
 
the
 
Swiss
 
Financial
 
Market
 
Supervisory
 
Authority
 
(FINMA)
 
published
 
five
 
new
 
ordinances
 
to
implement
 
the
 
final
 
Basel III
 
standards
 
in
 
Switzerland,
 
replacing
 
various
 
existing
 
FINMA
 
circulars,
 
including
ordinances on operational
 
risks and market
 
risks. The ordinances
 
contain the implementing
 
provisions for the
 
Swiss
Federal
 
Council’s
 
revised
 
Capital
 
Adequacy
 
Ordinance
 
for
 
banks
 
(the
 
CAO)
 
and
 
they
 
will
 
enter
 
into
 
force
 
on
1 January 2025.
Shortening the securities settlement cycle to
 
T+1
In the US,
 
a shortened
 
T+1 settlement cycle
 
will apply to
 
securities transactions
 
beginning on
 
28 May 2024. In
 
April
2024, the UK
 
Accelerated Settlement Taskforce
 
issued a report
 
proposing a phased
 
approach to the
 
adoption of
T+1 settlement
 
and the
 
establishing of a
 
technical working
 
group to review
 
the operational
 
and behavioral
 
changes
required for a T+1 settlement cycle.
 
Recommendations for changes
 
are planned to be made by
 
the end of 2025 to
enable
 
the
 
market
 
to
 
prepare,
 
with
 
the
 
move
 
to
 
T+1
 
expected
 
to
 
take
 
place before
 
the
 
end
 
of
 
2027.
 
The
 
UK
government has accepted the recommendations and confirmed it will work with the
 
EU and Switzerland to see if
similar timeframes will be pursued and,
 
therefore,
 
if alignment is possible.
 
New Retirement Security Rule adopted for
 
US retirement and pension accounts
In April 2024,
 
the US
 
Department of
 
Labor (the
 
DOL) adopted
 
a new Retirement
 
Security Rule,
 
related amendments
to existing
 
rules governing
 
transactions between
 
covered plans
 
and parties
 
in interest,
 
and amendments
 
to the
“qualified professional asset manager” transaction exemption. The
 
Retirement Security Rule expands the scope of
transactions
 
subject
 
to
 
requirements
 
of
 
the
 
Employment
 
Retirement
 
Income
 
Security
 
Act
 
by
 
expanding
 
the
relationships
 
and
 
advice
 
that
 
create
 
a
 
fiduciary
 
relationship
 
between
 
an
 
investment
 
professional
 
and
 
a
 
plan
 
or
beneficiary, particularly in relation to
 
individual retirement accounts
 
(IRAs). The amendments
 
to existing transaction
exemptions generally
 
limit or
 
prohibit the
 
use of
 
those exemptions
 
for transactions
 
involving IRAs,
 
with the
 
intention
of
 
requiring
 
transactions
 
involving
 
IRAs
 
to
 
rely
 
upon
 
an
 
exemption
 
(PTE
 
2020-2)
 
imposing
 
specific
 
impartiality,
conflict-of-interest and compliance requirements. Global Wealth Management US
 
treats established IRA accounts
as fiduciary
 
relationships in
 
accordance with
 
PTE 2020-2.
 
We are assessing
 
the effect
 
of the
 
changes on
 
our business
with IRA accounts.
 
In connection with the
 
adoption of the
 
Retirement Security Rule,
 
the DOL also amended
 
PTE 2020-2 to expand
 
the
scope of
 
affiliated persons
 
for which
 
a criminal
 
conviction or
 
determinations of
 
misconduct disqualify
 
an investment
professional from using the exemption and to add a
 
one-year transition period for a newly disqualified investment
professional
 
to
 
transition
 
the
 
related
 
business.
 
The
 
amendments
 
to
 
the
 
qualified
 
professional
 
asset
 
manager
exemption also expand the scope of
 
events that may trigger disqualification and add
 
a similar one-year transition
provision. In each case, the DOL retains the
 
ability to grant an individual exemption
 
from the disqualification.
The Swiss National Bank will raise the minimum
 
reserve requirement for banks
In April 2024, the Swiss National Bank
 
(the SNB) announced that it will raise
 
the minimum reserve requirement for
domestic banks from 2.5%
 
to 4%, and it
 
will therefore amend the
 
National Bank Ordinance as
 
of 1 July 2024.
 
The
SNB further announced
 
that liabilities arising
 
from cancelable customer
 
deposits (excluding
 
tied pension provisions)
will be included in
 
full in the
 
calculation of the
 
minimum reserve requirement, as
 
is the case with
 
the other relevant
liabilities.
 
This
 
revokes
 
the
 
previous
 
exception
 
under
 
which
 
only
 
20%
 
of
 
these
 
liabilities
 
counted
 
toward
 
the
calculation. Based
 
on preliminary
 
internal assessments, UBS
 
expects a
 
negative impact
 
of USD 70m
 
to USD 80m
per annum on net interest income to result from these changes.
 
 
UBS Group first quarter 2024 report |
UBS Group | Recent developments
 
6
Other developments
Capital returns
On 24 April
 
2024, the
 
shareholders approved a
 
dividend of
 
USD 0.70 per
 
share at
 
the Annual
 
General Meeting.
The dividend was paid on 3 May 2024 to shareholders
 
of record on 2 May 2024.
Our 2022
 
share repurchase program
 
was concluded on
 
28 March 2024.
 
A total
 
of 298,537,950
 
UBS Group
 
AG
shares were acquired under that program, at an aggregate
 
purchase price of CHF 5,010m, of which CHF 1,202m
were acquired in 2023
 
prior to the announcement
 
of the acquisition of
 
the Credit Suisse
 
Group.
 
On 12 April 2023,
the Swiss
 
Takeover Board
 
approved the
 
use of
 
up to
 
178,031,942 shares
 
repurchased under
 
the 2022
 
program,
and originally intended for cancellation, for
 
the acquisition of the Credit Suisse Group.
On 3 April 2024, we
 
launched a new
 
2024 share repurchase
 
program of up
 
to USD 2bn over two
 
years. We expect
to execute up
 
to USD 1bn of
 
repurchases in 2024,
 
commencing after the
 
completion of the
 
merger of UBS AG
 
and
Credit Suisse AG.
›
Refer to the “Share information and earnings per share” section of this report for more information
Credit Suisse’s wealth management business
 
in Japan
In April 2024, UBS and Sumitomo Mitsui Trust
 
Holdings, Inc. (SuMi TRUST Holdings) announced that their wealth
management entity, UBS SuMi
 
TRUST Wealth
 
Management Co.,
 
Ltd. (UBS
 
SuMi), will
 
acquire Credit Suisse’s
 
wealth
management business in
 
Japan, including all
 
of Credit Suisse’s client
 
advisors and the
 
assets they manage
 
in Japan.
Following completion, UBS
 
and SuMi TRUST Holdings
 
will rebalance their investments
 
in UBS SuMi to maintain
 
the
current ownership structure (UBS
 
51% / SuMi TRUST Holdings 49%).
 
UBS will continue to consolidate the
 
entity.
The transaction is expected to close in the fourth quarter
 
of 2024 and is not expected to have a material effect on
the common equity tier 1 capital of the Group.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
7
Group performance
 
Income statement
For the quarter ended
% change from
USD m
31.3.24
31.12.23
31.3.23
4Q23
1Q23
Net interest income
 
1,940
 
2,095
 
1,388
 
(7)
 
40
Other net income from financial instruments measured
 
at fair value through profit or loss
 
4,182
 
3,158
 
2,681
 
32
 
56
Net fee and commission income
 
6,492
 
5,780
 
4,606
 
12
 
41
Other income
 
124
 
(179)
 
69
 
79
Total revenues
 
12,739
 
10,855
 
8,744
 
17
 
46
Credit loss expense / (release)
 
106
 
136
 
38
 
(22)
 
177
Personnel expenses
 
6,949
 
7,061
 
4,620
 
(2)
 
50
General and administrative expenses
 
2,413
 
2,999
 
2,065
 
(20)
 
17
Depreciation, amortization and impairment of non-financial
 
assets
 
895
 
1,409
 
525
 
(37)
 
70
Operating expenses
 
10,257
 
11,470
 
7,210
 
(11)
 
42
Operating profit / (loss) before tax
 
2,376
 
(751)
 
1,495
 
59
Tax expense / (benefit)
 
 
612
 
(473)
 
459
 
33
Net profit / (loss)
 
1,764
 
(278)
 
1,037
 
70
Net profit / (loss) attributable to non-controlling interests
 
9
 
1
 
8
 
7
Net profit / (loss) attributable to shareholders
 
1,755
 
(279)
 
1,029
 
71
Comprehensive income
Total comprehensive income
 
(245)
 
2,695
 
1,833
Total comprehensive income attributable to non-controlling interests
 
(5)
 
18
 
13
Total comprehensive income attributable to shareholders
 
(240)
 
2,677
 
1,820
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
8
Selected financial information of our business divisions and Group Items
For the quarter ended 31.3.24
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group Items
Total
Total revenues as reported
 
6,143
 
2,423
 
776
 
2,751
 
1,001
 
(355)
 
12,739
of which: PPA effects and other integration items
1
 
234
 
256
 
293
 
(4)
 
779
Total revenues (underlying)
 
5,909
 
2,166
 
776
 
2,458
 
1,001
 
(351)
 
11,960
Credit loss expense / (release)
 
(3)
 
44
 
0
 
32
 
36
 
(2)
 
106
Operating expenses as reported
 
5,044
 
1,404
 
665
 
2,164
 
1,011
 
(33)
 
10,257
of which: integration-related expenses and PPA effects
2
 
404
 
160
 
71
 
143
 
242
 
1
 
1,021
Operating expenses (underlying)
 
4,640
 
1,245
 
594
 
2,022
 
769
 
(34)
 
9,236
Operating profit / (loss) before tax as reported
 
1,102
 
975
 
111
 
555
 
(46)
 
(320)
 
2,376
Operating profit / (loss) before tax (underlying)
 
1,272
 
878
 
182
 
404
 
197
 
(315)
 
2,617
For the quarter ended 31.12.23
3
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group Items
Total
Total revenues as reported
 
5,554
 
2,083
 
825
 
2,141
 
145
 
107
 
10,855
of which: PPA effects and other integration items
1
 
349
 
306
 
277
 
12
 
944
of which: losses related to investment in SIX Group
 
(190)
 
(317)
 
(508)
Total revenues (underlying)
 
5,395
 
2,094
 
825
 
1,864
 
145
 
95
 
10,419
Credit loss expense / (release)
 
(8)
 
85
 
(1)
 
48
 
15
 
(2)
 
136
Operating expenses as reported
 
5,282
 
1,398
 
704
 
2,283
 
1,787
 
16
 
11,470
of which: integration-related expenses and PPA effects
2
 
502
 
187
 
64
 
167
 
750
 
109
 
1,780
of which: acquisition-related costs
 
(1)
 
(1)
Operating expenses (underlying)
 
4,780
 
1,210
 
639
 
2,116
 
1,037
 
(92)
 
9,690
Operating profit / (loss) before tax as reported
 
280
 
601
 
122
 
(190)
 
(1,657)
 
93
 
(751)
Operating profit / (loss) before tax (underlying)
 
624
 
800
 
186
 
(300)
 
(907)
 
189
 
592
For the quarter ended 31.3.23
4
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group Items
Total
Total revenues as reported
 
4,788
 
1,277
 
503
 
2,365
 
23
 
(211)
 
8,744
Total revenues (underlying)
 
4,788
 
1,277
 
503
 
2,365
 
23
 
(211)
 
8,744
Credit loss expense / (release)
 
15
 
16
 
0
 
7
 
0
 
0
 
38
Operating expenses as reported
 
3,561
 
663
 
408
 
1,866
 
699
 
14
 
7,210
of which: acquisition-related costs
 
70
 
70
Operating expenses (underlying)
 
3,561
 
663
 
408
 
1,866
 
699
 
(57)
 
7,140
Operating profit / (loss) before tax as reported
 
1,212
 
598
 
95
 
492
 
(676)
 
(225)
 
1,495
Operating profit / (loss) before tax (underlying)
 
1,212
 
598
 
95
 
492
 
(676)
 
(155)
 
1,566
1 Includes accretion of PPA
 
adjustments on financial instruments and other
 
PPA effects, as well
 
as temporary and incremental items
 
directly related to the integration.
 
2 Includes temporary, incremental
 
operating
expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the Credit Suisse Group.
 
3 Comparative-period information has been restated for
changes in business
 
division perimeters,
 
Group Treasury
 
allocations and Non-core
 
and Legacy cost
 
allocations. Refer
 
to “Changes to
 
segment reporting in
 
2024” in the
 
“UBS business divisions
 
and Group Items”
section below and “Note
 
3 Segment reporting” in
 
the “Consolidated financial statements”
 
section of this report
 
for more information.
 
4 Comparative-period information has
 
been restated for changes
 
in Group
Treasury allocations.
 
Refer to “Changes to segment
 
reporting in 2024” in the
 
“UBS business divisions and Group
 
Items” section below and “Note
 
3 Segment reporting” in the “Consolidated
 
financial statements”
section of this report for more information.
Integration-related expenses, by business division and Group Items
For the quarter ended
USD m
31.3.24
31.12.23
Global Wealth Management
 
432
 
500
Personal & Corporate Banking
 
140
 
161
Asset Management
 
71
 
64
Investment Bank
 
143
 
167
Non-core and Legacy
 
242
 
750
Group Items
 
1
 
109
Total integration-related expenses
 
1,029
 
1,751
of which: total revenues
 
37
 
0
of which: operating expenses
 
992
 
1,751
of which: personnel expenses
 
555
 
794
of which: general and administrative expenses
 
355
 
455
of which: depreciation, amortization and impairment of non-financial
 
assets
 
82
 
503
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
9
Introduction to underlying results
In addition to
 
reporting our
 
results in accordance
 
with IFRS
 
Accounting Standards,
 
we report underlying
 
results that
exclude items of profit or loss that management believes
 
are not representative of the underlying performance.
In
 
the
 
first
 
quarter
 
of
 
2024,
 
underlying
 
revenues
 
exclude
 
purchase
 
price
 
allocation
 
(PPA)
 
effects
 
and
 
other
integration items. PPA
 
effects mainly consist
 
of PPA
 
adjustments on financial
 
instruments measured at
 
amortized
cost, including
 
off-balance sheet
 
positions, arising
 
from the
 
acquisition of
 
the Credit
 
Suisse Group.
 
Accretion of
 
PPA
adjustments on financial
 
instruments is accelerated
 
when the related
 
financial instrument is
 
derecognized before
its contractual maturity.
 
No adjustment is
 
made for accretion
 
of PPA
 
adjustments on financial
 
instruments within
the Non-core and Legacy business division,
 
due to the nature of
 
its business model. In 2023, underlying revenues
also exclude losses relating to our investment
 
in SIX Group.
Underlying expenses exclude
 
integration-related expenses that
 
are temporary, incremental
 
and directly
 
related to
the integration of
 
Credit Suisse into UBS,
 
including costs of
 
internal staff and contractors
 
substantially dedicated to
integration activities, retention
 
awards, redundancy costs,
 
incremental expenses from
 
the shortening of useful
 
lives
of property,
 
equipment and
 
software, and
 
impairment charges
 
relating to these
 
assets. Classification
 
as integration-
related expenses does
 
not affect the
 
timing of recognition
 
and measurement
 
of those expenses
 
or the presentation
thereof
 
in
 
the
 
income
 
statement. Integration-related
 
expenses
 
incurred
 
by
 
Credit
 
Suisse
 
also
 
included
 
expenses
associated with restructuring
 
programs that existed prior to the acquisition.
Results: 1Q24 vs 1Q23
Reported operating
 
profit before
 
tax increased
 
by USD 881m,
 
or 59%,
 
to USD 2,376m, reflecting
 
an increase
 
in
total revenues, partly offset
 
by higher operating expenses
 
and net credit loss expenses.
 
Total revenues increased by
USD 3,995m, or
 
46%, to
 
USD 12,739m, largely
 
due to
 
the consolidation
 
of Credit
 
Suisse revenues
 
of USD 3,829m,
and included accretion
 
impacts resulting from
 
PPA adjustments on financial
 
instruments and other PPA
 
effects of
USD 815m. This increase was mainly driven
 
by a USD 2,054m increase in total
 
combined net interest income and
other
 
net
 
income
 
from
 
financial
 
instruments
 
measured
 
at
 
fair
 
value
 
through
 
profit
 
or
 
loss
 
and
 
a
 
USD 1,886m
increase
 
in
 
net
 
fee
 
and
 
commission
 
income.
 
Other
 
income
 
also
 
increased
 
by
 
USD 55m.
 
Operating
 
expenses
increased by USD 3,047m, or
 
42%, to USD 10,257m, largely due
 
to the consolidation of Credit
 
Suisse expenses of
USD 2,903m,
 
and
 
included
 
integration-related
 
expenses
 
of
 
USD 992m.
 
This
 
increase
 
was
 
mainly
 
driven
 
by
 
a
USD 2,329m increase
 
in
 
personnel expenses.
 
Depreciation, amortization
 
and impairment
 
of non-financial
 
assets
also increased
 
by USD 370m,
 
and general
 
and administrative
 
expenses increased
 
by USD 348m,
 
with those
 
increases
partly
 
offset by
 
the prior-year
 
quarter including
 
a
 
USD 665m increase
 
in provisions
 
related to
 
the US
 
residential
mortgage-backed securities (RMBS) litigation matter.
 
Underlying results 1Q24 vs 1Q23
For the purpose of determining underlying results for the
 
first quarter of 2024, we excluded PPA effects and other
integration
 
items
 
of
 
USD 779m
 
from
 
total
 
revenues
 
and
 
integration-related
 
expenses
 
and
 
PPA
 
effects
 
of
USD 1,021m from operating expenses.
 
On
 
an
 
underlying
 
basis,
 
profit
 
before
 
tax
 
increased
 
by
 
USD 1,051m,
 
or
 
67%,
 
to
 
USD 2,617m,
 
reflecting
 
a
USD 3,216m increase in underlying total revenues,
 
partly offset by a USD 2,096m increase in
 
underlying operating
expenses and
 
net credit loss
 
expenses
 
of USD 106m, compared
 
with net
 
credit loss
 
expenses
 
of USD 38m in
 
the
first quarter of 2023.
Total revenues: 1Q24 vs 1Q23
Net interest income and other net income
 
from financial instruments measured at
 
fair value through profit or loss
Total combined net
 
interest income
 
and other
 
net income
 
from financial
 
instruments
 
measured at
 
fair value
 
through
profit or
 
loss increased
 
by USD 2,054m
 
to USD 6,123m,
 
mainly driven
 
by the
 
consolidation
 
of USD 2,965m
 
of Credit
Suisse
 
revenues,
 
and
 
included
 
USD 517m
 
of
 
accretion
 
impacts
 
resulting
 
from
 
PPA
 
adjustments
 
on
 
financial
instruments and other PPA effects.
 
Personal & Corporate Banking increased
 
by USD 871m to USD 1,704m,
 
largely attributable to the consolidation
 
of
USD 814m
 
of
 
Credit
 
Suisse
 
revenues,
 
and
 
included
 
USD 240m
 
of
 
accretion
 
of
 
PPA
 
adjustments
 
on
 
financial
instruments and other PPA effects. The remaining increase was mainly
 
driven by higher deposit margins, resulting
from higher interest rates, partly
 
offset by shifts to lower-margin
 
deposit products.
 
Excluding the aforementioned
accretion effects, underlying net interest
 
income was USD 1,268m.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
10
Global Wealth Management increased
 
by USD 555m to
 
USD 2,354m, largely attributable to
 
the consolidation of
USD 798m
 
of
 
Credit
 
Suisse
 
revenues,
 
and
 
included
 
USD 257m
 
of
 
accretion
 
of
 
PPA
 
adjustments
 
on
 
financial
instruments and other
 
PPA effects. The
 
remaining variance
 
was attributable
 
to lower deposit
 
margins, including
 
the
effects
 
of
 
shifts
 
to
 
lower-margin
 
products,
 
partly
 
offset
 
by
 
higher
 
rates
 
and
 
deposit
 
volumes.
 
Excluding
 
the
aforementioned accretion effects, underlying net
 
interest income was USD 1,615m.
Non-core and Legacy
 
increased by USD 890m
 
to USD 908m, which
 
included net gains from
 
position exits, along with
net interest income
 
from securitized products
 
and credit products.
 
Revenues also included
 
a net gain
 
of USD 272m
from the conclusion of agreements with
 
Apollo relating to the former Credit
 
Suisse securitized products group.
Group Items was negative USD 406m, compared with negative USD 252m in the
 
prior-year quarter, including the
consolidation of USD 124m
 
losses from Credit Suisse.
 
The remaining variance was
 
attributable to the net
 
effects of
Group hedging and own debt,
 
including hedge accounting ineffectiveness, within Group
 
Treasury and an increase
in funding costs
 
related to deferred
 
tax. The results
 
across the
 
periods were driven
 
by mark-to-market effects
 
on
portfolio-level economic hedges due to higher
 
interest rates and cross-currency-basis widening.
 
The Investment Bank decreased by USD 114m to USD 1,562m. This result included the consolidation of USD 22m
of Credit
 
Suisse revenues
 
and USD 17m
 
of accretion of
 
PPA adjustments
 
on financial
 
instruments and
 
other PPA
effects. The decrease was mainly attributable to lower revenues in Derivatives & Solutions, mostly driven by Rates,
due to
 
lower levels
 
of both
 
volatility and
 
client activity.
 
This was
 
partly offset
 
by
 
an increase
 
in Global
 
Banking,
mainly from higher revenues in Leveraged
 
Capital Markets.
›
Refer to the relevant business division commentary in the “UBS business divisions and Group Items” section of this
report for more information about business-division-specific revenues
›
Refer to “Integration of Credit Suisse” in the “Recent developments” section and “Note 2 Accounting for the
acquisition of the Credit Suisse Group” in the “Consolidated financial statements” section of this report for more
information about the conclusion of agreements with Apollo
›
Refer to “Note 4 Net interest income” in the “Consolidated financial statements” section of this report for more
information about net interest income
Net interest income and other net income from financial instruments measured at fair value through profit or loss
For the quarter ended
% change from
USD m
31.3.24
31.12.23
1
31.3.23
1
4Q23
1Q23
Net interest income from financial instruments measured
 
at amortized cost and fair value through other
comprehensive income
 
355
 
597
 
962
 
(41)
 
(63)
Net interest income from financial instruments measured
 
at fair value through profit or loss and other
 
1,585
 
1,498
 
425
 
6
 
273
Other net income from financial instruments measured
 
at fair value through profit or loss
 
4,182
 
3,158
 
2,681
 
32
 
56
Total
 
6,123
 
5,253
 
4,069
 
17
 
50
Global Wealth Management
 
2,354
 
2,268
 
1,799
 
4
 
31
of which: net interest income
 
1,873
 
1,871
 
1,487
 
0
 
26
of which: transaction-based income from foreign exchange and other
 
intermediary activity
2
 
482
 
397
 
312
 
21
 
54
Personal & Corporate Banking
 
 
1,704
 
1,704
 
833
 
0
 
105
of which: net interest income
 
 
1,508
 
1,510
 
704
 
0
 
114
of which: transaction-based income from foreign exchange and other
 
intermediary activity
2
 
196
 
194
 
129
 
1
 
52
Asset Management
 
(1)
 
10
 
(5)
 
(84)
Investment Bank
 
1,562
 
982
 
1,676
 
59
 
(7)
Non-core and Legacy
 
908
 
(25)
 
18
Group Items
 
(406)
 
315
 
(252)
 
61
1 Comparative-period information
 
has been restated
 
for changes in
 
business division perimeters,
 
Group Treasury
 
allocations and Non-core
 
and Legacy cost
 
allocations. Refer
 
to “Changes to
 
segment reporting in
2024” in the “UBS
 
business divisions and Group
 
Items” section below and
 
“Note 3 Segment reporting”
 
in the “Consolidated financial
 
statements” section of this
 
report for more information.
 
2 Mainly includes
spread-related income in
 
connection with client-driven
 
transactions, foreign
 
currency translation effects
 
and income and
 
expenses from precious
 
metals, which
 
are included in
 
the income statement
 
line Other net
income from financial instruments measured at fair value
 
through profit or loss. The
 
amounts reported on this line are one component
 
of Transaction-based income in
 
the management discussion and analysis in the
“Global Wealth Management” and “Personal & Corporate Banking” sections
 
of this report.
Net fee and commission income
Net fee and commission income
 
increased by USD 1,886m to USD 6,492m, and included
 
USD 306m of accretion
of PPA adjustments
 
on financial
 
instruments and
 
other PPA effects,
 
which was
 
included in
 
other fee
 
and commission
income, mainly in the Investment Bank.
Fees for portfolio management
 
and related services
 
increased by USD 841m
 
to USD 3,051m, largely
 
attributable to
the consolidation of USD 596m
 
of Credit Suisse revenues, as well as positive
 
market performance.
Excluding the consolidation of
 
USD 108m of Credit
 
Suisse revenues, net brokerage
 
fees increased by
 
USD 125m,
reflecting an increase in Cash Equities across all regions in Execution Services in the Investment Bank, as well as in
Global
 
Wealth Management,
 
due
 
to higher
 
levels
 
of client
 
activity, particularly
 
in
 
the Americas
 
and
 
Asia Pacific
regions.
 
›
Refer to “Note 5 Net fee and commission income” in the “Consolidated financial statements” section of this report
for more information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
11
Other income
Other income was USD 124m, compared with USD 69m in the prior-year quarter.
 
The increase was largely due to
a
 
USD 48m increase
 
in share
 
of net
 
profits
 
of associates
 
and joint
 
ventures,
 
mainly due
 
to the
 
consolidation of
USD 42m of Credit Suisse revenues.
›
Refer to “Note 6 Other income” in the “Consolidated financial statements” section of this report for more
information
Credit loss expense / release: 1Q24 vs
 
1Q23
Total net credit loss expenses in the first quarter of 2024 were USD 106m, compared with net credit loss expenses
of USD 38m in
 
the prior-year quarter, reflecting net
 
releases of USD 45m related
 
to performing positions and
 
net
expenses of USD 151m on credit-impaired positions.
›
Refer to “Note 9 Expected credit loss measurement” in the “Consolidated financial statements” section of this
report for more information
Credit loss expense / (release)
Performing positions
Credit-impaired positions
USD m
Stages 1 and 2
Stage 3
Purchased
 
Total
For the quarter ended 31.3.24
Global Wealth Management
 
(12)
 
7
 
2
 
(3)
Personal & Corporate Banking
 
(13)
 
64
 
(7)
 
44
Asset Management
 
0
 
0
 
0
 
0
Investment Bank
 
7
 
26
 
(1)
 
32
Non-core and Legacy
 
(26)
 
37
 
25
 
36
Group Items
 
(2)
 
0
 
0
 
(2)
Total
 
(45)
 
133
 
18
 
106
For the quarter ended 31.12.23
1
Global Wealth Management
 
(12)
 
3
 
0
 
(8)
Personal & Corporate Banking
 
(14)
 
95
 
4
 
85
Asset Management
 
0
 
0
 
0
 
(1)
Investment Bank
 
(13)
 
60
 
1
 
48
Non-core and Legacy
 
(1)
 
25
 
(9)
 
15
Group Items
 
(2)
 
0
 
0
 
(2)
Total
 
(43)
 
183
 
(4)
 
136
For the quarter ended 31.3.23
Global Wealth Management
 
15
 
0
 
15
Personal & Corporate Banking
 
15
 
0
 
16
Asset Management
 
0
 
0
 
0
Investment Bank
 
(5)
 
12
 
7
Non-core and Legacy
 
0
 
0
 
0
Group Items
 
0
 
0
 
0
Total
 
26
 
12
 
38
1
 
Comparative-period information has been restated for changes in business division perimeters. Refer to “Changes to segment reporting in 2024” in
 
the “UBS business divisions and Group Items” section and “Note
3 Segment reporting” in the “Consolidated financial statements” section of this report for more information.
Operating expenses: 1Q24 vs 1Q23
Operating expenses
For the quarter ended
% change from
USD m
31.3.24
31.12.23
31.3.23
4Q23
1Q23
Personnel expenses
 
 
6,949
 
7,061
 
4,620
 
(2)
 
50
of which: salaries and variable compensation
 
5,863
 
5,728
 
3,885
 
2
 
51
of which: variable compensation – financial advisors
1
 
1,267
 
1,176
 
1,111
 
8
 
14
General and administrative expenses
 
 
2,413
 
2,999
 
2,065
 
(20)
 
17
of which: net expenses for litigation, regulatory and similar
 
matters
 
(5)
 
8
 
721
of which: other general and administrative expenses
 
2,418
 
2,992
 
1,345
 
(19)
 
80
Depreciation, amortization and impairment of non-financial
 
assets
 
895
 
1,409
 
525
 
(37)
 
70
Total operating expenses
 
10,257
 
11,470
 
7,210
 
(11)
 
42
1 Consists of cash and deferred compensation awards and is based on compensable revenues and firm tenure using a formulaic approach. Also includes expenses related to compensation commitments with financial
advisors entered into at the time of recruitment that are subject to vesting requirements.
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
12
Personnel expenses
Personnel expenses
 
increased by
 
USD 2,329m to
 
USD 6,949m, mainly
 
due to
 
the consolidation
 
of Credit
 
Suisse
expenses of
 
USD 2,015m, and
 
included
 
integration-related expenses
 
of
 
USD 555m covering
 
awards
 
granted to
employees
 
to
 
support
 
retention
 
and
 
operational
 
stability
 
and
 
severance
 
expenses.
 
Salaries
 
and
 
variable
compensation
 
increased
 
by
 
USD 1,978m,
 
due
 
to
 
the
 
aforementioned
 
effects
 
and
 
also
 
due
 
to
 
higher
 
variable
compensation, including
 
an increase in financial
 
advisor compensation,
 
reflecting higher compensable
 
revenues, as
well as salary adjustments,
 
and foreign currency effects.
›
Refer to “Note 7 Personnel expenses” in the “Consolidated financial statements” section of this report for more
information
General and administrative expenses
General and administrative expenses increased
 
by USD 348m to USD 2,413m, largely
 
due to the consolidation of
Credit Suisse expenses of USD 587m, and
 
included total integration-related expenses
 
of USD 355m, mainly due to
USD 278m of consulting and outsourcing costs. Excluding the aforementioned effects, general and administrative
expenses decreased, largely due
 
to the prior-year quarter including an expense
 
for provisions
 
of USD 665m related
to
 
the
 
US
 
RMBS
 
litigation
 
matter
 
and
 
USD 43m
 
bank
 
levy
 
expenses,
 
partly
 
offset
 
by
 
a
 
USD 64m
 
increase
 
in
technology costs in the first quarter of 2024.
 
We believe that the industry continues to operate in an environment in which expenses
 
associated with litigation,
regulatory and similar matters will remain elevated
 
for the foreseeable future, and we continue
 
to be exposed to a
number
 
of
 
significant
 
claims
 
and
 
regulatory
 
matters.
 
The
 
outcome
 
of
 
many
 
of
 
these
 
matters,
 
the
 
timing
 
of
 
a
resolution, and the
 
potential effects
 
of resolutions on
 
our future business,
 
financial results
 
or financial condition
 
are
extremely difficult to predict.
›
Refer to “Note 8 General and administrative expenses” in the “Consolidated financial statements” section of this
report for more information
›
Refer to “Note 15 Provisions and contingent liabilities” in the “Consolidated financial statements” section of this
report for more information about litigation, regulatory and similar matters
›
Refer to the “Regulatory and legal developments” and “Risk factors” sections of the UBS Group Annual Report
2023, available under “Annual reporting” at
ubs.com/investors
, for more information about litigation, regulatory
and similar matters
 
Depreciation, amortization and impairment of
 
non-financial assets
Depreciation, amortization and impairment
 
of non-financial assets
 
increased by USD 370m
 
to USD 895m, largely
due to the consolidation of
 
Credit Suisse expenses of
 
USD 301m, and included total integration-related
 
expenses
of USD 82m,
 
mainly attributable
 
to accelerated
 
depreciation of
 
right-of-use assets
 
associated with
 
real estate
 
leases.
 
Tax: 1Q24 vs 1Q23
The Group had a net income tax expense of USD 612m in
 
the first quarter of 2024, compared with USD 459m in
the prior-year quarter.
 
The net current
 
tax expense
 
was USD 468m, compared
 
with USD 487m, and
 
primarily related to
 
the taxable profits
of UBS Switzerland AG and other entities.
 
There was a
 
net deferred tax
 
expense of USD 144m,
 
compared with
 
a benefit of
 
USD 28m in the
 
prior-year quarter,
with
 
such
 
expense
 
primarily
 
relating
 
to
 
the
 
amortization
 
of
 
deferred
 
tax
 
assets
 
(DTAs)
 
previously
 
recognized
 
in
relation to tax losses carried forward and
 
deductible temporary differences.
 
The Group’s effective tax rate for the quarter was
 
25.8%, which is higher than its structural rate of 23%, because
its net profit includes operating losses
 
of certain entities, reflecting integration-related expenses and restructuring
costs, that
 
did not
 
result in
 
any tax
 
benefits because
 
they cannot
 
be offset
 
with profits
 
of other
 
entities in
 
the Group,
and did not result
 
in any DTA recognition.
 
The Group’s tax
 
expense for the remaining
 
nine months of 2024
 
may be
impacted if further such operating
 
losses are incurred in these entities, and
 
the amount of that impact will
 
depend
on the amount of those losses. The Group’s effective tax rate is expected to decrease toward the structural rate
 
in
subsequent years.
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
13
Total comprehensive income attributable
 
to shareholders
In
 
the
 
first
 
quarter of
 
2024,
 
total
 
comprehensive income
 
attributable to
 
shareholders
 
was
 
negative USD 240m,
reflecting a net profit of
 
USD 1,755m and other
 
comprehensive income (OCI),
 
net of tax, of
 
negative USD 1,994m.
Foreign currency translation OCI was negative USD 1,277m, mainly resulting from a weakening of the Swiss franc
and the euro against the US dollar.
OCI
 
related
 
to
 
cash
 
flow
 
hedges
 
was
 
negative
 
USD 583m,
 
mainly
 
reflecting
 
net
 
unrealized
 
losses
 
on
 
US
 
dollar
hedging derivatives resulting from
 
increases in the relevant
 
US dollar long-term interest
 
rates, partly offset by
 
net
losses on hedging instruments that were reclassified
 
from OCI to the income statement.
OCI related to own credit on financial liabilities designated at fair value was negative USD 68m, primarily due to a
tightening of our own credit spreads.
Defined benefit plan OCI
 
was negative USD 56m,
 
mainly reflecting negative
 
pre-tax OCI in our
 
Swiss pension plans
of USD 92m, partly offset by
 
positive pre-tax OCI in our
 
non-Swiss plans of USD 30m, mainly
 
driven by US pension
plans.
›
Refer to “Statement of comprehensive income” in the “Consolidated financial statements” section of this report for
more information
›
Refer to “Reconciliation of equity under IFRS Accounting Standards to Swiss SRB common equity tier 1 capital” in
the “Capital management” section of this report for more information about the effects of OCI on common equity
tier 1 capital
›
Refer to “Note 21 Fair value measurement” in the “Consolidated financial statements” section of the UBS Group
Annual Report 2023, available under “Annual reporting” at
ubs.com/investors
, for more information about own
credit on financial liabilities designated at fair value
›
Refer to “Note 27 Post-employment benefit plans” in the “Consolidated financial statements” section of the UBS
Group Annual Report 2023, available under “Annual reporting” at
ubs.com/investors
, for more information about
OCI related to defined benefit plans
 
Sensitivity to interest rate movements
As
 
of
 
31 March
 
2024,
 
it
 
is
 
estimated
 
that
 
a
 
parallel
 
shift
 
in
 
yield
 
curves
 
by
 
+100
 
basis
 
points
 
could
 
lead
 
to
 
a
combined increase in
 
annual net interest
 
income from our
 
banking book of
 
approximately USD 1.5bn in
 
the first
year after
 
such a
 
shift. Of
 
this increase,
 
approximately USD 0.9bn, USD 0.4bn
 
and USD 0.1bn
 
would result
 
from
changes in Swiss franc, US dollar and
 
euro interest rates, respectively. A parallel shift in yield
 
curves by –100 basis
points could
 
lead to
 
a combined
 
decrease in
 
annual net
 
interest income
 
of approximately
 
USD 1.5bn in
 
the first
year after such a shift, showing similar currency
 
contributions as for the aforementioned increase
 
in rates.
These estimates
 
are based
 
on a
 
hypothetical scenario
 
of an
 
immediate change
 
in interest
 
rates, equal
 
across all
currencies and relative
 
to implied forward
 
rates as of 31 March
 
2024 applied to
 
our banking book.
 
These estimates
further assume no
 
change to balance
 
sheet size
 
and product
 
mix, stable
 
foreign exchange rates,
 
and no
 
specific
management action. These estimates do not
 
represent a forecast of net interest income
 
variability.
 
›
Refer to the “Risk management and control” section of this report for information about interest rate risk in the
banking book
Key figures and personnel
Below is
 
an overview
 
of selected
 
key figures
 
of the
 
Group. For
 
further information
 
about key
 
figures related
 
to
capital management, refer to the “Capital management”
 
section of this report.
 
Cost / income ratio: 1Q24 vs 1Q23
The cost / income
 
ratio was 80.5%, compared with
 
82.5%, mainly reflecting an increase
 
in total revenues, partly
offset by an increase in operating expenses.
 
On an underlying basis, the
 
cost / income ratio was
 
77.2%, compared
with 81.7%, mainly reflecting an increase in total revenues, partly
 
offset by an increase in operating expenses.
Personnel: 1Q24 vs 4Q23
The number of internal and external personnel employed was 136,622 (workforce count) as of 31 March 2024, a
net
 
decrease
 
of
 
1,840
 
compared
 
with
 
31 December
 
2023.
 
The
 
number
 
of
 
internal
 
personnel
 
employed
 
as
 
of
31 March 2024 was 111,549
 
(full-time equivalents), a net decrease
 
of 1,293 compared with
 
31 December 2023.
The number of external
 
staff was approximately 25,073 (workforce count)
 
as of 31 March 2024, a net
 
decrease of
approximately 546 compared with 31 December 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
14
Equity, CET1 capital and returns
As of or for the quarter ended
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
Net profit
Net profit / (loss) attributable to shareholders
 
1,755
 
(279)
 
1,029
Equity
 
Equity attributable to shareholders
 
85,260
 
86,108
 
56,754
Less: goodwill and intangible assets
 
7,384
 
7,515
 
6,272
Tangible equity attributable to shareholders
 
77,877
 
78,593
 
50,481
Less: other CET1 adjustments
 
(270)
 
107
 
5,891
CET1 capital
 
78,147
 
78,485
 
44,590
Returns
Return on equity (%)
 
8.2
 
(1.3)
 
7.2
Return on tangible equity (%)
 
9.0
 
(1.4)
 
8.1
Underlying return on tangible equity (%)
 
9.6
 
4.8
 
8.7
Return on CET1 capital (%)
 
9.0
 
(1.4)
 
9.1
Underlying return on CET1 capital (%)
 
9.6
 
4.7
 
9.8
1 Comparative-period information has been revised.
 
Refer to “Note 2 Accounting for the acquisition
 
of the Credit Suisse Group” in the
 
“Consolidated financial statements” section of
 
the UBS Group Annual Report
2023, available under “Annual reporting” at ubs.com/investors,
 
for more information.
Common equity tier 1 capital: 1Q24 vs 4Q23
During the first quarter of 2024,
 
our common equity tier 1 (CET1)
 
capital decreased by USD 0.3bn to
 
USD 78.1bn,
mainly reflecting an
 
operating profit
 
before tax
 
of USD 2.4bn, more
 
than offset
 
by negative effects
 
from foreign
currency
 
translation
 
of
 
USD 1.3bn,
 
dividend
 
accruals
 
of
 
USD 0.6bn,
 
current
 
tax
 
expenses
 
of
 
USD 0.5bn
 
and
amortization of transitional CET1 PPA adjustments (interest rate and own credit) of USD 0.4bn
 
(net of tax).
Return on common equity tier 1 capital: 1Q24
 
vs 1Q23
The annualized
 
return on
 
CET1 capital
 
was 9.0%,
 
compared with
 
9.1%, driven
 
by the
 
impact of
 
an increase
 
in
average CET1
 
capital, partly
 
offset by
 
higher net
 
profit attributable
 
to shareholders.
 
On an
 
underlying basis,
 
the
return on CET1 capital was 9.6%, compared with 9.8%.
Risk-weighted assets: 1Q24 vs 4Q23
During the first quarter of 2024, RWA decreased by USD
 
20.1bn to USD 526.4bn, primarily driven
 
by decreases of
USD 13.1bn resulting from asset size and
 
other movements as well as USD 11.2bn
 
resulting from currency effects,
partly offset by USD 4.2bn resulting from model updates and methodology
 
changes.
Common equity tier 1 capital ratio: 1Q24 vs 4Q23
Our CET1 capital ratio increased to 14.8% from 14.4%,
 
mainly reflecting the aforementioned decrease in RWA.
Leverage ratio denominator: 1Q24 vs 4Q23
The leverage ratio denominator (the LRD) decreased by USD 95.8bn to USD 1,599.6bn, driven by currency effects
of USD 56.3bn and asset size and other movements
 
of USD 39.4bn.
Common equity tier 1 leverage ratio: 1Q24
 
vs 4Q23
Our CET1 leverage ratio increased to 4.9% from 4.6%, mainly
 
due to the aforementioned decrease in the LRD.
 
 
UBS Group first quarter 2024 report |
UBS Group | Group performance
 
15
Outlook
Although monetary easing is expected
 
in the Eurozone,
 
the US and Switzerland,
 
the timing and magnitude of rate
cuts by
 
central banks
 
are unclear, as inflation
 
remains above
 
their target
 
range.
 
In addition,
 
the ongoing
 
geopolitical
tensions,
 
combined
 
with
 
consequential
 
elections
 
in
 
several
 
major
 
economies,
 
continue
 
to
 
create
 
uncertainty
regarding the macroeconomic and geopolitical outlooks.
In the second quarter of 2024, we
 
expect a low-to-mid single-digit decline
 
in net interest income in Global Wealth
Management,
 
due to moderately
 
lower lending and deposit
 
volumes and lower
 
interest rates in Switzerland,
 
partly
offset by additional
 
revenues,
 
primarily from higher
 
US dollar rates,
 
combined with our
 
repricing efforts. We
 
expect
a mid-to-high single-digit decrease
 
in net interest
 
income in Personal
 
& Corporate Banking in
 
US dollar terms,
 
as
the Swiss central bank’s interest rate
 
cut in March 2024 takes
 
effect for a full quarter.
 
In line with our strategy
 
to
actively reduce assets and costs in Non-core and Legacy, we continue to expect revenues in the closing out of any
positions to
 
approximately reflect
 
their current
 
book values.
 
We also
 
expect our
 
reported revenues
 
to include
 
around
USD 0.6bn of pull-to-par and other PPA accretion effects,
 
while we incur around USD 1.3bn of integration-related
expenses. The tax rate for
 
the second quarter is expected
 
to return to more elevated
 
levels, with our effective tax
rate still expected to be around 40% by the
 
end of 2024.
In addition to executing on our integration
 
plans, we will remain focused on serving
 
our clients, following through
on our strategy, investing in our people and remaining a pillar of economic support in the communities where we
live and work.
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items
 
16
UBS business divisions and
Group Items
Management report
Our businesses
We report five business divisions in
 
line with IFRS Accounting Standards: Global Wealth
 
Management, Personal &
Corporate Banking,
 
Asset
 
Management, the
 
Investment Bank,
 
and
 
Non-core
 
and
 
Legacy.
 
Non-core and
 
Legacy
includes positions
 
and businesses
 
not aligned
 
with our
 
strategy and
 
policies. Those
 
consist of
 
the assets
 
and liabilities
reported as part
 
of the
 
former Capital
 
Release Unit (Credit
 
Suisse) and certain
 
assets and liabilities
 
of the
 
former
Investment Bank
 
(Credit Suisse),
 
the former
 
Corporate Center
 
(Credit Suisse)
 
and other
 
former Credit
 
Suisse business
divisions.
 
Non-core
 
and
 
Legacy
 
also
 
includes
 
the
 
remaining
 
assets
 
and
 
liabilities
 
of
 
UBS’s
 
Non-core
 
and
 
Legacy
Portfolio, previously
 
reported in
 
Group Functions
 
(now renamed
 
to Group
 
Items), and
 
smaller amounts
 
of assets
and liabilities
 
of UBS’s
 
business divisions
 
that we
 
have assessed
 
as not
 
strategic in
 
light of
 
the acquisition
 
of the
Credit Suisse Group.
Our Group functions
 
are support and
 
control functions that
 
provide services to
 
the Group. Virtually
 
all costs and
revenues incurred
 
by the
 
support and
 
control functions
 
are allocated
 
to the
 
business divisions,
 
leaving a
 
residual
amount, mainly
 
related to
 
certain Group
 
funding and
 
hedging items,
 
that we
 
refer to
 
as Group
 
Items in
 
our segment
reporting.
Changes to segment reporting in 2024
Following
 
the
 
acquisition
 
of
 
the
 
Credit
 
Suisse
 
Group,
 
we
 
continue
 
to
 
refine
 
our
 
reporting
 
structure
 
and
organizational setup to align
 
with interests of stakeholders
 
and further incentivize
 
our business divisions to
 
achieve
Group-wide goals.
 
As previously
 
announced, in
 
the first
 
quarter of
 
2024 certain
 
changes
 
were made,
 
with an
 
impact
on reporting for
 
our business divisions and
 
Group Items (but with
 
no impact for the
 
UBS Group as
 
a whole). The
changes, summarized below,
 
improve the consistency
 
of our reporting
 
across the UBS
 
Group and align
 
our funding
and
 
cost allocation
 
methodologies with
 
the business
 
divisions
 
that
 
control and
 
manage
 
the
 
costs. The
 
changes
outlined
 
below
 
were
 
effective
 
as
 
of
 
1 January
 
2024
 
and
 
prior-period
 
information
 
has
 
been
 
adjusted
 
for
comparability.
Change in business division perimeters
We have transferred
 
certain businesses
 
from Swiss
 
Bank (Credit Suisse),
 
previously included
 
in Personal
 
& Corporate
Banking, to Global Wealth Management. The change predominantly related to the high net worth client segment
and represents approximately
 
USD 72bn in invested assets and
 
approximately USD 0.6bn in annualized
 
revenues.
A number of other smaller business shifts were also executed
 
between the business divisions in the first quarter
 
of
2024.
Changes to Group Treasury allocations
Starting with the first quarter of 2024, nearly all Group Treasury
 
costs that historically were retained and reported
in Group Items
 
have been
 
allocated
 
to the
 
business divisions.
 
Costs continued
 
to be
 
retained in Group
 
Items include
costs related to hedging and own debt, and deferred tax
 
asset (DTA)
 
funding costs.
We have also aligned internal
 
funds transfer pricing methodologies
 
applied by Credit Suisse
 
entities to UBS’s funds
transfer pricing methodology.
 
These changes resulted in
 
funding costs of approximately USD 0.3bn,
 
for 2023, moving from
 
Group Items to the
business divisions, predominantly related to
 
the second half of 2023.
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items
 
17
Going forward,
 
we expect
 
Group Items’
 
underlying loss
 
before tax,
 
excluding litigation
 
and income
 
from Group
hedging and own debt, to average approximately
 
USD 100m per quarter.
In
 
parallel
 
with
 
the
 
changes
 
noted
 
above,
 
we
 
increased
 
the
 
allocation
 
of
 
balance
 
sheet
 
resources
 
from
 
Group
Treasury to the business divisions, resulting in a shift of approximately USD 168bn of total assets, USD 9bn of risk-
weighted
 
assets
 
(RWA) and
 
USD 173bn
 
of
 
leverage
 
ratio
 
denominator (LRD)
 
from
 
Group
 
Items
 
to
 
the
 
business
divisions as of 31 December 2023.
 
Updated
 
cost allocations
We have reallocated USD 0.3bn of annualized costs from
 
Non-core and Legacy to the business divisions, with the
aim of avoiding stranded costs in Non-core and Legacy
 
at the end of the integration process.
 
›
Refer to “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information about segment results and the effects of changes in segment reporting
Changes in equity attribution
We have updated our equity attribution framework to align the capital ratios
 
for RWA and LRD more closely
 
with
our current Group capital targets,
 
increasing the equity attributed to the
 
business divisions. We have also reflected
the increased allocation of balance sheet resources previously retained in Group Items in
 
the attribution of equity,
resulting in
 
the attribution
 
of around
 
USD 14bn of
 
additional equity
 
to the
 
business divisions.
 
Going forward,
 
equity
retained in
 
Group Items
 
relates to DTAs,
 
accruals for shareholder
 
returns and unrealized
 
gains / losses
 
from cash
flow hedges.
 
›
Refer to the “Equity attribution” section of this report for more information about the equity attribution
framework
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Global Wealth Management
 
18
Global Wealth Management
Global Wealth Management
As of or for the quarter ended
% change from
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Net interest income
 
1,873
 
1,871
 
1,487
 
0
 
26
Recurring net fee income
3
 
3,024
 
2,900
 
2,454
 
4
 
23
Transaction-based income
3
 
1,212
 
955
 
843
 
27
 
44
Other income
 
33
 
(172)
 
4
 
805
Total revenues
 
6,143
 
5,554
 
4,788
 
11
 
28
Credit loss expense / (release)
 
(3)
 
(8)
 
15
 
(64)
Operating expenses
 
5,044
 
5,282
 
3,561
 
(5)
 
42
Business division operating profit / (loss) before tax
 
1,102
 
280
 
1,212
 
294
 
(9)
Underlying results
Total revenues as reported
 
6,143
 
5,554
 
4,788
 
11
 
28
of which: PPA effects and other integration items
4
 
234
 
349
 
(33)
of which: PPA effects recognized in net interest income
 
257
 
321
 
(20)
of which: PPA effects and other integration items recognized in transaction-based income
 
(24)
 
28
of which: losses related to investment in SIX Group
 
(190)
Total revenues (underlying)
3
 
5,909
 
5,395
 
4,788
 
10
 
23
Credit loss expense / (release)
 
(3)
 
(8)
 
15
 
(64)
Operating expenses as reported
 
5,044
 
5,282
 
3,561
 
(5)
 
42
of which: integration-related expenses and PPA effects
3,5
 
404
 
502
 
(20)
Operating expenses (underlying)
3
 
4,640
 
4,780
 
3,561
 
(3)
 
30
of which: expenses for litigation, regulatory and similar matters
 
12
 
49
 
11
 
(76)
 
11
Business division operating profit / (loss) before tax as reported
 
1,102
 
280
 
1,212
 
294
 
(9)
Business division operating profit / (loss) before tax (underlying)
3
 
1,272
 
624
 
1,212
 
104
 
5
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
(9.1)
 
(73.5)
 
(7.5)
Cost / income ratio (%)
3
 
82.1
 
95.1
 
74.4
Average attributed equity (USD bn)
6
 
33.1
 
33.3
 
24.7
 
(1)
 
34
Return on attributed equity (%)
3,6
 
13.3
 
3.4
 
19.7
Financial advisor compensation
7
 
1,267
 
1,176
 
1,111
 
8
 
14
Net new fee-generating assets (USD bn)
3
 
17.6
 
(3.4)
 
19.7
Fee-generating assets (USD bn)
3
 
1,731
 
1,661
 
1,335
 
4
 
30
Net new assets (USD bn)
3
 
27.4
 
20.1
 
39.8
Invested assets (USD bn)
3
 
4,023
 
3,922
 
2,962
 
3
 
36
Loans, gross (USD bn)
8
 
306.3
 
322.1
 
223.8
 
(5)
 
37
Customer deposits (USD bn)
8
 
482.4
 
485.0
 
330.3
 
(1)
 
46
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,9
 
0.3
 
0.5
 
0.3
Advisors (full-time equivalents)
 
10,338
 
10,469
 
9,117
 
(1)
 
13
Underlying performance measures
Pre-tax profit growth (year-on-year, %)
3
 
5.0
 
(41.1)
 
(7.5)
Cost / income ratio (%)
3
 
78.5
 
88.6
 
74.4
1 Comparative figures have
 
been restated for changes
 
in business division perimeters,
 
Group Treasury
 
allocations and Non-core and
 
Legacy cost allocations,
 
as well as changes in
 
the equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the
 
“Equity attribution” section and “Note 3
 
Segment reporting” in the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to
 
adjustments following organizational changes, restatements due to the retrospective
 
adoption of new accounting standards or
changes in accounting policies, and events after
 
the reporting period.
 
2 Comparative figures have been restated for changes in
 
Group Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in
 
the
“UBS business divisions and Group Items” section and “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more information. Comparatives may additionally differ due to
adjustments following organizational
 
changes, restatements
 
due to the
 
retrospective adoption
 
of new
 
accounting standards or
 
changes in
 
accounting
 
policies, and
 
events after the
 
reporting period.
 
3 Refer to
“Alternative performance
 
measures” in the appendix
 
to this report for the
 
definition and calculation method.
 
We started to report
 
fee-generating assets and net
 
new fee-generating assets on
 
a consolidated basis,
including Credit Suisse data, from the
 
fourth quarter of 2023 onward.
 
4 Includes accretion of PPA
 
adjustments on financial instruments
 
and other PPA
 
effects, as well as temporary
 
and incremental items directly
related to the integration.
 
5 Includes temporary, incremental operating expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the Credit
Suisse Group.
 
6 Refer to the “Equity attribution” section of this report for more information about the equity attribution framework.
 
7 Relates to licensed professionals with the ability to provide investment advice
to clients in the Americas.
 
Consists of cash and
 
deferred compensation awards
 
and is based on
 
compensable revenues and firm
 
tenure using a formulaic
 
approach. Also includes expenses
 
related to compensation
commitments with financial advisors entered
 
into at the time of recruitment
 
that are subject to vesting
 
requirements. Recruitment loans
 
to financial advisors were USD
 
1,726m as of 31 March 2024.
 
8 Loans and
Customer deposits in
 
this table include
 
customer brokerage
 
receivables and payables,
 
respectively, which
 
are presented in
 
a separate reporting
 
line on the
 
balance sheet.
 
9 Refer to the
 
“Risk management and
control” section of this report for more information about (credit-)impaired exposures. Excludes loans to financial advisors.
Results: 1Q24 vs 1Q23
Profit before tax decreased by
 
USD 110m, or 9%, to
 
USD 1,102m, mainly
 
due to higher operating
 
expenses, partly
offset by higher
 
total revenues. Underlying profit
 
before tax was USD
 
1,272m, after excluding USD 234m related
to purchase price allocation (PPA)
 
effects and other integration items,
 
as well as integration-related expenses and
PPA effects of USD 404m.
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Global Wealth Management
 
19
Total revenues
Total
 
revenues increased
 
by USD 1,355m, or
 
28%, to
 
USD 6,143m, largely driven
 
by the
 
consolidation of Credit
Suisse revenues, and
 
included the
 
aforementioned USD 234m
 
of PPA effects and
 
other integration
 
items. Excluding
these effects, underlying total revenues were USD 5,909m.
Net interest income
 
increased by USD 386m,
 
or 26%, to USD 1,873m,
 
largely driven by
 
the consolidation of
 
Credit
Suisse net interest income, and included USD 257m
 
of accretion of PPA adjustments on financial instruments and
other PPA effects.
 
The remaining variance was attributable to lower
 
deposit margins,
 
including the effects of shifts
to
 
lower-margin
 
products,
 
partly
 
offset
 
by
 
higher
 
rates
 
and
 
deposit
 
volumes.
 
Excluding
 
the
 
aforementioned
accretion effects, underlying net interest income
 
was USD 1,615m.
Recurring net fee income increased by USD 570m, or 23%, to USD 3,024m,
 
mainly driven by the consolidation of
Credit Suisse recurring net fee income and positive
 
market performance.
Transaction-based income increased
 
by USD 369m, or 44%,
 
to USD 1,212m, mainly driven
 
by the consolidation of
Credit
 
Suisse
 
transaction-based
 
income,
 
and
 
included
 
USD 6m
 
of
 
accretion
 
of
 
PPA
 
adjustments
 
on
 
financial
instruments and other
 
PPA effects, as
 
well as
 
higher levels
 
of client
 
activity, particularly in
 
the Americas and
 
Asia
Pacific
 
regions. Transaction-based
 
income
 
also
 
included negative
 
USD 30m of
 
temporary
 
and
 
incremental items
directly related
 
to the
 
integration. Excluding
 
negative USD 24m
 
resulting
 
from the
 
aforementioned accretion
 
effects
and temporary and incremental items,
 
underlying transaction-based income was
 
USD 1,236m.
Other income increased by USD 29m to USD
 
33m, mainly due to the consolidation
 
of Credit Suisse other income.
 
Credit loss expense / release
Net credit loss releases were USD 3m,
 
compared with net expenses of USD 15m in
 
the first quarter of 2023.
Operating expenses
Operating expenses increased by USD
 
1,483m, or 42%, to USD 5,044m,
 
largely due to the consolidation
 
of Credit
Suisse
 
expenses,
 
and
 
included
 
integration-related
 
expenses
 
of
 
USD 402m
 
and
 
higher
 
financial
 
advisor
compensation.
 
Excluding
 
integration-related
 
expenses
 
and
 
PPA
 
effects
 
of
 
USD 404m,
 
underlying
 
operating
expenses were USD 4,640m.
Invested assets: 1Q24 vs 4Q23
Invested assets increased
 
by USD 101bn, or
 
3%, to USD 4,023bn,
 
mainly driven by
 
positive market performance
 
of
USD 127.5bn
 
and
 
net
 
new
 
asset
 
inflows
 
of
 
USD 27.4bn,
 
partly
 
offset
 
by
 
negative
 
foreign
 
currency
 
effects
 
of
USD 47.3bn.
Loans: 1Q24 vs 4Q23
Loans decreased by USD 15.8bn to USD 306.3bn,
 
mainly driven by negative foreign currency effects and net new
loan outflows of USD 6.6bn.
 
Customer deposits: 1Q24 vs 4Q23
Customer deposits decreased
 
by USD 2.6bn to
 
USD 482.4bn, mainly driven
 
by negative foreign
 
currency effects,
partly offset by net new deposit inflows, mainly into
 
fixed-term deposit products.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Global Wealth Management
 
20
Regional breakdown of performance measures
As of or for the quarter ended 31.3.24
USD bn, except where indicated
Americas
1
Switzerland
2
EMEA
2
Asia Pacific
2
Global
3
Global Wealth
Management
Total revenues (USD m)
 
2,727
 
1,033
 
1,198
 
948
 
236
 
6,143
Operating profit / (loss) before tax (USD m)
 
252
 
377
 
331
 
315
 
(174)
 
1,102
Operating profit / (loss) before tax (underlying) (USD m)
4
 
252
 
377
 
331
 
315
 
(4)
 
1,272
Cost / income ratio (%)
4
 
90.5
 
63.7
 
72.8
 
67.1
 
82.1
Cost / income ratio (underlying) (%)
4
 
90.5
 
63.7
 
72.8
 
67.1
 
78.5
Loans, gross
 
95.7
5
 
107.2
 
59.1
 
43.5
 
0.8
 
306.3
Net new loans
 
(1.8)
 
(1.1)
 
(2.2)
 
(1.4)
 
(0.1)
 
(6.6)
Net new fee-generating assets
4
 
12.9
 
0.5
 
2.0
 
2.3
 
(0.1)
 
17.6
Fee-generating assets
4
 
990
 
213
 
371
 
155
 
1
 
1,731
Net new assets
4
 
13.7
 
7.7
 
(0.2)
 
6.4
 
(0.2)
 
27.4
Net new assets growth rate (%)
4
 
2.9
 
4.2
 
(0.1)
 
3.9
 
2.8
Invested assets
4
 
1,979
 
736
 
662
 
641
 
5
 
4,023
Advisors (full-time equivalents)
 
6,079
 
1,402
 
1,704
 
1,064
 
89
 
10,338
1 Including the following business units: United
 
States and Canada; and Latin
 
America.
 
2 In the third quarter of
 
2023, the invested assets of
 
Global Financial Intermediaries were transferred
 
from EMEA and Asia
Pacific to the Switzerland region, to better align it to
 
the management structure. These changes were applied prospectively and had no impact on previous
 
quarters.
 
3 Includes minor functions, which are not included
in the four regions individually presented
 
in this table, and also includes impacts
 
from accretion of purchase price allocation adjustments
 
on financial instruments and other PPA effects and
 
integration-related expenses.
 
4 Refer to “Alternative performance measures” in the appendix to this report for the definition and calculation method.
 
5 Loans include customer brokerage receivables, which are presented in a separate
 
reporting
line on the balance sheet.
Regional comments 1Q24 vs 1Q23, except where
 
indicated
 
Americas
Profit
 
before
 
tax
 
decreased
 
by
 
USD 114m
 
to
 
USD 252m.
 
Total
 
revenues
 
increased
 
by
 
USD 117m,
 
or
 
4%,
 
to
USD 2,727m, driven by higher recurring fees
 
and transaction-based income as well as the
 
consolidation of Credit
Suisse revenues,
 
partly offset
 
by lower
 
net interest
 
income. The
 
cost /
 
income ratio
 
increased to
 
90.5% from
 
85.4%.
Loans decreased 1% compared with the fourth quarter 2023, to USD 95.7bn, mainly reflecting USD
 
1.8bn of net
new loan outflows. Net new asset inflows were USD
 
13.7bn.
Switzerland
Profit
 
before
 
tax
 
increased
 
by
 
USD 127m
 
to
 
USD 377m.
 
Total
 
revenues
 
increased
 
by
 
USD 511m,
 
or
 
98%,
 
to
USD 1,033m, driven by the
 
consolidation of Credit
 
Suisse revenues as
 
well as the
 
transfer of the
 
Global Financial
Intermediaries business to the Switzerland region. The cost / income ratio increased to 63.7% from 52.4%. Loans
decreased 7%
 
compared with
 
the fourth
 
quarter 2023,
 
to USD 107.2bn,
 
driven by
 
negative foreign
 
currency effects
and USD 1.1bn of net new loan outflows. Net
 
new asset inflows were USD 7.7bn.
EMEA
Profit
 
before
 
tax
 
decreased
 
by
 
USD 21m
 
to
 
USD 331m.
 
Total
 
revenues
 
increased
 
by
 
USD 214m,
 
or
 
22%,
 
to
USD 1,198m, largely
 
driven by
 
the consolidation
 
of Credit
 
Suisse revenues,
 
partly offset
 
by the
 
transfer of
 
the Global
Financial
 
Intermediaries
 
business
 
to
 
the
 
Switzerland
 
region.
 
The
 
cost / income
 
ratio
 
increased
 
to
 
72.8%
 
from
64.2%. Loans decreased 5% compared with the fourth
 
quarter 2023, to USD 59.1bn, driven by
 
USD 2.2bn of net
new loan outflows.
 
Net new asset outflows were USD 0.2bn.
Asia Pacific
Profit
 
before
 
tax
 
increased
 
by
 
USD 64m
 
to
 
USD 315m.
 
Total
 
revenues
 
increased
 
by
 
USD 273m,
 
or
 
40%,
 
to
USD 948m, mainly
 
driven by
 
the consolidation
 
of Credit
 
Suisse revenues
 
and increases
 
in transaction-based
 
income.
The cost / income ratio
 
increased to 67.1%
 
from 62.8%. Loans decreased 5% compared
 
with the fourth quarter
2023, to
 
USD 43.5bn, driven by
 
USD 1.4bn of net
 
new loan
 
outflows and negative
 
foreign currency
 
effects. Net
new asset inflows were USD 6.4bn.
Global
Operating loss before tax
 
was USD 174m, mainly including USD 404m
 
of the aforementioned integration-related
expenses
 
and
 
PPA
 
effects,
 
partly
 
offset
 
by
 
the
 
aforementioned
 
USD 234m
 
related
 
to
 
PPA
 
effects
 
and
 
other
integration items.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Personal & Corporate Banking
 
21
Personal & Corporate Banking
 
Personal & Corporate Banking – in Swiss francs
As of or for the quarter ended
% change from
CHF m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Net interest income
 
1,332
 
1,320
 
650
 
1
 
105
Recurring net fee income
3
 
348
 
332
 
210
 
5
 
66
Transaction-based income
3
 
449
 
431
 
309
 
4
 
45
Other income
 
11
 
(251)
 
10
 
17
Total revenues
 
2,139
 
1,832
 
1,179
 
17
 
81
Credit loss expense / (release)
 
39
 
74
 
14
 
(47)
 
174
Operating expenses
 
1,241
 
1,222
 
613
 
2
 
103
Business division operating profit / (loss) before tax
 
859
 
537
 
552
 
60
 
56
Underlying results
Total revenues as reported
 
2,139
 
1,832
 
1,179
 
17
 
81
of which: PPA effects and other integration items
4
 
226
 
267
 
(15)
of which: PPA effects recognized in net interest income
 
 
212
 
235
 
(10)
of which: PPA effects and other integration items recognized in transaction-based income
 
14
 
31
 
(55)
of which: losses related to investment in SIX Group
 
(267)
Total revenues (underlying)
3
 
1,913
 
1,833
 
1,179
 
4
 
62
Credit loss expense / (release)
 
39
 
74
 
14
 
(47)
 
174
Operating expenses as reported
 
1,241
 
1,222
 
613
 
2
 
103
of which: integration-related expenses and PPA effects
3,5
 
141
 
162
 
(13)
Operating expenses (underlying)
3
 
1,100
 
1,060
 
613
 
4
 
79
of which: expenses for litigation, regulatory and similar matters
 
0
 
0
 
0
Business division operating profit / (loss) before tax as reported
 
859
 
537
 
552
 
60
 
56
Business division operating profit / (loss) before tax (underlying)
3
 
774
 
699
 
552
 
11
 
40
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
55.7
 
6.5
 
39.7
Cost / income ratio (%)
3
 
58.0
 
66.7
 
52.0
Average attributed equity (CHF bn)
6
 
19.1
 
19.3
 
10.0
 
(1)
 
90
Return on attributed equity (%)
3,6
 
18.0
 
11.1
 
22.0
Loans, gross (CHF bn)
 
252.9
 
251.8
 
144.3
 
0
 
75
Customer deposits (CHF bn)
 
255.9
 
257.8
 
165.3
 
(1)
 
55
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,7
 
1.2
 
1.0
 
0.8
Underlying performance measures
Pre-tax profit growth (year-on-year, %)
3
 
40.3
 
38.8
 
39.7
Cost / income ratio (%)
3
 
57.5
 
57.8
 
52.0
1 Comparative figures have been
 
restated for changes in
 
business division perimeters,
 
Group Treasury
 
allocations and Non-core and
 
Legacy cost allocations,
 
as well as changes in
 
the equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the
 
“Equity attribution” section and “Note 3
 
Segment reporting” in the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally
 
differ due to adjustments following organizational changes, restatements
 
due to the retrospective adoption of new accounting standards or
changes in accounting policies, and events after
 
the reporting period.
 
2 Comparative figures have been restated for changes in
 
Group Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in
 
the
“UBS business divisions and Group Items” section and “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more information. Comparatives may additionally differ due to
adjustments following organizational
 
changes, restatements
 
due to the
 
retrospective adoption
 
of new
 
accounting standards or
 
changes in
 
accounting policies,
 
and events after
 
the reporting period.
 
3 Refer to
“Alternative performance
 
measures” in the
 
appendix to this
 
report for the
 
definition and calculation
 
method.
 
4 Includes accretion of
 
PPA adjustments
 
on financial instruments
 
and other PPA
 
effects, as
 
well as
temporary and incremental items directly related to the integration.
 
5 Includes temporary, incremental operating expenses
 
directly related to the integration, as well as amortization
 
of newly recognized intangibles
resulting from the acquisition of the Credit Suisse
 
Group.
 
6 Refer to the “Equity attribution” section of
 
this report for more information about the equity
 
attribution framework.
 
7 Refer to the “Risk management
and control” section of this report for more information about (credit-)impaired exposures.
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Personal & Corporate Banking
 
22
Results
:
1Q24 vs 1Q23
Profit before tax increased by CHF 307m,
 
or 56%, to CHF 859m,
 
mainly due to the
 
acquisition of the Credit
 
Suisse
Group. Underlying profit before
 
tax was CHF 774m,
 
after excluding CHF 226m
 
related to purchase price allocation
(PPA) effects and other integration items, as well as integration-related expenses and PPA effects of CHF 141m.
Total revenues
Total
 
revenues increased by CHF 960m, or 81%, to CHF 2,139m, mainly due to the consolidation of Credit Suisse
revenues, and included the aforementioned CHF 226m of PPA
 
effects and other integration items. The remaining
increase
 
largely
 
reflected
 
increases
 
across
 
net
 
interest
 
income,
 
transaction-based
 
income
 
and
 
recurring
 
net
 
fee
income. Underlying total revenues were CHF 1,913m.
Net interest income increased by CHF 682m, or 105%, to CHF 1,332m, largely due to the
 
consolidation of Credit
Suisse net interest income, and included CHF 212m
 
of accretion of PPA adjustments on
 
financial instruments and
other
 
PPA
 
effects.
 
The
 
remaining
 
increase
 
was
 
mainly
 
driven
 
by
 
higher
 
deposit
 
margins,
 
resulting
 
from
 
higher
interest
 
rates,
 
partly
 
offset
 
by
 
shifts
 
to
 
lower-margin
 
deposit
 
products.
 
Excluding
 
the
 
aforementioned
 
accretion
effects, underlying net interest income was
 
CHF 1,120m.
 
Recurring net
 
fee income
 
increased by
 
CHF 138m, or
 
66%, to
 
CHF 348m, mainly
 
due to the
 
consolidation of
 
Credit
Suisse recurring
 
net fee income,
 
with the remaining
 
increase including
 
higher revenues
 
from custody and
 
mandate-
based fees.
 
Transaction-based
 
income increased
 
by CHF 140m,
 
or 45%,
 
to CHF 449m,
 
largely due
 
to the
 
consolidation of
 
Credit
Suisse transaction-based income, and included CHF 20m of accretion of PPA adjustments on financial instruments
and
 
other
 
PPA
 
effects,
 
partly
 
offset
 
by
 
a
 
decrease
 
mainly
 
driven
 
by
 
lower
 
credit
 
card
 
fees
 
from
 
private
 
clients.
Transaction-based income also
 
included negative
 
CHF 6m of
 
temporary and
 
incremental items
 
directly related
 
to
the integration. Excluding
 
CHF 14m of the
 
aforementioned accretion
 
effects and temporary
 
and incremental
 
items,
underlying transaction-based income was
 
CHF 435m.
Other income was stable at CHF 11m.
 
Credit loss expense / release
Net credit
 
loss expenses
 
were
 
CHF 39m, compared
 
with net
 
expenses of
 
CHF 14m in
 
the first
 
quarter of
 
2023,
largely due to the consolidation of Credit Suisse.
Operating expenses
Operating expenses increased by CHF 628m, or 103%, to CHF 1,241m, largely due to the consolidation of Credit
Suisse expenses, and
 
included integration-related expenses
 
of CHF 119m. Excluding
 
integration-related expenses
and PPA effects of CHF 141m, underlying operating expenses were CHF 1,100m.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Personal & Corporate Banking
 
23
Personal & Corporate Banking – in US dollars
As of or for the quarter ended
% change from
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Net interest income
 
1,508
 
1,510
 
704
 
0
 
114
Recurring net fee income
3
 
394
 
379
 
227
 
4
 
73
Transaction-based income
3
 
508
 
492
 
335
 
3
 
52
Other income
 
13
 
(299)
 
10
 
22
Total revenues
 
2,423
 
2,083
 
1,277
 
16
 
90
Credit loss expense / (release)
 
44
 
85
 
16
 
(48)
 
179
Operating expenses
 
1,404
 
1,398
 
663
 
0
 
112
Business division operating profit / (loss) before tax
 
975
 
601
 
598
 
62
 
63
Underlying results
Total revenues as reported
 
2,423
 
2,083
 
1,277
 
16
 
90
of which: PPA effects and other integration items
4
 
256
 
306
 
(16)
of which: PPA effects recognized in net interest income
 
240
 
270
 
(11)
of which: PPA effects and other integration items recognized in transaction-based income
 
16
 
36
 
(56)
of which: losses related to investment in SIX Group
 
(317)
Total revenues (underlying)
3
 
2,166
 
2,094
 
1,277
 
3
 
70
Credit loss expense / (release)
 
44
 
85
 
16
 
(48)
 
179
Operating expenses as reported
 
1,404
 
1,398
 
663
 
0
 
112
of which: integration-related expenses and PPA effects
3,5
 
160
 
187
 
(15)
Operating expenses (underlying)
3
 
1,245
 
1,210
 
663
 
3
 
88
of which: expenses for litigation, regulatory and similar matters
 
0
 
0
 
0
Business division operating profit / (loss) before tax as reported
 
975
 
601
 
598
 
62
 
63
Business division operating profit / (loss) before tax (underlying)
3
 
878
 
800
 
598
 
10
 
47
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
63.1
 
13.7
 
39.6
Cost / income ratio (%)
3
 
58.0
 
67.1
 
52.0
Average attributed equity (USD bn)
6
 
21.9
 
21.8
 
10.9
 
1
 
102
Return on attributed equity (%)
3,6
 
17.8
 
11.0
 
22.0
Loans, gross (USD bn)
 
280.3
 
299.2
 
157.6
 
(6)
 
78
Customer deposits (USD bn)
 
283.6
 
306.2
 
180.5
 
(7)
 
57
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,7
 
1.2
 
1.0
 
0.8
Underlying performance measures
Pre-tax profit growth (year-on-year, %)
3
 
46.9
 
51.2
 
39.6
Cost / income ratio (%)
3
 
57.5
 
57.8
 
52.0
1 Comparative figures have been
 
restated for changes in
 
business division perimeters, Group
 
Treasury allocations
 
and Non-core and Legacy
 
cost allocations, as
 
well as changes in the
 
equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items”
 
section, the “Equity attribution” section and
 
“Note 3 Segment reporting” in
 
the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to adjustments following organizational
 
changes, restatements due to the retrospective adoption of new accounting standards or
changes in accounting policies, and events after the reporting period.
 
2 Comparative figures have been restated for changes in Group
 
Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in the
“UBS business divisions and Group Items”
 
section and “Note 3 Segment reporting”
 
in the “Consolidated financial statements” section
 
of this report for more information.
 
Comparatives may additionally differ due
to adjustments following organizational
 
changes, restatements due
 
to the retrospective adoption of
 
new accounting standards or
 
changes in accounting policies,
 
and events after the
 
reporting period.
 
3 Refer to
“Alternative performance
 
measures” in the
 
appendix to this
 
report for the
 
definition and calculation
 
method.
 
4 Includes accretion of
 
PPA adjustments
 
on financial instruments
 
and other PPA
 
effects, as
 
well as
temporary and incremental items directly related to the integration.
 
5 Includes temporary, incremental operating expenses
 
directly related to the integration, as well as amortization of newly recognized intangibles
resulting from the acquisition of the Credit Suisse Group.
 
6 Refer to the “Equity attribution” section of this report
 
for more information about the equity attribution framework.
 
7 Refer to the “Risk management
and control” section of this report for more information about (credit-)impaired exposures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Asset Management
 
24
Asset Management
Asset Management
As of or for the quarter ended
% change from
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Net management fees
3
 
745
 
745
 
479
 
0
 
56
Performance fees
 
30
 
52
 
23
 
(42)
 
29
Net gain from disposals
 
27
Total revenues
 
776
 
825
 
503
 
(6)
 
54
Credit loss expense / (release)
 
0
 
(1)
 
0
Operating expenses
 
665
 
704
 
408
 
(5)
 
63
Business division operating profit / (loss) before tax
 
111
 
122
 
95
 
(9)
 
17
Underlying results
Total revenues as reported
 
776
 
825
 
503
 
(6)
 
54
Total revenues (underlying)
4
 
776
 
825
 
503
 
(6)
 
54
Credit loss expense / (release)
 
0
 
(1)
 
0
Operating expenses as reported
 
665
 
704
 
408
 
(5)
 
63
of which: integration-related expenses
4
 
71
 
64
 
10
Operating expenses (underlying)
4
 
594
 
639
 
408
 
(7)
 
46
of which: expenses for litigation, regulatory and similar matters
 
0
 
6
 
0
Business division operating profit / (loss) before tax as reported
 
111
 
122
 
95
 
(9)
 
17
Business division operating profit / (loss) before tax (underlying)
4
 
182
 
186
 
95
 
(2)
 
91
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
4
 
16.6
 
(1.9)
 
(45.6)
Cost / income ratio (%)
4
 
85.8
 
85.3
 
81.2
Average attributed equity (USD bn)
5
 
2.6
 
2.6
 
1.8
 
2
 
45
Return on attributed equity (%)
4,5
 
16.7
 
18.8
 
20.8
Gross margin on invested assets (bps)
4,6
 
19
 
21
 
18
Underlying performance measures
Pre-tax profit growth (year-on-year, %)
4
 
91.5
 
50.2
 
(45.6)
Cost / income ratio (%)
4
 
76.6
 
77.5
 
81.2
Information by business line / asset
 
class
Net new money (USD bn)
4
Equities
 
3.3
 
(6.4)
 
(4.1)
Fixed Income
 
13.8
 
(5.6)
 
19.2
of which: money market
 
10.4
 
1.4
 
18.0
Multi-asset & Solutions
 
1.7
 
0.9
 
1.3
Hedge Fund Businesses
 
(0.2)
 
(1.6)
 
(0.9)
Real Estate & Private Markets
 
0.3
 
0.3
 
(1.2)
Total net new money excluding associates
 
18.9
 
(12.4)
 
14.4
of which: net new money excluding money market
 
8.6
 
(13.8)
 
(3.6)
Associates
7
 
2.1
 
0.1
 
(0.3)
Total net new money
6
 
21.0
 
(12.2)
 
14.1
Invested assets (USD bn)
4
Equities
 
683
 
644
 
481
 
6
 
42
Fixed Income
 
450
 
445
 
320
 
1
 
41
of which: money market
 
145
 
134
 
138
 
9
 
6
Multi-asset & Solutions
 
278
 
274
 
161
 
1
 
72
Hedge Fund Businesses
 
58
 
57
 
55
 
3
 
6
Real Estate & Private Markets
 
148
 
156
 
100
 
(6)
 
48
Total invested assets excluding associates
 
1,617
 
1,577
 
1,117
 
3
 
45
of which: passive strategies
 
750
 
715
 
468
 
5
 
60
Associates
7
 
74
 
72
 
24
 
3
 
210
Total invested assets
6
 
1,691
 
1,649
 
1,140
 
3
 
48
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Asset Management
 
25
Asset Management (continued)
As of or for the quarter ended
% change from
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Information by region
Invested assets (USD bn)
4
Americas
 
424
 
402
 
321
 
5
 
32
Asia Pacific
6
 
214
 
211
 
177
 
2
 
21
EMEA (excluding Switzerland)
 
374
 
354
 
274
 
6
 
36
Switzerland
 
679
 
682
 
369
 
0
 
84
Total invested assets
6
 
1,691
 
1,649
 
1,140
 
3
 
48
Information by channel
Invested assets (USD bn)
4
Third-party institutional
 
960
 
939
 
626
 
2
 
53
Third-party wholesale
 
176
 
177
 
123
 
(1)
 
43
UBS’s wealth management businesses
 
482
 
461
 
368
 
4
 
31
Associates
7
 
74
 
72
 
24
 
3
 
210
Total invested assets
6
 
1,691
 
1,649
 
1,140
 
3
 
48
1 Comparative figures have been
 
restated for changes in
 
business division perimeters,
 
Group Treasury
 
allocations and Non-core and
 
Legacy cost allocations,
 
as well as changes in
 
the equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the
 
“Equity attribution” section and “Note 3
 
Segment reporting” in the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to
 
adjustments following organizational changes, restatements due to the retrospective
 
adoption of new accounting standards or
changes in accounting policies, and events after
 
the reporting period.
 
2 Comparative figures have been restated for changes
 
in Group Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in
 
the
“UBS business divisions and Group Items” section and “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more information. Comparatives may additionally differ due to
adjustments following organizational changes, restatements due
 
to the retrospective adoption
 
of new accounting standards
 
or changes in accounting policies,
 
and events after the
 
reporting period.
 
3 Net management
fees include transaction
 
fees, fund
 
administration revenues
 
(including net interest
 
and trading income
 
from lending activities
 
and foreign-exchange hedging
 
as part of
 
the fund services
 
offering), distribution fees,
incremental fund-related
 
expenses,
 
gains or
 
losses from
 
seed money
 
and co-investments,
 
funding costs,
 
the negative
 
pass-through impact
 
of third-party
 
performance fees,
 
and other
 
items that
 
are not
 
Asset
Management’s performance fees.
 
4 Refer to “Alternative performance measures”
 
in the appendix to this report for the definition and calculation method.
 
5 Refer to the “Equity attribution” section of this report
for more information about the equity attribution framework.
 
6 Starting with the second quarter of 2023, net new money
 
and invested assets include net new money and invested assets
 
from associates, to better
reflect the business strategy.
 
Comparative figures have been
 
restated to reflect this change.
 
7 The invested assets and
 
net new money amounts reported
 
for associates are prepared in
 
accordance with their local
regulatory requirements and practices.
 
Results: 1Q24 vs 1Q23
 
Profit before tax increased by USD 16m, or 17%, to USD 111m, mainly due to the acquisition of the Credit Suisse
Group. Underlying profit before tax was USD 182m,
 
after excluding integration-related expenses
 
of USD 71m.
Total revenues
Total
 
revenues
 
increased
 
by
 
USD 273m,
 
or
 
54%,
 
to
 
USD 776m,
 
reflecting
 
the
 
consolidation
 
of
 
Credit
 
Suisse
revenues.
Net management fees increased by USD 266m, or
 
56%, to USD 745m, largely due to
 
the consolidation of Credit
Suisse net management fees and also
 
due to the first quarter
 
of 2023 including negative pass-through fees, with
the
 
corresponding
 
offset
 
in
 
performance
 
fees.
 
The
 
increase
 
was
 
also
 
due
 
to
 
positive
 
market
 
performance
 
and
foreign currency effects, partly offset by continued
 
margin compression.
Performance fees
 
increased by
 
USD 7m, or
 
29%, to
 
USD 30m, mainly
 
due to
 
the consolidation
 
of Credit
 
Suisse
performance fees and increases in Hedge Fund Businesses,
 
Fixed Income and Real Estate & Private Markets, partly
offset by a decrease due to the first quarter
 
of 2023 including the aforementioned
 
pass-through fees.
Operating expenses
Operating expenses increased by USD 257m, or 63%, to USD 665m, mainly reflecting the
 
consolidation of Credit
Suisse
 
expenses,
 
and
 
included
 
integration-related
 
expenses of
 
USD 71m. The
 
increase
 
was
 
also
 
due
 
to
 
adverse
foreign currency effects and increases in technology expenses and general and administrative expenses. Excluding
the aforementioned integration-related expenses, underlying
 
operating expenses were USD 594m.
Invested assets: 1Q24 vs 4Q23
 
Invested assets
 
increased by
 
USD 42bn
 
to USD 1,691bn,
 
mainly reflecting
 
positive market
 
performance
 
of USD 72bn
and positive net
 
new money of
 
USD 21bn, partly offset
 
by adverse foreign currency
 
effects of USD 48bn.
 
Excluding
money market flows and associates, net new
 
money was positive USD 9bn.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Investment Bank
 
26
Investment Bank
Investment Bank
As of or for the quarter ended
% change from
USD m, except where indicated
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Advisory
 
189
 
191
 
171
 
(1)
 
11
Capital Markets
 
683
 
649
 
213
 
5
 
220
Global Banking
 
872
 
840
 
384
 
4
 
127
Execution Services
 
463
 
412
 
419
 
12
 
11
Derivatives & Solutions
 
873
 
447
 
1,022
 
95
 
(15)
Financing
 
542
 
442
 
539
 
23
 
1
Global Markets
 
1,878
 
1,301
 
1,980
 
44
 
(5)
of which: Equities
 
1,353
 
1,006
 
1,313
 
35
 
3
of which: Foreign Exchange, Rates and Credit
 
525
 
295
 
667
 
78
 
(21)
Total revenues
 
2,751
 
2,141
 
2,365
 
28
 
16
Credit loss expense / (release)
 
32
 
48
 
7
 
(33)
 
355
Operating expenses
 
2,164
 
2,283
 
1,866
 
(5)
 
16
Business division operating profit / (loss) before tax
 
555
 
(190)
 
492
 
13
Underlying results
Total revenues as reported
 
2,751
 
2,141
 
2,365
 
28
 
16
of which: PPA effects
3
 
293
 
277
 
6
of which: PPA effects recognized in Global Banking revenue line
 
288
 
275
 
5
Total revenues (underlying)
4
 
2,458
 
1,864
 
2,365
 
32
 
4
Credit loss expense / (release)
 
32
 
48
 
7
 
(33)
 
355
Operating expenses as reported
 
2,164
 
2,283
 
1,866
 
(5)
 
16
of which: integration-related expenses
4
 
143
 
167
 
(15)
Operating expenses (underlying)
4
 
2,022
 
2,116
 
1,866
 
(4)
 
8
of which: expenses for litigation, regulatory and similar matters
 
(1)
 
13
 
45
Business division operating profit / (loss) before tax as reported
 
555
 
(190)
 
492
 
13
Business division operating profit / (loss) before tax (underlying)
4
 
404
 
(300)
 
492
 
(18)
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
4
 
12.7
 
(270.2)
 
(47.0)
Cost / income ratio (%)
4
 
78.7
 
106.6
 
78.9
Average attributed equity (USD bn)
5
 
17.0
 
16.8
 
14.7
 
1
 
15
Return on attributed equity (%)
4,5
 
13.1
 
(4.5)
 
13.4
Underlying performance measures
Pre-tax profit growth (year-on-year, %)
4
 
(17.8)
 
(368.8)
 
(51.8)
Cost / income ratio (%)
4
 
82.3
 
113.5
 
78.9
Return on attributed equity (%)
4,5
 
9.5
 
(7.1)
 
13.4
1 Comparative figures have
 
been restated for changes in
 
business division perimeters, Group
 
Treasury allocations
 
and Non-core and Legacy
 
cost allocations, as
 
well as changes in the
 
equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items”
 
section, the “Equity attribution” section and
 
“Note 3 Segment reporting” in
 
the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to adjustments following organizational changes,
 
restatements due to the retrospective adoption of new accounting standards or
changes in accounting policies, and events after the reporting period.
 
2 Comparative figures have been restated for changes
 
in Group Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in the
“UBS business divisions and Group Items”
 
section and “Note 3 Segment reporting”
 
in the “Consolidated financial statements” section
 
of this report for more information.
 
Comparatives may additionally differ due
to adjustments following organizational changes,
 
restatements due to the
 
retrospective adoption of new accounting
 
standards or changes in
 
accounting policies, and events
 
after the reporting period.
 
3 Includes
accretion of PPA adjustments on financial instruments and other PPA effects.
 
4 Refer to “Alternative performance measures” in the appendix to this report for the definition and calculation method.
 
5 Refer to the
“Equity attribution” section of this report for more information about the equity attribution framework.
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Investment Bank
 
27
Results: 1Q24 vs 1Q23
Profit before
 
tax increased
 
by USD 63m,
 
or 13%,
 
to USD 555m,
 
mainly driven
 
by higher
 
total revenues,
 
partly offset
by higher operating expenses.
 
Underlying profit before tax
 
was USD 404m, after excluding
 
USD 293m of purchase
price allocation (PPA) effects and integration-related
 
expenses of USD 143m.
Total revenues
Total
 
revenues increased by
 
USD 386m, or 16%,
 
to USD 2,751m, due to
 
higher Global Banking revenues,
 
which
increased by USD 488m,
 
or 127%,
 
partly offset by
 
lower Global
 
Markets revenues,
 
which decreased by
 
USD 102m,
or 5%.
 
The consolidation
 
of Credit
 
Suisse revenues
 
included USD 293m
 
of PPA
 
effects. Excluding
 
these effects,
underlying total revenues were USD 2,458m.
Global Banking
Global Banking
 
revenues increased
 
by USD 488m,
 
or 127%,
 
to USD 872m,
 
mainly due
 
to USD 288m
 
of PPA effects.
Excluding these effects,
 
underlying Global Banking revenues
 
increased by USD 200m,
 
or 52%. The
 
overall global
fee pool
1,2
increased 18%.
Advisory revenues
 
increased by
 
USD 18m, or
 
11%, to
 
USD 189m, mainly
 
due to
 
higher merger
 
and acquisition
transaction revenues. The relevant global
 
fee pool
2
decreased 10%.
Capital
 
Markets
 
revenues
 
increased
 
by
 
USD 470m,
 
or
 
220%,
 
to
 
USD 683m,
 
mainly
 
due
 
to
 
USD 288m
 
of
 
the
aforementioned PPA effects.
 
Excluding these effects,
 
underlying Capital Markets
 
revenues increased by
 
USD 182m,
or 85%, with increases across all products. Leveraged Capital Markets revenues increased by USD 99m, or 245%,
Debt Capital Markets revenues increased by USD 39m, or 58%, and Equity Capital Markets revenues increased
 
by
USD 32m, or 58%. The relevant global fee
 
pools
1,2
 
increased by 58%, 26% and 58%, respectively.
Global Markets
Global Markets revenues decreased by USD 102m, or 5%, to
 
USD 1,878m, primarily driven by lower Derivatives
 
&
Solutions revenues, partly offset by higher Execution Services revenues.
Execution Services
 
revenues increased
 
by USD 44m, or
 
11%, to USD 463m,
 
due to increases
 
in Cash Equities
 
across
all regions.
Derivatives & Solutions revenues decreased by
 
USD 149m, or 15%, to
 
USD 873m, mostly driven by
 
Rates, due to
lower levels of both volatility and client activity.
Financing revenues increased by USD 3m, or
 
1%, to USD 542m.
Equities
Global Markets Equities revenues increased by USD 40m, or
 
3%, to USD 1,353m.
Foreign Exchange, Rates and Credit
Global Markets
 
Foreign
 
Exchange, Rates
 
and
 
Credit
 
revenues
 
decreased by
 
USD 142m, or
 
21%,
 
to USD 525m,
primarily driven by lower Rates revenues.
Credit loss expense / release
Net credit loss expenses were USD 32m, compared with net expenses
 
of USD 7m in the first quarter of 2023.
Operating expenses
Operating expenses increased by
 
USD 298m, or 16%, to
 
USD 2,164m, largely due to
 
the consolidation of Credit
Suisse expenses,
 
and included integration-related expenses of USD 143m. Excluding integration-related expenses,
underlying operating expenses were USD 2,022m.
1
 
UBS fee-pool-comparable revenues consist of revenues
 
from: merger-and-acquisition-related transactions; Equity Capital
 
Markets, excluding derivatives;
 
Leveraged Capital Markets,
 
excluding the impact of mark-to-
market movements on loan portfolios; and Debt Capital Markets,
 
excluding revenues related to debt underwriting of UBS instruments.
2
 
Source: Dealogic, as of 29 March 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Non-core and Legacy
 
28
Non-core and Legacy
Non-core and Legacy
As of or for the quarter ended
% change from
USD m
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Total revenues
 
1,001
 
145
 
23
 
588
Credit loss expense / (release)
 
36
 
15
 
0
 
139
Operating expenses
 
1,011
 
1,787
 
699
 
(43)
 
45
Operating profit / (loss) before tax
 
(46)
 
(1,657)
 
(676)
 
(97)
 
(93)
Underlying results
Total revenues as reported
 
1,001
 
145
 
23
 
588
Total revenues (underlying)
3
 
1,001
 
145
 
23
 
588
Credit loss expense / (release)
 
36
 
15
 
0
 
139
Operating expenses as reported
 
1,011
 
1,787
 
699
 
(43)
 
45
of which: integration-related expenses
3
 
242
 
750
Operating expenses (underlying)
3
 
769
 
1,037
 
699
 
(26)
 
10
of which: expenses for litigation, regulatory and similar matters
 
(16)
 
(33)
 
665
Operating profit / (loss) before tax as reported
 
(46)
 
(1,657)
 
(676)
 
(97)
 
(93)
Operating profit / (loss) before tax (underlying)
3
 
197
 
(907)
 
(676)
Performance measures and other information
Average attributed equity
4
 
10.6
 
9.5
 
1.1
 
12
 
889
Risk-weighted assets (USD bn)
 
57.9
 
74.0
 
13.1
 
(22)
 
342
Leverage ratio denominator (USD bn)
 
119.9
 
168.5
 
6.1
 
(29)
1 Comparative figures have
 
been restated for changes
 
in business division perimeters,
 
Group Treasury
 
allocations and Non-core and
 
Legacy cost allocations,
 
as well as changes in
 
the equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the
 
“Equity attribution” section and “Note 3
 
Segment reporting” in the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to
 
adjustments following organizational changes, restatements due to
 
the retrospective adoption of new accounting standards or
changes in accounting policies, and events after the reporting period.
 
2 Comparatives may additionally differ due to adjustments following organizational changes, restatements due to the retrospective adoption of
new accounting standards or changes
 
in accounting policies, and
 
events after the reporting period.
 
3 Refer to “Alternative
 
performance measures” in the appendix
 
to this report for the
 
definition and calculation
method.
 
4 Refer to the “Equity attribution” section of this report for more information about the equity attribution framework.
 
Composition of Non-core and Legacy
USD bn
RWA
Total assets
LRD
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
Exposure category
Equities
 
2.3
 
3.4
 
15.1
 
20.5
 
10.3
 
14.3
Macro
 
6.5
 
9.9
 
47.0
 
56.7
 
20.0
 
26.2
Loans
 
8.9
 
11.6
 
10.1
 
14.0
 
12.8
 
16.4
Securitized products
 
10.2
 
14.1
 
17.9
 
27.5
 
20.2
 
29.7
Credit
 
1.1
 
3.1
 
3.3
 
5.4
 
3.5
 
5.5
High-quality liquid assets
 
50.3
 
74.4
 
50.3
 
74.4
Operational risk
 
27.1
 
30.0
Other
 
1.8
 
1.9
 
2.1
 
3.0
 
2.9
 
1.9
Total
 
57.9
 
74.0
 
145.9
 
201.4
 
119.9
 
168.5
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Non-core and Legacy
 
29
Results: 1Q24 vs 1Q23
Loss before
 
tax was
 
USD 46m,
 
compared
 
with a
 
loss
 
before
 
tax of
 
USD 676m. Underlying
 
gain before
 
tax was
USD 197m, after excluding integration-related expenses
 
of USD 242m.
Total revenues
Total revenues increased by USD 978m
 
to USD 1,001m,
 
mainly due to
 
the transfer
 
of assets and
 
liabilities into
 
Non-
core and
 
Legacy following the acquisition
 
of the Credit
 
Suisse Group. Revenues
 
included net gains
 
from position
exits, along with net
 
interest income from securitized
 
products and credit
 
products. Revenues also included a
 
net
gain of USD 272m
 
from the conclusion of agreements with Apollo relating to the former Credit Suisse securitized
products group.
›
Refer to “Integration of Credit Suisse” in the “Recent developments” section and “Note 2 Accounting for the
acquisition of the Credit Suisse Group” in the “Consolidated financial statements” section of this report for more
information about the concluding of agreements with Apollo
Credit loss expense / release
Net
 
credit
 
loss
 
expenses
 
were
 
USD 36m,
 
compared
 
with
 
net
 
expenses
 
of
 
USD 0m.
 
Net
 
credit
 
loss
 
expenses
 
of
USD 62m related
 
to credit-impaired
 
(stage 3 and
 
purchased credit-impaired)
 
positions, mainly
 
across our Credit
 
and
Equities businesses,
 
were partly offset by net credit loss releases of USD 26m related to stage 1 and 2 positions.
Operating expenses
Operating
 
expenses
 
increased
 
by
 
USD 312m
 
to
 
USD 1,011m, mainly
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
 
Suisse
expenses, and included integration-related
 
expenses of USD 242m, driven
 
by corporate services. The
 
first quarter
of
 
2023
 
included
 
a
 
USD 665m
 
increase
 
in
 
provisions
 
related
 
to
 
the
 
US
 
residential
 
mortgage-backed
 
securities
litigation matter, which was
 
settled in the
 
third quarter of
 
2023. Excluding integration-related
 
expenses, underlying
operating expenses were USD 769m.
Risk-weighted assets and leverage ratio denominator:
 
1Q24 vs 4Q23
Risk-weighted assets
 
were reduced by
 
USD 16.1bn to
 
USD 57.9bn, while
 
the leverage
 
ratio denominator
 
decreased
by
 
USD 48.6bn to
 
USD 119.9bn. These
 
changes were
 
mainly driven
 
by active
 
unwinds of
 
Non-core
 
and Legacy
assets,
 
most
 
notably
 
reflecting
 
the
 
sale
 
of
 
USD 8bn
 
of
 
senior
 
secured
 
financing
 
facilities
 
provided
 
to
 
Apollo,
reductions in the loan inventory in the credit portfolio,
 
and exit of the life finance business in the
 
US.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
UBS business divisions and Group Items |
 
Group Items
 
30
Group Items
Group Items
As of or for the quarter ended
% change from
USD m
31.3.24
31.12.23
1
31.3.23
2
4Q23
1Q23
Results
Total revenues
 
(355)
 
107
 
(211)
 
68
Credit loss expense / (release)
 
(2)
 
(2)
 
0
Operating expenses
 
(33)
 
16
 
14
Operating profit / (loss) before tax
 
(320)
 
93
 
(225)
 
42
Underlying results
Total revenues as reported
 
(355)
 
107
 
(211)
 
68
of which: PPA effects
3
 
(4)
 
12
Total revenues (underlying)
4
 
(351)
 
95
 
(211)
 
66
Credit loss expense / (release)
 
(2)
 
(2)
 
0
Operating expenses as reported
 
(33)
 
16
 
14
of which: integration-related expenses
4
 
1
 
109
of which: acquisition-related costs
 
(1)
 
70
Operating expenses (underlying)
4
 
(34)
 
(92)
 
(57)
 
(63)
 
(41)
of which: expenses for litigation, regulatory and similar matters
 
0
 
(28)
 
1
Operating profit / (loss) before tax as reported
 
(320)
 
93
 
(225)
 
42
Operating profit / (loss) before tax (underlying)
4
 
(315)
 
189
 
(155)
 
104
1 Comparative figures have
 
been restated for changes
 
in business division perimeters,
 
Group Treasury
 
allocations and Non-core and
 
Legacy cost allocations,
 
as well as changes in
 
the equity attribution framework.
Refer to “Changes to segment
 
reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the
 
“Equity attribution” section and “Note 3
 
Segment reporting” in the “Consolidated financial statements”
section of this report for more information. Comparatives may additionally differ due to
 
adjustments following organizational changes, restatements due to
 
the retrospective adoption of new accounting standards or
changes in accounting policies, and events after
 
the reporting period.
 
2 Comparative figures have been restated for changes in
 
Group Treasury allocations.
 
Refer to “Changes to segment reporting in 2024” in
 
the
“UBS business divisions and Group Items” section and “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more information. Comparatives may additionally differ due to
adjustments following organizational
 
changes, restatements
 
due to the
 
retrospective adoption
 
of new accounting
 
standards or changes
 
in accounting
 
policies, and
 
events after the
 
reporting period.
 
3 Includes
accretion of PPA adjustments on financial instruments and other PPA
 
effects.
 
4 Refer to “Alternative performance measures” in the appendix to
 
this report for the definition and calculation method.
Results: 1Q24 vs 1Q23
Loss before tax
 
was USD 320m,
 
mainly driven
 
by mark-to-market
 
losses in
 
Group hedging
 
and own
 
debt,
 
compared
with a
 
loss of
 
USD 225m. Underlying
 
loss before
 
tax was
 
USD 315m, after
 
excluding USD 5m
 
of purchase
 
price
allocation effects
 
and integration-related
 
expenses, compared
 
with an
 
underlying loss
 
of USD 155m,
 
after excluding
acquisition-related costs of USD 70m.
Income
 
from
 
Group
 
hedging
 
and
 
own
 
debt,
 
including
 
hedge
 
accounting
 
ineffectiveness,
 
was
 
net
 
negative
USD 191m, compared with net negative income of USD 68m. The results across the periods were driven by mark-
to-market effects
 
on portfolio-level
 
economic hedges
 
due to
 
higher interest
 
rates and
 
cross-currency-basis
 
widening.
In addition, the first quarter of 2024 included a USD 25m donation expense and an
 
USD 11m increase in funding
costs related to deferred tax assets.
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
32
Risk management and control
This
 
section
 
provides
 
information
 
about
 
key
 
developments
 
during
 
the
 
reporting
 
period
 
and
 
should
 
be
 
read
 
in
conjunction with
 
the “Risk
 
management and
 
control” section
 
of the
 
UBS Group
 
Annual Report
 
2023, available
under “Annual
 
reporting” at
ubs.com/investors
, and
 
the “Recent
 
developments” section of
 
this report
 
for more
information about the integration of Credit
 
Suisse.
Credit risk
 
Overall banking products exposure
Overall banking products
 
exposure decreased by
 
USD 88bn to USD 1,092bn as
 
of 31 March
 
2024, mainly driven
by a
 
decrease in
 
balances at
 
central banks,
 
as well
 
as a
 
decrease in
 
loans and
 
advances to
 
customers due
 
to negative
currency effects.
Total net
 
credit loss
 
expenses
 
in the
 
first quarter
 
of 2024
 
were USD 106m,
 
reflecting net
 
releases of
 
USD 45m related
to performing positions and net expenses
 
of USD 151m on credit-impaired positions.
 
›
Refer to the “Balance sheet and off-balance sheet” section of this report for more information about balance sheet
movements
›
Refer to the “Group performance” section and “Note 9 Expected credit loss measurement” in the “Consolidated
financial statements” section of this report for more information about credit loss expense / release
Loan underwriting
In the Investment Bank,
 
mandated loan underwriting
 
commitments on a
 
notional basis decreased by
 
USD 0.1bn to
USD 1.9bn
 
as
 
of
 
31 March
 
2024.
 
In
 
Non-core
 
and
 
Legacy,
 
exposure
 
decreased
 
by
 
USD 0.5bn
 
to
 
USD 0.5bn
following the cancellation of the largest mandated exposure. As of 31 March 2024, USD 0.1bn
 
and USD 0.5bn of
commitments
 
in
 
the
 
Investment
 
Bank
 
and
 
in
 
Non-core
 
and
 
Legacy,
 
respectively,
 
have
 
not
 
been
 
distributed
 
as
originally planned.
 
Loan underwriting exposures are classified as
 
held for trading, with fair
 
values reflecting the market conditions at
the end of the quarter. Credit hedges are
 
in place to help protect against fair value movements
 
in the portfolio.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
33
Banking and traded products exposure in our business divisions and Group Items
31.3.24
USD m
Global
Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
 
Bank
Non-core
 
and Legacy
Group
 
Items
Total
Banking products
1,2
Gross exposure
 
471,001
 
448,792
 
1,694
 
106,280
 
47,997
 
15,889
 
1,091,653
of which: loans and advances to customers (on-balance sheet)
 
301,544
 
280,328
 
17
 
17,988
 
6,623
 
483
 
606,983
of which: guarantees and loan commitments (off-balance sheet)
 
20,727
 
53,044
 
60
 
34,778
 
3,427
 
17,001
 
129,036
Traded products
2,3,4
Gross exposure
 
13,933
 
4,969
 
0
 
44,191
 
63,093
of which: over-the-counter derivatives
 
9,817
 
4,511
 
0
 
12,556
 
26,885
of which: securities financing transactions
 
342
 
0
 
0
 
21,418
 
21,760
of which: exchange-traded derivatives
 
3,774
 
458
 
0
 
10,216
 
14,448
Other credit lines, gross
5
 
80,663
 
67,597
 
0
 
2,568
 
3
 
86
 
150,918
Total credit-impaired exposure, gross
 
1,095
 
3,425
 
0
 
642
 
1,875
 
0
 
7,038
of which: stage 3
 
919
 
3,051
 
0
 
591
 
753
 
0
 
5,315
of which: PCI
 
176
 
375
 
0
 
51
 
1,122
 
0
 
1,724
Total allowances and provisions for expected credit losses
 
326
 
1,211
 
0
 
375
 
324
 
7
 
2,243
of which: stage 1
 
146
 
334
 
0
 
124
 
10
 
6
 
620
of which: stage 2
 
70
 
239
 
0
 
93
 
4
 
0
 
406
of which: stage 3
 
97
 
627
 
0
 
158
 
154
 
0
 
1,035
of which: PCI
 
13
 
12
 
0
 
1
 
156
 
0
 
182
31.12.23
6
USD m
Global
Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
 
Bank
Non-core
 
and Legacy
Group
Items
Total
Banking products
1,2
Gross exposure
 
495,846
 
482,822
 
1,699
 
115,203
 
73,092
 
10,555
 
1,179,217
of which: loans and advances to customers (on-balance sheet)
 
317,137
 
299,150
 
13
 
16,993
 
8,117
 
131
 
641,542
of which: guarantees and loan commitments (off-balance sheet)
 
22,706
 
57,494
 
59
 
36,230
 
3,235
 
18,109
 
137,834
Traded products
2,3,4
Gross exposure
 
11,812
 
4,748
 
0
 
47,630
 
64,191
of which: over-the-counter derivatives
 
8,397
 
4,116
 
0
 
12,400
 
24,913
of which: securities financing transactions
 
371
 
19
 
0
 
23,044
 
23,434
of which: exchange-traded derivatives
 
3,045
 
613
 
0
 
12,186
 
15,844
Other credit lines, gross
5
 
83,077
 
75,334
 
0
 
4,714
 
5
 
126
 
163,256
Total credit-impaired exposure, gross
 
1,662
 
3,066
 
0
 
469
 
1,169
 
1
 
6,367
of which: stage 3
 
1,022
 
2,632
 
0
 
408
 
290
 
1
 
4,352
of which: PCI
 
640
 
434
 
0
 
61
 
879
 
0
 
2,014
Total allowances and provisions for expected credit losses
 
392
 
1,231
 
1
 
358
 
271
 
8
 
2,261
of which: stage 1
 
176
 
364
 
1
 
133
 
20
 
7
 
700
of which: stage 2
 
63
 
259
 
0
 
78
 
16
 
0
 
416
of which: stage 3
 
98
 
590
 
0
 
146
 
158
 
0
 
993
of which: PCI
 
55
 
19
 
0
 
1
 
77
 
0
 
153
1 IFRS 9 gross exposure
 
for banking products includes
 
the following financial instruments
 
in scope of expected
 
credit loss requirements: balances
 
at central banks,
 
amounts due from banks,
 
loans and advances to
customers, other financial assets at amortized cost, guarantees and irrevocable loan commitments.
 
2 Internal management view of credit risk, which differs in certain respects from
 
IFRS Accounting Standards.
 
3 As
counterparty risk for traded products is managed at counterparty level, no further split between exposures in
 
the Investment Bank, Non-core and Legacy, and Group Items is provided.
 
4 Credit Suisse traded products
are presented
 
before reflection
 
of the
 
impact of
 
the purchase
 
price allocation
 
performed under
 
IFRS 3,
 
Business Combinations,
 
following the
 
acquisition of
 
the Credit
 
Suisse Group
 
by UBS.
 
The acquisition
 
date
adjustment is less than USD 1bn and, if applied, would lead to a reduction in
 
our reported traded products exposure.
 
5 Unconditionally revocable committed credit lines.
 
6 Comparative figures in this table have
been restated for changes
 
in business division
 
perimeters and Group
 
Treasury allocations.
 
Refer to “Changes to
 
segment reporting in 2024”
 
in the “UBS business
 
divisions and Group Items”
 
section and “Note
 
3
Segment reporting” in the
 
“Consolidated financial statements”
 
section of this report
 
for more information. Comparatives
 
may additionally differ due
 
to adjustments following organizational
 
changes, restatements
due to the retrospective adoption of new accounting standards or changes in accounting policies, and events after the reporting
 
period.
 
Collateralization of Loans and advances to customers
1
Global Wealth Management
Personal & Corporate Banking
USD m, except where indicated
31.3.24
31.12.23
2
31.3.24
31.12.23
2
Secured by collateral
 
293,109
 
308,120
 
240,880
 
259,734
Residential real estate
 
107,299
 
111,755
 
189,360
 
204,184
Commercial / industrial real estate
 
10,033
 
10,860
 
39,677
 
42,560
Cash
 
31,095
 
36,813
 
2,926
 
3,269
Equity and debt instruments
 
119,722
 
122,079
 
3,399
 
3,666
Other collateral
3
 
24,960
 
26,613
 
5,518
 
6,055
Subject to guarantees
 
837
 
1,048
 
7,708
 
8,132
Uncollateralized and not subject to guarantees
 
7,598
 
7,969
 
31,739
 
31,284
Total loans and advances to customers, gross
 
301,544
 
317,137
 
280,328
 
299,150
Allowances
 
(226)
 
(181)
 
(966)
 
(987)
Total loans and advances to customers, net of allowances
 
301,319
 
316,957
 
279,362
 
298,163
Collateralized loans and advances to customers in % of total loans
 
and advances to customers, gross (%)
 
97.2
 
97.2
 
85.9
 
86.8
1 Collateral arrangements generally
 
incorporate a range of
 
collateral, including cash, securities,
 
real estate and other collateral.
 
UBS applies a risk-based approach that
 
generally prioritizes collateral according
 
to its
liquidity profile. In the case of loan facilities with funded and unfunded elements,
 
the collateral is first allocated to the funded element. Credit Suisse applies
 
a risk-based approach that generally prioritizes real estate
collateral and prioritizes other collateral according to its liquidity profile. In the case of loan facilities with funded
 
and unfunded elements, the collateral is proportionately allocated.
 
2 Comparative figures in this table
have been restated for
 
changes in business division
 
perimeters. Refer to
 
“Changes to segment reporting
 
in 2024” in the
 
“UBS business divisions
 
and Group Items” section
 
and Note 3 “Segment
 
reporting” in the
“Consolidated financial
 
statements” section
 
of this
 
report for
 
more information.
 
Comparatives may
 
additionally differ
 
due to
 
adjustments following
 
organizational changes,
 
restatements due
 
to the
 
retrospective
adoption of new accounting
 
standards or changes
 
in accounting policies,
 
and events after
 
the reporting period.
 
3 Includes but is
 
not limited to life
 
insurance contracts,
 
rights in respect
 
of subscription or
 
capital
commitments from fund partners, inventory, gold and other commodities.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
34
Market risk
The UBS
 
Group excluding
 
Credit Suisse
 
continued to
 
maintain generally
 
low levels
 
of management
 
value-at-risk
(VaR). Average management VaR
 
(1-day,
 
95% confidence level) increased marginally to USD 17m from USD 16m
in the first quarter of
 
2024. There were
 
no new VaR
 
negative backtesting exceptions in the first
 
quarter of 2024.
The number
 
of negative
 
backtesting exceptions
 
within the
 
most recent
 
250-business-day window
 
remained at
 
zero.
 
Credit Suisse’s average management VaR (1-day, 98% confidence level) decreased to
 
USD 17m from USD 23m in
the first
 
quarter of
 
2024, driven
 
by continued
 
strategic migration
 
of positions
 
to UBS
 
from the
 
Investment Bank
(Credit
 
Suisse)
 
and
 
reductions
 
in
 
Non-core
 
and
 
Legacy.
 
In
 
the
 
first
 
quarter
 
of
 
2024,
 
Credit
 
Suisse
 
had
 
no
 
new
negative
 
backtesting
 
exceptions.
 
The
 
number
 
of
 
negative
 
backtesting
 
exceptions
 
within
 
the
 
most
 
recent
 
250-
business-day window decreased to one from
 
three at the end of 2023.
The
 
Swiss
 
Financial
 
Market
 
Supervisory
 
Authority
 
(FINMA)
 
VaR
 
multiplier
 
derived
 
from
 
negative
 
backtesting
exceptions for market risk
 
risk-weighted assets was unchanged
 
compared with the prior
 
quarter, at 3.0,
 
for both
the UBS Group excluding Credit Suisse and Credit
 
Suisse.
Management value-at-risk (1-day, 95% confidence, 5 years of historical data) of our business divisions and Group Items
excluding Credit Suisse components, by general market risk type
1
Average by risk type
USD m
Min.
Max.
Period end
Average
Equity
Interest
rates
Credit
spreads
Foreign
exchange
Commodities
Global Wealth Management
 
1
 
2
 
1
 
1
 
0
 
1
 
2
 
0
 
0
Personal & Corporate Banking
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Asset Management
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Investment Bank
 
11
 
23
 
13
 
17
 
7
 
17
 
8
 
3
 
3
Non-core and Legacy
 
1
 
2
 
1
 
1
 
0
 
1
 
1
 
0
 
0
Group Items
 
4
 
5
 
4
 
4
 
1
 
4
 
3
 
1
 
0
Diversification effect
2,3
 
(6)
 
(6)
 
(1)
 
(5)
 
(4)
 
(1)
 
0
Total as of 31.3.24
 
12
 
23
 
13
 
17
 
7
 
18
 
9
 
3
 
3
Total as of 31.12.23
 
11
 
24
 
19
 
16
 
9
 
16
 
7
 
2
 
3
Management value-at-risk (1-day, 98% confidence, 2 years of historical data) of the Credit Suisse components of our
business divisions and Group Items, by general market risk type
1
Average by risk type
USD m
Min.
Max.
Period end
Average
Equity
Interest
rates
Credit
spreads
Foreign
exchange
Commodities
Global Wealth Management
 
1
 
3
 
2
 
2
 
1
 
0
 
1
 
0
 
0
Personal & Corporate Banking
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Asset Management
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Investment Bank
4
 
4
 
11
 
4
 
6
 
5
 
1
 
2
 
0
 
0
Non-core and Legacy
 
12
 
16
 
13
 
14
 
6
 
6
 
12
 
0
 
0
Group Items
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Diversification effect
2,3
 
(3)
 
(5)
 
(3)
 
3
 
(3)
 
0
 
0
Total as of 31.3.24
 
15
 
21
 
17
 
17
 
9
 
10
 
12
 
1
 
1
Total as of 31.12.23
 
20
 
25
 
21
 
23
 
11
 
12
 
16
 
1
 
1
1 Statistics at individual levels may not be summed
 
to deduce the corresponding aggregate figures. The
 
minima and maxima for each level may occur
 
on different days, and, likewise,
 
the value-at-risk (VaR) for each
business line or risk type, being driven
 
by the extreme loss tail of the corresponding
 
distribution of simulated profits and losses
 
for that business line or risk type,
 
may well be driven by different days
 
in the historical
time series, rendering invalid the simple summation of figures to arrive at the aggregate total.
 
2 The difference between the sum of the standalone VaR for the business divisions and Group Items and the total VaR.
 
3 As the minima
 
and maxima for different
 
business divisions and Group
 
Items occur on different
 
days, it is
 
not meaningful to calculate
 
a portfolio diversification
 
effect.
 
4 The Investment
 
Bank management VaR
consists of positions that we currently plan to retain going forward and were previously reported under Non-core and Legacy.
Economic value of equity and net interest income
 
sensitivity
The economic value of equity
 
(EVE) sensitivity in the UBS Group
 
banking book to a parallel shift
 
in yield curves of
+1 basis
 
point
 
was
 
negative
 
USD 31.3m
 
as
 
of
 
31 March
 
2024,
 
compared
 
with
 
negative
 
USD 30.1m
 
as
 
of
31 December 2023. This
 
excludes the sensitivity
 
of USD 5.4m from
 
additional tier 1 (AT1)
 
capital instruments (as
per specific FINMA requirements)
 
in contrast to general
 
Basel Committee on
 
Banking Supervision (BCBS)
 
guidance.
Exposure in the banking
 
book of the
 
UBS Group increased during the
 
first quarter of 2024,
 
due to interest rate
 
risk
hedges of recent AT1
 
issuances and a repositioning of the Swiss franc exposure
 
in anticipation of the subsequent
Swiss National Bank rate cut in March 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
35
The majority of
 
our interest rate
 
risk in
 
the banking
 
book is
 
a reflection of
 
the net asset
 
duration that
 
we run
 
to
offset our modeled
 
sensitivity of net
 
USD 23.4m (31 December 2023:
 
USD 24.3m) assigned to
 
our equity, goodwill
and
 
real
 
estate,
 
with
 
the aim
 
of
 
generating
 
a
 
stable
 
net
 
interest
 
income
 
contribution. Of
 
this,
 
USD 16.7m and
USD 5.7m
 
are
 
attributable
 
to
 
the
 
US
 
dollar
 
and
 
the
 
Swiss
 
franc
 
portfolios,
 
respectively
 
(31 December
 
2023:
USD 17.6m and USD 5.6m, respectively).
 
In addition to
 
the aforementioned
 
sensitivity, we
 
calculate the
 
six interest
 
rate shock
 
scenarios prescribed
 
by FINMA.
The “Parallel up” scenario, assuming all
 
positions were fair valued, was the
 
most severe and would have resulted
in a change in EVE
 
of negative USD 5.9bn, or
 
6.3%, of our tier 1
 
capital (31 December 2023:
 
negative USD 5.7bn,
or 6.1%), which is well below
 
the 15% threshold as per
 
the BCBS supervisory outlier test
 
for high levels of interest
rate risk in the banking book.
 
The immediate effect
 
on our tier 1
 
capital in the
 
“Parallel up” scenario
 
as of 31 March
 
2024 would have
 
been a
decrease of approximately
 
USD 0.9bn, or 0.9%,
 
(31 December 2023: USD 0.9bn,
 
or 0.9%), reflecting the
 
fact that
the
 
vast
 
majority
 
of
 
our
 
banking
 
book
 
is
 
accrual
 
accounted
 
or
 
subject
 
to
 
hedge
 
accounting.
 
The
 
“Parallel
 
up”
scenario would subsequently have a positive effect
 
on net interest income, assuming a constant
 
balance sheet.
›
Refer to “Interest rate risk in the banking book” in the “Risk management and control”
 
section of the UBS Group
Annual Report 2023, available under “Annual reporting” at
ubs.com/investors
, for more information about the
management of interest rate risk in the banking book
›
Refer to “Sensitivity to interest rate movements” in the “Group performance” section of this report for more
information about the effects of increases in interest rates on the net interest income of our banking book
 
Interest rate risk – banking book
31.3.24
USD m
Effect on EVE
1
 
– FINMA
Effect on EVE
1
 
– BCBS
Scenarios
CHF
EUR
GBP
USD
Other
Total
Additional tier 1 (AT1) capital
instruments
Total
+1 bp
 
(4.5)
 
(0.7)
 
0.1
 
(26.1)
 
(0.1)
 
(31.3)
 
5.4
 
(25.9)
Parallel up
2
 
(661.4)
 
(132.6)
 
26.4
 
(5,044.0)
 
(43.6)
 
(5,855.3)
 
1,000.1
 
(4,855.2)
Parallel down
2
 
703.7
 
132.7
 
(32.3)
 
5,252.2
 
40.4
 
6,096.8
 
(1,153.4)
 
4,943.4
Steepener
3
 
(306.6)
 
(13.0)
 
(5.4)
 
(1,205.2)
 
(40.7)
 
(1,570.9)
 
179.8
 
(1,391.1)
Flattener
4
 
176.4
 
(7.8)
 
9.7
 
39.4
 
30.3
 
248.0
 
44.7
 
292.7
Short-term up
5
 
(79.6)
 
(45.8)
 
17.5
 
(2,032.0)
 
10.7
 
(2,129.2)
 
469.6
 
(1,659.5)
Short-term down
6
 
80.5
 
45.9
 
(17.8)
 
2,167.5
 
(9.6)
 
2,266.4
 
(487.7)
 
1,778.8
31.12.23
USD m
Effect on EVE
1
 
– FINMA
Effect on EVE
1
 
– BCBS
Scenarios
CHF
EUR
GBP
USD
Other
Total
Additional tier 1 (AT1) capital
instruments
Total
+1 bp
 
(3.7)
 
(0.6)
 
0.1
 
(26.0)
 
0.2
 
(30.1)
 
4.9
 
(25.2)
Parallel up
2
 
(548.9)
 
(119.3)
 
16.2
 
(5,027.2)
 
(0.9)
 
(5,680.2)
 
904.6
 
(4,775.5)
Parallel down
2
 
561.8
 
124.3
 
(29.2)
 
5,216.0
 
2.8
 
5,875.7
 
(1,044.5)
 
4,831.3
Steepener
3
 
(305.3)
 
(13.1)
 
(11.9)
 
(1,037.0)
 
(33.8)
 
(1,401.1)
 
93.4
 
(1,307.6)
Flattener
4
 
189.6
 
(5.0)
 
14.0
 
(124.2)
 
30.8
 
105.2
 
109.6
 
214.8
Short-term up
5
 
(27.3)
 
(39.4)
 
19.4
 
(2,171.3)
 
23.9
 
(2,194.7)
 
486.3
 
(1,708.4)
Short-term down
6
 
26.5
 
41.8
 
(21.8)
 
2,312.1
 
(26.8)
 
2,331.9
 
(507.8)
 
1,824.1
1 Economic value of equity.
 
2 Rates across all tenors move by ±150 bps for Swiss franc, ±200 bps
 
for euro and US dollar, and ±250 bps for pound sterling.
 
3 Short-term rates decrease and long-term rates increase.
 
4 Short-term rates increase and long-term rates decrease.
 
5 Short-term rates increase more than long-term rates.
 
6 Short-term rates decrease more than long-term rates.
Country risk
We remain
 
watchful of
 
a range
 
of geopolitical
 
developments and
 
political changes
 
in a
 
number of
 
countries, as
well as international tensions
 
arising from the Russia–Ukraine war, conflicts in the
 
Middle East and US–China
 
trade
relations. Our direct exposure to Israel is
 
less than USD 0.5bn and
 
our direct exposure to Gulf Cooperation
 
Council
countries is less
 
than USD 7bn. We
 
have limited direct
 
exposure to
 
Egypt, Jordan
 
and Lebanon, and
 
we have no
direct exposure to
 
Iran, Iraq or
 
Syria. Our direct
 
exposure to Russia,
 
Belarus and Ukraine
 
is immaterial, and
 
potential
second-order impacts, such as European energy security, continue to be monitored.
 
Inflation has abated to some extent in major Western economies, though there are still concerns regarding future
developments, and central banks’
 
monetary policy is in the
 
spotlight. The potential for
 
“higher-for-longer” interest
rates raises the prospect of a global recession.
 
There are ongoing concerns regarding the property sector
 
in China.
This combination of factors translates into
 
a more uncertain and volatile
 
environment, which increases the risk of
financial market disruption.
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
36
We continue to monitor
 
potential trade policy
 
disputes, as well as
 
economic and political
 
developments in addition
to those mentioned above. We
 
are closely watching elections in
 
a number of key
 
markets in 2024. Our
 
exposure
to emerging market countries is less than
 
10% of our total country exposure, mainly
 
in Asia.
›
Refer to the “Risk management and control” section of the UBS Group Annual Report 2023, available under
“Annual reporting” at
ubs.com/investors
, for more information
Non-financial risk
We continue to actively manage the non-financial risks emerging from the acquisition of the Credit Suisse Group,
including the
 
current operation
 
of dual
 
corporate structures,
 
and the
 
scale, pace
 
and complexity
 
of the
 
required
integration activities.
 
These activities continue
 
to be managed
 
via the program
 
run by our
 
Group Integration Office.
The integration of Credit Suisse requires data to
 
be migrated into the UBS environment and
 
we aim to ensure that
we have robust controls
 
to preserve data integrity,
 
quality and availability,
 
to mitigate data migration risks and to
meet regulatory expectations.
 
Through this
 
period of
 
change, we
 
place an
 
increased focus
 
on maintaining
 
and enhancing
 
our control
 
environment
and continue to cooperate with regulators in relation to the submission and execution
 
of implementation plans to
meet regulatory requirements, including remediation requirements applicable to Credit Suisse
 
AG. In addition, the
Group is closely monitoring
 
non-financial risk indicators, to detect
 
any potential for adverse impacts
 
on the control
environment.
 
There is an
 
increased risk
 
of cyber-related
 
operational disruption
 
to business
 
activities at
 
our locations
 
and / or those
of
 
third-party
 
suppliers
 
due
 
to
 
operating
 
an
 
enlarged
 
group
 
of
 
entities.
 
This
 
is
 
combined
 
with
 
the
 
increasingly
dynamic threat
 
environment, which
 
is intensified
 
by current
 
geopolitical factors
 
and evidenced
 
by the
 
increased
volumes and sophistication of cyberattacks
 
against financial institutions globally.
Cyberattacks on
 
third-party vendors
 
have affected
 
our operations
 
in the
 
past and
 
continue to
 
be a
 
source of
 
residual
risk to our business. No cyber events occurred in the first
 
quarter of 2024 related to our own infrastructure, or the
infrastructure of any third party, that
 
had material financial or operational
 
effects on us. We remain on heightened
alert to respond to and mitigate elevated cybersecurity and information security threats. Following a post-incident
review
 
of
 
the
 
ION
 
XTP
 
ransomware
 
attack,
 
we
 
are
 
improving
 
our
 
frameworks
 
for
 
managing
 
third
 
parties
 
that
support
 
our
 
important
 
business
 
services
 
and
 
continue
 
with
 
actions
 
to
 
enhance
 
our
 
cyber-risk
 
assessments
 
and
controls over
 
third-party vendors.
 
We continue
 
to invest
 
in improving
 
our technology
 
infrastructure and
 
information
security governance to improve our defense,
 
detection and response capabilities
 
against cyberattacks.
In addition, we
 
are working to
 
enhance our operational
 
resilience to address
 
these heightened risks and
 
to meet
regulatory deadlines through 2026. We are implementing a global framework designed to drive enhancements in
operational resilience
 
across all
 
business divisions
 
and relevant
 
jurisdictions, as
 
well as
 
working with
 
the third
 
parties,
including vendors,
 
that are of
 
critical importance
 
to our operations,
 
to assess their
 
operational resilience
 
against our
standards.
The increasing interest
 
in data-driven
 
advisory processes,
 
and use of
 
artificial intelligence
 
(AI) and machine
 
learning,
is opening up new questions
 
related to the fairness of
 
AI algorithms, data life cycle
 
management, data ethics,
 
data
privacy and security, and
 
records management. In
 
addition, new risks
 
continue to emerge,
 
such as those that
 
result
from the demand from
 
our clients for distributed
 
ledger technology, blockchain-based
 
assets and cryptocurrencies;
however,
 
we
 
currently
 
have
 
limited
 
exposure
 
to
 
such
 
risks,
 
and
 
relevant
 
control
 
frameworks
 
for
 
them
 
are
implemented and reviewed on a regular basis
 
as they evolve.
Competition to find new business
 
opportunities, products and services
 
across the financial services sector,
 
both for
firms and
 
for customers,
 
is increasing,
 
particularly during
 
periods of
 
market volatility
 
and economic
 
uncertainty.
Thus, suitability
 
risk, product
 
selection, cross-divisional
 
service offerings,
 
quality of
 
advice and
 
price transparency
remain areas of heightened focus for UBS and
 
for the industry as a whole.
Evolving
 
environmental,
 
social
 
and
 
governance
 
regulations
 
and
 
major
 
legislation,
 
such
 
as
 
the
 
Consumer
 
Duty
regulation in the United
 
Kingdom, the Swiss Financial
 
Services Act (FIDLEG) in
 
Switzerland, Regulation Best
 
Interest
(Reg BI) in the
 
US and the Markets
 
in Financial Instruments
 
Directive II (MiFID II)
 
in the EU, all significantly
 
affect the
industry and have required adjustments to
 
control processes.
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Risk management and
 
control
 
37
Cross-border
 
risk
 
(including
 
unintended
 
permanent
 
establishment)
 
remains
 
an
 
area
 
of
 
regulatory
 
attention
 
for
global
 
financial
 
institutions,
 
including
 
a
 
focus
 
on
 
market
 
access,
 
such
 
as
 
third-country
 
market
 
access
 
into
 
the
European Economic Area, and taxation of US persons. We maintain a series of controls designed to
 
address these
risks, and we are increasing the number of controls
 
that are automated.
Financial crime, including
 
money laundering, terrorist
 
financing, sanctions violations,
 
fraud, bribery and corruption,
continues
 
to
 
present
 
a
 
major
 
risk,
 
as
 
technological
 
innovation
 
and
 
geopolitical
 
developments
 
increase
 
the
complexity of
 
doing business
 
and heightened regulatory
 
attention continues.
 
Money laundering
 
and financial
 
fraud
techniques are becoming increasingly sophisticated, including growing use of
 
AI, and geopolitical volatility makes
the sanctions landscape more
 
complex. The extensive and
 
continuously evolving sanctions arising
 
from the Russia–
Ukraine war require
 
constant attention to
 
prevent circumvention risks, while
 
the conflicts in
 
the Middle East may
increase terrorist financing
 
risks. An effective
 
financial crime prevention
 
program therefore remains
 
essential for us.
We are focused
 
on strategic enhancements to
 
our global anti-money-laundering,
 
know-your-client and sanctions
programs to respond to new
 
and existing regulatory requirements
 
and to respond to developing
 
threats, as well as
alignment of standards and processes as
 
Credit Suisse clients are migrated to UBS
 
platforms.
 
Achieving
 
fair
 
outcomes
 
for
 
our
 
clients,
 
upholding
 
market
 
integrity
 
and
 
cultivating
 
the
 
highest
 
standards
 
of
employee conduct
 
are of
 
critical importance
 
to us.
 
We maintain
 
a
 
conduct risk
 
framework across
 
our activities,
which is designed to align our standards and conduct with these objectives and to retain momentum on fostering
a strong culture.
 
On 5 January 2024,
 
we integrated the
 
UBS and Credit
 
Suisse conduct risk
 
frameworks to align
 
the
handling of conduct risk across the firm.
In September
 
2022, the
 
US Securities
 
and Exchange
 
Commission (the
 
SEC) and
 
the Commodity
 
Futures Trading
Commission (the CFTC)
 
issued settlement
 
orders relating to
 
communications recordkeeping
 
requirements in
 
our US
broker-dealers
 
and
 
our
 
registered
 
swap
 
dealers.
 
In
 
response
 
to
 
identified
 
shortcomings,
 
we
 
are
 
continuing
 
to
implement a global remediation program.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
38
Capital management
The
 
disclosures
 
in
 
this
 
section
 
are
 
provided
 
for
 
UBS Group AG
 
on
 
a
 
consolidated
 
basis
 
and
 
focus
 
on
 
key
developments during
 
the reporting
 
period and
 
information in
 
accordance with
 
the Basel III
 
framework, as
 
applicable
to Swiss systemically relevant banks (SRBs).
 
They should be read in conjunction
 
with “Capital management” in the
“Capital, liquidity and funding,
 
and balance sheet” section
 
of the UBS Group
 
Annual Report 2023, available
 
under
“Annual
 
reporting”
 
at
ubs.com/investors
,
 
which
 
provides
 
more
 
information
 
about
 
our
 
capital
 
management
objectives, planning and activities, as
 
well as the Swiss SRB total loss-absorbing capacity
 
(TLAC) framework.
UBS Group AG is a
 
holding company and
 
conducts substantially all
 
of its
 
operations through UBS AG
 
and Credit
Suisse AG, and subsidiaries
 
thereof. UBS Group AG, UBS AG
 
and Credit Suisse AG
 
have contributed a
 
significant
portion
 
of
 
their
 
respective
 
capital
 
to,
 
and
 
provide
 
substantial
 
liquidity
 
to,
 
such
 
subsidiaries.
 
Many
 
of
 
these
subsidiaries
 
are
 
subject
 
to
 
regulations
 
requiring
 
compliance
 
with
 
minimum
 
capital,
 
liquidity
 
and
 
similar
requirements.
›
Refer to the 31 March 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information relating to additional regulatory disclosures for UBS Group AG on a consolidated basis, as well as the
significant regulated subsidiaries and sub-groups of UBS Group AG
›
Refer to the
 
UBS AG first
 
quarter 2024
 
report, available
 
under “Quarterly
 
reporting” at
ubs.com/investors
, for more
information
 
about capital
 
and other
 
regulatory
 
information
 
for UBS AG
 
consolidated,
 
in accordance
 
with the Basel
 
III
framework,
 
as applicable
 
to Swiss SRBs
Swiss SRB going and gone concern requirements and information
As of 31.3.24
RWA
LRD
USD m, except where indicated
in %
in %
Required going concern capital
Total going concern capital
 
14.77
1
 
77,731
 
5.00
1
 
79,982
Common equity tier 1 capital
 
10.47
 
55,094
 
3.50
2
 
55,988
of which: minimum capital
 
4.50
 
23,690
 
1.50
 
23,995
of which: buffer capital
 
5.50
 
28,954
 
2.00
 
31,993
of which: countercyclical buffer
 
0.47
 
2,450
Maximum additional tier 1 capital
 
4.30
 
22,637
 
1.50
 
23,995
of which: additional tier 1 capital
 
3.50
 
18,425
 
1.50
 
23,995
of which: additional tier 1 buffer capital
 
0.80
 
4,211
Eligible going concern capital
Total going concern capital
 
17.75
 
93,467
 
5.84
 
93,467
Common equity tier 1 capital
 
14.84
 
78,147
 
4.89
 
78,147
Total loss-absorbing additional tier 1 capital
3
 
2.91
 
15,320
 
0.96
 
15,320
of which: high-trigger loss-absorbing additional tier 1 capital
 
2.68
 
14,103
 
0.88
 
14,103
of which: low-trigger loss-absorbing additional tier 1 capital
 
0.23
 
1,217
 
0.08
 
1,217
Required gone concern capital
Total gone concern loss-absorbing capacity
4,5,6
 
10.73
7
 
56,460
 
3.75
7
 
59,987
of which: base requirement including add-ons for market share and LRD
 
10.73
 
56,460
 
3.75
 
59,987
Eligible gone concern capital
Total gone concern loss-absorbing capacity
 
19.75
 
103,986
 
6.50
 
103,986
Total tier 2 capital
 
0.10
 
537
 
0.03
 
537
of which: non-Basel III-compliant tier 2 capital
 
0.10
 
537
 
0.03
 
537
TLAC-eligible senior unsecured debt
 
19.65
 
103,449
 
6.47
 
103,449
Total loss-absorbing capacity
Required total loss-absorbing capacity
 
25.49
 
134,191
 
8.75
 
139,969
Eligible total loss-absorbing capacity
 
37.51
 
197,453
 
12.34
 
197,453
Risk-weighted assets / leverage ratio denominator
Risk-weighted assets
 
526,437
Leverage ratio denominator
 
1,599,646
1 Includes
 
applicable add-ons
 
of 1.44%
 
for risk-weighted
 
assets (RWA)
 
and 0.50%
 
for leverage
 
ratio denominator
 
(LRD).
 
2 Our
 
minimum CET1
 
leverage ratio
 
requirement of
 
3.50% consists
 
of a
 
1.5% base
requirement, a 1.5% base buffer capital requirement, a 0.25% LRD add-on requirement
 
and a 0.25% market share add-on requirement
 
based on our Swiss credit business.
 
3 Includes outstanding low-trigger loss-
absorbing additional tier 1
 
capital instruments, which
 
are available under the
 
Swiss systemically relevant
 
bank framework to meet
 
the going concern requirements
 
until their first call
 
date. As of
 
their first call date,
these instruments are eligible to meet the gone concern requirements.
 
4 A maximum of 25% of the gone concern requirements can be met with instruments that have a remaining maturity of between one and two
years. Once at least 75% of the minimum gone concern requirement has
 
been met with instruments that have a remaining maturity of greater than
 
two years, all instruments that have a remaining maturity of between
one and two years remain eligible to be included in the total gone concern capital.
 
5 From 1 January 2023, the resolvability discount on the gone concern capital requirements for systemically important banks (SIBs)
has been replaced
 
with reduced base
 
gone concern capital
 
requirements equivalent to
 
75% of the
 
total going concern
 
requirements (excluding countercyclical
 
buffer requirements).
 
6 As of
 
July 2024, the
 
Swiss
Financial Market Supervisory
 
Authority (FINMA) will
 
have the authority to
 
impose a surcharge of
 
up to 25% of
 
the total going concern
 
capital requirements should obstacles
 
to an SIB’s
 
resolvability be identified
 
in
future resolvability assessments.
 
7 Includes applicable add-ons of 1.08% for RWA and 0.38% for LRD.
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
39
We are subject to
 
the going and gone
 
concern requirements of
 
the Swiss Capital Adequacy
 
Ordinance that include
the
 
too-big-to-fail
 
(TBTF)
 
provisions
 
applicable
 
to
 
Swiss
 
SRBs.
 
The
 
table
 
above
 
provides
 
the
 
risk-weighted asset
(RWA)- and leverage ratio denominator (LRD)-based
 
requirements and information as of 31 March
 
2024.
Transitional purchase price allocation
 
adjustments for regulatory capital
As part of the acquisition of
 
the Credit Suisse Group in 2023,
 
the assets acquired and liabilities
 
assumed, including
contingent liabilities, were
 
recognized at fair
 
value as
 
of the
 
acquisition date in
 
accordance with IFRS 3,
Business
Combinations
. The purchase price allocation
 
(PPA) fair value adjustments
 
required under IFRS 3 were recognized
 
as
part of
 
negative goodwill and
 
included
 
effects on
 
financial instruments measured
 
at amortized
 
cost, such as
 
fair
value impacts
 
from interest
 
rates and
 
own credit,
 
that are
 
expected to
 
accrete back
 
to par
 
through the
 
income
statement as the instruments are held to maturity. Similar own-credit-related effects have also been recognized as
part of the
 
PPA adjustments
 
on financial liabilities
 
measured at
 
fair value. As
 
agreed with the
 
Swiss Financial
 
Market
Supervisory Authority (FINMA), a
 
transitional common equity tier 1
 
(CET1) capital treatment has
 
been applied for
certain of
 
these fair
 
value adjustments, given
 
the substantially
 
temporary nature of
 
the IFRS-3-accounting-driven
effects. As such,
 
equity reductions under
 
IFRS Accounting Standards
 
of USD 5.9bn (before
 
tax) and USD 5.0bn
 
(net
of tax) as of the acquisition date have been neutralized
 
for CET1 capital calculation purposes, of
 
which USD 1.0bn
(net
 
of
 
tax)
 
relates
 
to
 
own-credit-related
 
fair
 
value
 
adjustments.
 
The
 
transitional
 
treatment
 
is
 
subject
 
to
 
linear
amortization and will
 
be reduced
 
to nil
 
by 30 June 2027.
 
The amortization of
 
transitional CET1 PPA
 
adjustments
(interest rate
 
and own
 
credit) since
 
the acquisition
 
date totaled
 
USD 1.0bn (net
 
of tax)
 
as of
 
31 March 2024,
 
an
increase of USD 0.4bn (net of tax) in the first
 
quarter of 2024.
Additional capital requirements for
 
UBS Group AG consolidated and UBS
 
AG standalone under current
requirements
As
 
a
 
result
 
of
 
the
 
acquisition
 
of
 
the
 
Credit
 
Suisse
 
Group,
 
the
 
capital
 
add-on
 
for
 
UBS
 
Group
 
AG
 
consolidated,
reflecting the degree of
 
systemic importance, which is based
 
on market share and
 
LRD, will increase to
 
reflect its
greater market
 
share and
 
LRD after
 
an appropriate
 
transition period
 
to be
 
agreed with
 
FINMA. We
 
currently estimate
that this will add around USD 10bn to the Group’s tier one capital requirement, when fully
 
phased in. The phase-
in
 
of
 
the
 
increased
 
capital
 
requirements
 
will
 
commence
 
from
 
the
 
end
 
of
 
2025
 
and
 
will
 
be
 
completed
 
by
 
the
beginning of 2030, at the latest.
Effective at the
 
time of
 
the merger with
 
Credit Suisse AG,
 
UBS AG
 
standalone will continue
 
to adhere to
 
capital
requirements
 
on
 
a
 
fully
 
applied
 
basis,
 
including
 
risk-weights
 
of
 
250%
 
and
 
400%
 
for
 
Swiss
 
and
 
foreign
participations, respectively,
 
and after the removal
 
of the regulatory
 
filter that had been
 
granted to Credit
 
Suisse AG
standalone prior to the merger.
 
A transition to the UBS
 
approach for the treatment
 
of Credit Suisse AG standalone
participations would have reduced CET1 capital
 
by around USD 9bn, using Credit
 
Suisse balances as of 31 March
2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
40
Total loss-absorbing capacity
The table below provides Swiss SRB going and gone concern information based on the Swiss SRB
 
framework and
requirements that are discussed under “Capital management” in the “Capital, liquidity and funding, and
 
balance
sheet” section of the UBS Group Annual Report 2023,
 
available under “Annual reporting” at
ubs.com/investors
.
 
Swiss SRB going and gone concern information
USD m, except where indicated
31.3.24
31.12.23
Eligible going concern capital
Total going concern capital
 
93,467
 
92,377
Total tier 1 capital
 
93,467
 
92,377
Common equity tier 1 capital
 
78,147
 
78,485
Total loss-absorbing additional tier 1 capital
 
15,320
 
13,892
of which: high-trigger loss-absorbing additional tier 1 capital
 
14,103
 
12,678
of which: low-trigger loss-absorbing additional tier 1 capital
 
1,217
 
1,214
Eligible gone concern capital
Total gone concern loss-absorbing capacity
 
103,986
 
107,106
Total tier 2 capital
 
537
 
538
of which: non-Basel III-compliant tier 2 capital
 
537
 
538
TLAC-eligible senior unsecured debt
 
103,449
 
106,567
Total loss-absorbing capacity
Total loss-absorbing capacity
 
197,453
 
199,483
Risk-weighted assets / leverage ratio denominator
Risk-weighted assets
 
526,437
 
546,505
Leverage ratio denominator
 
1,599,646
 
1,695,403
Capital and loss-absorbing capacity ratios (%)
Going concern capital ratio
 
17.8
 
16.9
of which: common equity tier 1 capital ratio
 
14.8
 
14.4
Gone concern loss-absorbing capacity ratio
 
19.8
 
19.6
Total loss-absorbing capacity ratio
 
37.5
 
36.5
Leverage ratios (%)
Going concern leverage ratio
 
5.8
 
5.4
of which: common equity tier 1 leverage ratio
 
4.9
 
4.6
Gone concern leverage ratio
 
6.5
 
6.3
Total loss-absorbing capacity leverage ratio
 
12.3
 
11.8
Total loss-absorbing capacity and movement
 
Our TLAC decreased by USD 2.0bn to USD 197.5bn
 
in the first quarter of 2024.
Going concern capital and movement
Our going concern
 
capital increased by
 
USD 1.1bn to USD 93.5bn.
 
Our CET1 capital
 
decreased by
 
USD 0.3bn to
USD 78.1bn, mainly reflecting
 
an operating profit
 
before tax
 
of USD 2.4bn, more
 
than offset
 
by negative effects
from foreign
 
currency translation
 
of USD 1.3bn,
 
dividend accruals
 
of USD 0.6bn,
 
current tax
 
expenses of
 
USD 0.5bn
and amortization of transitional CET1 PPA adjustments (interest rate and own credit) of USD
 
0.4bn (net of tax).
Our
 
loss-absorbing
 
additional
 
tier 1
 
(AT1)
 
capital
 
increased
 
by
 
USD 1.4bn
 
to
 
USD 15.3bn,
 
mainly
 
reflecting
 
the
issuance of two AT1 capital instruments equivalent
 
to a total of USD 1.5bn.
Following the approval of a minimum amount of conversion capital by
 
UBS Group AG’s shareholders at the 2024
Annual General
 
Meeting, AT1
 
capital instruments
 
issued from
 
the beginning
 
of the
 
fourth quarter
 
of 2023 are
 
now,
upon the occurrence
 
of a trigger
 
event or
 
a viability
 
event, subject
 
to conversion
 
into UBS Group
 
AG ordinary
 
shares
rather than a write-down.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
41
Gone concern loss-absorbing capacity and movement
Our
 
total
 
gone
 
concern
 
loss-absorbing
 
capacity
 
decreased
 
by
 
USD 3.1bn
 
to
 
USD 104.0bn
 
and
 
included
USD 103.4bn of TLAC-eligible senior
 
unsecured debt instruments.
 
The decrease of USD 3.1bn mainly reflected
 
the
call of
 
USD 2.1bn equivalent of
 
TLAC-eligible senior
 
unsecured debt
 
instruments, a
 
USD 1.9bn equivalent TLAC-
eligible
 
senior unsecured
 
debt instrument
 
that ceased
 
to be
 
eligible
 
as gone
 
concern capital
 
when we
 
issued
 
a
notice of redemption of
 
the instrument in
 
the first quarter
 
of 2024, a USD 2.4bn
 
senior unsecured debt instrument
that was
 
no longer
 
TLAC eligible
 
due to
 
its residual tenor
 
falling below
 
one year, and negative
 
impacts from
 
interest
rate risk hedge, foreign
 
currency translation and
 
other effects. These
 
decreases were partly offset
 
by new issuances
totaling USD 5.4bn equivalent of TLAC-eligible
 
senior unsecured debt instruments.
›
Refer to “Bondholder information” at
 
ubs.com/investors
for more information about the eligibility of capital and
senior unsecured debt instruments and about key features and terms and conditions of capital instruments
Loss-absorbing capacity and leverage ratios
Our CET1 capital ratio increased to 14.8% from 14.4%,
 
primarily reflecting an USD 20.1bn decrease in RWA.
 
Our CET1 leverage ratio increased to 4.9%
 
from 4.6%, mainly reflecting a USD 95.8bn
 
decrease in the LRD.
Our
 
gone
 
concern
 
loss-absorbing
 
capacity
 
ratio
 
increased
 
to
 
19.8%
 
from
 
19.6%,
 
due
 
to
 
the
 
aforementioned
decrease in RWA,
 
partly offset by a decrease in gone concern loss-absorbing
 
capacity of USD 3.1bn.
 
Our gone concern leverage
 
ratio increased to 6.5%
 
from 6.3%, due to
 
the aforementioned decrease in the
 
LRD,
partly offset by the aforementioned decrease
 
in gone concern loss-absorbing capacity.
Swiss SRB total loss-absorbing capacity movement
USD m
Going concern capital
Swiss SRB
Common equity tier 1 capital as of 31.12.23
 
78,485
Operating profit / (loss) before tax
 
2,376
Current tax (expense) / benefit
 
(468)
Foreign currency translation effects, before tax
 
(1,290)
Amortization of transitional CET1 purchase price allocation adjustments, net of
 
tax
 
(350)
Other
1
 
(607)
Common equity tier 1 capital as of 31.3.24
 
78,147
Loss-absorbing additional tier 1 capital as of 31.12.23
 
13,892
Issuance of high-trigger loss-absorbing additional tier 1 capital
 
1,483
Interest rate risk hedge, foreign currency translation and other effects
 
(55)
Loss-absorbing additional tier 1 capital as of 31.3.24
 
15,320
Total going concern capital as of 31.12.23
 
92,377
Total going concern capital as of 31.3.24
 
93,467
Gone concern loss-absorbing capacity
Tier 2 capital as of 31.12.23
 
538
Interest rate risk hedge, foreign currency translation and other effects
 
(1)
Tier 2 capital as of 31.3.24
 
537
TLAC-eligible unsecured debt as of 31.12.23
 
106,567
Issuance of TLAC-eligible senior unsecured debt
 
5,438
Call of TLAC-eligible senior unsecured debt
 
(3,970)
Debt no longer eligible as gone concern loss-absorbing capacity
 
due to residual tenor falling to below one year
 
(2,424)
Interest rate risk hedge, foreign currency translation and other effects
 
(2,162)
TLAC-eligible unsecured debt as of 31.3.24
 
103,449
Total gone concern loss-absorbing capacity as of 31.12.23
 
107,106
Total gone concern loss-absorbing capacity as of 31.3.24
 
103,986
Total loss-absorbing capacity
Total loss-absorbing capacity as of 31.12.23
 
199,483
Total loss-absorbing capacity as of 31.3.24
 
197,453
1 Includes dividend accruals for the current year and movements related to other items.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
42
Reconciliation of equity under IFRS Accounting Standards to Swiss SRB common equity tier 1 capital
USD m
31.3.24
31.12.23
Total equity under IFRS Accounting Standards
 
85,766
 
86,639
Equity attributable to non-controlling interests
 
(506)
 
(531)
Defined benefit plans, net of tax
 
(935)
 
(965)
Deferred tax assets recognized for tax loss carry-forwards
 
(2,865)
 
(3,039)
Deferred tax assets for unused tax credits
 
(173)
 
(97)
Goodwill, net of tax
1
 
(5,738)
 
(5,750)
Intangible assets, net of tax
 
(811)
 
(894)
Compensation-related components (not recognized in net profit)
 
(1,548)
 
(2,186)
Expected losses on advanced internal ratings-based portfolio less provisions
 
(664)
 
(713)
Unrealized (gains) / losses from cash flow hedges, net of tax
 
3,621
 
3,109
Own credit related to (gains) / losses on financial liabilities
 
measured at fair value that existed at the balance sheet date, net of tax
 
1,308
 
1,291
Own credit related to (gains) / losses on derivative financial instruments
 
that existed at the balance sheet date
 
(72)
 
(89)
Prudential valuation adjustments
 
(316)
 
(368)
Accruals for dividends to shareholders for 2023
 
(2,240)
 
(2,240)
Transitional CET1 purchase price allocation adjustments, net of tax
 
3,966
 
4,316
Other
2
 
(650)
 
3
Total common equity tier 1 capital
 
78,147
 
78,485
1 Includes goodwill related to
 
significant investments in
 
financial institutions of USD
 
19m as of 31
 
March 2024 (USD 20m
 
as of 31 December
 
2023) presented on the
 
balance sheet line Investments
 
in associates.
 
2 Includes dividend accruals for the current year and other items.
 
Additional information
Sensitivity to currency movements
 
Risk-weighted assets
We estimate that a 10% depreciation of the US dollar against other currencies would have increased our RWA by
USD 22bn and
 
our CET1
 
capital by
 
USD 2.5bn as
 
of 31
 
March 2024
 
(31 December
 
2023: USD 24bn
 
and USD 2.6bn,
respectively)
 
and
 
decreased
 
our
 
CET1
 
capital
 
ratio
 
by
 
14 basis
 
points
 
(31
 
December
 
2023:
 
13 basis
 
points).
Conversely,
 
a
 
10%
 
appreciation
 
of
 
the
 
US
 
dollar
 
against
 
other
 
currencies
 
would
 
have
 
decreased
 
our
 
RWA
 
by
USD 20bn and our
 
CET1 capital by
 
USD 2.3bn (31 December
 
2023: USD 21bn and
 
USD 2.4bn, respectively) and
increased our CET1 capital ratio by 14 basis points (31
 
December 2023: 13 basis points).
Leverage ratio denominator
We estimate that a
 
10% depreciation of the
 
US dollar against other
 
currencies would have increased
 
our LRD by
USD 104bn
 
as
 
of
 
31
 
March
 
2024
 
(31
 
December
 
2023:
 
USD 114bn)
 
and
 
decreased
 
our
 
CET1
 
leverage
 
ratio
 
by
15 basis points
 
(31 December
 
2023: 15 basis
 
points). Conversely, a
 
10% appreciation
 
of the
 
US dollar
 
against other
currencies would have decreased our LRD by USD 94bn (31 December 2023:
 
USD 103bn) and increased our CET1
leverage ratio by 15 basis points (31 December
 
2023: 15 basis points).
The aforementioned
 
sensitivities do
 
not consider
 
foreign currency
 
translation effects
 
related to
 
defined benefit
 
plans
other than those related to the currency
 
translation of the net equity of foreign operations.
›
Refer to “Active management of sensitivity to currency movements” under “Capital management” in the “Capital,
liquidity and funding, and balance sheet” section of the UBS Group Annual Report 2023, available under “Annual
reporting” at
ubs.com/investors
, for more information
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
43
Estimated effect on capital from litigation,
 
regulatory and similar matters subject to
 
provisions and contingent
liabilities
We have estimated the
 
loss in capital that
 
we could incur
 
as a result of
 
the risks associated
 
with the matters
 
related
to
 
UBS AG
 
and
 
subsidiaries
 
described
 
in
 
“Note 15
 
Provisions
 
and
 
contingent
 
liabilities”
 
in
 
the
 
“Consolidated
financial
 
statements”
 
section
 
of
 
this
 
report.
 
We
 
have
 
employed
 
for
 
this
 
purpose
 
the
 
advanced
 
measurement
approach (AMA) methodology
 
that we use
 
when determining
 
the capital requirements
 
associated with
 
operational
risks, based on a
 
99.9% confidence level
 
over a 12-month horizon.
 
The methodology takes
 
into consideration UBS
and industry experience for the AMA
 
operational risk categories to which
 
those matters correspond, as well
 
as the
external environment affecting risks of these types, in
 
isolation from other areas. On this basis, with respect to the
litigation,
 
regulatory
 
and
 
similar
 
matters
 
related
 
to
 
UBS AG and
 
subsidiaries,
 
we estimate
 
the
 
maximum loss
 
in
capital that we
 
could incur over
 
a 12-month period
 
as a result
 
of our risks
 
associated with these
 
operational risk
categories at USD 4.2bn as of 31 March 2024.
 
This estimate is not related
 
to and does not take into
 
account any
provisions
 
recognized
 
for
 
any
 
of
 
these
 
matters
 
and
 
does
 
not
 
constitute
 
a
 
subjective
 
assessment
 
of
 
our
 
actual
exposure in any of these matters.
›
Refer to “Non-financial risk” in the “Risk management and control” section of the UBS Group Annual Report 2023,
available under “Annual reporting” at
ubs.com/investors
, for more information
›
Refer to “Note 15 Provisions and contingent liabilities” in the “Consolidated financial statements” section of this
report for more information
 
Risk-weighted assets
 
During the first quarter of 2024, RWA decreased by USD
 
20.1bn to USD 526.4bn, primarily driven by decreases
 
of
USD 13.1bn resulting from
 
asset size and other
 
movements,
 
as well as USD 11.2bn
 
resulting from currency
 
effects,
partly offset by USD 4.2bn resulting from model
 
updates and methodology changes.
Movement in risk-weighted assets, by key driver
USD bn
RWA as of
31.12.23
Currency
effects
Model updates
and
methodology
changes
Asset size and
other
1
RWA as of
31.3.24
Credit and counterparty credit risk
2
 
345.3
 
(10.5)
 
(0.6)
 
(10.8)
 
323.5
Non-counterparty-related risk
3
 
34.4
 
(0.8)
 
(0.5)
 
33.1
Market risk
 
21.4
 
4.8
 
(1.8)
 
24.4
Operational risk
 
145.4
 
145.4
Total
 
546.5
 
(11.2)
 
4.2
 
(13.1)
 
526.4
1 Includes the Pillar 3 categories “Asset size,” “Credit quality of counterparties,” “Acquisitions
 
and disposals” and “Other.”
 
For more information, refer to the 31 March 2024 Pillar 3 Report, available under “Pillar 3
disclosures” at ubs.com/investors.
 
2 Includes settlement risk, credit valuation
 
adjustments, equity exposures in
 
the banking book, investments in
 
funds and securitization exposures in the
 
banking book.
 
3 Non-
counterparty-related risk includes deferred tax assets recognized for temporary differences, property,
 
equipment, software and other items.
Credit and counterparty credit risk
Credit and
 
counterparty credit
 
risk RWA
 
were USD 323.5bn
 
as of
 
31 March
 
2024. The
 
decrease of
 
USD 21.8bn
included currency effects of USD 10.5bn.
Asset size and other movements resulted in
 
a USD 10.8bn decrease in RWA.
 
–
Non-core
 
and
 
Legacy
 
RWA
 
decreased
 
by
 
USD 10.3bn,
 
mainly
 
driven
 
by
 
our
 
actions
 
to
 
actively
 
unwind
 
the
portfolio, in addition to the natural roll-off.
–
Global Wealth Management RWA decreased by
 
USD 2.3bn, mainly driven by lower RWA from
 
loans.
–
Investment Bank RWA decreased by USD 0.7bn,
 
mainly due to lower RWA from derivatives
 
and loans.
–
Personal & Corporate Banking RWA increased
 
by USD 1.4bn.
 
–
Group Items
 
RWA increased
 
by USD 1.0bn,
 
mainly as
 
higher RWA
 
from the
 
high-quality liquid
 
asset portfolio
 
and
nostro accounts were partly offset by lower RWA
 
from securities financing transactions.
–
Asset Management RWA increased by USD 0.1bn.
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
44
Model updates
 
and methodology
 
changes resulted
 
in a
 
RWA decrease
 
of USD 0.6bn,
 
mainly reflecting
 
an RWA
decrease of
 
USD 1.5bn related
 
to the
 
recalibration of
 
certain multipliers
 
as a
 
result of
 
improvements to
 
models,
partly
 
offset
 
by
 
RWA
 
increases
 
from
 
model
 
updates
 
related
 
to
 
income-producing
 
real
 
estate,
 
derivatives,
 
and
securities financing transactions.
›
Refer to “Changes to segment reporting in 2024” in the “UBS business divisions and Group Items” section and
“Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more information
about the realignment of the business divisions and the updates related to allocations from Group Treasury
 
in the
first quarter of 2024
›
Refer to the 31 March 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information
 
›
Refer to “Credit risk” in the “Risk management and control” section of this report for more information
 
Market risk
Market
 
risk
 
RWA increased
 
by
 
USD 3.0bn to
 
USD 24.4bn in
 
the
 
first
 
quarter of
 
2024,
 
driven
 
by
 
an
 
increase of
USD 4.8bn that stems
 
from the
 
FINMA-approved integration of
 
time decay
 
into regulatory VaR
 
and stressed VaR
for derivatives with optionality,
 
which was partly offset by an improvement in the profit and loss representation of
derivatives with multiple underlyings.
 
This impact was partly offset
 
by a decrease of USD 1.8bn
 
from asset size and
other movements in
 
the Investment Bank
 
and in Non-core and
 
Legacy
.
The FINMA-agreed temporary
 
measure that
was
 
introduced
 
in
 
the
 
fourth
 
quarter
 
of
 
2022,
 
and
 
scheduled
 
to
 
be
 
lifted
 
with
 
the
 
implementation
 
of
 
the
aforementioned changes,
 
has not yet been
 
removed.
 
The temporary time decay RWA
 
buffer that was introduced
in the third quarter of 2021 has dropped to
 
an immaterial level.
›
Refer to the 31 March 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
 
ubs.com/investors,
 
for more
information
 
›
Refer to “Market risk” in the “Risk management and control” section of this report for more information
Operational risk
Operational risk RWA
 
were unchanged at
 
USD 145.4bn. In the
 
first quarter of
 
2024, we updated the
 
methodology
that we
 
use to
 
allocate operational
 
risk RWA
 
to the
 
business divisions
 
and Group
 
Items. The
 
updated allocation
reflects relative
 
changes in
 
financial metrics
 
and operational
 
losses as
 
observed at
 
year-end 2023,
 
following the
changes in
 
business
 
division perimeters.
 
The transfer
 
of certain
 
businesses
 
from Swiss
 
Bank (Credit
 
Suisse), previously
included in Personal & Corporate Banking, resulted in increased operational risk RWA
 
allocation to Global Wealth
Management in the first quarter of 2024.
›
Refer to “Note 15 Provisions and contingent liabilities” in the “Consolidated financial statements” section of this
report for more information
›
Refer to “Non-financial risk” in the “Risk management and control” section of the UBS Group Annual Report 2023,
available under “Annual reporting” at
ubs.com/investors
, for information about the AMA models
Outlook
 
We expect
 
an RWA
 
reduction of
 
around USD 2bn
 
from credit
 
and counterparty credit
 
risk model
 
updates in
 
the
second quarter
 
of 2024,
 
mainly related
 
to the
 
recalibration of
 
certain multipliers
 
as a
 
result of
 
improvements to
models. This decrease in RWA is expected
 
to be offset by increases in the second
 
half of 2024, primarily as a result
of the
 
migration of
 
Credit Suisse
 
portfolios to
 
UBS models.
 
The extent
 
and timing
 
of RWA
 
changes may
 
vary as
model
 
updates
 
are
 
completed
 
and
 
receive
 
regulatory
 
approval,
 
along
 
with
 
changes
 
in
 
the
 
composition
 
of
 
the
relevant portfolios. Furthermore,
 
we expect exposures
 
in Non-core
 
and Legacy to
 
reduce as a
 
result of maturities
and active unwinding of positions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
45
Risk-weighted assets, by business division and Group Items
1
USD bn
Global Wealth
Management
Personal &
Corporate
Banking
Asset
Manage-
ment
Investment
Bank
Non-core and
Legacy
Group
 
Items
Total
RWA
31.3.24
Credit and counterparty credit risk
2
 
95.0
 
127.8
 
7.6
 
64.3
 
25.3
 
3.5
 
323.5
Non-counterparty-related risk
3
 
6.7
 
3.2
 
0.7
 
3.7
 
1.7
 
17.0
 
33.1
Market risk
 
2.2
 
0.6
 
0.0
 
17.9
 
3.7
 
0.0
 
24.4
Operational risk
 
63.2
 
19.3
 
7.2
 
24.4
 
27.1
 
4.2
 
145.4
Total
 
167.1
 
150.9
 
15.6
 
110.2
 
57.9
 
24.7
 
526.4
31.12.23
Credit and counterparty credit risk
2
 
99.0
 
133.0
 
7.6
 
67.1
 
35.9
 
2.7
 
345.3
Non-counterparty-related risk
3
 
6.8
 
3.4
 
0.8
 
3.8
 
2.5
 
17.1
 
34.4
Market risk
 
1.8
 
0.2
 
0.0
 
13.8
 
5.6
 
0.0
 
21.4
Operational risk
 
59.4
 
17.6
 
7.2
 
25.0
 
30.0
 
6.2
 
145.4
Total
 
167.1
 
154.2
 
15.6
 
109.7
 
74.0
 
25.9
 
546.5
31.3.24 vs 31.12.23
Credit and counterparty credit risk
2
 
(4.0)
 
(5.2)
 
0.0
 
(2.9)
 
(10.6)
 
0.8
 
(21.8)
Non-counterparty-related risk
3
 
(0.1)
 
(0.2)
 
(0.1)
 
(0.1)
 
(0.7)
 
0.0
 
(1.2)
Market risk
 
0.4
 
0.3
 
0.0
 
4.1
 
(1.8)
 
0.0
 
3.0
Operational risk
 
3.8
 
1.7
 
0.0
 
(0.6)
 
(2.9)
 
(2.0)
 
0.0
Total
 
0.0
 
(3.3)
 
0.0
 
0.5
 
(16.1)
 
(1.2)
 
(20.1)
1 From the
 
first quarter of
 
2024 onward,
 
we have started
 
to further push
 
out risk-weighted
 
assets from Group
 
Items to the
 
business divisions.
 
Prior periods have
 
been restated to
 
reflect these changes.
 
Refer to
“Changes to segment reporting in 2024” in the “UBS
 
business divisions and Group Items” section, the “Equity attribution”
 
section and “Note 3 Segment reporting” in the “Consolidated financial
 
statements” section
of this report for more information about the realignment of the business divisions.
 
2 Includes settlement risk, credit valuation adjustments, equity exposures in the banking book and securitization
 
exposures in the
banking book.
 
3 Non-counterparty-related risk includes
 
deferred tax assets recognized
 
for temporary differences
 
(31 March 2024: USD 16.4bn;
 
31 December 2023: USD
 
16.4bn), as well as
 
property, equipment,
software and other items (31 March 2024: USD 16.7bn; 31 December 2023: USD 18.0bn).
 
Leverage ratio denominator
During the first quarter of
 
2024, the LRD decreased by
 
USD 95.8bn to USD 1,599.6bn, driven by currency effects
of USD 56.3bn and asset size and other movements
 
of USD 39.4bn.
 
Movement in leverage ratio denominator, by key driver
USD bn
LRD as of
 
31.12.23
Currency
 
effects
Asset size and
 
other
LRD as of
 
31.3.24
On-balance sheet exposures (excluding derivatives and securities
 
financing transactions)
 
1,329.2
 
(47.7)
 
(45.5)
 
1,236.0
Derivatives
 
128.1
 
(2.8)
 
3.6
 
129.0
Securities financing transactions
 
165.4
 
(3.4)
 
4.4
 
166.5
Off-balance sheet items
 
79.9
 
(2.2)
 
(2.2)
 
75.5
Deduction items
 
(7.2)
 
(0.2)
 
0.2
 
(7.3)
Total
 
1,695.4
 
(56.3)
 
(39.4)
 
1,599.6
The LRD movements described below exclude
 
currency effects.
 
On-balance sheet exposures
 
(excluding derivatives and
 
securities financing transactions)
 
decreased by USD 45.5bn,
mainly due to
 
a decrease
 
in cash and
 
central bank
 
balances driven
 
by repayment
 
of funding
 
from the
 
Swiss National
Bank, lower lending balances and trading portfolio assets mainly in Non-core and Legacy, driven by our actions to
actively
 
unwind
 
the
 
portfolio,
 
in
 
addition
 
to
 
the
 
natural
 
roll-off,
 
including
 
the
 
conclusion
 
of
 
an
 
investment
management agreement with Apollo. These decreases
 
were partly offset by higher trading portfolio assets, mainly
in the Investment Bank,
 
driven by higher inventory held to hedge client
 
positions.
Derivative exposures increased by USD 3.6bn,
 
mainly driven by higher exposures in the Investment
 
Bank.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
46
Securities financing
 
transactions increased by
 
USD 4.4bn,
 
mainly due
 
to client-driven
 
increases in
 
the Investment
Bank, partly offset by roll-offs of excess
 
cash re-investments in Group Treasury.
Off-balance sheet items decreased by USD 2.2bn,
 
driven by a decrease in commitments.
›
Refer to the “Balance sheet and off-balance sheet” section of this report for more information about balance sheet
movements
›
Refer to “Note 2 Accounting for the acquisition of the Credit Suisse Group” in the “Consolidated financial
statements” section of this report for more information about the conclusion of the investment management
agreement with Apollo
Leverage ratio denominator, by business division and Group Items
1
USD bn
Global Wealth
Management
 
Personal &
Corporate
Banking
Asset
Management
Investment
Bank
Non-core and
Legacy
Group Items
Total
 
31.3.24
On-balance sheet exposures
 
494.2
 
414.4
 
5.6
 
231.3
 
76.8
 
13.7
 
1,236.0
Derivatives
 
9.9
 
5.4
 
0.0
 
92.5
 
21.3
 
(0.1)
 
129.0
Securities financing transactions
 
55.1
 
42.6
 
0.1
 
48.3
 
20.2
 
0.3
 
166.5
Off-balance sheet items
 
20.0
 
34.3
 
0.2
 
17.5
 
2.3
 
1.2
 
75.5
Items deducted from Swiss SRB tier 1 capital
 
(3.3)
 
1.7
 
(1.2)
 
(0.4)
 
(0.6)
 
(3.5)
 
(7.3)
Total
 
575.8
 
498.4
 
4.7
 
389.2
 
119.9
 
11.6
 
1,599.6
31.12.23
On-balance sheet exposures
 
514.4
 
442.8
 
5.8
 
235.3
 
117.7
 
13.2
 
1,329.2
Derivatives
 
8.7
 
3.2
 
0.0
 
90.6
 
25.5
 
0.1
 
128.1
Securities financing transactions
 
50.4
 
40.0
 
0.1
 
50.6
 
24.3
 
0.2
 
165.4
Off-balance sheet items
 
22.2
 
37.0
 
0.2
 
18.5
 
1.7
 
0.3
 
79.9
Items deducted from Swiss SRB tier 1 capital
 
(3.2)
 
1.9
 
(1.2)
 
(0.4)
 
(0.7)
 
(3.6)
 
(7.2)
Total
 
592.5
 
524.8
 
4.9
 
394.5
 
168.5
 
10.2
 
1,695.4
31.3.24 vs 31.12.23
On-balance sheet exposures
 
(20.2)
 
(28.4)
 
(0.2)
 
(4.0)
 
(40.9)
 
0.5
 
(93.1)
Derivatives
 
1.3
 
2.2
 
0.0
 
1.9
 
(4.2)
 
(0.2)
 
0.9
Securities financing transactions
 
4.7
 
2.6
 
0.0
 
(2.2)
 
(4.1)
 
0.1
 
1.0
Off-balance sheet items
 
(2.2)
 
(2.7)
 
0.0
 
(1.0)
 
0.6
 
0.9
 
(4.5)
Items deducted from Swiss SRB tier 1 capital
 
(0.2)
 
(0.1)
 
0.0
 
0.0
 
0.0
 
0.1
 
(0.1)
Total
 
(16.7)
 
(26.4)
 
(0.2)
 
(5.3)
 
(48.6)
 
1.4
 
(95.8)
1 From the first quarter of 2024 onward, we have started to further push out LRD from Group Items to the business divisions.
 
Prior periods have been restated to reflect these changes. Refer to “Changes to segment
reporting in 2024” in
 
the “UBS business divisions
 
and Group Items” section,
 
the “Equity attribution”
 
section and “Note 3
 
Segment reporting” in
 
the “Consolidated financial statements”
 
section of this report
 
for
more information about the realignment of the business divisions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Capital management
 
47
Equity attribution
As
 
of
 
1 January
 
2024,
 
we
 
have
 
updated
 
our
 
equity
 
attribution
 
framework.
 
Specifically,
 
we
 
have
 
increased
 
the
allocation of tangible equity to
 
the business divisions by
 
aligning the capital ratios for
 
risk-weighted assets (RWA)
and the leverage
 
ratio denominator (the
 
LRD) more closely
 
with our current
 
Group capital targets.
 
Alongside the
updates to our equity
 
attribution framework, we
 
have reflected the
 
increased allocation of
 
balance sheet resources
previously retained centrally.
 
As a result, Group
 
Items primarily retains
 
equity related to
 
deferred tax assets,
 
accruals
for shareholder
 
returns or
 
unrealized gains
 
/ losses
 
from cash
 
flow hedges.
 
Prior periods
 
have
 
been restated
 
to
reflect these changes.
Under our equity attribution
 
framework, tangible equity
 
is attributed based on
 
equally weighted average
 
RWA and
average LRD, which both include resource allocations from our Group functions to the business divisions. Average
RWA and LRD
 
are converted to
 
common equity tier 1
 
(CET1) capital equivalents using
 
target capital ratios.
 
If the
attributed tangible equity calculated
 
under the weighted-driver approach
 
is less than
 
the CET1 capital
 
equivalent
of risk-based capital (RBC) for any
 
business division,
 
the CET1 capital equivalent of RBC
 
is used as a
 
floor for that
business division.
›
Refer to the “Balance sheet and off-balance sheet” section of this report for more information about movements in
equity attributable to shareholders
Average attributed equity
For the quarter ended
USD bn
31.3.24
31.12.23
1
31.3.23
1
Global Wealth Management
 
33.1
 
33.3
 
24.7
Personal & Corporate Banking
 
21.9
 
21.8
 
10.9
Asset Management
 
2.6
 
2.6
 
1.8
Investment Bank
 
17.0
 
16.8
 
14.7
Non-core and Legacy
 
10.6
 
9.5
 
1.1
Group Items
2
 
0.5
 
1.0
 
3.7
Average equity attributed to business divisions and Group Items
 
85.7
 
84.9
 
56.8
1 Prior periods
 
have been restated
 
to reflect the
 
changes to the
 
equity attribution framework.
 
2 Includes average attributed
 
equity related to
 
capital deduction items
 
for deferred tax
 
assets, dividend accruals
 
or
unrealized gains / losses from cash flow hedge.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Liquidity and funding management
 
48
Liquidity and funding management
Strategy, objectives and governance
 
This
 
section
 
provides
 
liquidity
 
and
 
funding
 
management
 
information
 
and
 
should
 
be
 
read
 
in
 
conjunction
 
with
“Liquidity and funding
 
management” in
 
the “Capital,
 
liquidity and funding,
 
and balance sheet”
 
section of the
 
UBS
Group
 
Annual
 
Report
 
2023,
 
available
 
under
 
“Annual
 
reporting”
 
at
ubs.com/investors
,
 
which
 
provides
 
more
information
 
about
 
the
 
Group’s
 
strategy,
 
objectives
 
and
 
governance
 
in
 
connection
 
with
 
liquidity
 
and
 
funding
management.
Liquidity coverage ratio
The
 
quarterly
 
average
 
liquidity
 
coverage
 
ratio
 
(the
 
LCR)
 
of
 
the
 
UBS
 
Group
 
increased
 
4.6 percentage
 
points
 
to
220.2%,
 
remaining above
 
the prudential
 
requirement communicated
 
by
 
the Swiss
 
Financial Market
 
Supervisory
Authority (FINMA).
The
 
movement in
 
the quarterly
 
average LCR
 
was primarily
 
driven by
 
an
 
increase in
 
high-quality
 
liquid assets
 
of
USD 7.0bn to USD 422.6bn, mostly driven by higher cash available
 
from customer deposits and loan repayments.
The
 
average
 
net
 
cash
 
outflows
 
decreased
 
by
 
USD 0.7bn
 
to
 
USD 192.1bn,
 
reflecting
 
higher
 
net
 
inflows
 
from
securities financing
 
transactions and
 
lower outflows
 
from derivatives
 
and loan
 
commitments, which
 
were partly
offset by higher net outflows from customer deposits
 
and loans.
›
Refer to the
31 March 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information about the LCR
Liquidity coverage ratio
USD bn, except where indicated
Average 1Q24
1
Average 4Q23
1
High-quality liquid assets
 
422.6
 
415.6
Net cash outflows
2
 
192.1
 
192.8
Liquidity coverage ratio (%)
3
 
220.2
 
215.7
1 Calculated based on an average of
 
61 data points in the first quarter
 
of 2024 and 63 data points in
 
the fourth quarter of 2023.
 
2 Represents the net cash outflows expected
 
over a stress period of 30 calendar
days.
 
3 Calculated after the application of haircuts and inflow and outflow rates, as well as,
 
where applicable, caps on Level 2 assets and cash inflows.
Net stable funding ratio
 
As of 31 March 2024, the net stable funding ratio of the
 
UBS Group increased 1.8 percentage points to 126.4%,
remaining above the prudential requirement
 
communicated by FINMA.
 
Available
 
stable
 
funding
 
decreased
 
by
 
USD 39.4bn
 
to
 
USD 887.0bn,
 
mostly
 
reflecting
 
decreases
 
in
 
customer
deposits, debt issued
 
and regulatory capital.
 
Required stable funding
 
decreased by USD 41.6bn
 
to USD 701.6bn,
predominantly reflecting lower lending assets,
 
mainly driven by negative currency effects.
›
Refer to the 31 March 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information about the NSFR
Net stable funding ratio
USD bn, except where indicated
31.3.24
31.12.23
Available stable funding
 
887.0
 
926.4
Required stable funding
 
701.6
 
743.2
Net stable funding ratio (%)
 
126.4
 
124.7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Balance sheet and off-balance
 
sheet
 
49
Balance sheet and off-balance sheet
This
 
section
 
provides
 
balance
 
sheet
 
and
 
off-balance sheet
 
information
 
and
 
should
 
be
 
read
 
in
 
conjunction
 
with
“Balance sheet
 
and off-balance
 
sheet” in
 
the “Capital,
 
liquidity and
 
funding, and
 
balance sheet”
 
section of
 
the
UBS Group
 
Annual Report
 
2023, available
 
under “Annual reporting”
 
at
ubs.com/investors
, which
 
provides more
information about the balance sheet and off-balance
 
sheet positions.
 
Balances disclosed in this
 
report represent quarter-end
 
positions, unless indicated
 
otherwise. Intra-quarter balances
fluctuate in the ordinary course of business and
 
may differ from quarter-end positions.
Balance sheet assets (31 March 2024 vs
 
31 December 2023)
Total assets were USD 1,607.1bn as of
 
31 March 2024, a decrease of USD 110.1bn
 
compared with 31 December
2023.
Cash and balances at
 
central banks decreased
 
by USD 42.6bn, mainly due
 
to repayment of funding
 
from the Swiss
National Bank
 
(the SNB)
 
and currency
 
effects. Lending
 
assets decreased
 
by USD 33.6bn,
 
driven by
 
negative currency
effects of
 
approximately USD
 
28.4bn. Derivatives
 
and cash
 
collateral receivables
 
on derivative
 
instruments
 
decreased
by USD 20.3bn, mainly in Derivatives &
 
Solutions in the Investment Bank,
 
primarily reflecting decreases in foreign
currency contracts, where
 
the contracts in
 
place at the
 
end of
 
March 2024
 
had lower values
 
compared with the
contracts
 
in
 
place
 
at
 
the
 
end
 
of
 
December
 
2023,
 
as
 
well
 
as
 
reductions in
 
Non-core
 
and
 
Legacy.
 
Trading assets
decreased by USD 9.5bn,
 
mainly in
 
Non-core and Legacy,
 
reflecting the unwinding
 
of the
 
Credit Suisse
 
business,
including the closure of an investment management agreement
 
with Apollo, partly offset by higher inventory
 
held
to hedge client positions in Derivatives & Solutions.
›
Refer to “Note 2 Accounting for the acquisition of the Credit Suisse Group”
 
in the “Consolidated financial
statements” section of this report for more information about the conclusion of the investment management
agreement with Apollo
Assets
As of
% change from
USD bn
31.3.24
31.12.23
31.12.23
Cash and balances at central banks
 
271.5
 
314.1
 
(14)
Lending
1
 
627.4
 
661.0
 
(5)
Securities financing transactions at amortized cost
 
101.6
 
99.0
 
3
Trading assets
 
160.1
 
169.6
 
(6)
Derivatives and cash collateral receivables on derivative instruments
 
205.9
 
226.2
 
(9)
Brokerage receivables
 
22.8
 
21.0
 
8
Other financial assets measured at amortized cost
 
62.7
 
65.5
 
(4)
Other financial assets measured at fair value
2
 
101.7
 
106.3
 
(4)
Non-financial assets
 
53.2
 
54.5
 
(2)
Total assets
 
1,607.1
 
1,717.2
 
(6)
1 Consists of Loans and advances to customers and Amounts due from banks.
 
2 Consists of Financial assets at fair value not held for trading and Financial assets measured at
 
fair value through other comprehensive
income.
 
Balance sheet liabilities (31 March 2024 vs
 
31 December 2023)
Total liabilities
 
were USD 1,521.4bn
 
as of
 
31 March 2024,
 
a decrease
 
of USD 109.2bn
 
compared with
 
31 December
2023.
Derivatives and
 
cash collateral
 
payables on
 
derivative instruments
 
decreased by
 
USD 33.5bn, mainly
 
in Derivatives &
Solutions, primarily reflecting
 
decreases in foreign
 
currency contracts with
 
the same drivers
 
as on the
 
asset side and
a decrease in cash collateral
 
payables on derivative instruments
 
driven by decreases in derivative
 
financial assets, as
well as reductions in Non-core
 
and Legacy.
 
Short-term borrowings decreased
 
by USD 29.2bn, mainly related
 
to the
repayment
 
of
 
funding from
 
the
 
SNB,
 
as
 
well
 
as
 
net maturities
 
of
 
commercial paper
 
and
 
certificates of
 
deposit.
Customer
 
deposits
 
decreased
 
by
 
USD 28.0bn,
 
predominantly
 
reflecting
 
currency
 
effects
 
of
 
approximately
USD 25.6bn. Debt
 
issued designated
 
at fair value
 
and long-term debt
 
issued measured at
 
amortized cost
 
decreased
by USD 17.0bn, mainly driven by net redemption of debt issued designated at fair value in Derivatives & Solutions
in the Investment Bank, and net maturities of
 
debt issued measured at amortized cost in Group
 
Treasury.
The “Liabilities,
 
by product
 
and currency”
 
table
 
in this
 
section provides
 
more information
 
about our
 
funding sources.
›
Refer to “Bondholder information” at
 
ubs.com/investors
for more information about capital and senior debt
instruments
 
›
Refer to the “Consolidated financial statements” section of this report for more information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Balance sheet and off-balance
 
sheet
 
50
Liabilities and equity
As of
 
% change from
USD bn
31.3.24
31.12.23
31.12.23
Short-term borrowings
1,2
 
80.3
 
109.5
 
(27)
Securities financing transactions at amortized cost
 
13.0
 
14.4
 
(10)
Customer deposits
 
764.0
 
792.0
 
(4)
Debt issued designated at fair value and long-term debt issued measured
 
at amortized cost
2
 
310.6
 
327.6
 
(5)
Trading liabilities
 
35.8
 
34.2
 
5
Derivatives and cash collateral payables on derivative instruments
 
200.3
 
233.8
 
(14)
Brokerage payables
 
46.6
 
42.5
 
10
Other financial liabilities measured at amortized cost
 
21.4
 
20.9
 
2
Other financial liabilities designated at fair value
 
28.1
 
29.5
 
(5)
Non-financial liabilities
 
21.3
 
26.3
 
(19)
Total liabilities
 
1,521.4
 
1,630.6
 
(7)
Share capital
 
0.3
 
0.3
 
0
Share premium
 
13.0
 
13.2
 
(2)
Treasury shares
 
(5.2)
 
(4.8)
 
8
Retained earnings
 
76.4
 
74.9
 
2
Other comprehensive income
3
 
0.7
 
2.5
 
(73)
Total equity attributable to shareholders
 
85.3
 
86.1
 
(1)
Equity attributable to non-controlling interests
 
0.5
 
0.5
 
(5)
Total equity
 
85.8
 
86.6
 
(1)
Total liabilities and equity
 
1,607.1
 
1,717.2
 
(6)
1 Consists of short-term debt issued measured at amortized cost and amounts due to banks, which includes amounts due to central banks.
 
2 The classification of debt issued measured at amortized cost into short-
term and long-term is based
 
on original contractual
 
maturity and therefore long-term
 
debt also includes debt
 
with a remaining time
 
to maturity of less
 
than one year.
 
This classification does
 
not consider any
 
early
redemption features.
 
3 Excludes other comprehensive income related to defined benefit plans and own credit, which is recorded directly in Retained earnings.
Equity (31 March 2024 vs 31 December 2023)
Equity attributable to shareholders decreased
 
by USD 848m to USD 85,260m as of 31
 
March 2024.
The decrease of USD 848m
 
was mainly driven by
 
net treasury share activity
 
that reduced equity by
 
USD 954m. This
was
 
predominantly
 
due
 
to
 
the
 
purchase
 
of
 
USD 1,002m
 
of
 
shares
 
in
 
relation
 
to
 
employee
 
share-based
compensation plans.
 
In addition,
 
total comprehensive
 
income attributable
 
to shareholders
 
was negative
 
USD 240m,
reflecting a net profit
 
of USD 1,755m and
 
negative other comprehensive
 
income (OCI) of USD 1,994m.
 
OCI mainly
included negative OCI related
 
to foreign currency translation
 
of USD 1,277m and negative
 
cash flow hedge OCI of
USD 583m.
 
These
 
decreases
 
were
 
partly
 
offset
 
by
 
deferred
 
share-based
 
compensation
 
awards
 
expensed
 
in
 
the
 
income
statement of USD 334m.
 
The payment of the 2023 dividend of USD 0.70 per
 
share, approved by shareholders at the 2024 Annual General
Meeting, reduced equity attributable to shareholders
 
by USD 2.3bn in the second quarter of 2024.
›
Refer to the “Group performance” and “Consolidated financial statements” sections of this report for more
information
›
Refer to “Reconciliation of equity under IFRS Accounting Standards to Swiss SRB common equity tier 1 capital” in
the “Capital management” section of this report for more information about the effects of OCI on common equity
tier 1 capital
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Balance sheet and off-balance
 
sheet
 
51
Liabilities, by product and currency
USD equivalent
All currencies
of which: USD
of which: CHF
of which: EUR
USD bn
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
Short-term borrowings
80.3
109.5
32.4
49.2
28.5
41.5
8.4
8.3
of which: amounts due to banks
47.9
71.0
10.0
20.4
28.1
41.1
3.5
3.1
of which: short-term debt issued
1,2
32.5
38.5
22.3
28.8
0.4
0.3
4.9
5.2
Securities financing transactions at amortized cost
13.0
14.4
8.6
7.8
1.5
2.4
2.6
3.3
Customer deposits
764.0
792.0
313.7
311.8
302.1
328.0
78.4
80.6
of which: demand deposits
222.0
240.9
56.1
57.4
101.4
114.9
35.1
38.3
of which: retail savings / deposits
175.5
186.1
29.6
28.9
141.7
152.6
4.1
4.5
of which: sweep deposits
37.6
41.0
37.6
41.0
0.0
0.0
0.0
0.0
of which: time deposits
328.8
324.0
190.3
184.4
58.9
60.5
39.2
37.8
Debt issued designated at fair value and long-term debt issued measured
 
at
amortized cost
2
310.6
327.6
177.0
185.8
41.6
44.7
65.3
69.6
Trading liabilities
35.8
34.2
11.0
12.6
1.4
1.1
10.1
9.3
Derivatives and cash collateral payables on derivative instruments
200.3
233.8
156.2
181.0
5.7
9.9
24.0
26.7
Brokerage payables
46.6
42.5
35.7
31.5
0.6
0.7
2.9
2.4
Other financial liabilities measured at amortized cost
 
21.4
20.9
11.5
11.3
4.2
3.9
1.9
2.0
Other financial liabilities designated at fair value
28.1
29.5
4.1
6.8
0.1
0.1
3.9
3.5
Non-financial liabilities
21.3
26.3
12.5
13.2
2.9
4.2
3.5
4.4
Total liabilities
1,521.4
1,630.6
762.7
810.9
388.5
436.5
200.7
210.0
1 Short-term debt issued consists of certificates
 
of deposit, commercial paper,
 
acceptances and promissory notes,
 
and other money market
 
paper.
 
2 The classification of debt
 
issued measured at amortized cost into
short-term and long-term is based on original contractual maturity and therefore long-term debt also includes debt with a remaining time to maturity of less than one year. This
 
classification does not consider any early
redemption features.
Off-balance sheet (31 March 2024 vs
 
31 December 2023)
Guarantees decreased by USD 4.3bn,
 
mainly driven by a
 
decrease in sponsored repo clearing in
 
Group Treasury,
 
as
well as currency effects.
 
Irrevocable loan commitments
 
decreased by USD 4.3bn,
 
primarily driven by
 
the unwinding
of
 
the
 
Credit
 
Suisse
 
business
 
in
 
Non-Core
 
and
 
Legacy,
 
as
 
well
 
as
 
currency
 
effects.
 
Committed
 
unconditionally
revocable credit lines decreased by USD 12.4bn, mainly reflecting currency effects.
Off-balance sheet
As of
% change from
USD bn
31.3.24
31.12.23
31.12.23
Guarantees
1,2
 
39.6
 
43.9
 
(10)
Irrevocable loan commitments
1
 
87.3
 
91.6
 
(5)
Committed unconditionally revocable credit lines
 
150.9
 
163.3
 
(8)
Forward starting reverse repurchase and securities borrowing agreements
 
17.6
 
18.4
 
(4)
1 Guarantees and irrevocable loan commitments are shown net of sub-participations.
 
2 Includes guarantees measured at fair value through profit or loss.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Risk, capital, liquidity and funding,
 
and balance sheet | Share information and earnings
 
per share
 
52
Share information and earnings per share
UBS Group AG
 
shares
 
are
 
listed
 
on
 
the
 
SIX
 
Swiss
 
Exchange
 
(SIX).
 
They
 
are
 
also
 
listed
 
on
 
the
 
New
 
York
 
Stock
Exchange (the NYSE) as global registered shares. Each share has
 
a nominal value of USD 0.10. Shares issued were
unchanged in the first quarter of 2024 compared
 
with the fourth quarter of 2023.
We
 
held
 
256m
 
shares
 
as
 
of
 
31 March
 
2024,
 
of
 
which
 
121m
 
shares
 
had
 
been
 
acquired
 
under
 
our
 
2022
 
share
repurchase program for cancellation
 
purposes. The remaining 135m
 
shares are primarily held
 
to hedge our
 
share
delivery obligations related to employee share-based
 
compensation and participation plans.
Treasury
 
shares
 
held
 
increased
 
by
 
2m
 
shares
 
in
 
the
 
first
 
quarter
 
of
 
2024.
 
This
 
mainly
 
reflected
 
25.0m
 
shares
purchased
 
from
 
the
 
market
 
to
 
hedge
 
future
 
share
 
delivery
 
obligations
 
related
 
to
 
employee
 
share-based
compensation awards, largely offset by the
 
delivery of treasury shares under our share-based
 
compensation plans.
Shares
 
acquired
 
under
 
our
 
2022
 
program
 
totaled
 
121m
 
as
 
of
 
31 March
 
2024
 
for
 
a
 
total
 
acquisition
 
cost
 
of
USD 2,277m (CHF 2,138m). This program concluded on 28 March 2024 and the 121m shares repurchased under
this program will
 
be canceled by
 
means of
 
a capital
 
reduction, pending approval
 
by the
 
shareholders at a
 
future
Annual General Meeting.
 
On
 
3 April
 
2024,
 
we
 
launched
 
a
 
new
 
2024
 
share
 
repurchase
 
program
 
of
 
up
 
to
 
USD 2bn
 
over
 
two
 
years.
 
As
previously communicated, we expect
 
to repurchase up
 
to USD 1bn of
 
our shares in
 
2024, commencing after
 
the
completion of the merger of UBS AG and Credit
 
Suisse AG.
 
›
Refer to the “Recent developments” section of this report for more information about the integration of Credit
Suisse
›
Refer to the “Equity, CET1 capital and returns” table in the “Group performance” section of this report
 
for more
information about equity attributable to shareholders and tangible equity attributable to shareholders
As of or for the quarter ended
31.3.24
31.12.23
31.3.23
Basic and diluted earnings (USD m)
Net profit / (loss) attributable to shareholders for basic
 
EPS
 
1,755
 
(279)
 
1,029
Less: (profit) / loss on own equity derivative contracts
 
0
 
0
 
0
Net profit / (loss) attributable to shareholders for diluted
 
EPS
 
1,755
 
(279)
 
1,029
Weighted average shares outstanding
Weighted average shares outstanding for basic EPS
1
 
3,205,234,203
 
3,225,500,133
 
3,072,799,315
Effect of dilutive potential shares resulting from notional
 
employee shares, in-the-money options and warrants outstanding
2
 
159,939,399
 
123,601
3
 
140,868,722
Weighted average shares outstanding for diluted EPS
 
3,365,173,602
 
3,225,623,734
 
3,213,668,037
Earnings per share (USD)
Basic
 
0.55
 
(0.09)
 
0.33
Diluted
 
0.52
 
(0.09)
 
0.32
Shares outstanding and potentially dilutive instruments
Shares issued
 
3,462,087,722
 
3,462,087,722
 
3,524,635,722
Treasury shares
4
 
255,661,512
 
253,233,437
 
472,352,835
of which: related to the 2021 share repurchase program
 
62,548,000
of which: related to the 2022 share repurchase program
 
120,506,008
 
120,506,008
 
298,537,950
Shares outstanding
 
3,206,426,210
 
3,208,854,285
 
3,052,282,887
Potentially dilutive instruments
5
 
11,621,246
 
163,417,391
3
 
4,859,813
Other key figures
Total book value per share (USD)
 
26.59
 
26.83
 
18.59
Tangible book value per share (USD)
 
24.29
 
24.49
 
16.54
Share price (USD)
6
 
30.74
 
31.01
 
21.07
Market capitalization (USD m)
7
 
106,440
 
107,355
 
74,276
1 The weighted average shares outstanding for basic earnings per share (EPS) are calculated by taking the number of shares at the beginning of the period, adjusted by the number of shares acquired or issued during
the period, multiplied by a time-weighted factor for the period outstanding. As a result, balances are
 
affected by the timing of acquisitions and issuances during the period.
 
2 The weighted average number of shares
for notional employee
 
awards with
 
performance conditions
 
reflects all
 
potentially dilutive
 
shares that
 
are expected to
 
vest under
 
the terms of
 
the awards.
 
3 Due to
 
the net loss
 
in the
 
fourth quarter
 
of 2023,
155,065,831 weighted average
 
potential shares from
 
unvested notional share
 
awards were not
 
included in the
 
calculation of diluted
 
EPS as they
 
were not dilutive
 
for the quarter
 
ended 31 December 2023.
 
Such
shares are only taken into account
 
for the diluted EPS calculation when their
 
conversion to ordinary shares would decrease
 
earnings per share or increase the
 
loss per share, in accordance
 
with IAS 33, Earnings per
Share.
 
4 Based on a settlement date view.
 
5 Reflects potential shares that could dilute basic EPS in the future,
 
but were not dilutive
 
for any of the periods presented. Mainly includes equity-based awards
 
subject
to absolute and relative performance conditions and equity derivative contracts. For the quarter ended 31 December 2023, also includes 155,065,831 weighted average potential shares
 
from unvested notional share
awards that were not included in the calculation
 
of diluted EPS as they were not dilutive.
 
6 Represents the share price as listed
 
on the SIX Swiss Exchange, translated
 
to US dollars using the closing exchange
 
rate
as of the respective date.
 
7 The calculation of market
 
capitalization was amended in the second quarter
 
of 2023 to reflect total shares issued
 
multiplied by the share price at the end
 
of the period. The calculation
was previously based on total shares outstanding multiplied by the share price at the end of the period. Market
 
capitalization was increased by USD 10.0bn as of 31 March 2023 as a result.
Ticker symbols UBS Group AG
Security identification codes
Trading exchange
SIX / NYSE
Bloomberg
Reuters
ISIN
CH0244767585
SIX Swiss Exchange
UBSG
UBSG SW
UBSG.S
Valoren
24 476 758
New York Stock Exchange
UBS
UBS UN
UBS.N
CUSIP
CINS H42097 10 7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements |
 
UBS Group AG interim consolidated financial
 
statements (unaudited)
 
54
UBS Group AG interim consolidated financial
statements (unaudited)
Income statement
For the quarter ended
USD m
Note
31.3.24
31.12.23
31.3.23
Interest income from financial instruments measured at
 
amortized cost and fair value through
other comprehensive income
4
 
10,078
 
10,036
 
4,777
Interest expense from financial instruments measured at
 
amortized cost
4
 
(9,724)
 
(9,440)
 
(3,814)
Net interest income from financial instruments measured
 
at fair value through profit or loss and other
4
 
1,585
 
1,498
 
425
Net interest income
4
 
1,940
 
2,095
 
1,388
Other net income from financial instruments measured
 
at fair value through profit or loss
 
4,182
 
3,158
 
2,681
Fee and commission income
5
 
7,080
 
6,409
 
5,053
Fee and commission expense
5
 
(588)
 
(629)
 
(447)
Net fee and commission income
5
 
6,492
 
5,780
 
4,606
Other income
6
 
124
 
(179)
 
69
Total revenues
 
12,739
 
10,855
 
8,744
Credit loss expense / (release)
9
 
106
 
136
 
38
Personnel expenses
7
 
6,949
 
7,061
 
4,620
General and administrative expenses
8
 
2,413
 
2,999
 
2,065
Depreciation, amortization and impairment of non-financial
 
assets
 
895
 
1,409
 
525
Operating expenses
 
10,257
 
11,470
 
7,210
Operating profit / (loss) before tax
 
2,376
 
(751)
 
1,495
Tax expense / (benefit)
 
612
 
(473)
 
459
Net profit / (loss)
 
1,764
 
(278)
 
1,037
Net profit / (loss) attributable to non-controlling interests
 
9
 
1
 
8
Net profit / (loss) attributable to shareholders
 
1,755
 
(279)
 
1,029
Earnings per share (USD)
Basic
 
0.55
 
(0.09)
 
0.33
Diluted
 
0.52
 
(0.09)
 
0.32
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements |
 
UBS Group AG interim consolidated financial
 
statements (unaudited)
 
55
 
Statement of comprehensive income
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Comprehensive income attributable to shareholders
1
Net profit / (loss)
 
1,755
 
(279)
 
1,029
Other comprehensive income that may be reclassified to the income
 
statement
Foreign currency translation
Foreign currency translation movements related to net assets of foreign operations, before tax
 
(3,473)
 
4,197
 
236
Effective portion of changes in fair value of hedging instruments
 
designated as net investment hedges, before tax
 
2,182
 
(2,620)
 
(127)
Foreign currency translation differences on foreign operations reclassified to the
 
income statement
 
0
 
60
 
(1)
Effective portion of changes in fair value of hedging instruments
 
designated as net investment hedges reclassified
 
to the income statement
 
1
 
(25)
 
(1)
Income tax relating to foreign currency translations, including the effect of
 
net investment hedges
 
13
 
(15)
 
(2)
Subtotal foreign currency translation, net of tax
 
(1,277)
 
1,597
 
106
Financial assets measured at fair value through other comprehensive income
Net unrealized gains / (losses), before tax
 
0
 
8
 
2
Net realized (gains) / losses reclassified to the income statement
 
from equity
 
0
 
(4)
 
0
Income tax relating to net unrealized gains / (losses)
 
0
 
0
 
0
Subtotal financial assets measured at fair value through other comprehensive
 
income, net of tax
 
0
 
3
 
2
Cash flow hedges of interest rate risk
Effective portion of changes in fair value of derivative instruments designated
 
as cash flow hedges, before tax
 
(1,246)
 
1,803
 
387
Net (gains) / losses reclassified to the income statement from
 
equity
 
544
 
566
 
349
Income tax relating to cash flow hedges
 
119
 
(399)
 
(130)
Subtotal cash flow hedges, net of tax
 
(583)
 
1,970
 
606
Cost of hedging
Cost of hedging, before tax
 
(9)
 
(24)
 
(5)
Income tax relating to cost of hedging
 
0
 
0
 
0
Subtotal cost of hedging, net of tax
 
(9)
 
(24)
 
(5)
Total other comprehensive income that may be reclassified to the income statement, net
 
of tax
 
(1,870)
 
3,546
 
709
Other comprehensive income that will not be reclassified to the income
 
statement
Defined benefit plans
Gains / (losses) on defined benefit plans, before tax
 
(62)
 
164
 
25
Income tax relating to defined benefit plans
 
6
 
(33)
 
6
Subtotal defined benefit plans, net of tax
 
(56)
 
131
 
31
Own credit on financial liabilities designated at fair value
Gains / (losses) from own credit on financial liabilities designated
 
at fair value, before tax
 
(69)
 
(731)
 
69
Income tax relating to own credit on financial liabilities designated
 
at fair value
 
2
 
10
 
(17)
Subtotal own credit on financial liabilities designated at
 
fair value, net of tax
 
(68)
 
(721)
 
51
Total other comprehensive income that will not be reclassified to the income statement,
 
net of tax
 
(124)
 
(591)
 
83
Total other comprehensive income
 
(1,994)
 
2,956
 
791
Total comprehensive income attributable to shareholders
 
(240)
 
2,677
 
1,820
Comprehensive income attributable to non-controlling
 
interests
Net profit / (loss)
 
9
 
1
 
8
Total other comprehensive income that will not be reclassified to the income statement,
 
net of tax
 
(14)
 
17
 
5
Total comprehensive income attributable to non-controlling interests
 
(5)
 
18
 
13
Total comprehensive income
Net profit / (loss)
 
1,764
 
(278)
 
1,037
Other comprehensive income
 
(2,008)
 
2,973
 
796
of which: other comprehensive income that may be reclassified
 
to the income statement
 
(1,870)
 
3,546
 
709
of which: other comprehensive income that will not be reclassified
 
to the income statement
 
(138)
 
(573)
 
87
Total comprehensive income
 
(245)
 
2,695
 
1,833
1 Refer to the “Group performance” section of this report for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements |
 
UBS Group AG interim consolidated financial
 
statements (unaudited)
 
56
 
Balance sheet
USD m
Note
31.3.24
31.12.23
Assets
Cash and balances at central banks
 
271,527
 
314,148
Amounts due from banks
 
22,143
 
21,161
Receivables from securities financing transactions measured at amortized
 
cost
 
101,650
 
99,039
Cash collateral receivables on derivative instruments
11
 
46,714
 
50,082
Loans and advances to customers
9
 
605,283
 
639,844
Other financial assets measured at amortized cost
12
 
62,750
 
65,498
Total financial assets measured at amortized cost
 
1,110,067
 
1,189,773
Financial assets at fair value held for trading
10
 
160,104
 
169,633
of which: assets pledged as collateral that may be sold or repledged
 
by counterparties
 
49,382
 
51,263
Derivative financial instruments
10, 11
 
159,229
 
176,084
Brokerage receivables
10
 
22,796
 
21,037
Financial assets at fair value not held for trading
10
 
99,612
 
104,018
Total financial assets measured at fair value through profit or loss
 
441,741
 
470,773
Financial assets measured at fair value through other comprehensive income
10
 
2,078
 
2,233
Investments in associates
 
2,250
 
2,373
Property, equipment and software
 
16,770
 
17,849
Goodwill and intangible assets
 
7,384
 
7,515
Deferred tax assets
 
10,614
 
10,682
Other non-financial assets
12
 
16,217
 
16,049
Total assets
 
1,607,120
 
1,717,246
Liabilities
Amounts due to banks
 
47,857
 
70,962
Payables from securities financing transactions measured at amortized cost
 
12,961
 
14,394
Cash collateral payables on derivative instruments
 
11
 
37,293
 
41,582
Customer deposits
 
763,959
 
792,029
Debt issued measured at amortized cost
 
14
 
226,251
 
237,817
Other financial liabilities measured at amortized cost
 
12
 
21,356
 
20,851
Total financial liabilities measured at amortized cost
 
1,109,677
 
1,177,633
Financial liabilities at fair value held for trading
 
10
 
35,758
 
34,159
Derivative financial instruments
10, 11
 
163,042
 
192,181
Brokerage payables designated at fair value
 
10
 
46,628
 
42,522
Debt issued designated at fair value
10, 13
 
116,806
 
128,289
Other financial liabilities designated at fair value
10, 12
 
28,140
 
29,484
Total financial liabilities measured at fair value through profit or loss
 
390,374
 
426,635
Provisions and contingent liabilities
 
15
 
10,914
 
12,250
Other non-financial liabilities
 
12
 
10,388
 
14,089
Total liabilities
 
1,521,354
 
1,630,607
Equity
Share capital
 
346
 
346
Share premium
 
12,972
 
13,216
Treasury shares
 
(5,157)
 
(4,796)
Retained earnings
 
76,436
 
74,880
Other comprehensive income recognized directly in equity, net of tax
 
663
 
2,462
Equity attributable to shareholders
 
85,260
 
86,108
Equity attributable to non-controlling interests
 
506
 
531
Total equity
 
85,766
 
86,639
Total liabilities and equity
 
1,607,120
 
1,717,246
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements |
 
UBS Group AG interim consolidated financial
 
statements (unaudited)
 
57
 
Statement of changes in equity
USD m
Share
capital and
share
premium
Treasury
shares
Retained
earnings
OCI
recognized
directly in
equity,
net of tax
1
of which:
foreign
currency
translation
of which:
cash flow
hedges
Total equity
attributable to
shareholders
Balance as of 1 January 2024
2
 
13,562
 
(4,796)
 
74,880
 
2,462
 
5,584
 
(3,109)
 
86,108
Acquisition of treasury shares
 
(1,008)
3
 
(1,008)
Delivery of treasury shares under share-based compensation
 
plans
 
(595)
 
627
 
32
Other disposal of treasury shares
 
1
 
20
3
 
21
Share-based compensation expensed in the income statement
 
334
 
334
Tax (expense) / benefit
 
5
 
5
Equity classified as obligation to purchase own shares
 
1
 
1
Translation effects recognized directly in retained earnings
 
(72)
 
72
 
72
 
0
Share of changes in retained earnings of associates and
 
joint ventures
 
(1)
 
(1)
New consolidations / (deconsolidations) and other increases
 
/ (decreases)
 
11
 
(3)
 
8
Total comprehensive income for the period
 
1,631
 
(1,870)
 
(1,277)
 
(583)
 
(240)
of which: net profit / (loss)
 
1,755
 
1,755
of which: OCI, net of tax
 
(124)
 
(1,870)
 
(1,277)
 
(583)
 
(1,994)
Balance as of 31 March 2024
2
 
13,318
 
(5,157)
 
76,436
 
663
 
4,307
 
(3,621)
 
85,260
Non-controlling interests as of 31 March 2024
 
506
Total equity as of 31 March 2024
 
85,766
Balance as of 1 January 2023
2
 
13,850
 
(6,874)
 
50,004
 
(103)
 
4,128
 
(4,234)
 
56,876
Acquisition of treasury shares
 
(2,270)
3
 
(2,270)
Delivery of treasury shares under share-based compensation
 
plans
 
(798)
 
845
 
47
Other disposal of treasury shares
 
(4)
 
57
3
 
53
Share-based compensation expensed in the income statement
 
199
 
199
Tax (expense) / benefit
 
7
 
7
Equity classified as obligation to purchase own shares
 
22
 
22
Translation effects recognized directly in retained earnings
 
24
 
(24)
 
(24)
 
0
Share of changes in retained earnings of associates and
 
joint ventures
 
0
 
0
New consolidations / (deconsolidations) and other increases
 
/ (decreases)
 
0
 
0
Total comprehensive income for the period
 
1,111
 
709
 
106
 
606
 
1,820
of which: net profit / (loss)
 
1,029
 
1,029
of which: OCI, net of tax
 
83
 
709
 
106
 
606
 
791
Balance as of 31 March 2023
2
 
13,275
 
(8,242)
 
51,140
 
581
 
4,234
 
(3,652)
 
56,754
Non-controlling interests as of 31 March 2023
 
352
Total equity as of 31 March 2023
 
57,106
1 Excludes other comprehensive income related to defined benefit plans and own credit that is recorded directly in Retained earnings.
 
2 Excludes non-controlling interests.
 
3 Includes treasury shares acquired and
disposed of by the Investment Bank in its capacity as a market
 
maker with regard to UBS shares and related derivatives,
 
and to hedge certain issued structured debt instruments.
 
These acquisitions and disposals are
reported based on the sum of the net monthly movements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements |
 
UBS Group AG interim consolidated financial
 
statements (unaudited)
 
58
Statement of cash flows
Year-to-date
USD m
31.3.24
31.3.23
Cash flow from / (used in) operating activities
Net profit / (loss)
 
1,764
 
1,037
Non-cash items included in net profit and other adjustments:
Depreciation, amortization and impairment of non-financial
 
assets
 
895
 
525
Credit loss expense / (release)
 
106
 
38
Share of net (profits) / loss of associates and joint ventures and
 
impairment related to associates
 
(58)
 
(10)
Deferred tax expense / (benefit)
 
144
 
(28)
Net loss / (gain) from investing activities
 
12
 
(87)
Net loss / (gain) from financing activities
 
(3,460)
 
3,442
Other net adjustments
1
 
16,762
 
(816)
Net change in operating assets and liabilities:
1
Amounts due from banks and amounts due to banks
 
1,547
 
1,855
Receivables from securities financing transactions measured at amortized
 
cost
 
(5,686)
 
7,827
Payables from securities financing transactions measured at amortized cost
 
(71)
 
5,666
Cash collateral on derivative instruments
 
(692)
 
(1,891)
Loans and advances to customers
 
6,401
 
(483)
Customer deposits
 
(2,545)
 
(22,226)
Financial assets and liabilities at fair value held for trading and derivative financial
 
instruments
 
(4,422)
 
(6,125)
Brokerage receivables and payables
 
2,577
 
(4,618)
Financial assets at fair value not held for trading and other financial assets
 
and liabilities
 
2,891
 
(7,182)
Provisions and other non-financial assets and liabilities
 
(4,035)
 
(1,483)
Income taxes paid, net of refunds
 
(585)
 
(545)
Net cash flow from / (used in) operating activities
 
11,544
2
 
(25,106)
Cash flow from / (used in) investing activities
Purchase of property, equipment and software
 
(413)
 
(375)
Disposal of property, equipment and software
 
28
 
0
Net (purchase) / redemption of financial assets measured
 
at fair value through other comprehensive income
 
550
 
10
Purchase of debt securities measured at amortized cost
 
(851)
 
(4,255)
Disposal and redemption of debt securities measured at amortized
 
cost
 
2,002
 
2,225
Net cash flow from / (used in) investing activities
 
1,315
 
(2,396)
Cash flow from / (used in) financing activities
Repayment of Swiss National Bank funding
 
(22,082)
Net issuance (repayment) of short-term debt measured at amortized
 
cost
 
(5,851)
 
(2,429)
Net movements in treasury shares and own equity derivative
 
activity
 
(973)
 
(2,191)
Issuance of debt designated at fair value and long-term debt measured
 
at amortized cost
 
28,469
 
26,811
Repayment of debt designated at fair value and long-term debt measured
 
at amortized cost
 
(39,137)
 
(23,193)
Inflows from securities financing transactions measured at amortized
 
cost
3
 
1,000
Outflows from securities financing transactions measured at amortized
 
cost
3
 
(2,052)
Net cash flows from other financing activities
 
(192)
 
(126)
Net cash flow from / (used in) financing activities
 
(40,818)
 
(1,128)
Total cash flow
Cash and cash equivalents at the beginning of the period
 
340,311
 
195,321
Net cash flow from / (used in) operating, investing and financing
 
activities
 
(27,959)
 
(28,629)
Effects of exchange rate differences on cash and cash equivalents
1
 
(12,852)
 
747
Cash and cash equivalents at the end of the period
4
 
299,499
 
167,439
of which: cash and balances at central banks
5
 
271,527
 
144,099
of which: amounts due from banks
5
 
20,014
 
13,439
of which: money market paper
5,6
 
7,958
 
9,901
Additional information
Net cash flow from / (used in) operating activities includes:
Interest received in cash
 
14,382
 
7,047
Interest paid in cash
 
12,123
 
5,859
Dividends on equity investments, investment funds and associates
 
received in cash
7
 
582
 
525
1 Foreign currency translation and foreign exchange effects on operating assets and liabilities and on cash and cash equivale
 
nts are presented within the Other net adjustments line. Does not include foreign currency
hedge effects related to foreign
 
exchange swaps.
 
2 Includes cash receipts from
 
the sale of loans and
 
loan commitments of USD 7,464m
 
within the Non-core and Legacy
 
business division.
 
3 Reflects cash flows
from securities financing transactions
 
measured at amortized cost that use UBS debt instruments as the underlying.
 
4 USD 5,592m and USD 4,137m of Cash and cash equivalents (mainly
 
reflected in Amounts due
from banks) were restricted as of
 
31 March 2024 and 31 March 2023,
 
respectively. The
 
amount as of 31 March 2024
 
includes cash and cash equivalents
 
pledged to the depositor protection
 
system in Switzerland,
following new requirements that became
 
effective in the fourth
 
quarter of 2023. Refer
 
to ”Note 23 Restricted and transferred
 
financial assets” in the ”Consolidated
 
financial statements” section of the
 
UBS Group
Annual report 2023 for more information.
 
5 Includes only balances with an original maturity of three months or less.
 
6 Money market paper is included in the balance sheet under Financial assets at fair value not
held for trading (31 March 2024: USD 6,854m; 31 March 2023: USD 9,644m), Other financial assets measured at amortized cost (31 March 2024: USD 221m; 31 March 2023: USD 218m), Financial assets measured
at fair value through other comprehensive income (31
 
March 2024: USD 420m; 31 March 2023: USD 0m) and
 
Financial assets at fair value held for trading
 
(31 March 2024: USD 463m; 31 March 2023: USD 39m).
 
7 Includes dividends received from associates reported within Net cash flow from / (used in) investing activities.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
59
Notes to the UBS Group AG interim consolidated
financial statements (unaudited)
Note 1
 
Basis of accounting
Basis of preparation
The consolidated
 
financial statements
 
(the financial
 
statements) of
 
UBS Group AG and
 
its subsidiaries
 
(together,
UBS
 
or
 
the
 
Group)
 
are
 
prepared
 
in
 
accordance
 
with
 
IFRS
 
Accounting
 
Standards, as
 
issued
 
by
 
the
 
International
Accounting Standards
 
Board (the
 
IASB), and
 
are
 
presented in
 
US
 
dollars. These
 
interim
 
financial statements
 
are
prepared in accordance with IAS 34,
Interim Financial Reporting
.
In preparing
 
these interim financial
 
statements, the same
 
accounting policies and
 
methods of
 
computation have
been applied as in the
 
UBS Group AG consolidated annual
 
financial statements for
 
the period ended 31 December
2023, except for the changes described in this Note and changes
 
in segment reporting as set out in Note 3. These
interim
 
financial
 
statements
 
are
 
unaudited
 
and
 
should
 
be
 
read
 
in
 
conjunction
 
with
 
UBS Group AG’s
 
audited
consolidated financial statements in
 
the UBS Group Annual Report
 
2023 and the “Management
 
report” sections
of this report. In the opinion of management, all necessary adjustments
 
have been made for a fair presentation of
the Group’s financial position, results
 
of operations and cash flows.
Preparation of
 
these interim financial
 
statements requires management
 
to make
 
estimates and
 
assumptions that
affect
 
the
 
reported
 
amounts
 
of
 
assets,
 
liabilities,
 
income,
 
expenses
 
and
 
disclosures
 
of
 
contingent
 
assets
 
and
liabilities. These estimates
 
and assumptions are based
 
on the best available
 
information. Actual results
 
in the future
could differ
 
from such
 
estimates and
 
differences may
 
be material
 
to the
 
financial statements.
 
Revisions to
 
estimates,
based on regular
 
reviews, are recognized
 
in the period
 
in which they
 
occur. For more
 
information about areas of
estimation
 
uncertainty
 
that
 
are
 
considered
 
to
 
require
 
critical
 
judgment,
 
refer
 
to
 
“Note 1a
 
Material
 
accounting
policies” in the “Consolidated financial statements”
 
section of the UBS Group Annual Report
 
2023.
Amendments to IAS 12,
 
Income Taxes
UBS
 
has
 
applied
 
for
 
the
 
purposes
 
of
 
these
 
financial
 
statements
 
the
 
exception
 
that
 
was
 
introduced
 
by
 
the
amendments to
 
IAS 12,
Income Taxes
, issued in
 
May 2023
 
in relation to
 
top-up taxes
 
on income
 
under Global
 
Anti-
Base Erosion
 
Rules that
 
have been
 
imposed under
 
legislation that
 
has been
 
enacted or
 
substantively enacted
 
to
implement the Pillar
 
Two model rules published by the
 
Organisation for Economic
 
Co-operation and Development.
The exception
 
requires that
 
deferred tax
 
assets and
 
deferred tax
 
liabilities be
 
neither recognized
 
nor disclosed
 
in
respect of such top-up taxes.
Other amendments to IFRS Accounting Standards
A number of
 
minor amendments to
 
IFRS Accounting Standards
 
became effective from
 
1 January 2024 and
 
have
had no material effect on the Group.
IFRS 18,
Presentation and Disclosure in Financial
 
Statements
In April 2024, the IASB issued a new standard,
 
IFRS 18,
Presentation and Disclosure in Financial Statements,
 
which
replaces IAS 1,
Presentation of Financial Statements
. The main changes introduced by IFRS 18 relate
 
to:
–
the structure of income statements;
–
new disclosure requirements for management performance
 
measures (MPMs); and
–
enhanced guidance on
 
aggregation / disaggregation of
 
information on the
 
face of financial
 
statements and in
the notes thereto.
IFRS 18 will be
 
effective from 1 January
 
2027 and will
 
also apply to
 
comparative information. UBS will
 
first apply
these new
 
requirements in
 
the Annual
 
Report 2027
 
and, for
 
interim reporting,
 
in the
 
first quarter
 
2027 interim
report. UBS is assessing the impact of the new
 
requirements on its reporting, but expects limited impact. UBS will
take the opportunity to
 
refine the grouping of
 
items in the
 
primary financial statements and in
 
the notes thereto
based on new principles of aggregation and
 
disaggregation in IFRS 18.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
60
Note 1
 
Basis of accounting (continued)
Currency translation rates
The
 
following table
 
shows the
 
rates of
 
the main
 
currencies used
 
to translate
 
the financial
 
information of
 
UBS’s
operations with a functional currency other
 
than the US dollar into US dollars.
Closing exchange rate
Average rate
1
As of
For the quarter ended
31.3.24
31.12.23
31.3.23
31.3.24
31.12.23
31.3.23
1 CHF
 
1.11
 
1.19
 
1.09
 
1.13
 
1.13
 
1.08
1 EUR
 
1.08
 
1.10
 
1.08
 
1.08
 
1.08
 
1.08
1 GBP
 
1.26
 
1.28
 
1.23
 
1.26
 
1.25
 
1.22
100 JPY
 
0.66
 
0.71
 
0.75
 
0.67
 
0.68
 
0.75
1 Monthly income statement items of operations with a functional currency other than the US dollar are translated into US dollars using month-end rates. Disclosed average rates for a quarter represent an average of
three month-end rates,
 
weighted according
 
to the
 
income and expense
 
volumes of
 
all operations
 
of the
 
Group with the
 
same functional
 
currency for each
 
month. Weighted
 
average rates
 
for individual business
divisions may deviate from the weighted average rates for the Group.
 
Note 2
 
Accounting for the acquisition of the Credit
 
Suisse Group
The transaction
On 12 June
 
2023, UBS Group AG
 
acquired Credit
 
Suisse Group AG,
 
succeeding by
 
operation of
 
Swiss law
 
to all
assets and liabilities of Credit Suisse Group AG, and became the direct
 
or indirect shareholder of all of the
 
former
direct and indirect subsidiaries of
 
Credit Suisse Group AG. The acquisition
 
of Credit Suisse Group AG constituted
 
a
business combination under IFRS 3,
Business Combinations
, and was required to be accounted for by applying the
acquisition method of accounting.
 
IFRS 3 measurement period adjustments
 
for the acquisition of the Credit Suisse
 
Group
The acquisition of
 
Credit Suisse Group
 
AG was made
 
without the ordinary
 
due diligence procedures
 
and outside
the conventional time
 
frame for an
 
acquisition of
 
this scale and
 
nature. As
 
such, complete
 
information about all
relevant facts and circumstances as of
 
the acquisition date were not practically available to
 
UBS at the time when
the initial acquisition accounting was applied for the purpose of the UBS Group second quarter 2023 report, with
the amounts that form part of
 
the business combination accounting therefore considered
 
provisional and subject
to further measurement period
 
adjustments if new
 
information about facts
 
and circumstances existing on
 
the date
of the acquisition is obtained
 
within one year from the acquisition
 
date. The acquisition of Credit Suisse
 
Group AG
resulted
 
in
 
provisional
 
negative
 
goodwill
 
of
 
USD 27.7bn.
 
No
 
adjustments
 
were
 
made
 
to
 
the
 
acquisition
 
date
accounting during the first quarter of 2024.
For details
 
of the
 
accounting for
 
the acquisition,
 
including measurement
 
period adjustments,
 
refer to
 
“Note 1a
Material
 
accounting
 
policies”
 
and
 
“Note 2
 
Accounting
 
for
 
the
 
acquisition
 
of
 
the
 
Credit
 
Suisse
 
Group”
 
in
 
the
“Consolidated
 
financial
 
statements”
 
section
 
of
 
the
 
UBS
 
Group
 
Annual
 
Report
 
2023.
 
For
 
changes
 
to
 
segment
reporting, including change in business division
 
perimeters,
 
refer to Note 3.
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
61
Note 2
 
Accounting for the acquisition of the Credit
 
Suisse Group (continued)
Conclusion of an investment management agreement
 
with Apollo and the transfer of senior
 
secured
asset-based financing
In
 
the
 
first
 
quarter
 
of
 
2024,
 
Credit
 
Suisse
 
entered
 
into
 
agreements
 
with
 
entities
 
managed
 
by
 
Atlas
 
Securitized
Products Management Holdings
 
(Atlas) and
 
other affiliates
 
of Apollo Management
 
Holdings (collectively,
 
Apollo)
to
 
conclude
 
the
 
investment
 
management
 
agreement
 
under
 
which
 
Atlas
 
has
 
managed
 
Credit
 
Suisse’s
 
retained
portfolio of
 
assets of
 
its
 
former securitized
 
products group.
 
Following the
 
closure of
 
this
 
agreement,
 
the assets
previously managed by Atlas are to be managed in
 
Non-core and Legacy.
 
The parties also agreed to conclude the
transition services
 
agreement under
 
which Credit
 
Suisse has
 
provided services
 
to Atlas.
 
In addition,
 
Credit Suisse
AG entered into
 
an agreement
 
with Apollo
 
Capital Management
 
(ACM) and
 
other parties
 
managed, controlled
 
and
/ or advised
 
by ACM or
 
its affiliates (collectively, the Assignees)
 
to transfer USD 8.0bn
 
of senior secured
 
asset-based
financing, with
 
USD 6.0bn funded
 
as of
 
31 December 2023
 
recognized as
 
financial assets
 
at fair
 
value held
 
for
trading
 
at
 
a
 
fair
 
value
 
of
 
USD 5.5bn
 
and
 
the
 
remaining
 
notional
 
of
 
USD 2.0bn
 
recognized
 
as
 
derivative
 
loan
commitments at
 
a fair
 
value of
 
USD 0.15bn. As
 
part of
 
the loan
 
transfer,
 
Credit Suisse
 
AG extended
 
a one-year
USD 750m senior
 
swingline facility
 
to the
 
Assignees, which
 
is accounted
 
for as
 
an off
 
-balance sheet
 
irrevocable
commitment as of
 
31 March 2024. In
 
the first quarter
 
of 2024, the
 
UBS Group recognized a
 
net gain of
 
USD 0.3bn
from the conclusion of the investment management
 
agreement and the assignment of the loan facilities.
Derecognition of loans and loan commitments
In addition to the
 
transfers with Apollo
 
noted above, during
 
the first quarter
 
of 2024 the
 
Group recognized further
gains of USD 0.4bn from exiting certain loans and loan commitments acquired
 
as a result of the acquisition of the
Credit Suisse Group,
 
including USD 0.2bn in
 
relation to the securitized
 
products book and USD
 
0.2bn in relation to
the corporate lending book, mainly driven by disposals to third parties and natural roll-offs, accelerated by actions
to actively unwind the portfolio in Non-core and Legacy.
 
Note 3
 
Segment reporting
As part of
 
the continued refinement
 
of UBS’s reporting
 
structure and organizational setup,
 
in the first
 
quarter of
2024 certain
 
changes were
 
made, with
 
an impact
 
on segment
 
reporting for
 
UBS’s business
 
divisions and
 
Group
Items. Prior-period information has been adjusted
 
for comparability. The changes are as follows:
–
Change
 
in
 
business
 
division
 
perimeters:
UBS
 
has
 
transferred
 
certain
 
businesses
 
from
 
Swiss
 
Bank
 
(Credit
Suisse),
 
previously
 
included
 
in
 
Personal
 
&
 
Corporate
 
Banking,
 
to
 
Global
 
Wealth
 
Management.
 
The
 
change
predominantly related to the high
 
net worth client segment and
 
represents approximately USD 72bn
 
in invested
assets and approximately
 
USD 0.6bn in annualized
 
revenues. A
 
number of
 
other smaller
 
business shifts
 
were also
executed between the business divisions in the
 
first quarter of 2024.
 
–
Changes to Group Treasury allocations:
UBS has allocated to the business divisions nearly all Group Treasury
costs that historically were
 
retained and reported in
 
Group Items. Costs continued
 
to be retained in Group
 
Items
include costs related to hedging
 
and own debt, and deferred
 
tax asset funding costs. UBS
 
has also aligned the
internal funds
 
transfer pricing
 
methodologies applied
 
by Credit
 
Suisse entities
 
to UBS’s
 
funds transfer
 
pricing
methodology.
 
These
 
changes
 
resulted
 
in
 
funding
 
costs
 
of
 
approximately
 
USD 0.3bn,
 
for
 
2023,
 
moving
 
from
Group Items
 
to the
 
business divisions,
 
predominantly related
 
to the
 
second half
 
of 2023.
 
In parallel
 
with the
changes noted above, UBS
 
has increased the
 
allocation of balance sheet
 
resources from Group Treasury
 
to the
business divisions.
–
Updated
 
cost allocations:
UBS has
 
reallocated USD 0.3bn
 
of annualized
 
costs from
 
Non-core and
 
Legacy to
the
 
business
 
divisions,
 
with
 
the
 
aim
 
of
 
avoiding
 
stranded
 
costs
 
in
 
Non-core
 
and
 
Legacy
 
at
 
the
 
end
 
of
 
the
integration process.
Following the
 
collective changes
 
outlined above,
 
prior-period information
 
for the
 
first quarter
 
of 2023
 
has been
restated, resulting in decreases
 
in Operating profit /
 
(loss) before tax of
 
USD 3m for Global Wealth
 
Management,
USD 1m for Personal
 
& Corporate
 
Banking and of
 
USD 11m for Group
 
Items, and increases
 
in Operating profit
 
/
(loss) before tax
 
of USD 1m
 
for Asset Management
 
and USD 15m
 
for the Investment
 
Bank, with
 
no change to
 
Non-
core and Legacy.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
62
Note 3
 
Segment reporting (continued)
Prior-period information as
 
of 31 December
 
2023 has also
 
been restated, resulting
 
in increases
 
of Total
 
assets of
USD 98.4bn
 
in
 
Global
 
Wealth
 
Management, USD 13.3bn
 
in
 
Personal
 
&
 
Corporate Banking,
 
USD 28.9bn
 
in
 
the
Investment
 
Bank
 
and
 
USD
 
28.6bn
 
in
 
Non-core
 
and
 
Legacy
 
with
 
a
 
corresponding
 
decrease
 
of
 
total
 
assets
 
of
USD 169.2bn in Group Items.
These changes had no effect on the reported
 
results or financial position of the Group.
›
Refer to the “Management report” sections of this report and the “Consolidated financial statements” section of
the UBS Group Annual Report 2023 for more information about the Group’s
 
business divisions
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group Items
UBS Group
For the quarter ended 31 March 2024
Total revenues
 
6,143
 
2,423
 
776
 
2,751
 
1,001
 
(355)
 
12,739
Credit loss expense / (release)
 
(3)
 
44
 
0
 
32
 
36
 
(2)
 
106
Operating expenses
 
5,044
 
1,404
 
665
 
2,164
 
1,011
 
(33)
 
10,257
Operating profit / (loss) before tax
 
1,102
 
975
 
111
 
555
 
(46)
 
(320)
 
2,376
Tax expense / (benefit)
 
612
Net profit / (loss)
 
1,764
As of 31 March 2024
Total assets
 
552,990
 
460,290
 
22,316
 
412,686
 
145,858
 
12,979
 
1,607,120
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group Items
UBS Group
For the quarter ended 31 March 2023
1
Total revenues
 
4,788
 
1,277
 
503
 
2,365
 
23
 
(211)
 
8,744
Credit loss expense / (release)
 
15
 
16
 
0
 
7
 
0
 
0
 
38
Operating expenses
 
3,561
 
663
 
408
 
1,866
 
699
 
14
 
7,210
Operating profit / (loss) before tax
 
1,212
 
598
 
95
 
492
 
(676)
 
(225)
 
1,495
Tax expense / (benefit)
 
459
Net profit / (loss)
 
1,037
As of 31 December 2023
1
Total assets
 
567,648
 
483,794
 
21,804
 
428,269
 
201,453
 
14,277
 
1,717,246
1 Comparative-period information has been restated for Group Treasury allocations.
 
Note 4
 
Net interest income
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Interest income from loans and deposits
1
 
9,089
 
9,201
 
4,106
Interest income from securities financing transactions measured
 
at amortized cost
2
 
1,217
 
1,085
 
766
Interest income from other financial instruments measured
 
at amortized cost
 
347
 
340
 
259
Interest income from debt instruments measured at fair
 
value through other comprehensive income
 
27
 
28
 
23
Interest income from derivative instruments designated as cash
 
flow hedges
 
 
(602)
 
(617)
 
(376)
Total interest income from financial instruments measured at amortized cost and fair
 
value through other comprehensive income
 
10,078
 
10,036
 
4,777
Interest expense on loans and deposits
3
 
5,439
 
5,213
 
1,994
Interest expense on securities financing transactions measured
 
at amortized cost
4
 
495
 
412
 
365
Interest expense on debt issued
 
3,740
 
3,761
 
1,429
Interest expense on lease liabilities
 
50
 
53
 
26
Total interest expense from financial instruments measured at amortized cost
 
9,724
 
9,440
 
3,814
Total net interest income from financial instruments measured at amortized cost and fair
 
value through other comprehensive income
 
355
 
597
 
962
Net interest income from financial instruments measured at fair value through profit
 
or loss and other
 
1,585
 
1,498
 
425
Total net interest income
 
1,940
 
2,095
 
1,388
1 Consists of interest
 
income from cash and
 
balances at central
 
banks, amounts due
 
from banks, and
 
cash collateral receivables
 
on derivative instruments,
 
as well as negative
 
interest on amounts
 
due to banks,
customer deposits, and cash collateral
 
payables on derivative instruments.
 
2 Includes interest income on receivables
 
from securities financing transactions
 
and negative interest, including fees,
 
on payables from
securities financing transactions.
 
3 Consists of
 
interest expense on
 
amounts due to
 
banks, cash
 
collateral payables
 
on derivative
 
instruments, and
 
customer deposits,
 
as well as
 
negative interest on
 
cash and
balances at central banks, amounts due from banks,
 
and cash collateral receivables on derivative instruments.
 
4 Includes interest expense on payables from securities financing
 
transactions and negative interest,
including fees, on receivables from securities financing transactions.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
63
Note 5
 
Net fee and commission income
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Underwriting fees
 
194
 
189
 
127
M&A and corporate finance fees
 
259
 
224
 
178
Brokerage fees
 
1,150
 
725
 
880
Investment fund fees
 
1,257
 
1,223
 
1,178
Portfolio management and related services
 
3,051
 
2,966
 
2,210
Other
 
1,169
 
1,081
 
479
Total fee and commission income
1
 
7,080
 
6,409
 
5,053
of which: recurring
 
4,407
 
4,318
 
3,413
of which: transaction-based
 
2,641
 
2,048
 
1,616
of which: performance-based
 
32
 
43
 
24
Fee and commission expense
 
588
 
629
 
447
Net fee and commission income
 
6,492
 
5,780
 
4,606
1 Includes third-party fee and commission income for the
 
first quarter of 2024 of USD 3,986m for Global Wealth
 
Management (fourth quarter of 2023: USD 3,690m; first quarter of
 
2023: USD 3,145m), USD 708m
for Personal &
 
Corporate Banking (fourth
 
quarter of 2023:
 
USD 691m; first quarter
 
of 2023: USD 449m),
 
USD 941m for Asset Management
 
(fourth quarter of 2023:
 
USD 961m; first quarter
 
of 2023: USD 687m)
USD 1,332m for the Investment Bank (fourth quarter
 
of 2023: USD 1,240m; first quarter of 2023:
 
USD 770m), USD 5m for Group Items (fourth quarter of 2023:
 
negative USD 233m; first quarter of 2023: USD 3m)
and USD 108m for
 
Non-core and Legacy
 
(fourth quarter of
 
2023: USD 60m; first
 
quarter of 2023:
 
USD 0m). Comparative-period
 
information has been
 
restated for changes
 
in business division
 
perimeters, Group
Treasury allocations and Non-core and Legacy cost allocations.
 
Refer to the “Management report” section of this report and Note 3 for more information.
 
 
Note 6
 
Other income
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Associates, joint ventures and subsidiaries
Net gains / (losses) from acquisitions and disposals of
 
subsidiaries
1
 
(1)
 
20
 
2
Net gains / (losses) from disposals of investments in associates
 
and joint ventures
 
(2)
 
4
 
0
Share of net profits of associates and joint ventures
 
58
 
(465)
2
 
10
Total
 
55
 
(442)
 
12
Net gains / (losses) from disposals of financial assets measured
 
at fair value through other comprehensive income
 
0
 
4
 
0
Income from properties
3
 
14
 
13
 
4
Net gains / (losses) from properties held for sale
 
(1)
 
1
 
0
Other
 
56
4
 
245
5
 
54
6
Total other income
 
124
 
(179)
 
69
1 Includes foreign exchange gains / (losses) reclassified
 
from other comprehensive income related to the
 
disposal or closure of foreign operations.
 
2 Includes a USD 508m share of proportionate
 
impairment losses
reflected in the
 
SIX Group profit
 
and loss, of
 
which USD 317m was
 
reported in Personal
 
and Corporate Banking
 
and USD 190m was
 
reported in Global Wealth
 
Management.
 
3 Includes rent received
 
from third
parties.
 
4 Effective from the first quarter of
 
2024, fees received from mortgage-servicing
 
rights are reflected within “Net fee
 
and commission income.”
 
Fees received from mortgage-servicing
 
rights received in the
first quarter of 2024
 
amounted to USD 71m.
 
5 Includes income of USD 75m
 
related to mortgage-servicing rights
 
and income of USD 41m related
 
to insurance and similar
 
contracts acquired as part
 
of the Credit
Suisse Group
 
6 Includes income of USD 35m due to extinguishment gains on own bonds.
 
Note 7
 
Personnel expenses
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Salaries and variable compensation
1
 
5,863
 
5,728
 
3,885
of which: variable compensation – financial advisors
2
 
1,267
 
1,176
 
1,111
Contractors
 
86
 
90
 
70
Social security
 
409
 
431
 
279
Post-employment benefit plans
 
367
 
544
3
 
236
Other personnel expenses
 
225
 
268
 
151
Total personnel expenses
 
6,949
 
7,061
 
4,620
1 Includes role-based
 
allowances.
 
2 Consists of
 
cash and deferred
 
compensation awards
 
and is based
 
on compensable revenues
 
and firm tenure
 
using a formulaic
 
approach. Also includes
 
expenses related to
compensation commitments with
 
financial advisors entered
 
into at the
 
time of recruitment
 
that are subject
 
to vesting requirements.
 
3 Includes a
 
USD 245m increase
 
in the pension
 
plan obligation of
 
the Swiss
pension plan of Credit Suisse following the decision to align that pension plan to UBS’s Swiss pension
 
plan.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
64
Note 8
 
General and administrative expenses
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Outsourcing costs
 
423
 
478
 
248
Technology costs
 
588
 
564
 
322
Consulting, legal and audit fees
 
403
 
565
 
181
Real estate and logistics costs
 
289
 
400
 
142
Market data services
 
199
 
212
 
113
Marketing and communication
 
115
 
159
 
52
Travel and entertainment
 
72
 
90
 
54
Litigation, regulatory and similar matters
1
 
(5)
 
8
 
721
Other
 
330
 
523
 
232
Total general and administrative expenses
 
2,413
 
2,999
 
2,065
1 Reflects the net increase / (decrease) in provisions
 
for litigation, regulatory and similar matters recognized in the income
 
statement. The current quarter includes a decrease in acquired contingent liabilities measured
under IFRS 3 of USD 50m as well as changes in other provisions for litigation measured under IAS 37 of USD 45m (refer to Note 15b for more information).
 
Note 9
 
Expected credit loss measurement
a) Credit loss expense / release
 
Total net credit loss expenses in the first quarter of
 
2024
 
were USD 106m, reflecting USD 45m net releases related
to performing positions and USD 151m net
 
expenses on credit-impaired positions.
Stage 1 and 2 net releases of USD 45m primarily
 
related
 
to releases in Non-core and Legacy,
 
mainly due to
repayments and stage transfers from performing
 
to credit impaired. Such releases
 
also included
 
net releases from
scenario effects of USD 13m across Global Wealth
 
Management,
 
the Investment Bank and Personal & Corporate
Banking. Credit loss expenses of USD 151m for
 
credit-impaired positions are substantially
 
distributed across Non-
core and Legacy, Personal & Corporate Banking
 
and the Investment Bank.
Credit loss expense / (release)
Performing positions
Credit-impaired positions
USD m
Stages 1 and 2
Stage 3
Purchased
 
Total
For the quarter ended 31.3.24
Global Wealth Management
 
(12)
 
7
 
2
 
(3)
Personal & Corporate Banking
 
(13)
 
64
 
(7)
 
44
Asset Management
 
0
 
0
 
0
 
0
Investment Bank
 
7
 
26
 
(1)
 
32
Non-core and Legacy
 
(26)
 
37
 
25
 
36
Group Items
 
(2)
 
0
 
0
 
(2)
Total
 
(45)
 
133
 
18
 
106
For the quarter ended 31.12.23
1
Global Wealth Management
 
(12)
 
3
 
0
 
(8)
Personal & Corporate Banking
 
(14)
 
95
 
4
 
85
Asset Management
 
0
 
0
 
0
 
(1)
Investment Bank
 
(13)
 
60
 
1
 
48
Non-core and Legacy
 
(1)
 
25
 
(9)
 
15
Group Items
 
(2)
 
0
 
0
 
(2)
Total
 
(43)
 
183
 
(4)
 
136
For the quarter ended 31.3.23
Global Wealth Management
 
15
 
0
 
15
Personal & Corporate Banking
 
15
 
0
 
16
Asset Management
 
0
 
0
 
0
Investment Bank
 
(5)
 
12
 
7
Non-core and Legacy
 
0
 
0
 
0
Group Items
 
0
 
0
 
0
Total
 
26
 
12
 
38
1
 
Comparative-period information has been restated for changes in business division perimeters. Refer to “Changes to segment reporting in 2024” in
 
the “UBS business divisions and Group Items” section and “Note
3 Segment reporting” in the “Consolidated financial statements” section of this report for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
65
Note 9
 
Expected credit loss measurement (continued)
b) Changes to ECL models, scenarios, scenario
 
weights and post-model adjustments
Scenarios and scenario weights
The expected
 
credit loss
 
(ECL) scenarios,
 
along with
 
their related
 
macroeconomic factors and
 
market data,
 
were
reviewed in light of the economic
 
and political conditions prevailing
 
in the first quarter of 2024
 
through a series of
governance meetings,
 
with input
 
and feedback
 
from UBS Risk
 
and Finance
 
experts across
 
the business
 
divisions and
regions. ECLs
 
for Credit
 
Suisse AG positions
 
were
 
calculated based
 
on Credit
 
Suisse AG’s models,
 
including the
same scenarios
 
and scenario weight inputs as for
 
UBS’s existing business activity.
UBS
 
kept scenarios
 
and scenario
 
weights in
 
line
 
with those
 
applied
 
in the
 
2023
 
annual reporting.
 
The
 
baseline
scenario
 
was
 
updated
 
with
 
the
 
latest
 
macroeconomic
 
forecasts
 
as
 
of
 
31 March
 
2024.
 
The
 
assumptions
 
on
 
a
calendar-year basis are
 
included in the table
 
below and imply a
 
more optimistic outlook
 
for the US and Switzerland
for 2024. The outlook for the US for 2025 is
 
marginally less optimistic, while that for
 
Switzerland is unchanged.
 
The mild
 
debt crisis
 
scenario and
 
the stagflationary
 
geopolitical crisis
 
scenario were
 
updated based
 
on the
 
latest
market data, but the assumptions remained
 
broadly unchanged. Refer to the table below.
 
Post-model adjustments
Total
 
stage 1 and 2
 
allowances and provisions
 
were USD 1,026m as
 
of 31 March 2024
 
and included post-model
adjustments
 
of
 
USD 286m
 
(31 December
 
2023:
 
USD 326m).
 
Post-model
 
adjustments are
 
intended
 
to
 
cover for
uncertainty levels, including
 
the geopolitical situation
 
and to
 
align outputs
 
for Credit
 
Suisse model
 
with those of
UBS for dedicated
 
segments. During the
 
first quarter 2024,
 
post-model adjustments
 
decreased by USD 40m
 
due to
higher model driven outputs, exposure decreases and foreign exchange
 
translation.
Comparison of shock factors
Baseline
Key parameters
2023
2024
2025
Real GDP growth (annual percentage change)
US
 
 
2.5
 
2.3
 
1.4
Eurozone
 
0.5
 
0.6
 
1.2
Switzerland
 
0.8
 
1.3
 
1.5
Unemployment rate (%, annual average)
US
 
 
3.6
 
3.9
 
4.1
Eurozone
 
6.5
 
6.7
 
6.8
Switzerland
 
2.0
 
2.3
 
2.3
Fixed income: 10-year government bonds (%, Q4)
USD
 
3.9
 
4.1
 
4.1
EUR
 
2.0
 
2.2
 
2.2
CHF
 
0.7
 
0.7
 
0.7
Real estate (annual percentage change, Q4)
 
US
 
 
5.2
 
2.5
 
2.0
Eurozone
 
(1.0)
 
0.9
 
2.6
Switzerland
 
0.1
 
1.0
 
2.5
Economic scenarios and weights applied
Assigned weights in %
ECL scenario
31.3.24
31.12.23
31.3.23
Baseline
 
60.0
 
60.0
 
60.0
Mild debt crisis
 
 
15.0
 
15.0
–
Stagflationary geopolitical crisis
 
25.0
 
25.0
 
25.0
Global crisis
 
–
–
 
15.0
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
66
Note 9
 
Expected credit loss measurement (continued)
c) ECL-relevant balance sheet and off-balance
 
sheet positions including ECL allowances
 
and provisions
The following tables
 
provide information
 
about financial
 
instruments and
 
certain non-financial
 
instruments that
 
are
subject
 
to
 
ECL
 
requirements.
 
For
 
amortized-cost
 
instruments,
 
the
 
carrying
 
amount
 
represents
 
the
 
maximum
exposure to credit risk, taking
 
into account the allowance for
 
credit losses. Financial assets measured at
 
fair value
through other comprehensive
 
income (FVOCI) are
 
also subject to ECL;
 
however, unlike amortized-cost
 
instruments,
the allowance
 
for credit
 
losses for
 
FVOCI instruments
 
does not
 
reduce the
 
carrying amount
 
of these financial
 
assets.
Instead, the
 
carrying amount
 
of financial
 
assets measured
 
at FVOCI
 
represents the
 
maximum exposure
 
to credit
 
risk.
In addition to recognized financial assets, certain off-balance sheet financial instruments and other credit lines are
also subject to ECL.
 
The maximum exposure to
 
credit risk for off-balance
 
sheet financial instruments is calculated
based on the maximum contractual amounts.
USD m
31.3.24
Carrying amount
1
ECL allowances
Financial instruments measured at amortized cost
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 3
PCI
Cash and balances at central banks
 
271,527
 
271,378
 
17
 
0
 
132
 
(55)
 
0
 
(25)
 
0
 
(30)
Amounts due from banks
 
22,143
 
22,042
 
65
 
0
 
36
 
(24)
 
(6)
 
0
 
0
 
(18)
Receivables from securities financing transactions measured at
amortized cost
 
101,650
 
101,650
 
0
 
0
 
0
 
(2)
 
(2)
 
0
 
0
 
0
Cash collateral receivables on derivative instruments
 
46,714
 
46,714
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Loans and advances to customers
 
605,283
 
571,497
 
28,773
 
3,742
 
1,272
 
(1,700)
 
(362)
 
(284)
 
(920)
 
(134)
of which: Private clients with mortgages
 
251,891
 
239,416
 
11,319
 
923
 
233
 
(196)
 
(55)
 
(92)
 
(39)
 
(10)
of which: Real estate financing
 
90,220
 
84,485
 
5,444
 
179
 
111
 
(64)
 
(27)
 
(28)
 
(9)
 
0
of which: Large corporate clients
 
29,008
 
23,954
 
3,917
 
689
 
447
 
(580)
 
(91)
 
(83)
 
(318)
 
(87)
of which: SME clients
 
24,276
 
20,506
 
2,745
 
951
 
74
 
(442)
 
(64)
 
(32)
 
(335)
 
(11)
of which: Lombard
 
150,759
 
149,153
 
931
 
549
 
126
 
(61)
 
(7)
 
(1)
 
(41)
 
(12)
of which: Credit cards
 
1,840
 
1,402
 
399
 
38
 
0
 
(40)
 
(6)
 
(10)
 
(23)
 
0
of which: Commodity trade finance
 
5,358
 
5,169
 
165
 
11
 
12
 
(123)
 
(17)
 
(2)
 
(104)
 
0
of which: Ship / aircraft financing
 
8,777
 
7,998
 
776
 
3
 
0
 
(47)
 
(40)
 
(7)
 
0
 
0
of which: Consumer financing
 
2,912
 
2,629
 
199
 
35
 
49
 
(64)
 
(20)
 
(19)
 
(24)
 
0
Other financial assets measured at amortized cost
 
62,750
 
61,988
 
574
 
166
 
22
 
(134)
 
(35)
 
(9)
 
(83)
 
(6)
of which: Loans to financial advisors
 
2,615
 
2,430
 
70
 
115
 
0
 
(49)
 
(6)
 
(1)
 
(43)
 
0
Total financial assets measured at amortized cost
 
1,110,067
 
1,075,268
 
29,428
 
3,908
 
1,463
 
(1,915)
 
(405)
 
(318)
 
(1,003)
 
(189)
Financial assets measured at fair value through other comprehensive
income
 
2,078
 
2,078
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Total on-balance sheet financial assets in scope of ECL requirements
 
1,112,145
 
1,077,346
 
29,428
 
3,908
 
1,463
 
(1,915)
 
(405)
 
(318)
 
(1,003)
 
(189)
Total exposure
ECL provisions
Off-balance sheet (in scope of ECL)
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 3
PCI
Guarantees
 
41,744
 
40,211
 
1,314
 
173
 
45
 
(64)
 
(27)
 
(18)
 
(19)
 
1
of which: Large corporate clients
 
8,643
 
7,710
 
841
 
78
 
14
 
(25)
 
(10)
 
(11)
 
(4)
 
0
of which: SME clients
 
2,670
 
2,274
 
286
 
86
 
23
 
(9)
 
(4)
 
(3)
 
(2)
 
1
of which: Financial intermediaries and hedge funds
 
 
20,920
 
20,865
 
55
 
0
 
0
 
(11)
 
(8)
 
(3)
 
0
 
0
of which: Lombard
 
3,959
 
3,947
 
6
 
5
 
0
 
(7)
 
0
 
0
 
(7)
 
0
of which: Commodity trade finance
 
2,088
 
2,077
 
11
 
0
 
0
 
(1)
 
(1)
 
0
 
0
 
0
Irrevocable loan commitments
 
87,292
 
82,700
 
4,335
 
230
 
27
 
(173)
 
(112)
 
(54)
 
(13)
 
6
of which: Large corporate clients
 
48,060
 
44,281
 
3,682
 
77
 
21
 
(152)
 
(93)
 
(47)
 
(13)
 
0
Forward starting reverse repurchase and securities borrowing
agreements
 
17,649
 
17,649
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Unconditionally revocable loan commitments
 
150,918
 
148,116
 
2,616
 
186
 
0
 
(89)
 
(73)
 
(15)
 
0
 
0
of which: Real estate financing
 
12,318
 
11,616
 
703
 
0
 
0
 
(10)
 
(10)
 
0
 
0
 
0
of which: Large corporate clients
 
16,793
 
16,422
 
358
 
12
 
0
 
(25)
 
(18)
 
(7)
 
0
 
0
of which: SME clients
 
10,548
 
10,205
 
313
 
30
 
0
 
(36)
 
(31)
 
(5)
 
0
 
0
of which: Lombard
 
61,036
 
60,901
 
133
 
1
 
0
 
0
 
0
 
0
 
0
 
0
of which: Credit cards
 
10,049
 
9,560
 
485
 
4
 
0
 
(9)
 
(8)
 
(2)
 
0
 
0
Irrevocable committed prolongation of existing loans
 
3,719
 
3,709
 
7
 
3
 
0
 
(3)
 
(3)
 
0
 
0
 
0
Total off-balance sheet financial instruments and other credit lines
 
301,322
 
292,385
 
8,271
 
593
 
72
 
(328)
 
(215)
 
(88)
 
(32)
 
7
Total allowances and provisions
 
(2,243)
 
(620)
 
(406)
 
(1,035)
 
(182)
1 The carrying amount of financial assets measured at amortized cost represents the total gross exposure net of the respective
 
ECL allowances.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
67
Note 9
 
Expected credit loss measurement (continued)
USD m
31.12.23
Carrying amount
1
ECL allowances
Financial instruments measured at amortized cost
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 3
PCI
Cash and balances at central banks
 
314,148
 
314,025
 
18
 
0
 
106
 
(48)
 
0
 
(26)
 
0
 
(22)
Amounts due from banks
 
21,161
 
21,107
 
17
 
0
 
38
 
(12)
 
(6)
 
(1)
 
0
 
(5)
Receivables from securities financing transactions measured at
amortized cost
 
99,039
 
99,039
 
0
 
0
 
0
 
(2)
 
(2)
 
0
 
0
 
0
Cash collateral receivables on derivative instruments
 
50,082
 
50,082
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Loans and advances to customers
 
639,844
 
611,019
 
24,408
 
2,869
 
1,548
 
(1,698)
 
(423)
 
(289)
 
(862)
 
(123)
of which: Private clients with mortgages
 
268,616
 
256,614
 
10,695
 
929
 
378
 
(209)
 
(62)
 
(97)
 
(39)
 
(11)
of which: Real estate financing
 
97,817
 
92,084
 
5,367
 
270
 
97
 
(103)
 
(41)
 
(31)
 
(21)
 
(11)
of which: Large corporate clients
 
30,084
 
25,671
 
3,182
 
700
 
532
 
(575)
 
(105)
 
(70)
 
(312)
 
(89)
of which: SME clients
 
25,957
 
22,155
 
2,919
 
754
 
129
 
(402)
 
(71)
 
(42)
 
(277)
 
(13)
of which: Lombard
 
156,353
 
156,299
 
3
 
50
 
0
 
(41)
 
(13)
 
(11)
 
(17)
 
0
of which: Credit cards
 
2,041
 
1,564
 
438
 
39
 
0
 
(42)
 
(6)
 
(11)
 
(24)
 
0
of which: Commodity trade finance
 
5,727
 
5,662
 
25
 
22
 
18
 
(130)
 
(18)
 
(1)
 
(111)
 
0
of which: Ship / aircraft financing
 
9,214
 
8,920
 
273
 
4
 
17
 
(51)
 
(48)
 
(3)
 
0
 
(1)
of which: Consumer financing
 
2,982
 
2,795
 
92
 
38
 
57
 
(59)
 
(22)
 
(17)
 
(20)
 
0
Other financial assets measured at amortized cost
 
65,498
 
64,311
 
968
 
158
 
61
 
(151)
 
(41)
 
(10)
 
(94)
 
(5)
of which: Loans to financial advisors
 
2,615
 
2,422
 
79
 
114
 
0
 
(49)
 
(4)
 
(1)
 
(44)
 
0
Total financial assets measured at amortized cost
 
1,189,773
 
1,159,583
 
25,410
 
3,027
 
1,753
 
(1,911)
 
(473)
 
(326)
 
(956)
 
(156)
Financial assets measured at fair value through other comprehensive
income
 
2,233
 
2,233
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Total on-balance sheet financial assets in scope of ECL requirements
 
1,192,006
 
1,161,816
 
25,410
 
3,027
 
1,753
 
(1,911)
 
(473)
 
(326)
 
(956)
 
(156)
Total exposure
ECL provisions
Off-balance sheet (in scope of ECL)
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 3
PCI
Guarantees
 
46,191
 
44,487
 
1,495
 
151
 
58
 
(73)
 
(28)
 
(22)
 
(23)
 
0
of which: Large corporate clients
 
9,267
 
8,138
 
1,023
 
89
 
17
 
(31)
 
(11)
 
(13)
 
(7)
 
0
of which: SME clients
 
2,839
 
2,469
 
337
 
31
 
2
 
(14)
 
(4)
 
(5)
 
(5)
 
0
of which: Financial intermediaries and hedge funds
 
 
22,922
 
22,876
 
46
 
0
 
0
 
(12)
 
(8)
 
(3)
 
0
 
0
of which: Lombard
 
5,045
 
5,045
 
0
 
0
 
0
 
(1)
 
0
 
0
 
(1)
 
0
of which: Commodity trade finance
 
2,037
 
2,027
 
9
 
0
 
0
 
(1)
 
(1)
 
0
 
0
 
0
Irrevocable loan commitments
 
91,643
 
87,080
 
4,297
 
218
 
48
 
(178)
 
(117)
 
(51)
 
(14)
 
4
of which: Large corporate clients
 
50,696
 
46,708
 
3,881
 
59
 
48
 
(149)
 
(94)
 
(41)
 
(12)
 
(2)
Forward starting reverse repurchase and securities borrowing
agreements
 
18,444
 
18,444
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Unconditionally revocable loan commitments
 
163,256
 
160,456
 
2,654
 
146
 
0
 
(95)
 
(78)
 
(17)
 
0
 
0
of which: Real estate financing
 
15,846
 
15,033
 
813
 
0
 
0
 
(14)
 
(11)
 
(3)
 
0
 
0
of which: Large corporate clients
 
17,139
 
16,678
 
454
 
8
 
0
 
(23)
 
(17)
 
(6)
 
0
 
0
of which: SME clients
 
11,658
 
11,253
 
375
 
29
 
0
 
(38)
 
(33)
 
(5)
 
0
 
0
of which: Lombard
 
77,618
 
77,618
 
0
 
1
 
0
 
0
 
0
 
0
 
0
 
0
of which: Credit cards
 
10,458
 
9,932
 
522
 
4
 
0
 
(10)
 
(8)
 
(2)
 
0
 
0
Irrevocable committed prolongation of existing loans
 
4,608
 
4,593
 
11
 
4
 
0
 
(4)
 
(4)
 
0
 
0
 
0
Total off-balance sheet financial instruments and other credit lines
 
324,141
 
315,060
 
8,456
 
519
 
106
 
(350)
 
(226)
 
(90)
 
(37)
 
3
Total allowances and provisions
 
(2,261)
 
(700)
 
(416)
 
(993)
 
(153)
1 The carrying amount of financial assets measured at amortized cost represents the total gross exposure net of the respective
 
ECL allowances.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
68
Note 9
 
Expected credit loss measurement (continued)
The table
 
below provides information
 
about the gross
 
carrying amount of
 
exposures subject to
 
ECL and
 
the ECL
coverage ratio for
 
UBS’s core loan portfolios
 
(i.e.,
Loans and advances
 
to customers
 
and
 
Loans to financial
 
advisors
)
and
 
relevant
 
off-balance
 
sheet
 
exposures.
Cash
 
and
 
balances
 
at
 
central
 
banks
,
Amounts
 
due
 
from
 
banks
,
Receivables from
 
securities
 
financing transactions
,
Cash collateral
 
receivables
 
on derivative
 
instruments
 
and
Financial
assets measured
 
at fair
 
value through
 
other comprehensive
 
income
 
are not included
 
in the
 
table below, due
 
to their
lower sensitivity to ECL.
ECL coverage ratios are calculated by dividing ECL
 
allowances and provisions by the gross carrying amount of the
related exposures.
Coverage ratios for core loan portfolio
31.3.24
Gross carrying amount (USD m)
ECL coverage (bps)
On-balance sheet
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
PCI
Private clients with mortgages
 
252,087
 
239,471
 
11,412
 
962
 
243
 
8
 
2
 
81
 
6
 
406
 
395
Real estate financing
 
90,284
 
84,512
 
5,472
 
188
 
111
 
7
 
3
 
50
 
6
 
493
 
0
Total real estate lending
 
342,372
 
323,984
 
16,884
 
1,150
 
354
 
8
 
3
 
71
 
6
 
420
 
270
Large corporate clients
 
29,587
 
24,045
 
4,001
 
1,008
 
534
 
196
 
38
 
208
 
62
 
3,160
 
1,632
SME clients
 
24,718
 
20,570
 
2,777
 
1,286
 
85
 
179
 
31
 
114
 
41
 
2,602
 
1,305
Total corporate lending
 
54,305
 
44,615
 
6,777
 
2,293
 
619
 
188
 
35
 
169
 
53
 
2,847
 
1,587
Lombard
 
150,820
 
149,160
 
932
 
590
 
138
 
4
 
0
 
10
 
1
 
699
 
840
Credit cards
 
1,879
 
1,408
 
410
 
61
 
0
 
211
 
41
 
256
 
89
 
3,802
 
0
Commodity trade finance
 
5,481
 
5,186
 
168
 
115
 
12
 
224
 
32
 
144
 
35
 
9,044
 
0
Ship / aircraft financing
 
8,823
 
8,038
 
782
 
3
 
0
 
53
 
50
 
84
 
53
 
0
 
0
Consumer financing
 
2,976
 
2,649
 
218
 
59
 
49
 
215
 
77
 
884
 
138
 
4,093
 
31
Other loans and advances to customers
 
40,327
 
36,818
 
2,886
 
389
 
234
 
21
 
9
 
31
 
11
 
657
 
626
Loans to financial advisors
 
2,664
 
2,435
 
71
 
157
 
0
 
186
 
23
 
160
 
27
 
2,716
 
0
Total other lending
 
212,971
 
205,695
 
5,466
 
1,375
 
434
 
22
 
6
 
91
 
9
 
1,900
 
606
Total
1
 
609,647
 
574,295
 
29,127
 
4,819
 
1,406
 
29
 
6
 
98
 
11
 
1,998
 
953
Gross exposure (USD m)
ECL coverage (bps)
Off-balance sheet
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
PCI
Private clients with mortgages
 
7,907
 
7,590
 
289
 
29
 
0
 
7
 
6
 
34
 
7
 
24
 
0
Real estate financing
 
13,652
 
12,919
 
732
 
0
 
0
 
7
 
8
 
0
 
7
 
0
 
0
Total real estate lending
 
21,559
 
20,509
 
1,021
 
29
 
0
 
7
 
7
 
4
 
7
 
23
 
0
Large corporate clients
 
73,534
 
68,451
 
4,881
 
168
 
35
 
28
 
18
 
133
 
25
 
995
 
0
SME clients
 
15,269
 
14,438
 
678
 
130
 
23
 
34
 
29
 
216
 
38
 
181
 
0
Total corporate lending
 
88,803
 
82,889
 
5,559
 
297
 
58
 
29
 
20
 
143
 
27
 
640
 
0
Lombard
 
68,645
 
68,477
 
161
 
7
 
0
 
1
 
0
 
1
 
0
 
9,921
 
0
Credit cards
 
10,049
 
9,560
 
485
 
4
 
0
 
9
 
8
 
34
 
9
 
0
 
0
Commodity trade finance
 
4,446
 
4,429
 
18
 
0
 
0
 
6
 
6
 
127
 
6
 
0
 
0
Ship / aircraft financing
 
1,643
 
1,643
 
0
 
0
 
0
 
13
 
12
 
0
 
13
 
0
 
0
Consumer financing
 
167
 
167
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Financial intermediaries and hedge funds
 
48,923
 
48,619
 
304
 
0
 
0
 
3
 
2
 
114
 
3
 
0
 
0
Other off-balance sheet commitments
 
39,437
 
38,444
 
723
 
256
 
14
 
6
 
4
 
40
 
4
 
257
 
0
Total other lending
 
173,310
 
171,338
 
1,691
 
267
 
14
 
3
 
2
 
49
 
3
 
493
 
0
Total
2
 
283,672
 
274,736
 
8,271
 
593
 
72
 
12
 
8
 
106
 
11
 
543
 
0
Total on- and off-balance sheet
3
 
893,319
 
849,030
 
37,399
 
5,412
 
1,479
 
23
 
7
 
100
 
11
 
1,838
 
860
1 Includes Loans and
 
advances to customers and
 
Loans to financial advisors,
 
which are presented on
 
the balance sheet line Other
 
financial
 
assets measured at amortized
 
cost.
 
2 Excludes Forward
 
starting reverse
repurchase and securities borrowing agreements.
 
3 Includes on-balance sheet exposure, gross and off-balance sheet exposure (notional) and the related
 
ECL coverage ratio (bps).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
69
Note 9
 
Expected credit loss measurement (continued)
Coverage ratios for core loan portfolio
31.12.23
Gross carrying amount (USD m)
ECL coverage (bps)
On-balance sheet
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
PCI
Private clients with mortgages
 
268,825
 
256,675
 
10,792
 
968
 
389
 
8
 
2
 
90
 
6
 
399
 
283
Real estate financing
 
97,920
 
92,124
 
5,398
 
290
 
108
 
11
 
4
 
57
 
7
 
713
 
980
Total real estate lending
 
366,745
 
348,800
 
16,190
 
1,258
 
497
 
9
 
3
 
79
 
6
 
472
 
434
Large corporate clients
 
30,660
 
25,775
 
3,252
 
1,012
 
620
 
188
 
41
 
215
 
60
 
3,083
 
1,429
SME clients
 
26,359
 
22,226
 
2,961
 
1,031
 
142
 
153
 
32
 
141
 
45
 
2,689
 
893
Total corporate lending
 
57,019
 
48,001
 
6,213
 
2,042
 
762
 
172
 
37
 
180
 
53
 
2,884
 
1,329
Lombard
 
156,394
 
156,312
 
15
 
67
 
0
 
3
 
1
 
7,616
 
2
 
2,487
 
0
Credit cards
 
2,083
 
1,571
 
449
 
63
 
0
 
200
 
40
 
253
 
87
 
3,801
 
0
Commodity trade finance
 
5,858
 
5,681
 
26
 
133
 
18
 
223
 
32
 
365
 
34
 
8,333
 
6
Ship / aircraft financing
 
9,265
 
8,968
 
276
 
4
 
17
 
56
 
54
 
99
 
55
 
0
 
315
Consumer financing
 
3,041
 
2,817
 
110
 
58
 
57
 
195
 
79
 
1,559
 
135
 
3,422
 
7
Other loans and advances to customers
 
41,136
 
39,293
 
1,419
 
105
 
320
 
21
 
10
 
39
 
11
 
3,981
 
0
Loans to financial advisors
 
2,665
 
2,426
 
80
 
159
 
0
 
185
 
17
 
122
 
20
 
2,793
 
0
Total other lending
 
220,442
 
217,068
 
2,373
 
589
 
412
 
21
 
7
 
210
 
9
 
4,376
 
8
Total
1
 
644,206
 
613,869
 
24,777
 
3,889
 
1,671
 
27
 
7
 
117
 
11
 
2,329
 
737
Gross exposure (USD m)
ECL coverage (bps)
Off-balance sheet
Total
Stage 1
Stage 2
Stage 3
PCI
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
PCI
Private clients with mortgages
 
9,782
 
9,505
 
261
 
15
 
0
 
6
 
5
 
27
 
6
 
40
 
0
Real estate financing
 
17,107
 
16,281
 
826
 
0
 
0
 
9
 
8
 
44
 
9
 
0
 
0
Total real estate lending
 
26,889
 
25,786
 
1,088
 
15
 
0
 
8
 
7
 
40
 
8
 
40
 
0
Large corporate clients
 
77,103
 
71,524
 
5,357
 
157
 
65
 
26
 
17
 
111
 
24
 
1,217
 
242
SME clients
 
16,762
 
15,868
 
812
 
80
 
2
 
40
 
29
 
196
 
37
 
640
 
0
Total corporate lending
 
93,865
 
87,392
 
6,170
 
236
 
67
 
29
 
19
 
122
 
26
 
1,022
 
221
Lombard
 
86,173
 
86,173
 
0
 
1
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Credit cards
 
10,458
 
9,932
 
522
 
4
 
0
 
10
 
8
 
35
 
10
 
0
 
0
Commodity trade finance
 
4,640
 
4,628
 
13
 
0
 
0
 
6
 
5
 
151
 
6
 
0
 
0
Ship / aircraft financing
 
1,053
 
1,053
 
0
 
0
 
0
 
26
 
26
 
0
 
26
 
0
 
0
Consumer financing
 
153
 
153
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Financial intermediaries and hedge funds
 
42,578
 
42,325
 
253
 
0
 
0
 
3
 
3
 
142
 
3
 
0
 
0
Other off-balance sheet commitments
 
39,887
 
39,174
 
411
 
263
 
39
 
7
 
4
 
111
 
5
 
453
 
0
Total other lending
 
184,944
 
183,438
 
1,199
 
268
 
39
 
3
 
2
 
85
 
3
 
486
 
0
Total
2
 
305,697
 
296,616
 
8,456
 
519
 
106
 
11
 
8
 
107
 
10
 
717
 
0
Total on- and off-balance sheet
3
 
949,904
 
910,485
 
33,233
 
4,408
 
1,777
 
22
 
7
 
114
 
11
 
2,140
 
675
1 Includes Loans and advances
 
to customers and Loans
 
to financial advisors,
 
which are presented on
 
the balance sheet line
 
Other financial assets measured
 
at amortized cost.
 
2 Excludes Forward
 
starting reverse
repurchase and securities borrowing agreements.
 
3 Includes on-balance-sheet exposure, gross and off-balance-sheet exposure (notional) and the related
 
ECL coverage ratio (bps).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
70
Note 10
 
Fair value measurement
a) Fair value hierarchy
The fair
 
value hierarchy
 
classification of
 
financial and
 
non-financial assets
 
and liabilities
 
measured at
 
fair value
 
is
summarized in the table below.
During the first three
 
months of 2024, assets and
 
liabilities that were transferred from
 
Level 2 to Level 1, or
 
from
Level 1 to Level 2, and were held for the entire
 
reporting period were not material.
Determination of fair values from quoted market
 
prices or valuation techniques
1
31.3.24
31.12.23
USD m
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
Financial assets measured at fair value on a recurring basis
Financial assets at fair value held for trading
116,980
30,734
12,390
160,104
118,975
28,045
22,613
169,633
of which: Equity instruments
 
103,929
 
344
 
247
 
104,520
 
102,602
 
1,403
 
321
 
104,325
of which: Government bills / bonds
 
5,972
 
6,652
 
35
 
12,659
 
6,995
 
8,763
 
73
 
15,830
of which: Investment fund units
 
6,022
 
1,943
 
234
 
8,198
 
8,392
 
1,124
 
129
 
9,645
of which: Corporate and municipal bonds
 
1,052
 
16,152
 
1,045
 
18,250
 
984
 
12,801
 
1,284
 
15,069
of which: Loans
 
0
 
5,499
 
10,606
 
16,105
 
0
 
3,837
 
19,618
 
23,456
of which: Asset-backed securities
 
4
 
139
 
119
 
262
 
3
 
112
 
133
 
248
Derivative financial instruments
1,146
155,710
2,373
159,229
622
172,903
2,559
176,084
of which: Foreign exchange
 
416
 
61,337
 
197
 
61,951
 
347
 
78,060
 
253
 
78,659
of which: Interest rate
 
0
 
52,144
 
402
 
52,546
 
0
 
55,190
 
407
 
55,597
of which: Equity / index
 
0
 
36,489
 
1,186
 
37,675
 
0
 
34,174
 
1,299
 
35,473
of which: Credit
 
0
 
2,590
 
434
 
3,024
 
0
 
3,456
 
513
 
3,969
of which: Commodities
 
7
 
3,001
 
2
 
3,011
 
1
 
1,869
 
13
 
1,883
Brokerage receivables
 
0
 
22,796
 
0
 
22,796
 
0
 
21,037
 
0
 
21,037
Financial assets at fair value not held for trading
 
31,065
 
59,843
 
8,704
 
99,612
 
30,717
 
64,865
 
8,435
 
104,018
of which: Financial assets for unit-linked investment contracts
 
16,458
 
25
 
0
 
16,482
 
15,877
 
7
 
0
 
15,884
of which: Corporate and municipal bonds
 
60
 
14,532
 
217
 
14,809
 
62
 
16,722
 
215
 
17,000
of which: Government bills / bonds
 
14,065
 
7,019
 
0
 
21,083
 
14,306
 
4,801
 
0
 
19,107
of which: Loans
 
0
 
3,710
 
2,167
 
5,878
 
0
 
4,252
 
2,258
 
6,510
of which: Securities financing transactions
 
0
 
32,840
 
98
 
32,938
 
0
 
36,857
 
52
 
36,909
of which: Asset-backed securities
 
0
 
1,169
 
500
 
1,668
 
0
 
1,525
 
180
 
1,704
of which: Auction rate securities
 
0
 
0
 
1,211
 
1,211
 
0
 
0
 
1,208
 
1,208
of which: Investment fund units
 
371
 
458
 
688
 
1,517
 
367
 
548
 
678
 
1,592
of which: Equity instruments
 
111
 
1
 
3,017
 
3,130
 
105
 
38
 
3,097
 
3,241
Financial assets measured at fair value through other comprehensive income on
 
a recurring basis
Financial assets measured at fair value through other comprehensive
 
income
 
67
 
2,011
 
0
 
2,078
 
68
 
2,165
 
0
 
2,233
of which: Commercial paper and certificates of deposit
 
0
 
1,783
 
0
 
1,783
 
0
 
1,948
 
0
 
1,948
of which: Corporate and municipal bonds
 
67
 
179
 
0
 
246
 
68
 
207
 
0
 
276
Non-financial assets measured at fair value on a recurring basis
Precious metals and other physical commodities
 
6,466
 
0
 
0
 
6,466
 
5,930
 
0
 
0
 
5,930
Non-financial assets measured at fair value on a non-recurring basis
Other non-financial assets
2
 
0
 
0
 
35
 
35
 
0
 
0
 
31
 
31
Total assets measured at fair value
155,725
271,093
23,502
450,320
156,312
289,015
33,639
478,966
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
71
Note 10
 
Fair value measurement (continued)
Determination of fair values from quoted market
 
prices or valuation techniques (continued)
1
31.3.24
31.12.23
USD m
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
Total
Financial liabilities measured at fair value on a recurring basis
Financial liabilities at fair value held for trading
 
26,785
 
8,771
 
202
 
35,758
 
27,684
 
6,315
 
161
 
34,159
of which: Equity instruments
 
18,996
 
294
 
66
 
19,356
 
18,266
 
248
 
92
 
18,606
of which: Corporate and municipal bonds
 
34
 
6,966
 
132
 
7,132
 
28
 
4,981
 
62
 
5,071
of which: Government bills / bonds
 
6,596
 
1,232
 
0
 
7,828
 
8,559
 
905
 
0
 
9,464
of which: Investment fund units
 
1,159
 
216
 
3
 
1,378
 
832
 
118
 
4
 
954
Derivative financial instruments
967
156,208
5,867
163,042
771
185,815
5,595
192,181
of which: Foreign exchange
 
372
 
58,684
 
51
 
59,107
 
457
 
89,394
 
36
 
89,887
of which: Interest rate
 
0
 
49,966
 
307
 
50,273
 
0
 
52,673
 
246
 
52,920
of which: Equity / index
 
0
 
41,522
 
4,302
 
45,825
 
0
 
38,046
 
3,333
 
41,380
of which: Credit
 
0
 
3,205
 
525
 
3,731
 
0
 
4,081
 
619
 
4,700
of which: Commodities
 
3
 
2,618
 
20
 
2,642
 
0
 
1,437
 
21
 
1,458
of which: Loan commitments measured at FVTPL
 
0
 
127
 
555
 
682
 
0
 
135
 
1,037
 
1,172
Financial liabilities designated at fair value on a recurring basis
Brokerage payables designated at fair value
 
0
 
46,628
 
0
 
46,628
 
0
 
42,522
 
0
 
42,522
Debt issued designated at fair value
 
0
 
102,823
 
13,983
 
116,806
 
0
 
113,012
 
15,276
 
128,289
Other financial liabilities designated at fair value
 
0
 
25,490
 
2,650
 
28,140
 
0
 
26,878
 
2,606
 
29,484
of which: Financial liabilities related to unit-linked investment contracts
 
0
 
16,612
 
0
 
16,612
 
0
 
15,992
 
0
 
15,992
of which: Securities financing transactions
 
0
 
5,121
 
0
 
5,121
 
0
 
7,416
 
0
 
7,416
of which: Over-the-counter debt instruments and others
 
0
 
3,757
 
2,650
 
6,407
 
0
 
3,471
 
2,606
 
6,076
Total liabilities measured at fair value
27,752
339,920
22,703
390,374
28,454
374,542
23,638
426,635
1 Bifurcated embedded derivatives are presented on the same balance sheet lines
 
as their host contracts and are not included in this table. The fair value of these derivatives was not
 
material for the periods presented.
 
2 Other non-financial assets primarily consist of properties and other non-current assets held for sale, which are measured at the
 
lower of their net carrying amount or fair value less costs to sell.
b) Valuation adjustments
The table below summarizes the changes
 
in deferred day-1 profit or loss reserves during the
 
relevant period.
 
Deferred day-1 profit or loss is generally released into
Other net income from financial instruments measured
 
at fair
value
 
through
 
profit
 
or
 
loss
 
when
 
the
 
pricing
 
of
 
equivalent
 
products
 
or
 
the
 
underlying
 
parameters
 
become
observable or when the transaction is closed out.
Deferred day-1 profit or loss reserves
For the quarter ended
USD m
31.3.24
31.12.23
31.3.23
Reserve balance at the beginning of the period
 
404
 
396
 
422
Profit / (loss) deferred on new transactions
 
42
 
54
 
91
(Profit) / loss recognized in the income statement
 
(62)
 
(48)
 
(113)
Foreign currency translation
 
0
 
1
 
0
Reserve balance at the end of the period
 
384
 
404
 
399
The table below summarizes other valuation
 
adjustment reserves recognized on the
 
balance sheet.
Other valuation adjustment reserves on the
 
balance sheet
As of
USD m
31.3.24
31.12.23
Own credit adjustments on financial liabilities designated at fair value
1
 
(1,315)
 
(1,287)
of which: debt issued designated at fair value
 
(1,334)
 
(1,297)
of which: other financial liabilities designated at fair value
 
19
 
10
Credit valuation adjustments
2
 
(118)
 
(145)
Funding and debit valuation adjustments
 
(107)
 
(116)
Other valuation adjustments
 
(2,135)
 
(2,654)
of which: liquidity
 
(1,588)
 
(2,051)
of which: model uncertainty
 
(547)
 
(603)
1 Own credit adjustments on financial liabilities designated at fair value includes amounts for TLAC notes.
 
2 Amount does not include reserves against defaulted counterparties.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
72
Note 10
 
Fair value measurement (continued)
c) Level 3 instruments: valuation techniques
 
and inputs
The
 
table
 
below
 
presents material
 
Level 3
 
assets
 
and
 
liabilities,
 
together
 
with
 
the
 
valuation
 
techniques
 
used
 
to
measure fair value,
 
as well as
 
the inputs used
 
in a given
 
valuation technique that are
 
considered significant as of
31 March 2024 and unobservable, and a range
 
of values for those unobservable inputs.
The range of values
 
represents the highest- and
 
lowest-level inputs used in the valuation
 
techniques. Therefore, the
range does not reflect the level of uncertainty regarding a particular input or an assessment of the reasonableness of
the Group’s estimates and assumptions, but rather the different underlying characteristics of the relevant
 
assets and
liabilities held by the Group.
 
The significant unobservable
 
inputs disclosed in
 
the table below
 
are consistent with
 
those included in
 
“Note 21 Fair
value measurement” in the “Consolidated financial
 
statements” section of the UBS Group
 
Annual Report 2023.
Valuation techniques and inputs
 
used in the fair value measurement of Level
 
3 assets and liabilities
Fair value
Significant unobservable
input(s)
1
Range of inputs
Assets
Liabilities
Valuation technique(s)
31.3.24
31.12.23
USD bn
31.3.24
31.12.23
31.3.24
31.12.23
low
high
weighted
average
2
low
high
weighted
average
2
unit
1
Financial assets and liabilities at fair value held for
 
trading and Financial assets at fair value not held for
 
trading
Corporate and municipal
bonds
 
1.3
 
1.5
 
0.1
 
0.1
Relative value to
market comparable
Bond price equivalent
 
8
 
126
 
98
 
5
 
126
 
99
points
Discounted expected
cash flows
Discount margin
 
486
 
486
 
486
 
135
 
491
 
463
basis
points
Traded loans,
 
loans
measured at fair value,
loan commitments and
guarantees
 
12.9
 
22.0
 
0.0
 
0.0
Relative value to
market comparable
Loan price equivalent
 
1
 
142
 
83
 
1
 
120
 
88
points
Discounted expected
cash flows
Credit spread
 
19
 
2,374
 
513
 
19
 
2,681
 
614
basis
points
Market comparable
and securitization
model
Credit spread
 
122
 
1,803
 
310
 
162
 
1,849
 
318
basis
points
Option model
Gap risk
 
0
 
2
 
0
 
0
 
2
 
0
%
Auction rate securities
 
1.2
 
1.2
Discounted expected
cash flows
Credit spread
 
135
 
208
 
151
 
135
 
205
 
150
basis
points
Investment fund units
3
 
0.8
 
0.8
 
0.0
 
0.0
Relative value to
market comparable
Net asset value
Equity instruments
3
 
3.4
 
3.4
 
0.1
 
0.1
Relative value to
market comparable
Price
Debt issued designated at
fair value
4
 
14.0
 
15.3
Other financial liabilities
designated at fair value
 
2.7
 
2.6
Discounted expected
cash flows
Funding spread
 
106
 
201
 
51
 
201
basis
points
Derivative financial instruments
Interest rate
 
0.4
 
0.4
 
0.3
 
0.2
Option model
Volatility of interest rates
 
41
 
87
 
45
 
154
basis
points
Volatility of inflation
 
1
 
6
 
1
 
6
%
IR-to-IR correlation
 
3
 
100
 
4
 
100
%
Credit
 
0.4
 
0.5
 
0.5
 
0.6
Discounted expected
cash flows
Credit spreads
 
 
3
 
1,804
 
1
 
2,421
basis
points
Credit correlation
 
50
 
66
 
50
 
66
%
Credit volatility
 
60
 
60
 
60
 
60
%
Bond price equivalent
 
1
 
133
 
2
 
242
points
Recovery rates
 
0
 
100
 
14
 
100
%
Equity / index
 
1.3
 
1.3
 
4.3
 
3.3
Option model
Equity dividend yields
 
0
 
19
 
0
 
17
%
Volatility of equity stocks,
equity and other indices
 
4
 
152
 
4
 
142
%
Equity-to-FX correlation
 
(35)
 
78
 
(40)
 
77
%
Equity-to-equity correlation
 
(50)
 
100
 
(50)
 
100
%
Loan commitments
measured at FVTPL
 
0.5
 
1.0
Relative value to
market comparable
Loan price equivalent
 
10
 
100
 
35
 
102
points
1 The ranges of significant unobservable inputs are represented in points, percentages and basis points.
 
Points are a percentage of par (e.g., 100 points would be 100% of par).
 
2 Weighted averages are provided for
most non-derivative financial instruments and were calculated
 
by weighting inputs based on the
 
fair values of the respective instruments. Weighted averages are
 
not provided for inputs related
 
to Other financial liabilities
designated at fair value
 
and Derivative financial instruments,
 
as this would not
 
be meaningful.
 
3 The range
 
of inputs is not
 
disclosed, as there is
 
a dispersion of values
 
given the diverse nature
 
of the investments.
 
4 Debt issued designated at fair value primarily consists of UBS structured notes, which include variable maturity notes with various equity and foreign exchange underlying risks, as well as rates-linked and credit-linked
notes, all of
 
which have embedded
 
derivative parameters
 
that are considered
 
to be unobservable.
 
The equivalent
 
derivative instrument parameters
 
for debt issued
 
or embedded derivatives
 
for over-the-counter
 
debt
instruments are presented in the respective derivative financial instruments lines in this table.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
73
Note 10
 
Fair value measurement (continued)
d) Level 3 instruments: sensitivity to changes
 
in unobservable input assumptions
 
The table below summarizes those financial assets and liabilities classified as Level 3 for
 
which a change in one or
more of
 
the unobservable
 
inputs to
 
reflect reasonably
 
possible alternative
 
assumptions would
 
change fair
 
value
significantly, and the estimated effect thereof.
 
The
 
sensitivity data
 
shown below
 
presents an
 
estimation of
 
valuation uncertainty
 
based
 
on
 
reasonably possible
alternative values for Level 3
 
inputs at the balance sheet
 
date and does not represent
 
the estimated effect of stress
scenarios. Typically,
 
these financial
 
assets and
 
liabilities are
 
sensitive to
 
a combination
 
of inputs
 
from Levels 1–3.
Although well-defined interdependencies may exist
 
between Level 1 / 2 parameters and
 
Level 3 parameters (e.g.,
between interest rates,
 
which are generally
 
Level 1 or Level 2,
 
and prepayments,
 
which are generally
 
Level 3), these
have not been incorporated
 
in the table. Furthermore,
 
direct interrelationships between
 
the Level 3 parameters are
not a significant element of the valuation uncertainty.
Sensitivity of fair value measurements to changes
 
in unobservable input assumptions
1
31.3.24
31.12.23
USD m
Favorable
 
changes
Unfavorable
 
changes
Favorable
 
changes
Unfavorable
 
changes
Traded loans, loans measured at fair value and guarantees
 
441
 
(407)
 
635
 
(600)
Securities financing transactions
 
37
 
(33)
 
30
 
(32)
Auction rate securities
 
39
 
(25)
 
67
 
(21)
Asset-backed securities
 
54
 
(58)
 
39
 
(36)
Equity instruments
 
447
 
(428)
 
430
 
(413)
Investment fund units
 
142
 
(144)
 
135
 
(137)
Loan commitments measured at FVTPL
 
148
 
(176)
 
313
 
(343)
Interest rate derivatives, net
 
209
 
(102)
 
217
 
(103)
Credit derivatives, net
 
117
 
(117)
 
140
 
(131)
Foreign exchange derivatives, net
 
4
 
(4)
 
5
 
(4)
Equity / index derivatives, net
 
563
 
(498)
 
521
 
(443)
Other
 
126
 
(141)
 
281
 
(276)
Total
 
2,327
 
(2,133)
 
2,815
 
(2,538)
1 Sensitivity of issued and over-the-counter debt instruments is reported with the equivalent derivative
 
or Other.
e) Level 3 instruments: movements during
 
the period
The table below presents additional information about material Level 3 assets and liabilities measured at fair value
on a recurring basis. Level 3 assets and liabilities
 
may be hedged with instruments
 
classified as Level 1 or Level 2 in
the fair
 
value hierarchy
 
and, as
 
a
 
result,
 
realized and
 
unrealized gains
 
and losses
 
included in
 
the table
 
may not
include the effect of related hedging
 
activity. Furthermore, the realized and unrealized gains and
 
losses presented
in the table are not
 
limited solely to those
 
arising from Level 3 inputs,
 
as valuations are generally
 
derived from both
observable and unobservable parameters.
Assets
 
and
 
liabilities
 
transferred
 
into
 
or
 
out
 
of
 
Level 3
 
are
 
presented
 
as
 
if
 
those
 
assets
 
or
 
liabilities
 
had
 
been
transferred on 1 January 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
74
Note 10
 
Fair value measurement (continued)
Movements of Level 3 instruments
USD bn
Balance
at the
 
beginning
of the
period
Net gains /
losses
included in
compre-
hensive
income
1
of which:
related to
instruments
held at the
end of the
period
Purchases
Sales
Issuances
Settlements
Transfers
 
into
 
Level 3
Transfers
 
out of
 
Level 3
Foreign
 
currency
 
translation
Balance
at the
end
of the
period
For the three months ended 31 March 2024
2
Financial assets at fair value held for trading
 
22.6
 
(0.2)
 
(0.0)
 
0.4
 
(8.9)
 
0.9
 
(3.4)
 
1.6
 
(0.7)
 
(0.1)
 
12.4
of which: Equity instruments
 
0.3
 
(0.0)
 
0.0
 
0.0
 
(0.0)
0.0
 
(0.0)
 
0.1
 
(0.1)
 
(0.0)
 
0.2
of which: Corporate and municipal bonds
 
1.3
 
(0.1)
 
(0.0)
 
0.3
 
(0.4)
0.0
 
(0.0)
 
0.0
 
(0.0)
 
(0.0)
 
1.0
of which: Loans
 
19.6
 
0.4
 
(0.0)
 
0.0
 
(7.8)
 
0.9
 
(3.3)
 
1.4
 
(0.5)
 
(0.0)
 
10.6
Derivative financial instruments – assets
 
2.6
 
0.1
 
0.1
 
0.0
 
(0.0)
 
0.4
 
(0.4)
 
0.1
 
(0.3)
 
(0.0)
 
2.4
of which: Interest rate
 
0.4
 
0.1
 
0.1
 
0.0
 
(0.0)
 
0.1
 
(0.1)
 
0.0
 
(0.1)
 
0.0
 
0.4
of which: Equity / index
 
1.3
 
(0.1)
 
(0.1)
0.0
 
(0.0)
 
0.3
 
(0.2)
 
0.0
 
(0.1)
 
(0.0)
 
1.2
of which: Credit
 
0.5
 
(0.0)
 
0.0
0.0
 
(0.0)
 
0.0
 
(0.1)
 
0.1
 
(0.1)
 
(0.0)
 
0.4
Financial assets at fair value not held for trading
 
8.4
 
(0.0)
 
(0.1)
 
0.1
 
(0.1)
 
0.4
 
(0.4)
 
0.4
 
(0.1)
 
(0.1)
 
8.7
of which: Loans
 
2.3
 
0.1
 
0.1
 
0.0
 
(0.0)
 
0.2
 
(0.3)
0.0
 
(0.1)
 
(0.0)
 
2.2
of which: Auction rate securities
 
1.2
 
0.0
 
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
 
1.2
of which: Equity instruments
 
3.1
 
(0.0)
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
(0.0)
0.0
0.0
 
(0.1)
 
3.0
Derivative financial instruments – liabilities
 
5.6
 
0.3
 
0.3
0.0
 
(0.2)
 
1.6
 
(1.2)
 
0.3
 
(0.6)
 
(0.0)
 
5.9
of which: Interest rate
 
0.2
 
0.1
 
0.1
0.0
0.0
 
0.0
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
0.3
of which: Equity / index
 
3.3
 
0.5
 
0.4
0.0
 
(0.0)
 
1.5
 
(0.8)
 
0.2
 
(0.3)
 
(0.0)
 
4.3
of which: Credit
 
0.6
 
(0.0)
 
(0.0)
0.0
 
(0.0)
 
0.1
 
(0.2)
 
0.1
 
(0.1)
 
(0.0)
 
0.5
of which: Loan commitments measured at FVTPL
 
1.0
 
(0.1)
 
(0.1)
0.0
 
(0.2)
 
0.0
 
(0.0)
 
0.0
 
(0.2)
 
(0.0)
 
0.6
Debt issued designated at fair value
 
15.3
 
0.2
 
0.2
0.0
0.0
 
1.6
 
(1.4)
 
0.9
 
(2.5)
 
(0.1)
 
14.0
Other financial liabilities designated at fair value
 
2.6
 
(0.2)
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
(0.3)
 
0.5
 
(0.0)
 
(0.0)
 
2.7
For the three months ended 31 March 2023
Financial assets at fair value held for trading
 
1.5
 
0.1
 
0.1
 
0.1
 
(0.6)
 
0.1
0.0
 
0.1
 
(0.1)
 
0.0
 
1.1
of which: Investment fund units
 
0.1
 
(0.0)
 
(0.0)
 
0.0
 
(0.0)
0.0
0.0
 
0.0
 
(0.0)
 
0.0
 
0.0
of which: Corporate and municipal bonds
 
0.5
 
0.0
 
0.0
 
0.1
 
(0.2)
0.0
0.0
 
0.0
 
(0.0)
 
0.0
 
0.4
of which: Loans
 
0.6
 
0.0
 
0.0
 
0.0
 
(0.4)
 
0.1
0.0
 
0.0
 
(0.0)
 
(0.0)
 
0.3
Derivative financial instruments – assets
 
1.5
 
(0.1)
 
(0.1)
0.0
0.0
 
0.2
 
(0.1)
 
0.0
 
(0.1)
 
0.0
 
1.3
of which: Interest rate
 
0.5
 
(0.0)
 
(0.0)
0.0
0.0
 
0.0
 
(0.0)
0.0
 
(0.1)
 
(0.0)
 
0.4
of which: Equity / index
 
0.7
 
(0.1)
 
(0.1)
0.0
0.0
 
0.1
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
0.6
of which: Credit
 
0.3
 
0.0
 
0.0
0.0
0.0
0.0
 
(0.0)
 
0.0
 
(0.0)
 
0.0
 
0.3
Financial assets at fair value not held for trading
 
3.7
 
0.0
 
0.0
 
0.3
 
(0.2)
0.0
0.0
 
0.0
 
(0.0)
 
0.0
 
3.8
of which: Loans
 
0.7
 
0.0
 
0.0
 
0.1
0.0
0.0
0.0
 
0.0
 
(0.0)
 
(0.0)
 
0.8
of which: Auction rate securities
 
1.3
 
0.0
 
0.0
0.0
 
(0.0)
0.0
0.0
0.0
0.0
0.0
 
1.3
of which: Equity instruments
 
0.8
 
0.0
 
0.0
 
0.1
 
(0.1)
0.0
0.0
 
0.0
0.0
 
0.0
 
0.9
Derivative financial instruments – liabilities
 
1.7
 
0.1
 
0.1
0.0
0.0
 
0.4
 
(0.2)
 
0.0
 
0.1
 
0.0
 
2.1
of which: Interest rate
 
0.1
 
(0.0)
 
(0.0)
0.0
0.0
 
0.1
 
(0.0)
0.0
 
0.2
 
(0.0)
 
0.4
of which: Equity / index
 
1.2
 
0.1
 
0.1
0.0
0.0
 
0.2
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
1.4
of which: Credit
 
0.3
 
(0.0)
 
(0.0)
0.0
0.0
 
0.0
 
0.0
 
0.0
 
(0.0)
 
0.0
 
0.3
Debt issued designated at fair value
 
10.5
 
0.4
 
0.4
0.0
0.0
 
1.3
 
(1.3)
 
0.3
 
(0.7)
 
0.0
 
10.5
Other financial liabilities designated at fair value
 
0.7
 
0.0
 
0.0
0.0
0.0
 
0.1
 
(0.0)
0.0
 
(0.2)
 
(0.0)
 
0.6
1 Net gains / losses included
 
in comprehensive income are recognized
 
in Net interest income and
 
Other net income from financial
 
instruments measured at fair value
 
through profit or loss in
 
the Income statement,
and also in
 
Gains / (losses)
 
from own credit
 
on financial liabilities
 
designated at fair
 
value, before
 
tax in the
 
Statement of comprehensive
 
income.
 
2 Total
 
Level 3 assets as
 
of 31 March 2024
 
were USD 23.5bn
(31 December 2023: USD 33.6bn). Total Level 3 liabilities as of 31 March 2024 were USD 22.7bn (31 December 2023:
 
USD 23.6bn).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
75
Note 10
 
Fair value measurement (continued)
f) Financial instruments not measured
 
at fair value
The table
 
below reflects
 
the estimated
 
fair values
 
of financial
 
instruments not
 
measured at
 
fair value.
 
Valuation
principles applied
 
when determining fair
 
value estimates for
 
financial instruments not
 
measured at
 
fair value
 
are
consistent with those described in “Note 21
 
Fair value measurement” in the “Consolidated financial statements”
section of the UBS Group Annual Report 2023.
Financial instruments not measured at fair value
31.3.24
31.12.23
USD bn
Carrying
amount
Fair value
Carrying
amount
Fair value
Assets
Cash and balances at central banks
 
271.5
 
271.5
 
314.1
 
314.1
Amounts due from banks
 
22.1
 
22.2
 
21.2
 
21.2
Receivables from securities financing transactions measured at amortized
 
cost
 
101.6
 
101.7
 
99.0
 
99.0
Cash collateral receivables on derivative instruments
 
46.7
 
46.7
 
50.1
 
50.1
Loans and advances to customers
 
605.3
 
600.2
 
639.8
 
633.7
Other financial assets measured at amortized cost
 
62.8
 
60.7
 
65.5
 
64.0
Liabilities
Amounts due to banks
 
47.9
 
47.8
 
71.0
 
71.0
Payables from securities financing transactions measured at amortized cost
 
13.0
 
12.9
 
14.4
 
14.4
Cash collateral payables on derivative instruments
 
37.3
 
37.3
 
41.6
 
41.5
Customer deposits
 
764.0
 
764.8
 
792.0
 
792.9
Debt issued measured at amortized cost
 
226.3
 
230.9
 
237.8
 
241.3
Other financial liabilities measured at amortized cost
1
 
16.2
 
16.0
 
15.3
 
15.2
1 Excludes lease liabilities.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
76
Note 11
 
Derivative instruments
a) Derivative instruments
As of 31.3.24, USD bn
Derivative
financial
assets
Derivative
financial
liabilities
Notional values
related to derivative
financial assets and
liabilities
1
Other
notional
values
2
Derivative financial instruments
Interest rate
 
52.5
 
50.3
 
3,469
 
21,010
Credit derivatives
 
3.0
 
3.7
 
206
Foreign exchange
 
62.0
 
59.1
 
7,014
 
224
Equity / index
 
37.7
 
45.8
 
1,439
 
92
Commodities
 
3.0
 
2.6
 
152
 
20
Other
3
 
1.0
 
1.5
 
182
Total derivative financial instruments, based on netting under IFRS Accounting Standards
4
 
159.2
 
163.0
 
12,461
 
21,346
Further netting potential not recognized on the balance
 
sheet
5
 
(141.5)
 
(147.9)
of which: netting of recognized financial liabilities / assets
 
(115.7)
 
(115.7)
of which: netting with collateral received / pledged
 
(25.8)
 
(32.1)
Total derivative financial instruments, after consideration of further netting potential
 
17.7
 
15.2
As of 31.12.23, USD bn
Derivative financial instruments
Interest rate
 
55.6
 
52.9
 
3,524
 
20,074
Credit derivatives
 
4.0
 
4.7
 
275
Foreign exchange
 
78.7
 
89.9
 
6,913
 
180
Equity / index
 
35.5
 
41.4
 
1,397
 
95
Commodities
 
2.0
 
1.6
 
143
 
16
Other
3
 
0.4
 
1.6
 
117
Total derivative financial instruments, based on netting under IFRS Accounting Standards
4
 
176.1
 
192.2
 
12,369
 
20,366
Further netting potential not recognized on the balance
 
sheet
5
 
(162.8)
 
(167.9)
of which: netting of recognized financial liabilities / assets
 
(133.0)
 
(133.0)
of which: netting with collateral received / pledged
 
(29.8)
 
(35.0)
Total derivative financial instruments, after consideration of further netting potential
 
13.3
 
24.2
1 In cases where derivative
 
financial instruments are presented
 
on a net basis
 
on the balance sheet,
 
the respective notional
 
values of the netted
 
derivative financial instruments
 
are still presented on
 
a gross basis.
Notional amounts of client-cleared ETD and OTC transactions
 
through central clearing counterparties are not disclosed, as they
 
have a significantly different risk profile.
 
2 Other notional values relate to derivatives
that are cleared through either
 
a central counterparty or an
 
exchange and settled on a
 
daily basis (except for
 
OTC derivatives settled through collateralized-to-market arrangements, which are presented under
 
Derivative
financial assets and Derivative financial liabilities). The fair value of these derivatives is presented on the balance sheet net of the corresponding cash margin under Cash collateral receivables on derivative instruments
and Cash collateral payables
 
on derivative instruments
 
and was not material
 
for all periods presented.
 
3 Includes mainly Loan commitments
 
measured at FVTPL, as
 
well as unsettled purchases
 
and sales of non-
derivative financial instruments for which the changes in the fair value
 
between trade date and settlement date are recognized as derivative
 
financial instruments.
 
4 Financial assets and liabilities are presented net
on the balance sheet if UBS has the unconditional and legally enforceable right to offset the recognized amounts, both in the normal course of business and in the event of default, bankruptcy or insolvency of UBS or
its counterparties, and intends either to
 
settle on a net basis or to
 
realize the asset and settle the liability
 
simultaneously.
 
5 Reflects the netting potential
 
in accordance with enforceable master netting and
 
similar
arrangements where not all criteria for a net presentation on the balance sheet have been met. Refer to “Note 22 Offsetting financial assets and financial liabilities” in
 
the “Consolidated financial statements” section
of the UBS Group Annual Report 2023 for more information.
 
b) Cash collateral on derivative instruments
USD bn
Receivables
31.3.24
Payables
31.3.24
Receivables
31.12.23
Payables
31.12.23
Cash collateral on derivative instruments, based on netting under IFRS Accounting
 
Standards
1
 
46.7
 
37.3
 
50.1
 
41.6
Further netting potential not recognized on the balance
 
sheet
2
 
(28.8)
 
(22.6)
 
(32.9)
 
(26.4)
of which: netting of recognized financial liabilities / assets
 
(26.0)
 
(19.8)
 
(29.7)
 
(23.2)
of which: netting with collateral received / pledged
 
(2.8)
 
(2.8)
 
(3.2)
 
(3.2)
Cash collateral on derivative instruments, after consideration of further netting potential
 
17.9
 
14.7
 
17.2
 
15.2
1 Financial assets and liabilities are presented
 
net on the balance sheet if UBS
 
has the unconditional and legally enforceable
 
right to offset the recognized amounts,
 
both in the normal course of business
 
and in the
event of default,
 
bankruptcy or insolvency
 
of UBS or
 
its counterparties, and
 
intends either to
 
settle on a
 
net basis or
 
to realize the
 
asset and settle
 
the liability simultaneously.
 
2 Reflects the
 
netting potential in
accordance with enforceable
 
master netting and
 
similar arrangements where
 
not all criteria
 
for a net
 
presentation on the
 
balance sheet have
 
been met. Refer
 
to “Note 22
 
Offsetting financial assets
 
and financial
liabilities” in the “Consolidated financial statements” section of the UBS Group Annual Report 2023 for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
77
Note
12
 
Other assets and liabilities
 
a) Other financial assets measured at amortized
 
cost
USD m
31.3.24
31.12.23
Debt securities
 
43,031
 
45,057
Loans to financial advisors
 
2,615
 
2,615
Fee- and commission-related receivables
 
2,472
 
2,619
Finance lease receivables
 
5,948
 
6,288
Settlement and clearing accounts
 
 
395
 
338
Accrued interest income
 
2,981
 
3,163
Other
1
 
5,308
 
5,418
Total other financial assets measured at amortized cost
 
62,750
 
65,498
1 Predominantly includes cash collateral provided to exchanges and clearing houses to secure securities trading activity through
 
those counterparties.
b) Other non-financial assets
USD m
31.3.24
31.12.23
Precious metals and other physical commodities
 
 
6,466
 
5,930
Deposits and collateral provided in connection with litigation,
 
regulatory and similar matters
1
 
2,736
 
2,726
Prepaid expenses
 
2,048
 
2,080
Current tax assets
 
 
1,620
 
1,456
VAT,
 
withholding tax and other tax receivables
 
952
 
1,327
Properties and other non-current assets held for sale
 
156
 
188
Other
 
2,239
 
2,342
Total other non-financial assets
 
16,217
 
16,049
1 Refer to Note 15 for more information.
c) Other financial liabilities measured at
 
amortized cost
USD m
31.3.24
31.12.23
Other accrued expenses
 
3,063
 
3,270
Accrued interest expenses
 
6,482
 
6,692
Settlement and clearing accounts
 
2,234
 
1,519
Lease liabilities
 
5,213
 
5,502
Other
 
 
4,364
 
3,868
Total other financial liabilities measured at amortized cost
 
21,356
 
20,851
d) Other financial liabilities designated at
 
fair value
 
USD m
31.3.24
31.12.23
Financial liabilities related to unit-linked investment contracts
 
16,612
 
15,992
Securities financing transactions
 
5,121
 
7,416
Over-the-counter debt instruments and other
 
6,407
 
6,076
Total other financial liabilities designated at fair value
 
28,140
 
29,484
e) Other non-financial liabilities
USD m
31.3.24
31.12.23
Compensation-related liabilities
 
6,530
 
9,746
of which: net defined benefit liability
 
772
 
796
Current tax liabilities
 
1,447
 
1,460
Deferred tax liabilities
 
330
 
325
VAT,
 
withholding tax and other tax payables
 
888
 
1,120
Deferred income
 
670
 
635
Other
 
524
 
802
Total other non-financial liabilities
 
10,388
 
14,089
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
78
Note
13
 
Debt issued designated at fair value
USD m
31.3.24
31.12.23
Equity-linked
1
 
56,608
 
60,573
Rates-linked
 
 
25,940
 
28,883
Credit-linked
 
6,756
 
7,730
Fixed-rate
 
17,359
 
20,541
Commodity-linked
 
3,618
 
3,844
Other
 
6,525
 
6,718
of which: debt that contributes to total loss-absorbing capacity
 
4,476
 
4,629
Total debt issued designated at fair value
2
 
116,806
 
128,289
1 Includes investment fund unit-linked instruments issued.
 
2 As of 31 March 2024, 99% of Total debt issued designated at fair value was unsecured.
 
Note
14
 
Debt issued measured at amortized cost
USD m
31.3.24
31.12.23
Short-term debt
1
 
32,485
 
38,530
Senior unsecured debt
 
 
143,540
 
147,547
of which: contributes to total loss-absorbing capacity (TLAC)
 
98,973
 
101,939
Covered bonds
 
6,498
 
5,214
Subordinated debt
 
16,446
 
17,644
of which: eligible as high-trigger loss-absorbing additional
 
tier 1 capital instruments
 
12,021
 
10,744
of which: eligible as low-trigger loss-absorbing additional
 
tier 1 capital instruments
 
1,217
 
1,214
of which: eligible as non-Basel III-compliant tier 2 capital
 
instruments
 
537
 
538
Debt issued through the Swiss central mortgage institutions
 
25,669
 
27,377
Other long-term debt
 
1,613
 
1,506
Long-term debt
2
 
193,766
 
199,288
Total debt issued measured at amortized cost
3,4
 
226,251
 
237,817
1 Debt with an original contractual maturity
 
of less than one year,
 
includes mainly certificates of deposit and
 
commercial paper.
 
2 Debt with an original contractual
 
maturity greater than or equal to one
 
year. The
classification of debt
 
issued into
 
short-term and
 
long-term does
 
not consider
 
any early redemption
 
features.
 
3 Net of
 
bifurcated embedded
 
derivatives,
 
the fair value
 
of which
 
was not
 
material for
 
the periods
presented.
 
4 Except for Covered bonds (100% secured), Debt issued through the Swiss central mortgage institutions (100% secured) and Other long
 
-term debt (92% secured), 100% of the balance was unsecured
as of 31 March 2024.
 
Note 15
 
Provisions and contingent liabilities
a) Provisions and contingent liabilities
The table below presents an overview of total provisions
 
and contingent liabilities.
USD m
31.3.24
31.12.23
Provisions related to expected credit losses (IFRS 9,
Financial Instruments
)
1
 
328
 
350
Provisions related to Credit Suisse loan commitments (IFRS
 
3,
Business Combinations
)
 
1,667
 
1,924
Provisions related to litigation, regulatory and similar matters
 
(IAS 37,
Provisions, Contingent Liabilities and Contingent Assets
)
 
3,920
 
4,020
Acquisition-related contingent liabilities (IFRS 3,
Business Combinations
)
 
3,783
 
3,832
Restructuring, real-estate and other provisions (IAS 37,
Provisions, Contingent Liabilities and Contingent Assets
)
 
1,216
 
2,123
Total provisions and contingent liabilities
 
10,914
 
12,250
1 Refer to Note 9c for more information.
 
The table below presents additional information for provisions under IAS 37,
Provisions, Contingent Liabilities and
Contingent Assets
.
USD m
Litigation,
regulatory and
similar matters
1
Restructuring
2
Real estate
3
Other
4
Total
Balance as of 31 December 2023
 
4,020
 
741
 
259
 
1,123
 
6,144
Increase in provisions recognized in the income statement
 
59
 
122
 
2
 
20
 
203
Release of provisions recognized in the income statement
 
(15)
 
(44)
 
(2)
 
(796)
 
(857)
Provisions used in conformity with designated purpose
 
(102)
 
(155)
 
(4)
 
(12)
 
(273)
Foreign currency translation and other movements
 
(44)
 
(3)
 
(17)
 
(17)
 
(82)
Balance as of 31 March 2024
 
3,920
 
662
 
238
 
317
 
5,136
1 Consists of provisions for losses resulting from legal, liability and compliance risks.
 
2 Consists of USD 443m of provisions for onerous contracts related to real estate as of 31 March 2024 (31 December 2023: USD
448m) and USD 218m
 
of personnel-related restructuring provisions
 
as of 31 March
 
2024 (31 December 2023:
 
USD 294m).
 
3 Mainly includes provisions
 
for reinstatement costs with
 
respect to leased properties.
 
4 Mainly includes provisions related to employee benefits and operational risks.
Information about provisions and
 
contingent liabilities in respect of
 
litigation, regulatory and similar matters,
 
as a
class,
 
is
 
included
 
in
 
Note
 
15b.
 
There
 
are
 
no
 
material
 
contingent
 
liabilities
 
associated
 
with
 
the
 
other
 
classes
 
of
provisions.
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
79
Note 15
 
Provisions and contingent liabilities
 
(continued)
b) Litigation, regulatory and similar matters
The Group operates in
 
a legal and regulatory
 
environment that exposes it to
 
significant litigation and similar risks
arising from disputes
 
and regulatory proceedings. As
 
a result,
 
UBS (which for
 
purposes of this
 
Note may
 
refer to
UBS
 
Group
 
AG
 
and/or
 
one
 
or
 
more
 
of
 
its
 
subsidiaries,
 
as
 
applicable)
 
is
 
involved
 
in
 
various
 
disputes
 
and
 
legal
proceedings, including litigation, arbitration,
 
and regulatory and criminal investigations.
Such matters are subject
 
to many uncertainties,
 
and the outcome and the
 
timing of resolution are
 
often difficult to
predict,
 
particularly in
 
the
 
earlier
 
stages
 
of
 
a
 
case.
 
There
 
are
 
also
 
situations
 
where
 
the Group
 
may
 
enter into
 
a
settlement
 
agreement.
 
This
 
may
 
occur
 
in
 
order
 
to
 
avoid
 
the
 
expense,
 
management
 
distraction
 
or
 
reputational
implications of
 
continuing to
 
contest liability,
 
even
 
for those
 
matters for
 
which
 
the Group
 
believes it
 
should be
exonerated. The uncertainties inherent in all such matters affect the amount and timing of any potential outflows
for both matters
 
with respect to
 
which provisions have
 
been established and
 
other contingent liabilities.
 
The Group
makes
 
provisions
 
for
 
such
 
matters
 
brought
 
against
 
it
 
when,
 
in
 
the
 
opinion
 
of
 
management
 
after
 
seeking legal
advice, it
 
is more
 
likely than
 
not that
 
the Group
 
has a
 
present legal
 
or constructive obligation
 
as a
 
result of
 
past
events, it
 
is probable
 
that an
 
outflow of
 
resources will
 
be required,
 
and the
 
amount can
 
be reliably
 
estimated. Where
these factors
 
are
 
otherwise satisfied,
 
a
 
provision may
 
be
 
established for
 
claims that
 
have
 
not
 
yet been
 
asserted
against the
 
Group, but
 
are nevertheless
 
expected to
 
be, based
 
on
 
the Group’s
 
experience with
 
similar asserted
claims.
 
If
 
any
 
of
 
those
 
conditions
 
is
 
not
 
met,
 
such
 
matters
 
result
 
in
 
contingent
 
liabilities.
 
If
 
the
 
amount
 
of
 
an
obligation cannot
 
be reliably
 
estimated, a
 
liability exists
 
that is
 
not recognized
 
even if
 
an outflow
 
of resources
 
is
probable. Accordingly, no
 
provision is
 
established even if
 
the potential
 
outflow of resources
 
with respect
 
to such
matters could be significant. Developments relating to a matter that occur after the relevant reporting period, but
prior
 
to
 
the
 
issuance
 
of
 
financial
 
statements, which
 
affect
 
management’s assessment
 
of
 
the
 
provision
 
for
 
such
matter
 
(because,
 
for
 
example,
 
the
 
developments provide
 
evidence of
 
conditions that
 
existed
 
at
 
the
 
end
 
of
 
the
reporting
 
period),
 
are
 
adjusting
 
events
 
after
 
the
 
reporting period
 
under
 
IAS
 
10
 
and
 
must
 
be
 
recognized in
 
the
financial statements for the reporting period.
Specific litigation, regulatory and other matters are
 
described below, including all such matters that
 
management
considers to be material and others that management believes to be of significance to the Group due to potential
financial,
 
reputational
 
and
 
other
 
effects.
 
The
 
amount
 
of
 
damages
 
claimed,
 
the
 
size
 
of
 
a
 
transaction
 
or
 
other
information is
 
provided where
 
available and
 
appropriate in order
 
to assist
 
users in
 
considering the
 
magnitude of
potential exposures.
In the case of certain matters below, we state that we have established a provision, and for the other matters, we
make no such statement. When we
 
make this statement and we expect
 
disclosure of the amount of a provision
 
to
prejudice seriously our
 
position with other
 
parties in the
 
matter because it
 
would reveal what
 
UBS believes to
 
be
the
 
probable
 
and
 
reliably estimable
 
outflow, we
 
do
 
not
 
disclose
 
that amount.
 
In
 
some
 
cases we
 
are
 
subject to
confidentiality obligations
 
that preclude
 
such disclosure.
 
With respect
 
to the
 
matters for
 
which we
 
do not
 
state
whether we have
 
established a provision,
 
either: (a) we
 
have not established
 
a provision; or
 
(b) we have
 
established
a provision
 
but expect
 
disclosure of
 
that fact
 
to prejudice
 
seriously our
 
position with
 
other parties
 
in the
 
matter
because it would reveal the fact that
 
UBS believes an outflow of resources to be probable
 
and reliably estimable.
With respect to certain litigation, regulatory
 
and similar matters for which we
 
have established provisions, we are
able to
 
estimate the expected
 
timing of outflows.
 
However, the aggregate
 
amount of the
 
expected outflows for
those matters for which we
 
are able to estimate expected
 
timing is immaterial relative to
 
our current and expected
levels of liquidity over the relevant time periods.
The
 
aggregate
 
amount
 
provisioned
 
for
 
litigation,
 
regulatory
 
and
 
similar
 
matters
 
as
 
a
 
class
 
is
 
disclosed
 
in
 
the
“Provisions”
 
table
 
in
 
Note
 
15a
 
above. It
 
is
 
not
 
practicable
 
to
 
provide
 
an
 
aggregate
 
estimate
 
of
 
liability
 
for
 
our
litigation, regulatory
 
and similar
 
matters as
 
a class
 
of contingent
 
liabilities beyond
 
what has
 
been identified
 
as a
consequence of
 
the acquisition
 
of Credit
 
Suisse as
 
set out
 
below. Doing
 
so would
 
require UBS
 
to provide
 
speculative
legal assessments as to claims and proceedings that involve unique fact patterns or novel legal theories, that have
not yet
 
been initiated
 
or are
 
at early
 
stages of
 
adjudication,
 
or as
 
to which
 
alleged damages
 
have not
 
been quantified
by the claimants. Although
 
UBS therefore cannot provide a
 
numerical estimate of the future
 
losses that could arise
from litigation,
 
regulatory and
 
similar matters,
 
UBS believes
 
that the
 
aggregate amount
 
of possible
 
future losses
from this class that are more than remote
 
substantially exceeds the level of current
 
provisions.
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
80
Note 15
 
Provisions and contingent liabilities
 
(continued)
Litigation, regulatory
 
and similar
 
matters may
 
also result
 
in non-monetary
 
penalties and
 
consequences. A
 
guilty plea
to, or conviction of, a crime could have material consequences for UBS. Resolution of regulatory proceedings may
require UBS to obtain waivers of regulatory disqualifications to maintain certain operations, may entitle regulatory
authorities to limit, suspend or terminate
 
licenses and regulatory authorizations, and may
 
permit financial market
utilities to
 
limit, suspend
 
or terminate
 
UBS’s participation
 
in such
 
utilities. Failure
 
to obtain
 
such waivers,
 
or any
limitation, suspension
 
or termination
 
of licenses,
 
authorizations or
 
participations, could
 
have material
 
consequences
for UBS.
The
 
risk
 
of
 
loss
 
associated with
 
litigation, regulatory
 
and
 
similar matters
 
is
 
a
 
component of
 
operational risk
 
for
purposes of determining
 
capital requirements.
 
Information concerning
 
our capital requirements
 
and the calculation
of operational risk for this purpose is included
 
in the “Capital management” section
 
of this report.
Matters related
 
to Credit
 
Suisse entities
 
are separately
 
described herein.
 
The amounts
 
shown in
 
the table
 
below
reflect
 
the
 
provisions
 
recorded
 
under
 
IFRS
 
Accounting
 
Standards
 
accounting
 
principles.
 
In
 
connection
 
with
 
the
acquisition of
 
Credit Suisse,
 
UBS Group
 
AG additionally
 
has reflected
 
in its
 
purchase accounting
 
under IFRS
 
3 a
further
 
valuation
 
adjustment
 
of
 
USD
 
3.8bn
 
reflecting
 
an
 
updated
 
estimate
 
of
 
outflows
 
relating
 
to
 
contingent
liabilities for all present
 
obligations included in the scope
 
of the acquisition at
 
fair value upon closing, even
 
if it is
not probable that they will result in an
 
outflow of resources, significantly decreasing the recognition threshold for
litigation liabilities beyond those that generally
 
apply under IFRS Accounting Standards and
 
US GAAP.
 
Provisions for litigation, regulatory and similar matters
 
by business division and in Group Items
1
USD m
Global Wealth
Management
Personal &
Corporate
Banking
 
Asset
Management
Investment
Bank
Non-core
and Legacy
Group Items
UBS Group
Balance as of 31 December 2023
 
1,235
 
157
 
15
 
294
 
2,186
 
134
 
4,020
Increase in provisions recognized in the income statement
 
12
 
0
 
0
 
1
 
46
 
0
 
59
Release of provisions recognized in the income statement
 
(1)
 
0
 
0
 
(2)
 
(12)
 
0
 
(15)
Provisions used in conformity with designated purpose
 
(20)
 
0
 
(12)
 
0
 
(69)
 
0
 
(102)
Foreign currency translation and other movements
 
(26)
 
(4)
 
0
 
(5)
 
(9)
 
0
 
(44)
Balance as of 31 March 2024
 
1,201
 
152
 
2
 
288
 
2,142
 
134
 
3,920
1 Provisions, if any,
 
for the matters described in items
 
A2, B8 and B10 of this Note
 
are recorded in Global Wealth Management
 
;
 
provisions, if any,
 
for the matters described in items
 
B1, B2, B3, B4, B5, B6,
 
B7, B9,
B11 and B12 of this Note are recorded in Non-core and Legacy; provisions, if any, for the matters described in items B13 and B14 of this Note are recorded in Group Items. Provisions,
 
if any, for the matters described
in items A1 and A4 of this Note are
 
allocated between Global Wealth Management and Personal & Corporate Banking; and provisions, if any, for the matters described
 
in item A3 are allocated between the Investment
Bank and Group Items.
A. Litigation, regulatory and similar matters
 
involving UBS AG and subsidiaries
1. Inquiries regarding cross-border wealth management
 
businesses
 
Tax
 
and regulatory
 
authorities in
 
a number
 
of countries
 
have made
 
inquiries, served
 
requests for
 
information or
examined
 
employees
 
located
 
in
 
their
 
respective
 
jurisdictions
 
relating
 
to
 
the
 
cross-border
 
wealth
 
management
services provided by UBS and other financial institutions.
Since 2013, UBS
 
(France) S.A., UBS AG
 
and certain former employees
 
have been under investigation in
 
France in
relation to UBS’s cross-border business with French
 
clients. In connection with this investigation, the investigating
judges ordered UBS AG to provide bail (“
caution
”) of EUR 1.1bn.
In 2019,
 
the court of
 
first instance
 
returned a verdict
 
finding UBS AG
 
guilty of
 
unlawful solicitation of
 
clients on
French territory and aggravated
 
laundering of the proceeds
 
of tax fraud, and UBS
 
(France) S.A. guilty of aiding
 
and
abetting unlawful
 
solicitation and
 
of laundering
 
the proceeds
 
of tax
 
fraud. The
 
court imposed
 
fines aggregating
EUR 3.7bn on UBS AG and UBS (France) S.A. and awarded EUR 800m of
 
civil damages to the French state. A trial
in the
 
Paris Court
 
of Appeal
 
took place
 
in March
 
2021. In
 
December 2021,
 
the Court
 
of Appeal
 
found UBS
 
AG
guilty of unlawful solicitation and aggravated laundering of the proceeds of tax fraud. The court ordered a fine of
EUR
 
3.75m,
 
the
 
confiscation
 
of
 
EUR
 
1bn,
 
and
 
awarded
 
civil
 
damages
 
to
 
the
 
French
 
state
 
of
 
EUR
 
800m.
 
UBS
appealed the decision to the
 
French Supreme Court. The Supreme
 
Court rendered its judgment on
 
15 November
2023. It
 
upheld the
 
Court of
 
Appeal‘s decision regarding
 
unlawful solicitation and
 
aggravated laundering of
 
the
proceeds of tax fraud, but overturned the confiscation of EUR
 
1bn, the penalty of EUR 3.75m and the
 
EUR 800m
of civil
 
damages awarded
 
to the
 
French state.
 
The case
 
has been
 
remanded to
 
the Court
 
of Appeal
 
for a
 
retrial
regarding these overturned elements.
 
The French state has reimbursed the
 
EUR 800m of civil damages
 
to UBS AG.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
81
Note 15
 
Provisions and contingent liabilities
 
(continued)
Our balance sheet at 31 March
 
2024 reflected a provision in an
 
amount that UBS believes to be
 
appropriate under
the applicable accounting standard. As in the case of other matters for
 
which we have established provisions, the
future
 
outflow of
 
resources in
 
respect of
 
such
 
matters cannot
 
be
 
determined with
 
certainty based
 
on
 
currently
available information
 
and accordingly
 
may ultimately
 
prove to
 
be substantially
 
greater (or
 
may be
 
less) than
 
the
provision that we have recognized.
2. Madoff
In relation to
 
the Bernard
 
L. Madoff Investment
 
Securities LLC
 
(BMIS) investment
 
fraud, UBS
 
AG, UBS (Luxembourg)
S.A. (now UBS
 
Europe SE, Luxembourg
 
branch) and certain
 
other UBS subsidiaries have
 
been subject to
 
inquiries
by a
 
number of
 
regulators, including
 
the Swiss
 
Financial Market
 
Supervisory Authority
 
(FINMA) and
 
the Luxembourg
Commission
 
de
 
Surveillance
 
du
 
Secteur
 
Financier.
 
Those
 
inquiries
 
concerned
 
two
 
third-party
 
funds
 
established
under Luxembourg
 
law,
 
substantially all
 
assets of
 
which were
 
with BMIS,
 
as well
 
as certain
 
funds established
 
in
offshore
 
jurisdictions
 
with
 
either
 
direct
 
or
 
indirect
 
exposure
 
to
 
BMIS.
 
These
 
funds
 
faced
 
severe
 
losses,
 
and
 
the
Luxembourg funds are in liquidation. The documentation establishing both funds identifies UBS entities in various
roles,
 
including custodian,
 
administrator,
 
manager,
 
distributor and
 
promoter,
 
and indicates
 
that UBS
 
employees
serve as board members.
In 2009 and 2010, the liquidators
 
of the two Luxembourg funds
 
filed claims against UBS entities,
 
non-UBS entities
and certain individuals, including
 
current and former UBS employees,
 
seeking amounts totaling approximately
 
EUR
2.1bn, which
 
includes amounts
 
that the
 
funds may
 
be held
 
liable to
 
pay the
 
trustee for
 
the liquidation
 
of BMIS
(BMIS Trustee).
A large number of alleged beneficiaries have filed claims
 
against UBS entities (and non-UBS entities) for purported
losses relating to
 
the Madoff fraud.
 
The majority of
 
these cases have
 
been filed in
 
Luxembourg, where decisions
that the claims in eight test cases were inadmissible have been affirmed by the Luxembourg Court of Appeal, and
the Luxembourg Supreme Court has dismissed
 
a further appeal in one of the test
 
cases.
In the
 
US, the
 
BMIS Trustee
 
filed claims
 
against UBS
 
entities, among
 
others, in
 
relation to
 
the two
 
Luxembourg
funds and one of
 
the offshore funds. The
 
total amount claimed against
 
all defendants in
 
these actions was
 
not less
than USD
 
2bn. In
 
2014, the
 
US Supreme
 
Court rejected
 
the BMIS
 
Trustee’s motion for
 
leave to
 
appeal decisions
dismissing all
 
claims except
 
those for
 
the recovery
 
of approximately
 
USD 125m
 
of payments
 
alleged to
 
be fraudulent
conveyances
 
and
 
preference
 
payments.
 
In
 
2016,
 
the
 
bankruptcy
 
court
 
dismissed
 
these
 
claims
 
against
 
the
 
UBS
entities. In 2019,
 
the Court of Appeals
 
reversed the dismissal of
 
the BMIS Trustee’s remaining
 
claims, and the US
Supreme Court
 
subsequently denied
 
a petition seeking
 
review of the
 
Court of Appeals’
 
decision. The case
 
has been
remanded to the Bankruptcy Court for further
 
proceedings.
3. Foreign exchange, LIBOR and benchmark rates,
 
and other trading practices
Foreign exchange-related regulatory matters:
 
Beginning in 2013, numerous authorities commenced investigations
concerning possible
 
manipulation of
 
foreign
 
exchange markets
 
and
 
precious
 
metals prices.
 
As
 
a
 
result
 
of these
investigations,
 
UBS
 
entered
 
into
 
resolutions
 
with
 
Swiss,
 
US
 
and
 
United
 
Kingdom
 
regulators
 
and
 
the
 
European
Commission. UBS
 
was granted
 
conditional immunity
 
by the Antitrust
 
Division of
 
the DOJ
 
and by
 
authorities in
 
other
jurisdictions
 
in
 
connection
 
with
 
potential
 
competition
 
law
 
violations
 
relating
 
to
 
foreign
 
exchange
 
and
 
precious
metals businesses.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
82
Note 15
 
Provisions and contingent liabilities
 
(continued)
Foreign exchange-related civil litigation:
 
Putative class actions have been filed since 2013 in US federal
 
courts and
in other jurisdictions against
 
UBS and other banks on
 
behalf of putative classes of
 
persons who engaged in foreign
currency transactions with any of the defendant banks. UBS has resolved US federal court class actions relating to
foreign currency transactions with
 
the defendant banks
 
and persons who
 
transacted in foreign
 
exchange futures
contracts and options on such futures
 
under a settlement agreement that
 
provides for UBS to pay an
 
aggregate of
USD 141m and
 
provide cooperation
 
to the
 
settlement classes.
 
Certain class
 
members have
 
excluded themselves
from that
 
settlement
 
and have
 
filed individual
 
actions in
 
US and
 
English courts
 
against
 
UBS and
 
other banks,
 
alleging
violations of
 
US and
 
European competition laws
 
and unjust
 
enrichment. UBS
 
and the
 
other banks
 
have resolved
those individual matters.
In
 
2015, a
 
putative
 
class action
 
was filed
 
in
 
federal court
 
against UBS
 
and numerous
 
other banks
 
on
 
behalf of
persons and
 
businesses in
 
the US
 
who directly
 
purchased foreign
 
currency from
 
the defendants
 
and alleged
 
co-
conspirators for
 
their own
 
end use.
 
In
 
2022, the
 
court denied
 
plaintiffs’ motion
 
for class
 
certification. In
 
March
2023, the court granted defendants’ summary
 
judgment motion, dismissing the case. Plaintiffs
 
have appealed.
LIBOR and other benchmark-related regulatory
 
matters:
 
Numerous government agencies conducted investigations
regarding potential improper attempts by UBS, among others, to manipulate LIBOR and other benchmark rates at
certain times. UBS reached settlements or otherwise concluded investigations relating to benchmark interest rates
with the investigating authorities. UBS
 
was granted conditional leniency or
 
conditional immunity from authorities
in certain jurisdictions,
 
including the Antitrust
 
Division of the DOJ
 
and the Swiss Competition
 
Commission (WEKO),
in connection with potential antitrust or competition law violations related to certain rates. However, UBS has not
reached a final settlement with WEKO, as the
 
Secretariat of WEKO has asserted that UBS does
 
not qualify for full
immunity.
LIBOR and
 
other benchmark-related
 
civil litigation:
 
A number
 
of putative
 
class actions
 
and other
 
actions are
 
pending
in the federal
 
courts in New
 
York against UBS
 
and numerous other banks
 
on behalf of
 
parties who transacted in
certain interest rate benchmark-based derivatives. Also
 
pending in the US
 
and in other jurisdictions are
 
a number
of other
 
actions asserting losses
 
related to
 
various products whose
 
interest rates were
 
linked to
 
LIBOR and other
benchmarks, including
 
adjustable rate
 
mortgages, preferred
 
and debt securities,
 
bonds pledged
 
as collateral, loans,
depository
 
accounts,
 
investments
 
and
 
other
 
interest-bearing
 
instruments.
 
The
 
complaints
 
allege
 
manipulation,
through
 
various
 
means,
 
of
 
certain
 
benchmark
 
interest
 
rates,
 
including
 
USD LIBOR,
 
Euroyen
 
TIBOR,
 
Yen
 
LIBOR,
EURIBOR,
 
CHF LIBOR,
 
GBP
 
LIBOR
 
and
 
seek
 
unspecified
 
compensatory
 
and
 
other
 
damages
 
under
 
varying
 
legal
theories.
USD LIBOR class
 
and individual
 
actions in
 
the US:
In 2013
 
and 2015,
 
the district
 
court in
 
the USD LIBOR
 
actions
dismissed, in whole or in
 
part, certain plaintiffs’ antitrust
 
claims, federal racketeering claims,
 
Commodity Exchange
Act claims, and state common law
 
claims, and again dismissed the
 
antitrust claims in 2016 following
 
an appeal. In
2021, the
 
Second Circuit affirmed
 
the district court’s
 
dismissal in part
 
and reversed in
 
part and remanded
 
to the
district
 
court
 
for
 
further
 
proceedings.
 
The
 
Second
 
Circuit,
 
among
 
other
 
things,
 
held
 
that
 
there
 
was
 
personal
jurisdiction over
 
UBS and
 
other foreign
 
defendants. Separately,
 
in 2018,
 
the Second
 
Circuit reversed
 
in part
 
the
district court’s
 
2015 decision
 
dismissing certain
 
individual plaintiffs’
 
claims and
 
certain of
 
these actions
 
are now
proceeding. In
 
April 2024,
 
UBS and
 
the remaining
 
defendants
 
in one
 
of the
 
putative class
 
actions, the
 
USD Exchange
action, reached a settlement in
 
principle, subject to court approval. The USD
 
Exchange action sought recovery on
behalf of persons
 
who transacted in Eurodollar
 
futures and options
 
on Eurodollar futures on
 
exchanges between
2005 and May 2010. In 2020, an individual action was filed in the Northern District of California against UBS and
numerous other banks alleging that the defendants conspired to fix the interest rate used as the basis for loans to
consumers by jointly
 
setting the USD LIBOR
 
rate and monopolized
 
the market for
 
LIBOR-based consumer loans
 
and
credit cards.
 
In September
 
2022, the
 
court granted
 
defendants’ motion
 
to dismiss
 
the complaint
 
in its
 
entirety, while
allowing plaintiffs the opportunity to file an amended complaint. Plaintiffs filed
 
an amended complaint in October
2022,
 
and
 
defendants
 
moved
 
to
 
dismiss
 
the
 
amended
 
complaint.
 
In
 
October
 
2023,
 
the
 
court
 
dismissed
 
the
amended complaint with prejudice. In January
 
2024, plaintiffs appealed the dismissal to the Ninth
 
Circuit Court of
Appeals. Defendants filed their response
 
to the appeal in March 2024.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
83
Note 15
 
Provisions and contingent liabilities
 
(continued)
Other benchmark class actions in the US:
 
Yen
 
LIBOR / Euroyen TIBOR
 
– In 2017, the court dismissed one Yen LIBOR / Euroyen TIBOR action in its entirety on
standing grounds. In
 
2020, the appeals
 
court reversed the
 
dismissal and, subsequently, plaintiffs
 
in that action
 
filed
an amended complaint
 
focused on Yen
 
LIBOR. In 2022,
 
the court granted
 
UBS’s motion for
 
reconsideration and
dismissed the case against UBS. The dismissal of the case against UBS could be appealed following
 
the disposition
of the case against the remaining defendant in the
 
district court.
CHF LIBOR
 
– In 2017, the court
 
dismissed the CHF LIBOR action on standing
 
grounds and failure to state a
 
claim.
Plaintiffs
 
filed
 
an
 
amended
 
complaint,
 
and
 
the
 
court
 
granted
 
a
 
renewed
 
motion
 
to
 
dismiss
 
in
 
2019.
 
Plaintiffs
appealed. In
 
2021, the
 
Second Circuit
 
granted the
 
parties’ joint
 
motion to
 
vacate the
 
dismissal and
 
remand the
 
case
for further
 
proceedings. Plaintiffs
 
filed a
 
third amended
 
complaint in
 
November 2022
 
and defendants
 
moved to
dismiss the amended complaint in January
 
2023.
EURIBOR
 
–
 
In
 
2017,
 
the
 
court
 
in
 
the
 
EURIBOR
 
lawsuit
 
dismissed
 
the
 
case
 
as
 
to
 
UBS
 
and
 
certain
 
other
 
foreign
defendants for lack of personal jurisdiction.
 
Plaintiffs have appealed.
 
GBP LIBOR
 
– The court dismissed the GBP LIBOR action
 
in 2019. Plaintiffs have appealed.
 
Government bonds:
 
Putative class actions
 
have been filed
 
since 2015 in
 
US federal courts
 
against UBS and
 
other
banks
 
on
 
behalf
 
of
 
persons
 
who
 
participated
 
in
 
markets
 
for
 
US
 
Treasury
 
securities
 
since
 
2007.
 
A
 
consolidated
complaint was filed in 2017 in the US District Court
 
for the Southern District of New York alleging that the banks
colluded with
 
respect to,
 
and manipulated
 
prices of,
 
US Treasury
 
securities sold
 
at auction
 
and in
 
the secondary
market and
 
asserting claims under
 
the antitrust
 
laws and
 
for unjust
 
enrichment. Defendants’ motions
 
to dismiss
the consolidated complaint
 
were granted in 2021.
 
Plaintiffs filed an amended
 
complaint, which defendants
 
moved
to dismiss later
 
in 2021.
 
In March 2022,
 
the court granted
 
defendants’ motion to
 
dismiss that complaint,
 
and in
February
 
2024,
 
the
 
Second
 
Circuit
 
affirmed
 
the
 
district
 
court’s
 
dismissal.
 
Similar
 
class
 
actions
 
have
 
been
 
filed
concerning European government bonds and
 
other government bonds.
In
 
2021,
 
the
 
European Commission
 
issued
 
a
 
decision finding
 
that
 
UBS
 
and
 
six
 
other
 
banks
 
breached European
Union antitrust rules in 2007–2011
 
relating to European government
 
bonds. The European Commission
 
fined UBS
EUR 172m. UBS is appealing the amount of the fine.
With respect
 
to additional
 
matters and
 
jurisdictions not
 
encompassed by
 
the settlements
 
and orders
 
referred to
above, our balance sheet
 
at 31 March 2024
 
reflected a provision in
 
an amount that UBS
 
believes to be appropriate
under the
 
applicable accounting
 
standard. As
 
in the
 
case of
 
other matters
 
for which
 
we have
 
established provisions,
the future outflow of resources in respect of such matters
 
cannot be determined with certainty based on currently
available information
 
and accordingly
 
may ultimately
 
prove to
 
be substantially
 
greater (or
 
may be
 
less) than
 
the
provision that we have recognized.
4. Swiss retrocessions
The Federal Supreme Court of Switzerland ruled in 2012, in
 
a test case against UBS, that distribution fees paid
 
to
a firm for distributing third-party
 
and intra-group investment funds
 
and structured products must be disclosed
 
and
surrendered
 
to
 
clients
 
who have
 
entered
 
into
 
a
 
discretionary
 
mandate agreement
 
with
 
the
 
firm,
 
absent a
 
valid
waiver. FINMA issued a
 
supervisory note
 
to all Swiss
 
banks in response
 
to the Supreme
 
Court decision.
 
UBS has
 
met
the FINMA requirements and has notified all potentially
 
affected clients.
The Supreme
 
Court decision
 
has resulted, and
 
continues to
 
result, in a
 
number of
 
client requests
 
for UBS to
 
disclose
and potentially surrender retrocessions. Client requests are assessed on a case-by-case basis. Considerations taken
into account
 
when assessing
 
these cases
 
include, among
 
other things,
 
the existence
 
of a discretionary
 
mandate and
whether or not the client documentation contained
 
a valid waiver with respect to distribution
 
fees.
Our balance
 
sheet at
 
31 March
 
2024 reflected
 
a provision
 
with respect
 
to matters
 
described in
 
this item 4
 
in an
amount that UBS believes to be appropriate under the applicable accounting standard. The ultimate exposure will
depend on client
 
requests and the resolution
 
thereof, factors that are
 
difficult to predict
 
and assess. Hence, as
 
in
the case of
 
other matters for which
 
we have established provisions,
 
the future outflow
 
of resources in
 
respect of
such matters
 
cannot be
 
determined with certainty
 
based on
 
currently available information
 
and accordingly may
ultimately prove to be substantially greater (or
 
may be less) than the provision that we
 
have recognized.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
84
Note 15
 
Provisions and contingent liabilities
 
(continued)
B. Litigation, regulatory and similar matters
 
involving Credit Suisse entities
1. Mortgage-related matters
Government and
 
regulatory
 
related matters
:
DOJ RMBS
 
settlement
 
– In January
 
2017, Credit Suisse
 
Securities (USA)
LLC
 
(CSS
 
LLC)
 
and
 
its
 
current
 
and
 
former
 
US
 
subsidiaries
 
and
 
US
 
affiliates
 
reached
 
a
 
settlement
 
with
 
the
 
US
Department of
 
Justice (DOJ)
 
related to
 
its legacy
 
Residential
 
Mortgage-Backed
 
Securities (RMBS)
 
business, a
 
business
conducted through
 
2007. The
 
settlement resolved
 
potential civil
 
claims by
 
the DOJ
 
related to certain
 
of those
 
Credit
Suisse entities’
 
packaging, marketing,
 
structuring, arrangement,
 
underwriting, issuance
 
and sale
 
of RMBS.
 
Pursuant
to the terms of the
 
settlement a civil monetary penalty was paid
 
to the DOJ in
 
January 2017. The settlement also
required
 
the
 
Credit
 
Suisse
 
entities
 
to
 
provide
 
certain
 
levels
 
of
 
consumer
 
relief
 
measures,
 
including
 
affordable
housing
 
payments
 
and
 
loan
 
forgiveness,
 
and
 
the
 
DOJ
 
and
 
Credit
 
Suisse
 
agreed
 
to
 
the
 
appointment
 
of
 
an
independent
 
monitor
 
to
 
oversee
 
the
 
completion
 
of
 
the
 
consumer
 
relief
 
requirements
 
of
 
the
 
settlement.
 
Credit
Suisse continues
 
to evaluate
 
its approach
 
toward satisfying
 
its remaining
 
consumer relief
 
obligations, and Credit
Suisse currently
 
anticipates that
 
it will
 
take much
 
longer than
 
the five-year
 
period provided
 
in the
 
settlement to
satisfy
 
in
 
full
 
its
 
obligations
 
in
 
respect
 
of
 
these
 
consumer
 
relief
 
measures,
 
subject
 
to
 
risk
 
appetite
 
and
 
market
conditions. Credit Suisse expects to incur costs
 
in relation to satisfying those obligations.
 
The amount of consumer
relief Credit Suisse must provide also
 
increases after 2021 pursuant
 
to the original settlement
 
by 5% per annum
 
of
the outstanding amount
 
due until these
 
obligations are settled.
 
The monitor publishes
 
reports periodically on
 
these
consumer relief matters.
Civil litigation: Repurchase litigations
 
– CSS LLC and/or certain of its affiliates
 
have also been named as defendants
in various
 
civil litigation
 
matters related to
 
their roles
 
as issuer,
 
sponsor, depositor, underwriter
 
and/or servicer
 
of
RMBS
 
transactions.
 
These
 
cases
 
currently
 
include
 
repurchase
 
actions
 
by
 
RMBS
 
trusts
 
and/or
 
trustees,
 
in
 
which
plaintiffs
 
generally
 
allege
 
breached
 
representations
 
and
 
warranties
 
in
 
respect
 
of
 
mortgage
 
loans
 
and
 
failure
 
to
repurchase such
 
mortgage loans
 
as required
 
under the
 
applicable agreements. The
 
amounts disclosed
 
below do
not reflect actual realized plaintiff losses to date or anticipated future litigation exposure. Unless otherwise stated,
these amounts reflect the original
 
unpaid principal balance amounts
 
as alleged in these actions and
 
do not include
any reduction in principal amounts since issuance.
DLJ Mortgage Capital, Inc. (DLJ) is a defendant in New York state court in: (i)
 
one action brought by Asset Backed
Securities Corporation
 
Home Equity
 
Loan Trust,
 
Series 2006-HE7,
 
in which plaintiff
 
alleges damages
 
of not
 
less than
USD 374m in an
 
amended complaint filed in August 2019;
 
in January 2020, DLJ filed
 
a motion to dismiss, which
the court granted in part and denied in
 
part in December 2023, dismissing with prejudice all notice-based claims;
in February
 
2024, the
 
parties filed
 
notices of
 
appeal; (ii)
 
one action
 
brought by
 
Home Equity
 
Asset Trust,
 
Series
2006-8, in
 
which plaintiff
 
alleges damages
 
of not
 
less than
 
USD 436m;
 
(iii) one
 
action brought
 
by Home
 
Equity
Asset Trust 2007-1,
 
in which plaintiff
 
alleges damages of
 
not less
 
than USD 420m; in
 
December 2018, the
 
court
denied DLJ’s motion for
 
partial summary judgment in this
 
action, which was affirmed
 
on appeal; in
 
March 2022,
the New
 
York
 
State Court
 
of Appeals
 
reversed the
 
decision and
 
ordered that
 
DLJ’s motion
 
for partial
 
summary
judgment be granted; a non-jury trial
 
in the action was held
 
between January and February 2023, and
 
a decision
is pending; (iv)
 
one action brought by
 
Home Equity Asset Trust
 
2007-2, in which
 
plaintiff alleges damages of
 
not
less than
 
USD 495m; and
 
(v) one
 
action brought
 
by CSMC
 
Asset-Backed Trust 2007-NC1,
 
in which
 
no damages
amount is alleged. These actions are at various
 
procedural stages.
2. Tax and securities law matters
In
 
May 2014,
 
Credit
 
Suisse AG
 
entered
 
into settlement
 
agreements with
 
several US
 
regulators regarding
 
its
 
US
cross-border matters. As part of the agreements, Credit Suisse AG, among other things, engaged an independent
corporate monitor
 
that reports
 
to the
 
New York State
 
Department of
 
Financial Services.
 
As of
 
July 2018,
 
the monitor
concluded both
 
his review
 
and his
 
assignment. Credit
 
Suisse AG
 
continues to
 
report
 
to and
 
cooperate with
 
US
authorities in
 
accordance with
 
Credit
 
Suisse AG’s
 
obligations under
 
the
 
agreements,
 
including by
 
conducting a
review
 
of
 
cross-border
 
services
 
provided
 
by
 
Credit
 
Suisse’s
 
Switzerland-based Israel
 
Desk.
 
Most
 
recently,
 
Credit
Suisse AG has provided information to US authorities regarding potentially undeclared US assets held by clients at
Credit Suisse AG since the May 2014 plea. Credit Suisse AG continues
 
to cooperate with the authorities. In March
2023,
 
the
 
US
 
Senate Finance
 
Committee issued
 
a
 
report
 
criticizing
 
Credit
 
Suisse AG’s
 
history
 
regarding
 
US
 
tax
compliance. The report called on the DOJ to investigate
 
Credit Suisse AG’s compliance with the 2014 plea.
 
 
 
UBS Group first quarter 2024 report |
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statements (unaudited)
 
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Note 15
 
Provisions and contingent liabilities
 
(continued)
In February 2021,
 
a qui tam
 
complaint was filed
 
in the Eastern
 
District of Virginia, alleging
 
that Credit Suisse AG
had violated the
 
False Claims Act
 
by failing to
 
disclose all US
 
accounts at the
 
time of the
 
2014 plea, which
 
allegedly
allowed Credit Suisse AG to pay a criminal fine in 2014 that was purportedly lower than it should have been. The
DOJ moved to
 
dismiss the case, and
 
the Court summarily dismissed
 
the suit. The case
 
is now on
 
appeal with the
US Federal Court of Appeals for the Fourth
 
Circuit.
3. Rates-related matters
Regulatory matters
: Regulatory authorities in a number of jurisdictions, including the US, UK, EU and Switzerland,
have for an extended period of time been conducting investigations into the setting of LIBOR and other reference
rates with
 
respect to
 
a number
 
of currencies,
 
as well
 
as the
 
pricing of
 
certain related
 
derivatives. These
 
ongoing
investigations have included
 
information requests from regulators
 
regarding LIBOR-setting practices
 
and reviews of
the activities
 
of various
 
financial institutions,
 
including Credit
 
Suisse Group
 
AG, which
 
was a
 
member of
 
three LIBOR
rate-setting panels
 
(US Dollar
 
LIBOR, Swiss
 
Franc LIBOR
 
and Euro
 
LIBOR). Credit
 
Suisse is
 
cooperating fully
 
with
these investigations.
Regulatory authorities in a number of jurisdictions, including WEKO,
 
the European Commission (Commission), the
South
 
African
 
Competition
 
Commission
 
and
 
the
 
Brazilian
 
Competition
 
Authority
 
have
 
been
 
conducting
investigations into
 
the
 
trading activities,
 
information sharing
 
and
 
the
 
setting of
 
benchmark
 
rates in
 
the
 
foreign
exchange (including electronic trading) markets.
 
Credit Suisse continues to cooperate
 
with ongoing investigations.
Credit Suisse
 
Group AG,
 
Credit Suisse
 
AG and
 
Credit Suisse
 
Securities (Europe)
 
Limited (CSSEL)
 
received a
 
Statement
of Objections and
 
a Supplemental Statement
 
of Objections
 
from the
 
Commission in
 
July 2018
 
and March 2021,
respectively, alleging
 
that Credit
 
Suisse entities
 
engaged in
 
anticompetitive practices
 
in connection
 
with their
 
foreign
exchange trading business.
 
In December
 
2021, the
 
Commission issued a
 
formal decision imposing
 
a fine
 
of EUR
83.3m. In February 2022, Credit Suisse appealed
 
this decision to the EU General Court.
The
 
reference
 
rates
 
investigations
 
have
 
also
 
included
 
information
 
requests
 
from
 
regulators
 
concerning
supranational, sub-sovereign
 
and agency
 
(SSA) bonds
 
and commodities
 
markets. Credit
 
Suisse Group
 
AG and
 
CSSEL
received a
 
Statement of
 
Objections from
 
the Commission
 
in December
 
2018, alleging
 
that Credit
 
Suisse entities
engaged
 
in
 
anticompetitive
 
practices
 
in
 
connection
 
with
 
their
 
SSA
 
bonds
 
trading
 
business.
 
In
 
April
 
2021,
 
the
Commission
 
issued
 
a
 
formal
 
decision
 
imposing
 
a
 
fine
 
of
 
EUR
 
11.9m.
 
In
 
July
 
2021,
 
Credit
 
Suisse
 
appealed
 
this
decision to the EU General Court.
Civil litigation:
USD LIBOR litigation
 
– Beginning in
 
2011, certain Credit
 
Suisse entities were
 
named in various
 
putative class and
individual lawsuits
 
filed in
 
the US,
 
alleging banks
 
on the
 
US dollar
 
LIBOR panel
 
manipulated US
 
dollar LIBOR
 
to
benefit their reputation
 
and increase
 
profits. All
 
remaining matters have
 
been consolidated for
 
pre-trial purposes
into a multi-district litigation in the US
 
District Court for the Southern District
 
of New York (SDNY).
In a series of rulings between 2013 and 2019 on motions
 
to dismiss, the SDNY (i) narrowed the claims against
 
the
Credit
 
Suisse
 
entities
 
and
 
the
 
other
 
defendants
 
(dismissing
 
antitrust,
 
Racketeer
 
Influenced
 
and
 
Corrupt
Organizations Act (RICO), Commodity Exchange Act, and
 
state law claims), (ii) narrowed
 
the set of plaintiffs who
may bring claims, and
 
(iii) narrowed the set
 
of defendants in the
 
LIBOR actions (including the dismissal
 
of several
Credit Suisse entities from
 
various cases on personal jurisdiction
 
and statute of limitation grounds).
 
After a number
of putative class and individual plaintiffs appealed the dismissal of their antitrust
 
claims to the United States Court
of Appeals
 
for the
 
Second Circuit
 
(Second Circuit),
 
in
 
December 2021,
 
the Second
 
Circuit affirmed
 
in
 
part and
reversed in part the district court’s decision
 
and remanded the case to the SDNY.
Separately, in May
 
2017, the
 
plaintiffs in three
 
putative class
 
actions moved for
 
class certification.
 
In February 2018,
the SDNY
 
denied certification
 
in
 
two of
 
the actions
 
and
 
granted certification
 
over a
 
single antitrust
 
claim in
 
an
action
 
brought
 
by
 
over-the-counter purchasers
 
of
 
LIBOR-linked derivatives.
 
In
 
April
 
2024,
 
Credit
 
Suisse and
 
the
remaining defendants
 
in one of
 
the putative class
 
actions in
 
which class
 
certification was
 
denied, the USD
 
Exchange
action, reached a settlement in
 
principle, subject to court approval. The USD
 
Exchange action sought recovery on
behalf of persons
 
who transacted in Eurodollar
 
futures and options
 
on Eurodollar futures on
 
exchanges between
2005 and May 2010.
 
 
 
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statements (unaudited)
 
86
Note 15
 
Provisions and contingent liabilities
 
(continued)
USD ICE LIBOR litigation
 
– In August 2020,
 
members of the
 
ICE LIBOR panel,
 
including Credit Suisse
 
Group AG and
certain of its affiliates, were named
 
in a civil action in the
 
US District Court for the Northern
 
District of California,
alleging that
 
panel banks
 
manipulated ICE
 
LIBOR to
 
profit from
 
variable interest
 
loans and
 
credit cards.
 
In December
2021, the
 
court denied
 
plaintiffs’ motion
 
for preliminary
 
and permanent
 
injunctions to
 
enjoin panel
 
banks from
continuing to set
 
LIBOR or
 
automatically setting
 
the benchmark
 
to zero each
 
day, and
 
in September
 
2022, the
 
court
granted
 
defendants’ motions
 
to
 
dismiss.
 
In
 
October
 
2022,
 
plaintiffs
 
filed
 
an
 
amended
 
complaint.
 
In
 
November
2022,
 
defendants filed
 
a
 
motion
 
to
 
dismiss
 
the
 
amended
 
complaint. In
 
October
 
2023,
 
the
 
court
 
dismissed
 
the
amended complaint with prejudice without
 
leave to amend. Plaintiffs have appealed.
Foreign exchange litigation
 
– Credit Suisse Group AG and affiliates
 
as well as other financial institutions
 
have been
named in civil lawsuits relating to the alleged
 
manipulation of foreign exchange
 
rates.
Credit Suisse AG,
 
together with other
 
financial institutions, was
 
named in
 
a consolidated putative
 
class action in
Israel, which made allegations similar to the consolidated class action. In April 2022, Credit Suisse entered into an
agreement to settle all claims. The settlement
 
remains subject to court approval.
Treasury markets
 
litigation
 
– CSS
 
LLC, along
 
with over
 
20 other
 
primary dealers
 
of US
 
treasury securities,
 
was named
in a number of
 
putative civil class
 
action complaints
 
in the US relating
 
to the US
 
treasury markets. These
 
complaints
generally alleged
 
that the
 
defendants colluded
 
to manipulate
 
US treasury
 
auctions, as
 
well as
 
the pricing
 
of US
treasury securities in the
 
when-issued market, with impacts upon
 
related futures and options, and
 
that certain of
the defendants
 
participated in
 
a group
 
boycott to
 
prevent the
 
emergence of
 
anonymous all-to-all
 
trading in
 
the
secondary market
 
for treasury
 
securities. In
 
March 2022,
 
the SDNY
 
granted defendants’
 
motion to
 
dismiss and
dismissed with prejudice all claims against the
 
defendants, and in February 2024, the Second Circuit
 
affirmed the
district court’s dismissal.
SSA bonds litigation
 
– Credit Suisse
 
Group AG and
 
certain of its affiliates,
 
together with other
 
financial institutions,
were named in
 
two Canadian
 
putative class actions,
 
which allege that
 
defendants conspired
 
to fix the
 
prices of SSA
bonds
 
sold
 
to
 
and
 
purchased from
 
investors
 
in
 
the
 
secondary
 
market. One
 
putative
 
class
 
action
 
was
 
dismissed
against
 
Credit
 
Suisse
 
in
 
February
 
2020.
 
In
 
October
 
2022,
 
in
 
the
 
second
 
action,
 
Credit
 
Suisse
 
entered
 
into
 
an
agreement to settle all claims. The settlement
 
remains subject to court approval.
Credit default swap
 
auction litigation
 
– In June
 
2021, Credit
 
Suisse Group AG
 
and affiliates,
 
along with other
 
banks
and entities, were named in a
 
putative class action complaint filed in the
 
US District Court for the District
 
of New
Mexico alleging
 
manipulation of credit
 
default swap
 
(CDS) final
 
auction prices.
 
In April
 
2022, defendants
 
filed a
motion to
 
dismiss. In
 
June 2023,
 
the court
 
granted in
 
part and
 
denied in
 
part defendants’ motion
 
to dismiss.
 
In
November 2023,
 
defendants filed
 
a motion
 
to enforce
 
the previous
 
CDS settlement
 
with the
 
SDNY. In
 
January 2024,
the SDNY ruled
 
that, to the
 
extent claims
 
in the New
 
Mexico action
 
arise from
 
conduct prior
 
to 30 June
 
2014, those
claims are barred by the SDNY settlement. The plaintiffs
 
have appealed the SDNY decision.
4. OTC trading cases
Interest rate
 
swaps litigation
: Credit
 
Suisse Group
 
AG and
 
affiliates, along
 
with other
 
financial institutions,
 
have
been
 
named
 
in
 
a
 
consolidated
 
putative
 
civil
 
class
 
action
 
complaint
 
and
 
complaints
 
filed
 
by
 
individual
 
plaintiffs
relating
 
to interest
 
rate swaps,
 
alleging that
 
dealer defendants
 
conspired
 
with trading
 
platforms to
 
prevent
 
the
development of interest rate swap exchanges. The individual lawsuits were brought by TeraExchange
 
LLC, a swap
execution facility, and affiliates; Javelin Capital Markets LLC, a swap execution facility,
 
and an affiliate; and trueEX
LLC, a
 
swap execution
 
facility, which claim
 
to have
 
suffered lost
 
profits as
 
a result
 
of defendants’
 
alleged conspiracy.
All interest rate swap actions have been consolidated
 
in a multi-district litigation in the SDNY.
Defendants moved to dismiss the
 
putative class and individual actions,
 
and the SDNY granted
 
in part and denied
in part these motions.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
87
Note 15
 
Provisions and contingent liabilities
 
(continued)
In February 2019, class plaintiffs in the consolidated multi-district litigation filed a motion
 
for class certification. In
March 2019,
 
class plaintiffs
 
filed a
 
fourth amended
 
consolidated class
 
action complaint. In
 
January 2022,
 
Credit
Suisse entered into an agreement
 
to settle all class
 
action claims. The settlement
 
remains subject to court
 
approval.
Credit
 
default
 
swaps
 
litigation
:
 
In
 
June
 
2017,
 
Credit
 
Suisse
 
Group
 
AG
 
and
 
affiliates,
 
along
 
with
 
other
 
financial
institutions, were named in a
 
civil action filed in
 
the SDNY by Tera
 
Group, Inc. and related
 
entities (Tera), alleging
violations of antitrust
 
law in
 
connection with the
 
allegation that CDS
 
dealers conspired to
 
block Tera’s electronic
CDS trading platform from successfully entering the market.
 
In July 2019, the SDNY granted in part and denied in
part
 
defendants’
 
motion
 
to
 
dismiss.
 
In
 
January
 
2020,
 
plaintiffs
 
filed
 
an
 
amended
 
complaint.
 
In
 
April
 
2020,
defendants filed
 
a
 
motion to
 
dismiss.
 
In August
 
2023, the
 
court granted
 
the motion,
 
dismissing all
 
claims with
prejudice. Plaintiffs have appealed.
Stock loan litigation
: Credit Suisse
 
Group AG and certain
 
of its affiliates,
 
as well as
 
other financial institutions,
 
were
originally named in
 
a number of
 
civil lawsuits in
 
the SDNY, certain
 
of which are
 
brought by
 
class action plaintiffs
alleging that the
 
defendants conspired to
 
keep stock-loan
 
trading in
 
an over-the-counter market
 
and collectively
boycotted certain trading platforms that sought to enter the market, and certain of
 
which are brought by trading
platforms
 
that sought
 
to
 
enter the
 
market alleging
 
that the
 
defendants
 
collectively boycotted
 
the platforms.
 
In
January 2022, Credit Suisse entered into an agreement
 
to settle all class action claims. In February 2022, the
 
court
entered an
 
order granting preliminary
 
approval to
 
the agreement
 
to settle
 
all class
 
action claims.
 
The settlement
remains subject to final court approval.
 
Odd-lot corporate bond litigation
: In April 2020, CSS LLC
 
and other financial institutions
 
were named in a putative
class action complaint
 
filed in the SDNY,
 
alleging a conspiracy
 
among the financial
 
institutions to boycott
 
electronic
trading platforms and fix prices in the secondary market for odd-lot corporate bonds. In October 2021, the
 
SDNY
granted defendants’ motion to dismiss. Plaintiffs
 
have appealed.
5. ATA litigation
Since November 2014, a series of lawsuits have been filed
 
against a number of banks, including Credit Suisse AG
and, in two instances, Credit Suisse AG, New York
 
Branch, in the US District Court for the Eastern District of New
York (EDNY) and the
 
SDNY alleging
 
claims under
 
the United
 
States Anti-Terrorism Act (ATA) and the
 
Justice Against
Sponsors of Terrorism Act. The plaintiffs in each of these
 
lawsuits are, or are relatives of, victims
 
of various terrorist
attacks in Iraq
 
and allege a
 
conspiracy and/or aiding
 
and abetting based
 
on allegations that
 
various international
financial institutions, including
 
the defendants, agreed
 
to alter, falsify or omit information from
 
payment messages
that
 
involved
 
Iranian
 
parties
 
for
 
the
 
express
 
purpose
 
of
 
concealing
 
the
 
Iranian
 
parties’
 
financial
 
activities
 
and
transactions from detection by US
 
authorities. The lawsuits allege
 
that this conduct has made
 
it possible for Iran to
transfer funds
 
to Hezbollah
 
and other terrorist
 
organizations actively
 
engaged in
 
harming US
 
military personnel
 
and
civilians. In January
 
2023, the United
 
States Court of
 
Appeals for the
 
Second Circuit
 
affirmed a
 
September 2019
ruling by
 
the EDNY
 
granting defendants’
 
motion to
 
dismiss the
 
first filed
 
lawsuit. In
 
October 2023,
 
the United
 
States
Supreme
 
Court denied
 
plaintiffs’ petition
 
for a
 
writ of certiorari.
 
In February
 
2024, plaintiffs
 
filed a
 
motion to
 
vacate
the judgment in the first filed lawsuit. Of the other seven cases, four are stayed, including one that was dismissed
as to
 
Credit Suisse
 
and most
 
of the
 
bank defendants
 
prior to
 
entry of
 
the stay,
 
and in
 
three plaintiffs
 
have filed
amended complaints, including two that were dismissed
 
prior to the court allowing plaintiffs to replead.
 
 
 
UBS Group first quarter 2024 report |
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statements (unaudited)
 
88
Note 15
 
Provisions and contingent liabilities
 
(continued)
6. Customer account matters
Several
 
clients
 
have
 
claimed
 
that
 
a
 
former
 
relationship
 
manager
 
in
 
Switzerland
 
had
 
exceeded
 
his
 
investment
authority
 
in
 
the
 
management of
 
their
 
portfolios, resulting
 
in
 
excessive concentrations
 
of
 
certain
 
exposures
 
and
investment losses.
 
Credit
 
Suisse AG
 
is investigating
 
the claims,
 
as well
 
as transactions
 
among the
 
clients. Credit
Suisse AG filed a criminal complaint against the former relationship manager with the Geneva Prosecutor’s Office
upon which the
 
prosecutor initiated
 
a criminal investigation.
 
Several clients of
 
the former relationship
 
manager also
filed criminal complaints with the
 
Geneva Prosecutor’s Office. In
 
February 2018, the former relationship manager
was sentenced to five years
 
in prison by the Geneva criminal
 
court for fraud, forgery
 
and criminal mismanagement
and ordered
 
to pay damages of
 
approximately USD 130m. Several
 
parties appealed the
 
judgment. In June 2019,
the
 
Criminal
 
Court
 
of
 
Appeals
 
of
 
Geneva
 
ruled
 
in
 
the
 
appeal
 
of
 
the
 
judgment
 
against
 
the
 
former
 
relationship
manager,
 
upholding the main findings of
 
the Geneva criminal court.
 
Several parties appealed the
 
decision to the
Swiss Federal
 
Supreme Court.
 
In February
 
2020, the Swiss
 
Federal Supreme
 
Court rendered
 
its judgment on
 
the
appeals, substantially confirming the findings
 
of the Criminal Court of Appeals of
 
Geneva.
Civil
 
lawsuits
 
have
 
been
 
initiated
 
against
 
Credit
 
Suisse
 
AG
 
and/or
 
certain
 
affiliates
 
in
 
Switzerland
 
and
 
other
jurisdictions, based
 
on the
 
findings established
 
in the
 
criminal proceedings
 
against the
 
former relationship
 
manager.
In
 
Singapore,
 
in
 
the
 
civil
 
lawsuit
 
brought
 
against
 
Credit
 
Suisse
 
Trust
 
Limited,
 
a
 
Credit
 
Suisse
 
AG
 
affiliate,
 
in
May 2023, the Singapore International
 
Commercial Court issued a
 
first instance judgment finding
 
for the plaintiffs
and
 
directing
 
the
 
parties’
 
experts
 
to
 
agree
 
on
 
the
 
amount
 
of
 
the
 
damages
 
award
 
according
 
to
 
the
 
calculation
method and parameters adopted by the court. As the parties’ experts were unable to agree on the amount
 
of the
damages, following
 
court directions,
 
the parties
 
filed their
 
proposed draft
 
orders with
 
supporting documents
 
in
August 2023.
 
In
 
September 2023,
 
the
 
court
 
ruled
 
that
 
the
 
damages
 
under
 
its
 
May 2023
 
judgment
 
are
USD 742.73m, excluding post-judgment interest. This figure does not exclude
 
potential overlap with the Bermuda
proceedings against Credit Suisse
 
Life (Bermuda) Ltd., which
 
are currently being appealed.
 
The court ordered the
parties to
 
ensure that
 
there shall
 
be no
 
double recovery
 
in relation
 
to this
 
award and
 
any sum
 
recovered in
 
the
Bermuda proceedings.
 
Credit Suisse
 
Trust Limited
 
has appealed
 
the judgment
 
and has
 
applied for
 
a stay
 
of execution
pending that appeal. In November 2023,
 
the court granted a stay of execution
 
of its May 2023 judgment pending
appeal on
 
the condition
 
that damages
 
awarded and
 
post-judgment interest
 
accrued are
 
paid into
 
court deposit
within 21 days, which condition was satisfied.
In Bermuda, in the civil lawsuit brought against
 
Credit Suisse Life (Bermuda) Ltd., a Credit Suisse
 
AG affiliate, trial
took place in the Supreme Court
 
of Bermuda in November and December 2021. The
 
Supreme Court of Bermuda
issued
 
a
 
first
 
instance
 
judgment
 
in
 
March
 
2022,
 
finding
 
for
 
the
 
plaintiff.
 
In
 
May
 
2022,
 
the
 
Supreme
 
Court
 
of
Bermuda
 
issued
 
an
 
order
 
awarding
 
damages
 
of
 
USD
 
607.35m
 
to
 
the
 
plaintiff. In
 
May
 
2022,
 
Credit
 
Suisse
 
Life
(Bermuda) Ltd.
 
appealed the
 
decision to
 
the Bermuda
 
Court of
 
Appeal. In
 
July 2022,
 
the Supreme
 
Court of
 
Bermuda
granted a stay
 
of execution
 
of its judgment
 
pending appeal
 
on the condition
 
that damages awarded
 
were paid into
an
 
escrow account
 
within 42
 
days, which
 
condition was
 
satisfied. In
 
June
 
2023, the
 
Bermuda Court
 
of Appeal
issued its judgment
 
confirming the award
 
issued by the
 
Supreme Court of
 
Bermuda and upholding
 
the Supreme
Court of Bermuda’s
 
finding that Credit
 
Suisse Life (Bermuda)
 
Ltd. had breached
 
its contractual and
 
fiduciary duties,
but overturning
 
the Supreme
 
Court of
 
Bermuda’s
 
finding that
 
Credit Suisse
 
Life (Bermuda)
 
Ltd. had
 
made fraudulent
misrepresentations. In July 2023, Credit Suisse Life (Bermuda) Ltd.
 
filed its notice of motion for leave
 
to appeal to
the Judicial Committee of the Privy Council and applied for a
 
stay of execution of the Bermuda Court of Appeal’s
judgment pending the outcome of
 
the appeal to the Judicial Committee
 
of the Privy Council on the condition
 
that
the
 
damages
 
awarded
 
remain
 
within
 
the
 
escrow
 
account
 
and
 
that
 
interest
 
be
 
added
 
to
 
the
 
escrow
 
account
calculated at
 
the Bermuda statutory
 
rate of
 
3.5%. A
 
hearing on
 
the applications for
 
leave to
 
appeal and stay
 
of
execution
 
took
 
place
 
in
 
December
 
2023.
 
Further,
 
in
 
December
 
2023,
 
USD
 
75m
 
was
 
released
 
from
 
the
 
escrow
account and paid to plaintiffs. In March 2024, the Bermuda Court of Appeal granted leave to appeal and ordered
that the
 
current stay
 
shall continue
 
pending determination
 
of the
 
appeal to
 
the Judicial
 
Committee of
 
the Privy
Council until and unless the
 
plaintiffs provide a top tier
 
bank guarantee for the remaining
 
judgment debt of USD
536.64m plus interest. The court
 
further ordered Credit Suisse
 
Life (Bermuda) Ltd. to pay
 
an additional USD 29.5m
into escrow in respect of accrued interest.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
89
Note 15
 
Provisions and contingent liabilities
 
(continued)
7. Mozambique matter
Credit Suisse has
 
been subject
 
to investigations by
 
regulatory and enforcement
 
authorities, as
 
well as civil
 
litigation,
regarding certain Credit
 
Suisse entities’
 
arrangement of
 
loan financing
 
to Mozambique
 
state enterprises,
 
Proindicus
S.A. and Empresa Moçambicana de Atum
 
S.A. (EMATUM), a
 
distribution to private investors of loan
 
participation
notes (LPN) related
 
to the EMATUM
 
financing in September
 
2013, and certain
 
Credit Suisse
 
entities’ subsequent
role in arranging the exchange
 
of those LPNs for
 
Eurobonds issued by the Republic
 
of Mozambique. In 2019,
 
three
former Credit Suisse employees pleaded guilty in the EDNY to accepting improper personal benefits in connection
with financing transactions carried out with
 
two Mozambique state enterprises.
In
 
October 2021,
 
Credit
 
Suisse reached
 
settlements with
 
the DOJ,
 
the US
 
Securities and
 
Exchange Commission
(SEC), the
 
UK Financial
 
Conduct Authority
 
(FCA) and
 
FINMA to
 
resolve inquiries
 
by these
 
agencies, including
 
findings
that Credit
 
Suisse failed
 
to appropriately
 
organize and
 
conduct its
 
business with
 
due skill
 
and care,
 
and manage
risks. Credit
 
Suisse Group
 
AG entered
 
into a
 
three-year Deferred
 
Prosecution Agreement
 
(DPA) with
 
the DOJ
 
in
connection with the criminal information
 
charging Credit Suisse Group AG
 
with conspiracy to commit wire
 
fraud
and consented to the entry of
 
a Cease and Desist Order
 
by the SEC. Under the
 
terms of the DPA, UBS Group
 
AG
(as successor to Credit Suisse Group AG) must continue compliance enhancement and remediation efforts agreed
by Credit Suisse, report to the DOJ on those efforts for three years and undertake additional measures as outlined
in the DPA. If the DPA’s conditions are complied with, the charges
 
will be dismissed at the end of the DPA’s three-
year term.
 
In
 
addition,
 
CSSEL entered
 
into
 
a
 
Plea
 
Agreement and
 
pleaded guilty
 
to one
 
count
 
of conspiracy
 
to
violate
 
the
 
US
 
federal
 
wire
 
fraud
 
statute.
 
CSSEL
 
is
 
bound
 
by
 
the
 
same
 
compliance,
 
remediation
 
and
 
reporting
obligations under
 
the DPA.
 
The
 
total monetary
 
sanctions paid
 
to the
 
DOJ and
 
SEC,
 
taking into
 
account various
credits and offsets,
 
was approximately USD 275m. Under
 
the terms of
 
the resolution with
 
the DOJ, Credit
 
Suisse
also
 
paid
 
USD
 
22.6m
 
in
 
restitution
 
to
 
eligible
 
investors
 
in
 
the
 
2016
 
Eurobonds
 
issued
 
by
 
the
 
Republic
 
of
Mozambique.
In
 
connection with
 
the resolution
 
with the
 
FCA, Credit
 
Suisse paid
 
a
 
penalty of
 
approximately USD
 
200m
 
and,
further to an agreement with the FCA, forgave
 
USD 200m of debt owed to Credit Suisse by
 
Mozambique.
The
 
FINMA
 
decree
 
concluding its
 
enforcement proceeding,
 
ordered
 
the
 
bank
 
to
 
remediate
 
certain
 
deficiencies.
Credit
 
Suisse’s
 
implementation
 
of
 
the
 
measures
 
required
 
under
 
the
 
FINMA
 
decree
 
has
 
been
 
reviewed
 
by
 
an
independent third
 
party appointed
 
by FINMA,
 
which review
 
recommends some
 
enhancements to
 
the measures
 
that
Credit Suisse has implemented. FINMA also arranged for certain existing
 
transactions to be reviewed by the same
independent third party on the basis of specific risk criteria, and required enhanced disclosure of certain sovereign
transactions.
In February 2019, certain Credit
 
Suisse entities, three former employees and
 
several other unrelated entities were
sued in the English High
 
Court by the Republic of
 
Mozambique seeking a declaration
 
that the sovereign guarantee
issued
 
in
 
connection
 
with
 
the
 
ProIndicus
 
loan
 
syndication
 
was
 
void,
 
and
 
damages.
 
Credit
 
Suisse
 
entities
subsequently filed cross
 
claims against several entities
 
controlled by Privinvest
 
Holding SAL (Privinvest)
 
that acted as
the project contractor,
 
Iskandar Safa, the
 
owner of Privinvest,
 
and several Mozambique
 
officials. In addition,
 
several
of the banks that participated
 
in the ProIndicus loan
 
syndicate brought claims
 
against Credit Suisse entities
 
seeking
a declaration that Credit Suisse is liable to compensate
 
them for alleged losses suffered as a result of any invalidity
of the
 
sovereign guarantee
 
or damages
 
stemming from
 
the alleged
 
loss. In
 
September 2023,
 
Credit Suisse,
 
the
Republic of
 
Mozambique,
 
and certain
 
of the
 
lenders in
 
the ProIndicus
 
syndicate entered
 
into a
 
settlement agreement
that, with the subsequent settlement with Privinvest entities referred to below, resolved
 
all claims involving Credit
Suisse entities in the English High Court.
In February 2022, Privinvest and Iskandar Safa brought a defamation claim in a Lebanese court against CSSEL and
Credit Suisse Group AG
 
and in November 2022, a
 
Privinvest employee who was the
 
lead negotiator on behalf
 
of
the Privinvest
 
entities in
 
relation to
 
the Mozambique
 
transactions, also
 
brought a
 
defamation claim
 
in the
 
same
court against
 
those entities.
 
In November
 
2023, UBS
 
Group AG (as
 
successor to
 
Credit Suisse
 
Group AG),
 
the Credit
Suisse entities,
 
Privinvest and
 
Iskandar Safa
 
entered into
 
an agreement
 
to settle
 
all claims
 
among them
 
in the
 
English
High Court and in Lebanon.
 
 
 
UBS Group first quarter 2024 report |
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statements (unaudited)
 
90
Note 15
 
Provisions and contingent liabilities
 
(continued)
8. Cross-border private banking matters
Credit
 
Suisse
 
offices
 
in
 
various
 
locations,
 
including
 
the
 
UK,
 
the
 
Netherlands,
 
France
 
and
 
Belgium,
 
have
 
been
contacted
 
by
 
regulatory
 
and
 
law
 
enforcement
 
authorities
 
that
 
are
 
seeking
 
records
 
and
 
information
 
concerning
investigations into Credit Suisse’s historical private banking services
 
on a cross-border basis and in part through its
local branches
 
and banks.
 
Credit Suisse has
 
conducted a
 
review of these
 
issues, the
 
UK and
 
French aspects
 
of which
have been closed, and is continuing to cooperate
 
with the authorities.
9. ETN-related litigation
XIV litigation
: Since March 2018, three class action complaints
 
were filed in the SDNY on behalf
 
of a putative class
of purchasers
 
of VelocityShares
 
Daily Inverse
 
VIX Short
 
Term
 
Exchange Traded
 
Notes linked
 
to the
 
S&P 500
 
VIX
Short-Term Futures Index
 
due December
 
4, 2030
 
(XIV ETNs).
 
In August
 
2018, plaintiffs
 
filed a
 
consolidated amended
class action complaint, naming Credit
 
Suisse Group AG and
 
certain affiliates and executives, which
 
asserts claims
for violations of
 
Sections 9(a)(4), 9(f), 10(b)
 
and 20(a) of
 
the US Securities
 
Exchange Act of
 
1934 and Rule
 
10b-5
thereunder and
 
Sections 11
 
and 15
 
of the
 
US Securities
 
Act of
 
1933 and
 
alleges that
 
the defendants
 
are responsible
for losses to investors following a decline in the value of XIV ETNs in February 2018. Defendants moved
 
to dismiss
the amended complaint in November 2018. In September
 
2019, the SDNY granted defendants’ motion to dismiss
and dismissed with prejudice all claims against the
 
defendants. In October 2019, plaintiffs filed a notice
 
of appeal.
In April 2021,
 
the Second Circuit
 
issued an order
 
affirming in part
 
and vacating in
 
part the SDNY’s
 
September 2019
decision
 
granting
 
defendants’ motion
 
to
 
dismiss
 
with
 
prejudice.
 
In
 
July
 
2022,
 
plaintiffs
 
filed
 
a
 
motion
 
for
 
class
certification. In
 
March 2023,
 
the court
 
denied plaintiffs’
 
motion to
 
certify two
 
of their
 
three alleged
 
classes and
granted plaintiffs’ motion to certify
 
their third alleged class. In March 2023, defendants
 
moved for reconsideration
and filed a
 
petition for permission
 
to appeal the
 
court’s class certification
 
decision to the
 
Second Circuit. In
 
April
2023,
 
plaintiffs
 
filed a
 
motion
 
seeking leave
 
to amend
 
their
 
complaint. In
 
May 2023,
 
plaintiffs
 
filed a
 
renewed
motion for class certification, which
 
defendants have opposed. In January
 
2024, the court issued an
 
order denying
plaintiffs’ motion to amend.
 
In March 2024, the
 
court denied plaintiffs’
 
renewed motion to
 
certify two of
 
the three
alleged classes, without
 
prejudice, and
 
denied defendants’ motion
 
for reconsideration on
 
the certification of
 
the
third alleged class.
DGAZ litigation
: In
 
January 2022,
 
Credit Suisse
 
AG was
 
named in
 
a class
 
action complaint
 
filed in
 
the SDNY
 
brought
on behalf of a putative class
 
of short sellers of VelocityShares
 
3x Inverse Natural Gas Exchange
 
Traded Notes linked
to the
 
S&P GSCI
 
Natural Gas
 
Index ER
 
due February
 
9, 2032
 
(DGAZ ETNs).
 
The complaint
 
asserts claims
 
for violations
of Section
 
10(b) of
 
the US
 
Securities Exchange
 
Act
 
of 1934
 
and Rule
 
10b-5 thereunder
 
and alleges
 
that Credit
Suisse is
 
responsible for
 
losses suffered
 
by short
 
sellers following
 
a June
 
2020 announcement
 
that Credit
 
Suisse
would delist
 
and suspend
 
further issuances
 
of the
 
DGAZ ETNs.
 
In July
 
2022, Credit
 
Suisse AG
 
filed a
 
motion to
dismiss. In March
 
2023, the court
 
granted Credit Suisse
 
AG’s motion to
 
dismiss. In May
 
2023, the court entered
 
an
order dismissing
 
the case
 
with prejudice.
 
In February
 
2024, the
 
Second Circuit
 
affirmed the
 
district court’s
 
dismissal.
10. Bulgarian former clients matter
Credit
 
Suisse
 
AG
 
has
 
been responding
 
to an
 
investigation by
 
the
 
Swiss Office
 
of
 
the
 
Attorney General
 
(SOAG)
concerning the
 
diligence and
 
controls
 
applied
 
to a
 
historical relationship
 
with Bulgarian
 
former clients
 
who are
alleged to
 
have laundered
 
funds through
 
Credit Suisse
 
AG accounts.
 
In December
 
2020, the
 
SOAG brought
 
charges
against
 
Credit
 
Suisse
 
AG
 
and
 
other
 
parties.
 
Credit
 
Suisse
 
AG
 
believes
 
its
 
diligence
 
and
 
controls
 
complied with
applicable legal requirements and intends to defend
 
itself vigorously.
 
The trial in the Swiss Federal Criminal Court
took place in the first quarter of 2022. In June 2022,
 
Credit Suisse AG was convicted in the Swiss Federal Criminal
Court of certain historical organizational inadequacies
 
in its anti-money laundering framework and ordered to pay
a fine of CHF 2m. In addition, the court
 
seized certain client assets in the amount of approximately CHF 12m and
ordered Credit
 
Suisse AG
 
to pay
 
a compensatory
 
claim in
 
the amount
 
of approximately
 
CHF 19m.
 
In July
 
2022,
Credit Suisse AG appealed the decision to the Swiss
 
Federal Court of Appeals.
11. SCFF
Credit
 
Suisse
 
has
 
received
 
requests
 
for
 
documents and
 
information in
 
connection with
 
inquiries, investigations,
enforcement and
 
other actions
 
relating to
 
the supply chain
 
finance funds
 
(SCFF) matter by
 
FINMA, the
 
FCA and
other regulatory and governmental agencies. The Luxembourg Commission
 
de Surveillance du Secteur Financier is
reviewing the
 
matter and
 
has commissioned
 
a report
 
from a
 
third party.
 
Credit Suisse
 
is cooperating
 
with these
authorities.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
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Note 15
 
Provisions and contingent liabilities
 
(continued)
In
 
February
 
2023,
 
FINMA
 
announced
 
the
 
conclusion
 
of
 
its
 
enforcement
 
proceedings
 
against
 
Credit
 
Suisse
 
in
connection with the SCFF matter. In its order, FINMA reported
 
that Credit Suisse had seriously breached applicable
Swiss supervisory
 
laws in
 
this context
 
with regard
 
to risk
 
management and
 
appropriate operational
 
structures. While
FINMA
 
recognized
 
that
 
Credit
 
Suisse
 
has
 
already
 
taken
 
extensive
 
organizational
 
measures
 
based
 
on
 
its
 
own
investigation into the
 
SCFF matter, particularly
 
to strengthen its
 
governance and control
 
processes, and FINMA
 
is
supportive
 
of
 
these
 
measures,
 
the
 
regulator
 
has
 
ordered
 
certain
 
additional
 
remedial
 
measures.
 
These
 
include
 
a
requirement that the most
 
important (approximately 500)
 
business relationships must be
 
reviewed periodically and
holistically at
 
the Credit
 
Suisse Executive
 
Board level,
 
in particular
 
for counterparty
 
risks, and that
 
Credit Suisse
 
must
set up a document
 
defining the responsibilities
 
of approximately 600 of
 
its highest-ranking managers.
 
The latter of
these measures
 
has been
 
made applicable
 
to UBS
 
Group. Separate
 
from the
 
enforcement proceeding
 
regarding
Credit Suisse, FINMA has opened four enforcement
 
proceedings against former managers of
 
Credit Suisse.
In May 2023,
 
FINMA opened
 
an enforcement
 
proceeding against
 
Credit Suisse in
 
order to confirm
 
compliance with
supervisory requirements in response to inquiries
 
from FINMA’s enforcement division in the SCFF
 
matter.
The Attorney
 
General of
 
the Canton
 
of Zurich
 
has initiated
 
a criminal
 
procedure in
 
connection with
 
the SCFF
 
matter
and several fund investors have joined the procedure
 
as interested parties. In such procedure, while certain
 
former
and active Credit Suisse employees,
 
among others, have been named
 
as accused persons, Credit
 
Suisse itself is not
a party to the procedure.
Certain civil actions have
 
been filed by fund investors
 
and other parties against
 
Credit Suisse and/or certain
 
officers
and directors in various
 
jurisdictions, which make allegations including mis-selling
 
and breaches of duties
 
of care,
diligence and other fiduciary duties.
12. Archegos
Credit
 
Suisse
 
has
 
received
 
requests
 
for
 
documents
 
and
 
information
 
in
 
connection
 
with
 
inquiries,
 
investigations
and/or actions
 
relating
 
to Credit
 
Suisse’s relationship
 
with Archegos
 
Capital Management
 
(Archegos), including
from
 
FINMA (assisted
 
by
 
a third
 
party
 
appointed by
 
FINMA), the
 
DOJ,
 
the SEC,
 
the US
 
Federal Reserve,
 
the US
Commodity
 
Futures
 
Trading
 
Commission (CFTC),
 
the US
 
Senate
 
Banking Committee,
 
the
 
Prudential
 
Regulation
Authority
 
(PRA),
 
the
 
FCA,
 
COMCO,
 
the
 
Hong
 
Kong
 
Competition
 
Commission
 
and
 
other
 
regulatory
 
and
governmental agencies. Credit Suisse is cooperating
 
with the authorities in these matters.
 
In July 2023,
 
the US Federal
 
Reserve and the
 
PRA announced resolutions of
 
their investigations of Credit
 
Suisse’s
relationship with Archegos. UBS Group AG, Credit Suisse AG, Credit Suisse Holdings (USA) Inc., and Credit Suisse
AG, New
 
York Branch
 
entered into
 
an Order
 
to Cease
 
and Desist
 
with the
 
Board of
 
Governors of
 
the Federal
 
Reserve
System. Under
 
the terms
 
of the
 
order, Credit
 
Suisse paid
 
a civil
 
money penalty
 
of USD
 
269m and
 
agreed to
 
undertake
certain remedial
 
measures relating
 
to counterparty
 
credit risk
 
management, liquidity
 
risk management
 
and non-
financial risk management, as well as enhancements
 
to board oversight and governance.
CSI
 
and
 
CSSEL
 
entered
 
into
 
a
 
settlement
 
agreement
 
with
 
the
 
PRA
 
providing
 
for
 
the
 
resolution
 
of
 
the
 
PRA’s
investigation, following which
 
the PRA
 
published a Final
 
Notice imposing a
 
financial penalty of
 
GBP 87m
 
on CSI
and CSSEL for breaches of various of the PRA’s
 
Fundamental Rules.
FINMA also entered
 
a decree
 
dated 14 July
 
2023 announcing
 
the conclusion
 
of its enforcement
 
proceeding, finding
that
 
Credit
 
Suisse
 
had
 
seriously
 
violated
 
financial
 
market
 
law
 
in
 
connection
 
with
 
its
 
business
 
relationship
 
with
Archegos and ordering remedial measures directed at Credit Suisse AG and UBS Group AG, as the legal successor
to
 
Credit
 
Suisse
 
Group
 
AG.
 
These
 
include
 
a
 
requirement
 
that
 
UBS
 
Group
 
AG
 
apply
 
its
 
restrictions
 
on
 
its
 
own
positions relating to individual clients throughout the financial group, as well as adjustments to the compensation
system of
 
the entire
 
financial group
 
to provide
 
for bonus
 
allocation criteria
 
that take
 
into account
 
risk appetite.
FINMA
 
also
 
announced
 
it
 
has
 
opened
 
enforcement
 
proceedings
 
against
 
a
 
former
 
Credit
 
Suisse
 
manager
 
in
connection with this matter.
Civil
 
actions
 
relating
 
to
 
Credit
 
Suisse’s
 
relationship with
 
Archegos
 
have
 
been
 
filed
 
against
 
Credit
 
Suisse
 
and/or
certain officers and directors, including claims
 
for breaches of fiduciary duties.
 
 
 
UBS Group first quarter 2024 report |
Consolidated financial statements | Notes to the UBS Group AG interim consolidated financial
 
statements (unaudited)
 
92
Note 15
 
Provisions and contingent liabilities
 
(continued)
13. Credit Suisse financial disclosures
Credit Suisse
 
Group AG
 
and certain
 
directors, officers
 
and executives
 
have been
 
named in
 
securities class action
complaints pending
 
in the SDNY. These complaints,
 
filed on behalf
 
of purchasers of
 
Credit Suisse shares, additional
tier 1 capital notes, and other securities
 
in 2023, allege that defendants made
 
misleading statements regarding: (i)
customer
 
outflows
 
in
 
late
 
2022;
 
(ii)
 
the
 
adequacy
 
of
 
Credit
 
Suisse’s
 
financial
 
reporting
 
controls;
 
and
 
(iii)
 
the
adequacy of
 
Credit
 
Suisse’s risk
 
management processes,
 
and include
 
allegations relating
 
to Credit
 
Suisse Group
AG’s merger with UBS Group AG. Many of the actions have been consolidated, and a motion to dismiss has
 
been
filed and remains pending. One
 
additional action, filed
 
in October 2023, has been
 
stayed pending a determination
on whether it should be consolidated with the
 
earlier actions.
Credit Suisse has received requests for documents and information from regulatory and governmental agencies in
connection with inquiries,
 
investigations and/or actions
 
relating to
 
these matters, as
 
well as
 
for other statements
regarding
 
Credit
 
Suisse’s
 
financial
 
condition,
 
including
 
from
 
the
 
SEC,
 
the
 
DOJ
 
and
 
FINMA.
 
Credit
 
Suisse
 
is
cooperating with the authorities in these matters.
14. Merger-related litigation
Certain Credit
 
Suisse Group AG
 
affiliates and certain
 
directors, officers
 
and executives have
 
been named in
 
class
action complaints pending in
 
the SDNY.
 
One complaint, brought
 
on behalf of
 
Credit Suisse shareholders,
 
alleges
breaches of fiduciary duty
 
under Swiss law and
 
civil RICO claims
 
under United States
 
federal law. In February 2024,
the court granted
 
defendants’ motions to
 
dismiss the civil
 
RICO claims and
 
conditionally dismissed the Swiss
 
law
claims pending defendants’ acceptance of jurisdiction in Switzerland. In March 2024, having received consents to
Swiss jurisdiction from all defendants served
 
with the complaint, the court dismissed the Swiss
 
law claims against
those defendants.
 
Additional complaints,
 
brought
 
on behalf
 
of holders
 
of Credit
 
Suisse additional
 
tier 1
 
capital
notes (AT1
 
noteholders) allege
 
breaches of
 
fiduciary duty
 
under Swiss
 
law,
 
arising from
 
a series
 
of scandals
 
and
misconduct, which
 
led to Credit
 
Suisse Group AG’s
 
merger with
 
UBS Group AG,
 
causing losses
 
to shareholders
 
and
AT1 noteholders. The motion to dismiss the first of these complaints
 
was granted in March 2024 on the basis that
Switzerland and not New York is the most appropriate forum for litigation.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Significant regulated subsidiary and sub-group
 
information
 
93
Significant regulated subsidiary
and sub-group information
Unaudited
 
Financial and regulatory key figures for our significant regulated
subsidiaries and sub-groups
UBS AG
(consolidated)
UBS AG
(standalone)
UBS Switzerland AG
(standalone)
UBS Europe SE
(consolidated)
UBS Americas Holding
LLC
(consolidated)
All values in million, except where indicated
USD
USD
CHF
EUR
USD
Financial and regulatory requirements
IFRS Accounting Standards
Swiss SRB rules
IFRS Accounting
Standards
Swiss SRB rules
Swiss GAAP
Swiss SRB rules
IFRS Accounting
Standards
EU regulatory rules
US GAAP
US Basel III rules
As of or for the quarter ended
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
1
31.3.24
31.12.23
Financial information
2
Income statement
Total operating income
3
9,056
7,951
2,365
2,254
2,463
2,275
300
293
3,658
3,333
Total operating expenses
7,677
7,618
2,203
2,205
1,605
1,562
236
255
3,562
3,422
Operating profit / (loss) before tax
1,379
333
163
49
858
713
64
38
96
(89)
Net profit / (loss)
1,014
242
216
(48)
698
586
22
21
22
(63)
Balance sheet
Total assets
1,116,806
1,156,016
676,385
698,149
320,367
314,231
47,872
46,981
194,508
194,258
Total liabilities
 
1,061,443
1,100,448
621,007
642,602
303,744
298,305
43,779
42,894
169,532
169,319
Total equity
55,363
55,569
55,379
55,546
16,624
15,926
4,093
4,087
24,976
24,939
Capital
4
Common equity tier 1 capital
 
43,863
 
44,130
 
51,971
 
52,553
 
12,630
 
12,515
2,619
2,625
14,136
14,081
Additional tier 1 capital
 
14,204
 
12,498
 
14,204
 
12,498
 
5,000
 
5,000
600
600
2,838
2,837
Total going concern capital / Tier 1 capital
 
58,067
 
56,628
 
66,175
 
65,051
 
17,630
 
17,515
3,219
3,225
16,975
16,919
Tier 2 capital
 
537
 
538
 
532
 
533
199
202
Total capital
3,219
3,225
17,174
17,120
Total gone concern loss-absorbing capacity
 
54,773
 
54,458
 
54,768
 
54,452
 
11,243
 
11,176
 
2,528
5
2,534
5
7,400
6
7,400
6
Total loss-absorbing capacity
 
112,840
 
111,086
 
120,943
 
119,504
 
28,872
 
28,691
5,747
5,759
24,375
6
24,319
6
Risk-weighted assets and leverage
ratio denominator
4
Risk-weighted assets
 
328,732
 
333,979
 
356,821
 
354,083
 
111,292
 
107,097
12,718
12,382
75,897
73,096
Leverage ratio denominator
 
1,078,591
 
1,104,408
 
641,315
 
643,939
 
337,653
 
330,515
48,796
45,078
183,701
184,015
Supplementary leverage ratio denominator
209,750
208,242
Capital and leverage ratios (%)
4
Common equity tier 1 capital ratio
 
13.3
 
13.2
 
14.6
 
14.8
 
11.3
 
11.7
 
20.6
 
21.2
 
18.6
 
19.3
Going concern capital ratio / Tier 1 capital ratio
 
17.7
 
17.0
 
18.5
 
18.4
 
15.8
 
16.4
 
25.3
 
26.0
 
22.4
 
23.1
Total capital ratio
 
25.3
 
26.0
 
22.6
 
23.4
Total loss-absorbing capacity ratio
 
34.3
 
33.3
 
25.9
 
26.8
 
45.2
 
46.5
 
32.1
 
33.3
Tier 1 leverage ratio
 
6.6
 
7.2
 
9.2
 
9.2
Supplementary tier 1 leverage ratio
 
8.1
 
8.1
Going concern leverage ratio
 
5.4
 
5.1
 
10.3
 
10.1
 
5.2
 
5.3
Total loss-absorbing capacity leverage ratio
 
10.5
 
10.1
 
8.6
 
8.7
 
11.8
 
12.8
 
13.3
 
13.2
Gone concern capital coverage ratio
 
105.9
 
112.5
Liquidity coverage ratio
4
High-quality liquid assets (bn)
251.0
254.5
123.7
130.0
77.5
76.3
18.3
18.9
28.4
28.0
Net cash outflows (bn)
131.3
134.3
46.1
50.4
54.4
53.6
12.4
12.8
18.9
18.9
Liquidity coverage ratio (%)
191.4
189.7
268.7
7
260.2
142.5
8
142.5
147.9
148.7
149.9
147.7
Net stable funding ratio
4
Total available stable funding (bn)
589.3
602.6
274.6
279.8
224.6
222.7
13.6
13.9
107.4
107.9
Total required stable funding (bn)
484.7
503.8
288.3
304.9
166.8
166.1
11.1
10.6
80.3
81.7
Net stable funding ratio (%)
121.6
119.6
95.2
9
91.7
134.6
9
134.1
122.6
131.5
133.7
132.1
Other
Joint and several liability between UBS AG and
UBS Switzerland AG (bn)
10
3
3
1 Comparative figures have
 
been restated to align
 
with the regulatory reports as
 
submitted to the European
 
Central Bank (the ECB).
 
2 The financial information
 
disclosed does not represent
 
financial statements
under the respective GAAP / IFRS Accounting Standards.
 
3 The total operating income includes credit
 
loss expense or release.
 
4 Refer to the 31 March 2024 Pillar 3 Report, available
 
under “Pillar 3 disclosures”
at ubs.com/investors,
 
for more
 
information.
 
5 Consists of
 
positions that
 
meet the
 
conditions laid
 
down in
 
Art. 72a–b of
 
the Capital
 
Requirements Regulation
 
II with
 
regard to
 
contractual, structural
 
or legal
subordination.
 
6 Consists of eligible long-term debt that meets the
 
conditions specified in 12 CFR § 252.162 of
 
the final TLAC rules. Total
 
loss-absorbing capacity is the sum of tier 1
 
capital and eligible long-term
debt.
 
7 In the first quarter of 2024, the liquidity coverage ratio (the LCR) of UBS AG was 268.7%, remaining above the prudential requirements communicated by FINMA.
 
8 In the first quarter of 2024, the LCR of
UBS Switzerland AG, which is a Swiss SRB, was
 
142.5%, remaining above the prudential requirement communicated by FINMA in connection with the
 
Swiss Emergency Plan.
 
9 In accordance with Art. 17h para. 3
and 4 of the Liquidity Ordinance, UBS AG standalone is required to maintain a minimum
 
NSFR of at least 80% without taking into account excess funding of UBS Switzerland AG
 
and 100% after taking into account
such excess funding.
 
10 Refer to the “Capital, liquidity and
 
funding, and balance sheet” section of this report
 
for more information about the joint and several liability. Under certain circumstances, the Swiss
 
Banking
Act and FINMA’s Banking Insolvency Ordinance
 
authorize FINMA to modify, extinguish or convert to common equity liabilities of a bank in connection with
 
a resolution or insolvency of such bank.
 
 
 
UBS Group first quarter 2024 report |
Significant regulated subsidiary and sub-group
 
information
 
94
UBS Group AG
 
is
 
a
 
holding
 
company
 
and
 
conducts
 
substantially
 
all
 
of
 
its
 
operations
 
through
 
UBS AG,
Credit Suisse AG
 
and
 
subsidiaries
 
thereof.
 
UBS Group AG,
 
UBS AG
 
and
 
Credit Suisse AG
 
have
 
contributed
 
a
significant portion
 
of their
 
respective capital
 
to, and
 
provide substantial
 
liquidity to,
 
such subsidiaries.
 
Many of
 
these
subsidiaries
 
are
 
subject
 
to
 
regulations
 
requiring
 
compliance
 
with
 
minimum
 
capital,
 
liquidity
 
and
 
similar
requirements.
 
The
 
table
 
in
 
this
 
section
 
summarizes
 
the
 
regulatory
 
capital components
 
and
 
capital
 
ratios of
 
our
significant regulated subsidiaries and sub-groups determined under the regulatory framework of each subsidiary’s
or sub-group’s home jurisdiction.
Supervisory authorities generally have discretion to impose higher requirements or
 
to otherwise limit the activities
of subsidiaries. Supervisory
 
authorities also may
 
require entities to
 
measure capital
 
and leverage ratios
 
on a stressed
basis and may limit
 
the ability of
 
an entity to engage
 
in new activities or
 
take capital actions
 
based on the results
 
of
those tests.
In June 2023, the Federal Reserve Board released
 
the results of its 2023 Dodd–Frank Act
 
Stress Test (DFAST). UBS’s
US
 
intermediate holding
 
company, UBS
 
Americas Holding
 
LLC, and
 
Credit
 
Suisse’s intermediate
 
holding, Credit
Suisse
 
Holdings
 
(USA),
 
Inc.,
 
exceeded
 
the
 
minimum
 
capital
 
requirements
 
under
 
the
 
severely
 
adverse
 
scenario.
Following the completion
 
of the
 
annual DFAST and
 
the Comprehensive Capital
 
Analysis and Review
 
(the CCAR),
UBS Americas Holding LLC was assigned a stress capital buffer (an SCB) of 9.1% (previously 4.8%) under the SCB
rule as of
 
1 October 2023, resulting in
 
a total common equity
 
tier 1 (CET1) capital
 
requirement of 13.6%. Credit
Suisse
 
Holdings
 
(USA),
 
Inc.
 
was
 
assigned
 
an
 
SCB
 
of
 
7.2%
 
(previously
 
9.0%),
 
resulting
 
in
 
a
 
total
 
CET1
 
capital
requirement of 11.7%.
 
Additional information on
 
the above
 
entities is
 
provided in
 
the 31 March 2024
 
Pillar 3 Report,
 
which is
 
available
under “Pillar 3 disclosures” at
ubs.com/investors
.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Significant regulated subsidiary and sub-group
 
information
 
95
Credit Suisse AG
 
(consolidated)
Credit Suisse AG
 
(standalone)
Credit Suisse
(Schweiz) AG
(consolidated)
Credit Suisse
(Schweiz) AG
(standalone)
Credit Suisse
International
(standalone)
Credit Suisse
Holdings (USA), Inc.
(consolidated)
All values in million, except where
indicated
CHF
CHF
CHF
CHF
USD
USD
Financial and regulatory requirements
US GAAP
 
Swiss SRB rules
Swiss SRB rules
(phase-in)
Swiss SRB rules
Swiss SRB rules
UK regulatory rules
US Basel III rules
As of or for the quarter ended
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
31.3.24
31.12.23
Financial information
1
Income statement
Total operating income
2
1,606
1,268
Total operating expenses
3,011
4,005
Operating profit / (loss) before tax
(1,405)
(2,737)
Net profit / (loss)
(1,501)
(2,749)
Balance sheet
Total assets
420,376
452,507
Total liabilities
 
382,177
414,391
Total equity
38,199
38,116
Capital
3
Common equity tier 1 capital
38,382
38,187
32,941
33,346
11,016
11,051
10,397
10,396
12,896
12,689
8,394
9,387
Additional tier 1 capital
466
458
466
458
3,100
3,100
3,100
3,100
1,200
1,200
522
522
Total going concern capital / Tier 1 capital
38,848
38,646
33,407
33,805
14,116
14,151
13,497
13,496
14,096
13,889
8,917
9,909
Tier 2 capital
0
0
58
78
Total capital
14,096
13,889
8,974
9,987
Total gone concern loss-absorbing
capacity
37,933
38,284
37,865
38,216
8,846
9,040
8,882
9,066
4,586
4,586
3,000
3,000
Total loss-absorbing capacity
76,782
76,930
71,272
72,021
22,962
23,191
22,379
22,562
18,682
18,475
11,917
12,909
Risk-weighted assets and
leverage ratio denominator
3
Risk-weighted assets
173,285
181,690
188,418
182,772
82,172
83,254
81,504
82,611
28,068
34,698
10,427
12,979
Leverage ratio denominator
485,606
524,968
282,144
288,610
246,156
253,818
243,924
251,692
67,069
78,135
25,799
29,484
Supplementary leverage ratio denominator
28,043
34,370
Capital and leverage ratios (%)
3
Common equity tier 1 capital ratio
22.1
21.0
17.5
18.2
13.4
13.3
12.8
12.6
45.9
36.6
80.5
72.3
Going concern capital ratio / Tier 1 capital
ratio
22.4
21.3
17.7
18.5
17.2
17.0
16.6
16.3
50.2
40.0
85.5
76.4
Total capital ratio
50.2
40.0
86.1
77.0
Total loss-absorbing capacity ratio
44.3
42.3
27.9
27.9
27.5
27.3
66.6
53.2
114.3
99.5
4
Tier 1 leverage ratio
21.0
17.8
34.6
33.6
Supplementary tier 1 leverage ratio
31.8
28.8
Going concern leverage ratio
8.0
7.4
11.8
11.7
5.7
5.6
5.5
5.4
Total loss-absorbing capacity leverage
ratio
15.8
14.7
9.3
9.1
9.2
9.0
27.9
23.6
46.2
43.8
4
Gone concern capital coverage ratio
139.2
143.4
Liquidity coverage ratio
3
High-quality liquid assets (bn)
149.6
142.6
78.7
67.3
56.9
52.1
56.9
52.0
14.6
15.4
11.0
12.6
Net cash outflows (bn)
56.8
53.8
17.5
17.1
37.6
34.4
38.0
34.9
4.5
6.0
5.6
6.6
Liquidity coverage ratio (%)
263.3
5
265.1
449.1
6
393.6
151.3
7
151.3
149.6
8
149.3
340.3
280.3
199.5
195.1
Net stable funding ratio
3
Total available stable funding (bn)
272.9
287.1
160.1
160.3
133.5
128.5
131.8
126.8
26.7
30.4
15.1
15.3
Total required stable funding (bn)
199.4
213.1
129.5
121.6
116.9
118.7
115.4
116.7
20.0
24.2
7.2
8.6
Net stable funding ratio (%)
136.9
134.7
123.6
9
131.8
9
114.2
108.3
114.2
9
108.7
9
136.7
125.6
210.3
179.1
Other
Joint and several liability between Credit
Suisse AG standalone and Credit Suisse
(Schweiz) AG standalone (bn)
10
0.6
0.5
1 The financial information disclosed does not represent financial statements under the respective GAAP / IFRS Accounting Standards.
 
2 The total operating income includes credit loss expense or release.
 
3 Refer
to the 31 March 2024 Pillar 3 Report, available under “Pillar 3
 
disclosures” at ubs.com/investors, for more
 
information.
 
4 Comparative information has been aligned with final audited
 
data.
 
5 In the first quarter
of 2024, the liquidity coverage ratio (the LCR) of Credit Suisse AG consolidated was 263.3%, remaining above the prudential requirements communicated by FINMA.
 
6 In the first quarter of 2024, the LCR of Credit
Suisse AG standalone was 449.1%, remaining above the
 
prudential requirements communicated by FINMA.
 
7 In the first quarter of 2024, the
 
LCR of Credit Suisse (Schweiz) AG consolidated was 151.3%, remaining
above the prudential requirements
 
communicated by FINMA.
 
8 In the first quarter
 
of 2024, the LCR
 
of Credit Suisse (Schweiz)
 
AG standalone was 149.6%, remaining
 
above the prudential requirements
 
communicated
by FINMA.
 
9 In accordance with Art. 17h para. 3
 
and 4 of the Liquidity Ordinance, Credit
 
Suisse AG standalone is allowed to fulfill
 
the minimum NSFR of 100% by
 
taking into consideration any excess funding
 
of
Credit Suisse (Schweiz) AG standalone, and Credit Suisse AG standalone has an NSFR requirement of at least 80% without taking into
 
consideration any such excess funding. Credit Suisse (Schweiz) AG must always
fulfill an NSFR of at least 100% on a
 
standalone basis.
 
10 The contingent liabilities of Credit Suisse (Schweiz) AG under this joint and several liability were fully
 
collateralized through cash deposits from Credit Suisse
AG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
96
Appendix
Alternative performance measures
Alternative performance measures
An alternative performance measure (an APM) is a financial measure of historical or
 
future financial performance,
financial position
 
or cash
 
flows other
 
than a
 
financial measure
 
defined or
 
specified in
 
the applicable
 
recognized
accounting standards or in
 
other applicable regulations. A
 
number of APMs
 
are reported in
 
the discussion of
 
the
financial and operating performance of
 
the external reports (annual, quarterly
 
and other reports). APMs
 
are used
to provide
 
a more
 
complete
 
picture of
 
operating
 
performance and
 
to reflect
 
management’s
 
view of
 
the fundamental
drivers
 
of
 
the
 
business
 
results. A
 
definition
 
of
 
each
 
APM,
 
the
 
method
 
used
 
to
 
calculate
 
it
 
and
 
the
 
information
content are presented in alphabetical order
 
in the table below. These APMs may
 
qualify as non-GAAP measures as
defined by US Securities and Exchange Commission
 
(SEC) regulations.
APM label
Calculation
 
Information content
Active Digital Banking clients in
Corporate & Institutional Clients (%)
– Personal & Corporate Banking
Calculated as the average number of active
 
clients for
each month in the relevant period divided by the
average number of total clients. “Clients” refers
 
to
the number of unique business relationships or legal
entities operated by Corporate & Institutional
 
Clients,
excluding clients that do not have an account,
 
mono-
product clients and clients that have defaulted on
loans or credit facilities. At the end of each month,
any client that has logged on at least once in
 
that
month is determined to be “active” (a log-in
 
time
stamp is allocated to all business relationship numbers
or per legal entity in a digital banking contract).
This measure provides information about the
proportion of active Digital Banking clients in the total
number of UBS clients (within the aforementioned
meaning) which are serviced by Corporate &
Institutional Clients.
Active Digital Banking clients in
Personal Banking (%)
– Personal & Corporate Banking
Calculated as the average number of active
 
clients for
each month in the relevant period divided by the
average number of total clients. “Clients” refers
 
to
the number of unique business relationships operated
by Personal Banking, excluding persons
 
under the age
of 15, clients who do not have a private account,
clients domiciled outside Switzerland and clients
 
who
have defaulted on loans or credit facilities. At the
 
end
of each month, any client that has logged on
 
at least
once in that month is determined to be “active”
 
(a
log-in time stamp is allocated to all business
relationship numbers in a digital banking contract).
This measure provides information about the
proportion of active Digital Banking clients in the total
number of UBS clients (within the aforementioned
meaning) who are serviced by Personal Banking.
Active Mobile Banking clients in
Personal Banking (%)
– Personal & Corporate Banking
Calculated as the average number of active
 
clients for
each month in the relevant period divided by the
average number of total clients. “Clients” refers
 
to
the number of unique business relationships operated
by Personal Banking, excluding persons
 
under the age
of 15, clients who do not have a private account,
clients domiciled outside Switzerland and clients
 
who
have defaulted on loans or credit facilities. At the
 
end
of each month, any client that has logged on
 
via the
mobile app at least once in that month is determined
to be “active” (a log-in time stamp is allocated
 
to all
business relationship numbers in a digital banking
contract).
This measure provides information about the
proportion of active Mobile Banking clients in the
total number of UBS clients (within the
aforementioned meaning) who are serviced by
Personal Banking.
Cost / income ratio (%)
Calculated as operating expenses divided by
 
total
revenues.
This measure provides information about the
efficiency of the business by comparing operating
expenses with gross income.
Fee and trading income for Corporate
 
&
Institutional Clients (USD and CHF)
– Personal & Corporate Banking
Calculated as the total of recurring net fee and
transaction-based income for Corporate &
Institutional Clients.
This measure provides information about the amount
of fee and trading income for Corporate
 
&
Institutional Clients.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
97
APM label
Calculation
 
Information content
Fee-generating assets (USD)
– Global Wealth Management
Calculated as the sum of discretionary and
nondiscretionary wealth management portfolios
(mandate volume) and assets where generated
revenues are predominantly of a recurring nature, i.e.,
mainly investment, mutual, hedge and private-market
funds where we have a distribution agreement,
including client commitments into closed-ended
private-market funds from the date that recurring
fees are charged. Assets related to our Global
Financial Intermediaries business are excluded, as
 
are
assets of sanctioned clients.
This measure provides information about the volume
of invested assets that create a revenue stream,
whether as a result of the nature of the contractual
relationship with clients or through the fee structure
of the asset. An increase in the level of fee-generating
assets results in an increase in the associated revenue
stream. Assets of sanctioned clients are excluded from
fee-generating assets.
Fee-pool-comparable revenues (USD)
– the Investment Bank
Calculated as the total of revenues from: merger-and-
acquisition-related transactions; Equity Capital
Markets,
 
excluding derivatives; Leveraged Capital
Markets, excluding the impact of mark-to-market
movements on loan portfolios; and Debt
 
Capital
Markets, excluding revenues related to debt
underwriting of UBS instruments.
This measure provides information about the amount
of revenues in the Investment Bank that are
comparable with the relevant global fee pools.
Gross margin on invested assets (bps)
– Asset Management
Calculated as total revenues (annualized as applicable)
divided by average invested assets.
This measure provides information about the total
revenues of the business in relation to invested assets.
Impaired loan portfolio as a percentage
of total loan portfolio, gross (%)
– Global Wealth Management,
Personal & Corporate Banking
Calculated as impaired loan portfolio divided by
 
total
gross loan portfolio.
This measure provides information about the
proportion of impaired loan portfolio in the total gross
loan portfolio.
Integration-related expenses (USD)
Generally include costs of internal staff
 
and
contractors substantially dedicated to integration
activities, retention awards, redundancy costs,
incremental expenses from the shortening of useful
lives of property, equipment and software, and
impairment charges relating to these assets.
Classification as integration-related expenses does
 
not
affect the timing of recognition and measurement of
those expenses or the presentation thereof in the
income statement. Integration-related expenses
incurred by Credit Suisse also included expenses
associated with restructuring programs that existed
prior to the acquisition.
This measure provides information about expenses
that are temporary, incremental and directly related to
the integration of Credit Suisse into UBS.
Invested assets (USD and CHF)
– Global Wealth Management,
Personal & Corporate Banking,
Asset Management
Calculated as the sum of managed fund
 
assets,
managed institutional assets, discretionary and
advisory wealth management portfolios, fiduciary
deposits, time deposits, savings accounts,
 
and wealth
management securities or brokerage accounts.
This measure provides information about the volume
of client assets managed by or deposited with
 
UBS for
investment purposes.
Investment products for Personal
Banking (USD and CHF)
– Personal & Corporate Banking
Calculated as the sum of investment funds
 
(including
UBS Vitainvest third-pillar pension funds, as
 
well as
money market funds), mandates and third-party life
insurance operated in Personal Banking.
This measure provides information about the volume
of investment funds (including UBS Vitainvest
 
third-
pillar pension funds, as well as money
 
market funds),
mandates and third-party life insurance operated in
Personal Banking.
Net interest margin (bps)
– Personal & Corporate Banking
Calculated as net interest income (annualized
 
as
applicable) divided by average loans.
This measure provides information about the
profitability of the business by calculating the
difference between the price charged for lending and
the cost of funding, relative to loan value.
Net new assets (USD)
– Global Wealth Management
Calculated as the net amount of inflows and
 
outflows
of invested assets (as defined in UBS policy) recorded
during a specific period, plus interest and dividends.
Excluded from the calculation are movements due to
market performance, foreign exchange translation,
fees, and the effects on invested assets of strategic
decisions by UBS to exit markets or services.
 
This measure provides information about the
development of invested assets during a
 
specific
period as a result of net new asset flows, plus the
effect of interest and dividends.
 
Net new assets growth rate (%)
– Global Wealth Management
Calculated as the net amount of inflows and
 
outflows
of invested assets (as defined in UBS policy) recorded
during a specific period (annualized as applicable),
plus interest and dividends, divided by total invested
assets at the beginning of the period.
This measure provides information about the growth
of invested assets during a specific period
 
as a result
of net new asset flows.
 
Net new fee-generating assets (USD)
– Global Wealth Management
Calculated as the net amount of fee-generating
 
asset
inflows and outflows, including dividend
 
and interest
inflows into mandates and outflows from mandate
fees paid by clients during a specific period.
 
Excluded
from the calculation are the effects on fee-generating
assets of strategic decisions by UBS to exit
 
markets or
services.
 
This measure provides information about the
development of fee-generating assets during
 
a
specific period as a result of net flows, excluding
movements due to market performance and
 
foreign
exchange translation, as well as the effects on fee-
generating assets of strategic decisions by UBS
 
to exit
markets or services.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
98
APM label
Calculation
 
Information content
Net new investment products for
Personal Banking (USD and CHF)
– Personal & Corporate Banking
Calculated as the net amount of inflows and
 
outflows
of investment products during a specific period.
This measure provides information about the
development of investment products during a specific
period as a result of net new investment product
flows.
Net new money (USD)
– Global Wealth Management,
Asset Management
Calculated as the net amount of inflows and
 
outflows
of invested assets (as defined in UBS policy) recorded
during a specific period. Excluded from the calculation
are movements due to market performance, foreign
exchange translation, dividends, interest and fees,
 
as
well as the effects on invested assets of strategic
decisions by UBS to exit markets
 
or services. Net new
money is not measured for Personal & Corporate
Banking.
This measure provides information about the
development of invested assets during a
 
specific
period as a result of net new money flows.
Net new money growth rate (%)
– Global Wealth Management
Calculated as the net amount of inflows and
 
outflows
of invested assets (as defined in UBS policy) recorded
during a specific period (annualized as applicable)
divided by total invested assets at the beginning
 
of
the period.
 
This measure provides information about the growth
of invested assets during a specific period
 
as a result
of net new money flows.
Net profit growth (%)
Calculated as the change in net profit attributable
 
to
shareholders from continuing operations between
current and comparison periods divided by net profit
attributable to shareholders from continuing
operations of the comparison period.
This measure provides information about profit
growth since the comparison period.
Operating expenses (underlying)
(USD)
Calculated by adjusting operating expenses
 
as
reported in accordance with IFRS Accounting
Standards for items that management believes
 
are
not representative of the underlying performance of
the businesses.
›
Refer to the “Group performance” section of this
report for more information
This measure provides information about the amount
of operating expenses, while excluding items
 
that
management believes are not representative of the
underlying performance of the businesses.
Operating profit / (loss) before tax
(underlying) (USD)
Calculated by adjusting operating profit / (loss) before
tax as reported in accordance with IFRS Accounting
Standards for items that management believes
 
are
not representative of the underlying performance of
the businesses.
›
Refer to the “Group performance” section of this
report for more information
This measure provides information about the amount
of operating profit / (loss) before tax, while excluding
items that management believes are not
representative of the underlying performance of the
businesses.
Pre-tax profit growth (%)
– Global Wealth Management,
Personal & Corporate Banking,
Asset Management,
the Investment Bank
Calculated as the change in net profit before tax
attributable to shareholders from continuing
operations between current and comparison periods
divided by net profit before tax attributable to
shareholders from continuing operations of the
comparison period.
This measure provides information about pre-tax
profit growth since the comparison period.
Pre-tax profit growth (underlying) (%)
– Global Wealth Management,
Personal & Corporate Banking,
Asset Management,
the Investment Bank
Calculated as the change in net profit before tax
attributable to shareholders from continuing
operations between current and comparison periods
divided by net profit before tax attributable to
shareholders from continuing operations of the
comparison period. Net profit before tax attributable
to shareholders from continuing operations excludes
items that management believes are not
representative of the underlying performance of the
businesses and also excludes related tax impact.
This measure provides information about pre-tax
profit growth since the comparison period, while
excluding items that management believes
 
are not
representative of the underlying performance of the
businesses.
Recurring net fee income
(USD and CHF)
– Global Wealth Management,
Personal & Corporate Banking
Calculated as the total of fees for services provided
 
on
an ongoing basis, such as portfolio management
 
fees,
asset-based investment fund fees and custody
 
fees,
which are generated on client assets, and
administrative fees for accounts.
This measure provides information about the amount
of recurring net fee income.
Return on attributed equity
1
 
(%)
Calculated as annualized business division
 
operating
profit before tax divided by average attributed equity.
This measure provides information about the
profitability of the business divisions in relation to
attributed equity.
Return on common equity tier 1
capital
1
 
(%)
Calculated as annualized net profit attributable to
shareholders divided by average common equity
 
tier 1
capital.
This measure provides information about the
profitability of the business in relation to common
equity tier 1 capital.
Return on equity
1
 
(%)
Calculated as annualized net profit attributable to
shareholders divided by average equity attributable
 
to
shareholders.
This measure provides information about the
profitability of the business in relation to equity.
Return on leverage ratio denominator,
gross
1
 
(%)
Calculated as annualized total revenues divided by
average leverage ratio denominator.
This measure provides information about the revenues
of the business in relation to the leverage ratio
denominator.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
99
APM label
Calculation
 
Information content
Return on tangible equity
1
 
(%)
Calculated as annualized net profit attributable to
shareholders divided by average equity attributable
 
to
shareholders less average goodwill and intangible
assets.
This measure provides information about the
profitability of the business in relation to tangible
equity.
Tangible book value per share
(USD)
Calculated as equity attributable to shareholders less
goodwill and intangible assets divided by the
 
number
of shares outstanding.
This measure provides information about tangible net
assets on a per-share basis.
Total book value per share
(USD)
Calculated as equity attributable to shareholders
divided by the number of shares outstanding.
This measure provides information about net assets
on a per-share basis.
Total revenues (underlying)
(USD)
Calculated by adjusting total revenues as reported in
accordance with IFRS Accounting Standards for items
that management believes are not representative of
the underlying performance of the businesses.
›
Refer to the “Group performance” section of this
report for more information
This measure provides information about the amount
of total revenues, while excluding items that
management believes are not representative of the
underlying performance of the businesses.
Transaction-based income
(USD and CHF)
– Global Wealth Management,
Personal & Corporate Banking
Calculated as the total of the non-recurring portion
 
of
net fee and commission income, mainly composed
 
of
brokerage and transaction-based investment fund
fees, and credit card fees, as well as fees for payment
and foreign-exchange transactions, together with
other net income from financial instruments
measured at fair value through profit or loss.
This measure provides information about the amount
of the non-recurring portion of net fee and
commission income, together with other net
 
income
from financial instruments measured at fair value
through profit or loss.
Underlying cost / income ratio (%)
Calculated as underlying operating expenses
 
(as
defined above) divided by underlying total
 
revenues
(as defined above).
 
This measure provides information about the
efficiency of the business by comparing operating
expenses with total revenues, while excluding items
that management believes are not representative of
the underlying performance of the businesses.
Underlying net profit growth (%)
Calculated as the change in net profit attributable
 
to
shareholders from continuing operations between
current and comparison periods divided by net profit
attributable to shareholders from continuing
operations of the comparison period.
 
Net profit
attributable to shareholders from continuing
operations excludes items that management
 
believes
are not representative of the underlying performance
of the businesses and also excludes related tax
impact.
This measure provides information about profit
growth since the comparison period, while excluding
items that management believes are not
representative of the underlying performance of the
businesses.
Underlying return on attributed equity
1
(%)
 
Calculated as annualized underlying business
 
division
operating profit before tax (as defined above) divided
by average attributed equity.
This measure provides information about the
profitability of the business divisions in relation to
attributed equity, while excluding items that
management believes are not representative of the
underlying performance of the businesses.
Underlying return on common equity
tier 1 capital
1
 
(%)
Calculated as annualized net profit attributable to
shareholders divided by average common equity
 
tier 1
capital. Net profit attributable to shareholders
excludes items that management believes
 
are not
representative of the underlying performance of the
businesses and also excludes related tax impact.
This measure provides information about the
profitability of the business in relation to common
equity tier 1 capital, while excluding items that
management believes are not representative of the
underlying performance of the businesses.
Underlying return on tangible equity
1
(%)
Calculated as annualized net profit attributable to
shareholders divided by average equity attributable
 
to
shareholders less average goodwill and intangible
assets. Net profit attributable to shareholders excludes
items that management believes are not
representative of the underlying performance of the
businesses and also excludes related tax impact.
This measure provides information about the
profitability of the business in relation to tangible
equity, while excluding items that management
believes are not representative of the underlying
performance of the businesses.
1
Profit or loss information for each of the first quarter of
 
2024 and the fourth quarter of 2023 is presented on a
 
consolidated basis, including for each quarter Credit Suisse
 
data for three months, and for
 
the purpose
of the calculation of return measures has been annualized multiplying such by four.
 
Profit or loss information for the first quarter of 2023 includes pre-acquisition UBS data for three months,
 
and for the purpose of the
calculation of return measures has been annualized multiplying such by four
.
This is a general list of the APMs used in our
 
financial reporting. Not all of the APMs
 
listed above may appear in
this particular report.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
100
Information related to underlying return on common equity tier 1 (CET1) capital and underlying return on tangible
equity (%)
As of or for the quarter ended
USD m, except where indicated
31.3.24
31.12.23
31.3.23
Underlying operating profit / (loss) before tax
 
2,617
 
592
 
1,566
Underlying tax expense / (benefit)
 
732
 
(329)
 
459
NCI
 
9
 
1
 
8
Underlying net profit / (loss)
 
1,877
 
920
 
1,099
Underlying net profit / (loss), annualized
 
7,507
 
3,680
 
4,396
Tangible equity
 
 
77,877
 
78,593
 
50,481
Average tangible equity
 
 
78,235
 
77,440
 
50,545
CET1 capital
 
 
78,147
 
78,485
 
44,590
Average CET1 capital
 
 
78,316
 
77,947
 
45,024
Underlying return on tangible equity (%)
 
9.6
 
4.8
 
8.7
Underlying return on common equity tier 1 capital
 
9.6
 
4.7
 
9.8
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
101
Abbreviations frequently used in our financial reports
A
ABS
 
asset-backed securities
AG
 
Aktiengesellschaft
AGM
 
Annual General Meeting of
shareholders
A-IRB
 
advanced internal ratings-
based
AIV
 
alternative investment
vehicle
ALCO
 
Asset and Liability
Committee
AMA
 
advanced measurement
approach
AML
 
anti-money laundering
AoA
 
Articles of Association
APM
 
alternative performance
measure
ARR
 
alternative reference rate
ARS
 
auction rate securities
ASF
 
available stable funding
AT1
 
additional tier 1
AuM
 
assets under management
B
BCBS
 
Basel Committee on
Banking Supervision
BIS
 
Bank for International
Settlements
BoD
 
Board of Directors
C
CAO
 
Capital Adequacy
Ordinance
CCAR
 
Comprehensive Capital
Analysis and Review
CCF
 
credit conversion factor
CCP
 
central counterparty
CCR
 
counterparty credit risk
CCRC
 
Corporate Culture and
Responsibility Committee
CDS
 
credit default swap
CEA
 
Commodity Exchange Act
CEO
 
Chief Executive Officer
CET1
 
common equity tier 1
CFO
 
Chief Financial Officer
CGU
 
cash-generating unit
CHF
 
Swiss franc
CIO
 
Chief Investment Office
C&ORC
 
Compliance & Operational
Risk Control
CRM
 
credit risk mitigation (credit
risk) or comprehensive risk
measure (market risk)
CST
 
combined stress test
CUSIP
 
Committee on Uniform
Security Identification
Procedures
CVA
 
credit valuation adjustment
D
DBO
 
defined benefit obligation
DCCP
 
Deferred Contingent
Capital Plan
 
DE&I
 
diversity, equity and
inclusion
DFAST
 
Dodd–Frank Act Stress Test
DM
 
discount margin
DOJ
 
US Department of Justice
DTA
 
deferred tax asset
DVA
 
debit valuation adjustment
E
EAD
 
exposure at default
EB
 
Executive Board
EC
 
European Commission
ECB
 
European Central Bank
ECL
 
expected credit loss
EGM
 
Extraordinary General
Meeting of shareholders
EIR
 
effective interest rate
EL
 
expected loss
EMEA
 
Europe, Middle East and
Africa
EOP
 
Equity Ownership Plan
EPS
 
earnings per share
ESG
 
environmental, social and
governance
ESR
 
environmental and social
risk
ETD
 
exchange-traded derivatives
ETF
 
exchange-traded fund
EU
 
European Union
EUR
 
euro
EURIBOR
 
Euro Interbank Offered Rate
EVE
 
economic value of equity
EY
 
Ernst & Young Ltd
F
FA
 
financial advisor
FCA
 
UK Financial Conduct
Authority
FDIC
 
Federal Deposit Insurance
Corporation
FINMA
 
Swiss Financial Market
Supervisory Authority
FMIA
 
Swiss Financial Market
Infrastructure Act
FSB
 
Financial Stability Board
FTA
 
Swiss Federal Tax
Administration
FVA
 
funding valuation
adjustment
FVOCI
 
fair value through other
comprehensive income
FVTPL
 
fair value through profit or
loss
FX
 
foreign exchange
G
GAAP
 
generally accepted
accounting principles
GBP
 
pound sterling
GCRG
 
Group Compliance,
Regulatory & Governance
GDP
 
gross domestic product
GEB
 
Group Executive Board
GHG
 
greenhouse gas
GIA
 
Group Internal Audit
GRI
 
Global Reporting Initiative
G-SIB
 
global systemically
important bank
H
HQLA
high-quality liquid assets
I
IAS
 
International Accounting
Standards
IASB
 
International Accounting
Standards Board
IBOR
 
interbank offered rate
IFRIC
 
International Financial
Reporting Interpretations
Committee
IFRS
 
Accounting Standards
Accounting
 
issued by the IASB
Standards
IRB
 
internal ratings-based
IRRBB
 
interest rate risk in the
banking book
ISDA
 
International Swaps and
Derivatives Association
ISIN
 
International Securities
Identification Number
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
102
Abbreviations frequently used in our financial reports (continued)
K
KRT
 
Key Risk Taker
L
LAS
 
liquidity-adjusted stress
LCR
 
liquidity coverage ratio
LGD
 
loss given default
LIBOR
 
London Interbank Offered
Rate
LLC
 
limited liability company
LoD
 
lines of defense
LRD
 
leverage ratio denominator
LTIP
 
Long-Term
 
Incentive Plan
LTV
 
loan-to-value
M
M&A
 
mergers and acquisitions
MRT
 
Material Risk Taker
N
NII
 
net interest income
NSFR
 
net stable funding ratio
NYSE
 
New York Stock Exchange
O
OCA
 
own credit adjustment
OCI
 
other comprehensive
income
OECD
 
Organisation for Economic
Co-operation and
Development
OTC
 
over-the-counter
P
PCI
 
purchased credit impaired
PD
 
probability of default
PIT
 
point in time
PPA
 
purchase price allocation
P&L
 
profit or loss
Q
QCCP
 
Qualifying central
counterparty
R
RBC
 
risk-based capital
RbM
 
risk-based monitoring
REIT
 
real estate investment trust
RMBS
 
residential mortgage-
backed securities
RniV
 
risks not in VaR
RoCET1
 
return on CET1 capital
RoU
 
right-of-use
rTSR
 
relative total shareholder
return
RWA
 
risk-weighted assets
S
SA
 
standardized approach or
société anonyme
SA-CCR
 
standardized approach for
counterparty credit risk
SAR
 
Special Administrative
Region of the People’s
Republic of China
SDG
 
Sustainable Development
Goal
SEC
 
US Securities and Exchange
Commission
SFT
 
securities financing
transaction
SI
 
sustainable investing or
sustainable investment
SIBOR
 
Singapore Interbank
Offered Rate
SICR
 
significant increase in credit
risk
SIX
 
SIX Swiss Exchange
SME
 
small and medium-sized
entities
SMF
 
Senior Management
Function
SNB
 
Swiss National Bank
SOR
 
Singapore Swap Offer Rate
SPPI
 
solely payments of principal
and interest
SRB
 
systemically relevant bank
SRM
 
specific risk measure
SVaR
 
stressed value-at-risk
T
TBTF
 
too big to fail
TCFD
 
Task
 
Force on Climate-
related Financial Disclosures
TIBOR
 
Tokyo
 
Interbank Offered
Rate
TLAC
 
total loss-absorbing capacity
TTC
 
through the cycle
U
USD
 
US dollar
V
VaR
 
value-at-risk
VAT
value added tax
This is a
 
general list
 
of the
 
abbreviations frequently
 
used in
 
our financial
 
reporting. Not
 
all of the
 
listed abbreviations
may appear in this particular report.
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
103
Information sources
 
Reporting publications
Annual publications
UBS
 
Group
 
Annual
 
Report
:
 
Published
 
in
 
English,
 
this
 
report
 
provides
 
descriptions
 
of:
 
the
 
Group
 
strategy
 
and
performance; the
 
strategy and
 
performance of
 
the business
 
divisions and
 
Group Items;
 
risk, treasury
 
and capital
management; corporate
 
governance;
 
the compensation
 
framework, including
 
information about
 
compensation for
the Board of Directors and the Group Executive Board members; and financial information, including the financial
statements.
 
“Auszug aus
 
dem Geschäftsbericht
”: This publication
 
provides a German
 
translation of
 
selected sections
 
of the UBS
Group Annual Report.
 
Compensation
 
Report
:
 
This
 
report
 
discusses
 
the
 
compensation
 
framework
 
and
 
provides
 
information
 
about
compensation for
 
the Board
 
of Directors
 
and the
 
Group Executive
 
Board members.
 
It is
 
available in
 
English and
German (
“Vergütungsbericht
”) and represents a component of the UBS
 
Group Annual Report.
Sustainability Report
: Published
 
in English,
 
the Sustainability Report
 
provides disclosures on
 
environmental, social
and governance topics related to the UBS Group.
 
It also provides certain disclosures related to diversity,
 
equity and
inclusion.
Quarterly publications
 
Quarterly financial report
: This report provides an
 
update on performance and strategy (where
 
applicable) for the
respective quarter. It is available in English.
The annual
 
and quarterly
 
publications
 
are available
 
in .pdf
 
and online
 
formats
 
at
ubs.com/investors
, under
 
“Financial
information.” Starting
 
with the
 
Annual Report
 
2022, printed
 
copies,
 
in any
 
language, of
 
the aforementioned
 
annual
publications are no longer provided.
 
Other information
Website
The “Investor
 
Relations” website
 
at
ubs.com/investors
 
provides the
 
following information
 
about UBS:
 
results-related
news
 
releases;
 
financial
 
information,
 
including
 
results-related
 
filings
 
with
 
the
 
US
 
Securities
 
and
 
Exchange
Commission (the SEC);
 
information for shareholders,
 
including UBS share price
 
charts, as well as
 
data and dividend
information, and
 
for bondholders;
 
the corporate
 
calendar; and
 
presentations by
 
management for
 
investors and
financial analysts. Information is available
 
online in English, with some information
 
also available in German.
Results presentations
Quarterly
 
results
 
presentations
 
are
 
webcast
 
live.
 
Recordings
 
of
 
most
 
presentations
 
can
 
be
 
downloaded
 
from
ubs.com/presentations
.
Messaging service
Email
 
alerts
 
to
 
news
 
about
 
UBS
 
can
 
be
 
subscribed
 
for
 
under
 
“UBS
 
News
 
Alert”
 
at
ubs.com/global/en/investor-
relations/contact/investor-services.html
. Messages are sent in English, German, French or Italian, with an option to
select theme preferences for such alerts.
Form 20-F and other submissions to the US
 
Securities and Exchange Commission
UBS files periodic
 
reports with
 
and submits
 
other information
 
to the
 
SEC. Principal
 
among these
 
filings is the
 
annual
report on Form 20-F,
 
filed pursuant to
 
the US Securities
 
Exchange Act of 1934.
 
The filing of
 
Form 20-F is structured
as a wraparound document. Most sections of the filing can be
 
satisfied by referring to the UBS Group AG Annual
Report. However, there is
 
a small amount
 
of additional information in
 
Form 20-F that is
 
not presented elsewhere
and is particularly targeted at readers in the US. Readers are encouraged to refer to this additional disclosure. Any
document that filed
 
with the SEC
 
is available on
 
the SEC’s website:
sec.gov
. Refer to
ubs.com/investors
 
for more
information.
 
 
 
 
UBS Group first quarter 2024 report |
Appendix
 
104
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 to the
 
anticipated effect of transactions
 
and strategic initiatives on
UBS’s
 
business and
 
future
 
development and
 
goals
 
or
 
intentions to
 
achieve climate,
 
sustainability and
 
other social
 
objectives. While
 
these
 
forward-looking
statements represent
 
UBS’s judgments,
 
expectations and
 
objectives concerning the
 
matters described,
 
a number
 
of risks,
 
uncertainties and
 
other important
factors could cause actual developments and results to differ materially from UBS’s expectations. In particular,
 
terrorist activity and conflicts
 
in the Middle East,
as well as the continuing Russia–Ukraine
 
war, may have significant impacts on global markets,
 
exacerbate global inflationary pressures, and slow
 
global growth.
In addition,
 
the ongoing
 
conflicts may
 
continue to
 
cause significant
 
population displacement,
 
and lead
 
to shortages
 
of vital
 
commodities, including
 
energy
shortages and food insecurity outside the areas immediately involved in armed conflict. Governmental responses to the armed conflicts, including, with
 
respect
to the Russia–Ukraine war, coordinated successive
 
sets of sanctions on
 
Russia and Belarus,
 
and Russian and Belarusian
 
entities and nationals, and
 
the uncertainty
as to whether
 
the ongoing conflicts will
 
widen and intensify,
 
may continue to
 
have significant adverse effects
 
on the market and
 
macroeconomic conditions,
including in
 
ways that
 
cannot be
 
anticipated. UBS’s
 
acquisition of
 
the Credit
 
Suisse Group
 
has materially
 
changed our
 
outlook and
 
strategic direction
 
and
introduced new operational challenges. The integration
 
of the Credit Suisse entities into the UBS structure is expected
 
to take between three and five years and
presents significant
 
risks, including
 
the risks that
 
UBS Group AG
 
may be unable
 
to achieve
 
the cost reductions
 
and other benefits
 
contemplated by
 
the transaction.
This creates significantly greater uncertainty about forward-looking statements. Other factors that may affect our performance and ability to achieve our plans,
outlook and other objectives also
 
include, but are not limited to:
 
(i) the degree to which UBS is successful
 
in the execution of its
 
strategic plans, including its cost
reduction and efficiency initiatives
 
and its ability to manage
 
its levels of risk-weighted
 
assets (RWA) and leverage ratio
 
denominator (LRD), liquidity
 
coverage ratio
and other financial resources,
 
including changes in RWA assets
 
and liabilities arising from higher
 
market volatility and the size
 
of the combined Group; (ii) the
degree to which UBS is successful in implementing changes to its businesses to meet changing market, regulatory
 
and other conditions, including as a result of
the acquisition of the Credit Suisse
 
Group; (iii) increased inflation and interest rate
 
volatility in major markets; (iv) developments in the macroeconomic climate
and in the markets in
 
which UBS operates or
 
to which it is
 
exposed, including movements
 
in securities prices or liquidity, credit spreads, currency
 
exchange rates,
deterioration or slow recovery in residential and commercial real estate markets, the effects of economic conditions, including increasing inflationary pressures,
market developments, increasing geopolitical tensions, and changes to national trade policies on the financial position or creditworthiness of
 
UBS’s clients and
counterparties, as well as on client sentiment and levels of activity; (v) changes in the availability of capital and funding, including
 
any adverse changes in UBS’s
credit spreads and credit ratings of UBS, Credit Suisse, sovereign issuers, structured credit products or
 
credit-related exposures, as well as availability and cost of
funding to
 
meet requirements
 
for debt
 
eligible for
 
total loss-absorbing
 
capacity (TLAC),
 
in particular
 
in light
 
of the
 
acquisition of
 
the Credit
 
Suisse Group;
(vi) changes in central
 
bank policies or
 
the implementation
 
of financial legislation
 
and regulation in
 
Switzerland, the
 
US, the UK,
 
the EU and
 
other financial
 
centers
that have imposed, or resulted
 
in, or may do so
 
in the future, more stringent
 
or entity-specific capital,
 
TLAC, leverage ratio, net
 
stable funding ratio, liquidity
 
and
funding
 
requirements,
 
heightened
 
operational
 
resilience
 
requirements,
 
incremental
 
tax
 
requirements,
 
additional
 
levies,
 
limitations
 
on
 
permitted
 
activities,
constraints on remuneration, constraints
 
on transfers of capital
 
and liquidity and sharing of
 
operational costs across the
 
Group or other measures, and the
 
effect
these will
 
or would
 
have on
 
UBS’s business
 
activities; (vii) UBS’s
 
ability to
 
successfully implement
 
resolvability and
 
related regulatory requirements
 
and the
 
potential
need to make further changes to the
 
legal structure or booking model of
 
UBS in response to legal and regulatory requirements
 
and any additional requirements
due to its acquisition of the Credit Suisse Group, or other developments; (viii) UBS’s ability to maintain and improve its systems and controls for complying
 
with
sanctions in a timely
 
manner and for the detection
 
and prevention of money
 
laundering to meet evolving
 
regulatory requirements and expectations,
 
in particular
in current geopolitical turmoil;
 
(ix) the uncertainty arising from domestic
 
stresses in certain major economies;
 
(x) changes in UBS’s competitive
 
position, including
whether differences in regulatory capital and other requirements among the major financial centers adversely affect UBS’s ability to
 
compete in certain lines of
business; (xi) changes in the standards of conduct applicable to our businesses that may result from new regulations or new enforcement of existing standards,
including measures to impose new and enhanced duties when interacting with customers and in the execution and handling of customer transactions; (xii) the
liability to which UBS may be exposed, or possible
 
constraints or sanctions that regulatory authorities
 
might impose on UBS, due to litigation, contractual
 
claims
and regulatory
 
investigations, including the
 
potential for
 
disqualification from
 
certain businesses, potentially
 
large fines
 
or monetary
 
penalties, or
 
the loss
 
of
licenses or privileges as
 
a result of
 
regulatory or other governmental sanctions, as
 
well as the effect
 
that litigation, regulatory and similar
 
matters have on the
operational risk component of our RWA, including as a result of
 
its acquisition of the Credit Suisse Group, as well as
 
the amount of capital available for return
to shareholders; (xiii) the effects on UBS’s business, in particular cross-border
 
banking, of sanctions, tax or regulatory developments and of possible changes in
UBS’s policies
 
and practices;
 
(xiv) UBS’s ability
 
to retain
 
and attract
 
the employees
 
necessary to
 
generate revenues
 
and to
 
manage, support
 
and control
 
its
businesses, which may be
 
affected by competitive factors;
 
(xv) changes in accounting
 
or tax standards or
 
policies, and determinations
 
or interpretations affecting
the
 
recognition
 
of
 
gain
 
or
 
loss,
 
the
 
valuation
 
of
 
goodwill,
 
the
 
recognition
 
of
 
deferred
 
tax
 
assets
 
and
 
other matters;
 
(xvi) UBS’s ability
 
to
 
implement new
technologies and business methods, including digital services and technologies, and ability to successfully compete with both existing
 
and new financial service
providers, some of which may not be
 
regulated to the same extent; (xvii) limitations on the
 
effectiveness of UBS’s internal processes for risk management, risk
control, measurement and modeling,
 
and of financial models
 
generally; (xviii) the occurrence of
 
operational failures, such as
 
fraud, misconduct, unauthorized
trading, financial crime, cyberattacks,
 
data leakage and systems failures,
 
the risk of which is increased
 
with cyberattack threats from both
 
nation states and non-
nation-state actors targeting
 
financial institutions; (xix) restrictions
 
on the ability of UBS
 
Group AG and UBS AG
 
to make payments or
 
distributions, including due
to restrictions on the ability of
 
its subsidiaries to make loans or distributions, directly
 
or indirectly,
 
or, in
 
the case of financial difficulties, due to
 
the exercise by
FINMA or the regulators of UBS’s operations in other countries of their broad statutory powers in relation
 
to protective measures, restructuring and liquidation
proceedings; (xx) the degree to which
 
changes in regulation, capital or
 
legal structure, financial results or
 
other factors may affect UBS’s ability
 
to maintain its
stated capital return objective;
 
(xxi) uncertainty over the scope
 
of actions that may
 
be required by UBS, governments
 
and others for UBS to
 
achieve goals relating
to climate, environmental and social matters, as well as the evolving
 
nature of underlying science and industry and the possibility of conflict
 
between different
governmental standards and regulatory regimes; (xxii) the ability of UBS to
 
access capital markets; (xxiii) the ability of UBS to successfully
 
recover from a disaster
or other
 
business continuity
 
problem due
 
to a
 
hurricane, flood,
 
earthquake, terrorist
 
attack, war,
 
conflict (e.g.,
 
the Russia–Ukraine
 
war), pandemic,
 
security
breach, cyberattack, power
 
loss, telecommunications failure or
 
other natural or
 
man-made event, including
 
the ability to
 
function remotely during
 
long-term
disruptions such as the COVID-19 (coronavirus) pandemic; (xxiv) the level
 
of success in the absorption of Credit Suisse, in the integration of the two groups
 
and
their businesses, and in the execution of the planned strategy regarding cost reduction and divestment of any non-core assets, the existing assets and liabilities
of Credit Suisse, the level
 
of resulting impairments and write-downs, the effect of
 
the consummation of the integration on the operational results,
 
share price
and credit
 
rating of UBS
 
– delays,
 
difficulties, or
 
failure in
 
closing the transaction
 
may cause market
 
disruption and challenges
 
for UBS
 
to maintain
 
business,
contractual and operational relationships;
 
and (xxv) the effect that these or other
 
factors or unanticipated events,
 
including media reports and speculations,
 
may
have on our
 
reputation and the
 
additional consequences that this
 
may have on
 
our business and
 
performance. The sequence in
 
which the factors
 
above are
presented is not indicative of their likelihood of occurrence or the potential magnitude of their consequences.
 
Our business and financial performance could be
affected by other factors identified in our past and
 
future filings and reports, including those filed with the
 
US Securities and Exchange Commission (the SEC).
More detailed information about those factors is set forth in documents furnished by UBS and filings made by UBS with
 
the SEC, including the UBS Group AG
and UBS AG Annual Reports
 
on Form 20- F for the year
 
ended 31 December 2023. UBS
 
is not under any obligation
 
to (and expressly disclaims any
 
obligation to)
update or alter its forward-looking statements, whether
 
as a result of new information, future events, or otherwise.
Rounding |
 
Numbers presented throughout this report may not add up
 
precisely to the totals provided in the tables and text.
 
Percentages and percent changes
disclosed in text and tables are
 
calculated on the basis of unrounded
 
figures. Absolute changes between reporting periods disclosed in
 
the text, which can be
derived from numbers presented in related tables, are calculated on
 
a rounded basis.
Tables |
 
Within tables, blank fields generally indicate non-applicability or that presentation of any content would not be meaningful, or that information is not
available as of the relevant date or for the relevant period. Zero values generally indicate that the respective figure is zero on an actual or rounded basis.
 
Values
that are zero on a rounded basis can be either negative
 
or positive on an actual basis.
Websites |
 
In this report, any
 
website addresses are provided
 
solely for information
 
and are not intended
 
to be active links.
 
UBS is not incorporating
 
the contents
of any such websites into this report.
edgarq24ubsgroupagp108i0
UBS Group AG
P.O. Box
CH-8098 Zurich
ubs.com
This
 
Form
 
6-K
 
is
 
hereby
 
incorporated
 
by
 
reference
 
into
 
(1)
 
each
 
of
 
the
 
registration
 
statements
 
on
 
Form
 
F-3
(Registration Numbers
 
333-263376, 333-272539
 
and 333-272452),
 
and on
 
Form S-8
 
(Registration Numbers
 
333-
200634; 333-200635;
 
333-200641; 333-200665; 333-215254;
 
333-215255; 333-228653; 333-230312;
 
333-249143
and 333-272975), and
 
into each
 
prospectus outstanding under
 
any of the
 
foregoing registration statements, (2)
 
any
outstanding
 
offering
 
circular
 
or
 
similar
 
document
 
issued
 
or
 
authorized
 
by
 
UBS
 
AG
 
and
 
Credit
 
Suisse
 
AG
 
that
incorporates by reference any Forms 6-K of UBS AG
 
and Credit Suisse AG (respectively) that are incorporated
 
into
its registration
 
statements filed
 
with the
 
SEC, and
 
(3) the
 
base prospectus
 
of Corporate
 
Asset Backed
 
Corporation
(“CABCO”) dated June 23,
 
2004 (Registration Number 333-111572), the Form 8-K
 
of CABCO filed and dated
 
June
23, 2004 (SEC
 
File Number 001-13444), and
 
the Prospectus Supplements relating to
 
the CABCO Series 2004-101
Trust dated May 10, 2004 and May 17, 2004 (Registration Number 033-91744 and 033-91744-05).
 
 
 
 
 
 
 
 
 
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
 
registrants have duly caused this
report to be signed on their behalf by the undersigned, thereunto duly
 
authorized.
UBS Group AG
By:
 
/s/
 
Sergio Ermotti
 
___
Name:
 
Sergio Ermotti
Title:
 
Group Chief Executive Officer
 
By:
 
/s/ Todd Tuckner
 
_
Name:
 
Todd Tuckner
Title:
 
Group Chief Financial Officer
By:
 
/s/ Steffen Henrich
 
____________
Name:
 
Steffen Henrich
Title:
 
Group Controller
 
UBS AG
By:
 
/s/
 
Sergio Ermotti
 
_
Name:
 
Sergio Ermotti
Title:
 
President of the Executive Board
By:
 
/s/ Todd Tuckner
 
_
Name:
 
Todd Tuckner
Title:
 
Chief Financial Officer
By:
 
/s/ Steffen Henrich
 
_____________
Name:
 
Steffen Henrich
Title:
 
Controller
 
Credit Suisse AG
By:
 
/s/
 
Ulrich Körner
 
______________
Name:
 
Ulrich Körner
Title:
 
Chief Executive Officer
By:
 
/s/
 
Simon Grimwood
 
_
Name:
 
Simon Grimwood
Title:
 
Chief Financial Officer
Date:
 
May 7, 2024
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