UBS’s fourth-quarter 2014 results-Fourth-quarter net profit CHF 1 billion; ordinary dividend doubled 

2014 net profit attributable to shareholders up 13% to CHF 3.6 billion; diluted EPS CHF 0.94

Ordinary dividend of CHF 0.50 per share proposed for the financial year 2014

Accrued one-time supplementary dividend of CHF 0.25 per share

Fully applied Basel III CET 1 ratio remains best in peer group

Following a fourth-quarter net profit attributable to shareholders of CHF 1 billion, UBS Group AG‘s net profit for 2014 increased 13% year over year to CHF 3.6 billion. Profit before tax for the year was CHF 2.9 billion on an adjusted basis and CHF 2.6 billion on a reported basis. All of UBS’s business divisions made significant progress in 2014. Wealth Management adjusted1 profit before tax increased 4% and the business attracted the highest net new money in Asia Pacific since 2007. Wealth Management Americas achieved another record adjusted1 profit before tax, which exceeded USD 1 billion. Retail & Corporate delivered on all its targets and adjusted1 profit before tax rose 4%. Global Asset Management achieved a significant turnaround in net new money, while the Investment Bank delivered a strong performance, with revenues up 8% in Corporate Client Solutions.

In 2014, UBS continued to reduce risk-weighted assets (RWA), improve its leverage ratio, and maintain the best fully applied Basel III CET 1 ratio in its peer group. These achievements, along with the 13% rise in net profit, enabled the firm to deliver attractive returns to its shareholders. Consequently, UBS intends to propose an ordinary dividend of CHF 0.50 per share for the financial year 2014, an increase of 100% on the prior year and a payout ratio of 53% of the Group’s reported net profit.

Reflecting progress in the establishment of the new Group holding company, including the successful completion of the share-for-share exchange offer, UBS fully accrued a supplementary capital return of CHF 0.25 per share in the fourth quarter of 2014. Subject to shareholder approval, UBS Group AG intends to pay this one-time supplementary capital return upon successful completion of the squeeze-out procedure. UBS Group AG intends (subject to market conditions) to enter the capital markets with its initial offering of additional tier 1 (AT1) capital securities later this month.

Commenting on UBS’s full-year and fourth-quarter results, Group Chief Executive Officer Sergio P. Ermotti said, “I am pleased with what we have achieved in 2014. The results are strong, our capital is strong and we’ve completed our strategic transformation, preparing us well for the future. While it’s premature to draw a conclusion about the quarter, we’ve had a solid start to the year. This gives us additional confidence to propose a significant capital return to our shareholders.”

Information in this release is presented for UBS Group AG on a consolidated basis unless otherwise specified. Key figures for UBS AG are included at the end of this release. Financial information for UBS AG does not differ materially from UBS Group AG; the differences are described on page 11 and 12 of the UBS Group AG quarterly report.

Full-year highlights

• Net profit attributable to UBS Group AG shareholders CHF 3.6 billion; diluted earnings per share CHF 0.94
• Ordinary dividend for the financial year 2014 of CHF 0.50 per share to be proposed, an increase of 100% and payout ratio of 53%
• One-time supplementary dividend of CHF 0.25 per share accrued
• Adjusted¹ profit before tax CHF 2.9 billion
• Fully applied common equity tier 1 (CET1) ratio surpassed the firm’s long-stated target of 13%, enabling the firm to maintain the best fully applied Basel III CET 1 ratio in its peer group even as it accrued for increased returns to shareholders
• Fully applied RWA of CHF 216 billion versus end-2015 target of under CHF 215 billion
• Fully applied Swiss SRB leverage ratio up 70 basis points to 4.1%; leverage, funding and liquidity ratios all remain comfortably above regulatory requirements
• Wealth Management increased adjusted¹ profit before tax 4% to CHF 2.5 billion, the highest since 2008; net new money strong at CHF 34.4 billion, reflecting highest net inflows from Asia Pacific since 2007 and resulting in net new money growth within the target range
• Wealth Management Americas achieved record adjusted¹ profit before tax of over USD 1.0 billion; net new money USD 10.0 billion; gross margin and adjusted¹ cost / income ratio both within the target ranges
• Retail & Corporate increased adjusted¹ profit before tax 4% to CHF 1.6 billion; net new business volume growth, net interest margin and adjusted¹ cost / income ratio all within the target ranges
• Global Asset Management adjusted¹ profit before tax CHF 0.5 billion; net new money excluding money market flows CHF 22.6 billion, resulting in net new money growth rate within the target range
• Investment Bank recorded adjusted¹ profit before tax of CHF 0.3 billion as the business dealt with industry-wide legal and regulatory issues and operated within tight resource limits; revenues up 8% in Corporate Client Solutions

Fourth-quarter highlights

• Net profit attributable to UBS Group AG shareholders CHF 963 million; diluted earnings per share CHF 0.26
• Adjusted¹ profit before tax CHF 648 million
• Wealth Management adjusted¹ profit before tax CHF 694 million; net new money CHF 3.0 billion on buoyant net new money flows from clients in Asia Pacific, ultra high net worth clients globally and its domestic business in Europe; adjusted¹ cost / income ratio remained within the target range
• Wealth Management Americas adjusted¹ profit before tax USD 233 million; new quarterly record for operating income; net new money increased to USD 5.5 billion, annualized net new money growth rate, gross margin and adjusted¹ cost / income ratio all within the target ranges
• Retail & Corporate adjusted¹ profit before tax CHF 356 million; net interest margin and adjusted¹ cost / income ratio both remained within the target ranges
• Global Asset Management adjusted¹ profit before tax CHF 124 million; higher operating income primarily reflected increased performance fees in traditional investments and global real estate
• Investment Bank adjusted¹ profit before tax CHF 426 million; revenues higher in both advisory and equity capital markets; while the adjusted¹ annualized return on attributed equity was below the target for the year, it was above the target for the quarter; adjusted¹ cost / income ratio improved and was within the target range

Read full UBS financial report

Source: UBS – UBS’s fourth-quarter 2014 results

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