6-K 1 edgarq24ubsag.htm edgarq24ubsag
 
 
 
 
 
 
 
 
 
 
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: November 8, 2024
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
 
Indicate by check mark whether the registrant files 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 Third Quarter 2024 Report of UBS AG, which
 
appears immediately following this
page.
 
edgarq24ubsagp3i0
 
UBS AG
Third quarter
 
2024 report
 
 
 
 
Corporate calendar UBS AG
Information about future publication dates is generally
 
available at
ubs.com/global/en/investor-relations/events/calendar.html
Contacts
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
Imprint
Publisher: UBS 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 AG
4
6
2.
Business divisions and
 
Group Items
14
16
18
20
22
23
3.
Risk, capital, liquidity and funding,
and balance sheet
25
31
38
39
4.
Consolidated
 
financial statements
43
82
Appendix
84
88
90
91
1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report
 
2
Terms used in this report, unless the context requires otherwise
“UBS”, “UBS Group”, “UBS Group
 
AG consolidated”, “Group” and
 
“the Group”
UBS Group AG and its consolidated subsidiaries
“UBS AG”, “UBS
 
AG consolidated”, “we”, “us” and
 
“our”
 
UBS AG and its consolidated subsidiaries
“Credit Suisse AG” and “Credit
 
Suisse AG consolidated”
Credit Suisse AG and its consolidated subsidiaries
 
before the merger
with UBS AG
“Credit Suisse Group“ and “Credit Suisse Group
 
AG consolidated”
Pre-acquisition Credit Suisse Group
”Credit Suisse”
 
Credit Suisse AG and its consolidated subsidiaries
 
before the merger
with UBS AG, 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
“UBS AG standalone”
 
UBS 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
“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. A number of APMs are reported in UBS’s 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
 
under “Alternative performance
 
measures”
in the
 
appendix to
 
this report.
 
These APMs
 
may qualify
 
as non-GAAP
 
measures as
 
defined by
 
US Securities
 
and
Exchange Commission (SEC) regulations.
Comparability
Comparative information in this report is
 
presented as follows.
Profit and
 
loss information
 
for the third
 
quarter of
 
2024 is based
 
entirely on
 
consolidated data
 
following the
 
merger
of UBS AG and
 
Credit Suisse AG. Profit
 
and loss information for the
 
second quarter of 2024 includes
 
one month
(June 2024)
 
of post-merger consolidated
 
data and
 
two months of
 
pre-merger UBS AG
 
data only
 
(April and
 
May
2024). Profit and
 
loss information for
 
the fourth quarter
 
of 2023 and
 
the third quarter
 
of 2023 includes
 
pre-merger
UBS
 
AG
 
data only.
 
Year-to-date information
 
for
 
2024 includes
 
four
 
months (June
 
to
 
September 2024)
 
of
 
post-
merger consolidated data and five
 
months of pre-merger UBS AG
 
data only (January to May
 
2024). Comparative
year-to-date information for 2023 includes pre-merger
 
UBS AG data only.
Balance
 
sheet
 
information
 
as
 
at
 
30 September
 
2024
 
and
 
30 June
 
2024
 
includes
 
post-merger
 
consolidated
information. Balance sheet dates prior to 30 June
 
2024 reflect pre-merger UBS AG information
 
only.
 
Comparison between UBS AG consolidated
 
and UBS Group AG consolidated
A
 
comparison
 
of
 
selected
 
financial
 
and
 
capital
 
information
 
of
 
UBS
 
AG
 
consolidated
 
and
 
of
 
UBS
 
Group
 
AG
consolidated is provided after the Notes to the UBS AG
 
interim consolidated financial statements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report
 
3
UBS AG consolidated key figures
UBS AG consolidated key figures
As of or for the quarter ended
 
As of or year-to-date
USD m, except where indicated
30.9.24
30.6.24
31.12.23
30.9.23
30.9.24
30.9.23
Results
Total revenues
 
11,997
 
9,900
 
8,014
 
8,348
 
31,006
 
25,661
Credit loss expense / (release)
 
167
 
84
 
62
 
27
 
303
 
80
Operating expenses
 
10,640
 
10,012
 
7,618
 
7,047
 
28,329
 
21,393
Operating profit / (loss) before tax
 
1,191
 
(196)
 
333
 
1,275
 
2,374
 
4,188
Net profit / (loss) attributable to shareholders
 
996
 
(264)
 
235
 
932
 
1,738
 
3,055
Profitability and growth
1
Return on equity (%)
 
4.2
 
(1.4)
 
1.7
 
7.0
 
3.1
 
7.4
Return on tangible equity (%)
 
4.5
 
(1.6)
 
2.0
 
8.0
 
3.4
 
8.3
Return on common equity tier 1 capital (%)
 
4.8
 
(1.7)
 
2.1
 
8.6
 
3.6
 
9.5
Return on leverage ratio denominator, gross (%)
 
3.0
 
3.0
 
3.0
 
3.2
 
3.1
 
3.3
Cost / income ratio (%)
 
88.7
 
101.1
 
95.1
 
84.4
 
91.4
 
83.4
Net profit growth (%)
 
6.9
n.m.
 
(84.5)
 
(41.7)
 
(43.1)
 
(45.1)
Resources
Total assets
 
1,626,893
 
1,564,664
 
1,156,016
 
1,097,536
 
1,626,893
 
1,097,536
Equity attributable to shareholders
 
96,943
 
93,392
 
55,234
 
52,836
 
96,943
 
52,836
Common equity tier 1 capital
2
 
84,423
 
83,001
 
44,130
 
43,378
 
84,423
 
43,378
Risk-weighted assets
2
 
515,520
 
509,953
 
333,979
 
321,134
 
515,520
 
321,134
Common equity tier 1 capital ratio (%)
2
 
16.4
 
16.3
 
13.2
 
13.5
 
16.4
 
13.5
Going concern capital ratio (%)
2
 
19.5
 
19.2
 
17.0
 
17.1
 
19.5
 
17.1
Total loss-absorbing capacity ratio (%)
2
 
38.2
 
38.6
 
33.3
 
33.8
 
38.2
 
33.8
Leverage ratio denominator
2
 
1,611,151
 
1,564,001
 
1,104,408
 
1,042,106
 
1,611,151
 
1,042,106
Common equity tier 1 leverage ratio (%)
2
 
5.2
 
5.3
 
4.0
 
4.2
 
5.2
 
4.2
Liquidity coverage ratio (%)
3
 
196.3
 
194.1
 
189.7
 
176.6
 
196.3
 
176.6
Net stable funding ratio (%)
 
126.8
 
127.7
 
119.6
 
121.7
 
126.8
 
121.7
Other
Invested assets (USD bn)
1,4
 
6,199
 
5,871
 
4,505
 
4,227
 
6,199
 
4,227
Personnel (full-time equivalents)
 
69,185
 
70,750
 
47,590
 
48,015
 
69,185
 
48,015
1 Refer to “Alternative
 
performance measures” in the appendix to
 
this report for the definition and
 
calculation method.
 
2 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.
 
3 The disclosed ratios represent quarterly averages for the quarters presented and are calculated based on an average of 65 data points in the
third quarter of 2024, 61 data points in the
 
second quarter of 2024, of which 40 data points were
 
before the merger of UBS AG and Credit Suisse
 
AG (i.e. from 2 April 2024 until
 
30 May 2024), and 21 data points
were after the merger (i.e.
 
from 31 May 2024
 
until 30 June 2024),
 
63 data points in the
 
fourth quarter of 2023
 
and 63 data points
 
in the third quarter
 
of 2023. Refer to
 
the “Liquidity and funding
 
management”
section of this report for more information.
 
4 Consists of invested assets for Global Wealth Management, Asset Management (including invested assets from
 
associates) and Personal & Corporate Banking. Refer to
“Note 31 Invested assets and net new money” in the “Consolidated financial statements” section of the UBS AG Annual Report 2023, available under “Annual reporting” at ubs.com/investors, for more information.
 
 
UBS AG third quarter 2024 report |
UBS AG | Recent developments
 
4
UBS AG
Management report
Recent developments
Integration of Credit Suisse
We continue to make progress related to the integration of
 
Credit Suisse, with the current focus on client account
and platform migrations.
Following the merger of UBS AG and Credit Suisse AG in May 2024
 
and the transition to a single US intermediate
holding company in June
 
2024, the merger of
 
UBS Switzerland AG and Credit
 
Suisse (Schweiz) AG was
 
completed
on 1 July 2024 and was another critical step on
 
our integration roadmap.
In October 2024, we completed the migration of our Global
 
Wealth Management client accounts in Luxembourg
and Hong Kong to UBS
 
platforms and we plan
 
to migrate our Global
 
Wealth Management client
 
accounts booked
in
 
Singapore
 
and
 
Japan
 
before
 
the
 
end
 
of
 
2024.
 
In
 
Switzerland,
 
we
 
expect
 
the
 
next
 
phase
 
of
 
Global
 
Wealth
Management and Personal & Corporate Banking
 
client account migrations in the second quarter
 
of 2025.
 
Our
 
Non-core
 
and
 
Legacy
 
business
 
division
 
continues
 
to
 
actively
 
exit
 
positions
 
and
 
reduce
 
its
 
exposures.
 
On
13 August
 
2024,
 
UBS
 
entered
 
into
 
an
 
agreement
 
to
 
sell
 
Select
 
Portfolio
 
Servicing,
 
the
 
US
 
mortgage-servicing
business of Credit Suisse managed in the Non-core and Legacy business division. Completion of the transaction is
subject to regulatory approvals and other customary closing conditions. The
 
transaction is expected to close in the
first
 
quarter
 
of
 
2025.
 
UBS AG
 
does
 
not
 
expect
 
to
 
recognize
 
a
 
material
 
profit
 
or
 
loss
 
upon
 
completion
 
of
 
the
transaction. Based
 
on balances
 
as of
 
30 September 2024,
 
the completion
 
of the
 
transaction would
 
reduce UBS AG’s
risk-weighted
 
assets
 
(RWA)
 
by
 
around
 
USD 1.4bn
 
and
 
UBS AG’s
 
leverage
 
ratio
 
denominator
 
(LRD)
 
by
 
around
USD 1.7bn.
In
 
October
 
2024, UBS
 
entered into
 
an
 
agreement to
 
sell
 
to American
 
Express Swiss
 
Holdings GmbH
 
(American
Express) its 50% interest
 
in Swisscard AECS GmbH
 
(Swisscard), a joint venture
 
between UBS and American
 
Express
in Switzerland. In addition, UBS
 
and Swisscard entered into an
 
agreement to transition the Credit
 
Suisse-branded
card portfolios to UBS. Both
 
transactions are subject to certain
 
closing conditions and are not
 
expected to have a
material impact for UBS.
 
Regulatory and legal developments
Withholding tax exemption period for too-big-to-fail
 
instruments
In August
 
2024, the
 
Swiss Federal
 
Council launched
 
a consultation
 
related to
 
the existing
 
withholding
 
tax exemption
that
 
applies
 
to
 
too-big-to-fail instruments
 
issued
 
by
 
no
 
later
 
than
 
31 December 2026.
 
The
 
Federal Council
 
had
recommended an
 
unlimited extension
 
of the
 
exemption as
 
part of
 
a broader reform
 
package in
 
its April
 
2024 report
on banking stability. As these reforms are not expected to enter into force before the expiry of the existing special
rules,
 
the
 
Swiss
 
Federal
 
Council
 
proposes
 
to
 
extend
 
the
 
current
 
exemption,
 
from
 
31 December
 
2026
 
to
31 December 2031, to ensure that banks can continue
 
to issue capital instruments on competitive terms.
 
Swiss legislators postpone the review of
 
a public liquidity backstop
In
 
August
 
2024,
 
the Swiss
 
Economic Affairs
 
and
 
Taxation
 
Committee of
 
the Council
 
of
 
States deferred
 
further
deliberations on
 
the introduction
 
of a
 
public liquidity
 
backstop until
 
the Swiss
 
parliamentary
 
investigation
 
committee
publishes its report on the failure
 
of the Credit Suisse Group, which
 
is expected to be released
 
by the end of 2024.
 
FINMA suspends annual approval of UBS’s
 
recovery and emergency plans
 
In October 2024, the Swiss
 
Financial Market Supervisory
 
Authority (FINMA) published its
 
2024 resolution reporting
for UBS. FINMA noted that if the preferred
 
resolution strategy was applied, UBS would be resolvable by means of
a
 
single
 
point
 
of
 
entry
 
recapitalization.
 
Considering
 
the
 
ongoing
 
integration
 
activities
 
and
 
the
 
additional
requirements for alternative
 
resolution strategies following
 
the Credit Suisse
 
crisis, including
 
the need for
 
legislative
changes, FINMA announced
 
that it
 
had suspended
 
the annual
 
approval of
 
UBS’s recovery
 
and emergency plans.
UBS has started working on the new plans
 
in close dialogue with FINMA.
 
UBS AG third quarter 2024 report |
UBS AG | Recent developments
 
5
Switzerland implements the Income Inclusion Rule
In September 2024, the Swiss
 
Federal Council introduced the Income
 
Inclusion Rule (the IIR), a measure developed
by the Organisation
 
for Economic Co-operation and
 
Development (the OECD) as
 
part of the
 
minimum corporate
taxation rules applicable to corporate
 
groups with a worldwide turnover of
 
at least EUR 750m. Under the IIR,
 
the
profits of foreign subsidiaries and branches of Swiss corporate groups will be taxed at a minimum rate of 15% on
the OECD global minimum tax
 
base with respect
 
to each jurisdiction in
 
which the corporate groups
 
operate. The
IIR complements
 
the Swiss
 
supplementary
 
tax that
 
was introduced
 
in January
 
2024. The
 
IIR will
 
apply from
 
1 January
2025, and UBS expects the overall tax impact from
 
the IIR will be limited, given that UBS is
 
subject to a corporate
tax burden of more than 15% in the vast majority of countries
 
in which it operates.
Mutual recognition agreement with the UK
 
submitted to the Swiss Parliament
In
 
September
 
2024,
 
the
 
Swiss
 
Federal
 
Council
 
submitted
 
for
 
parliamentary
 
approval
 
a
 
mutual
 
recognition
agreement
 
(an
 
MRA)
 
with
 
the
 
UK
 
regarding
 
financial
 
services.
 
The
 
agreement
 
facilitates
 
cross-border
 
financial
activities based
 
on a
 
new model
 
for regulatory
 
cooperation and
 
an outcomes-based
 
mutual recognition
 
of domestic
rules.
 
The
 
MRA
 
is
 
supplemented
 
by
 
an
 
enhanced
 
and
 
closer
 
supervisory
 
process
 
and
 
additional
 
supervisory
arrangements where new market access
 
is granted. It is expected
 
that the Parliaments in Switzerland and
 
the UK
will grant approval for the MRA in 2025.
 
Developments related to the final Basel III implementation
In Switzerland,
 
the amendments
 
to the
 
Capital Adequacy
 
Ordinance that
 
will incorporate
 
the final
 
Basel III standards
into Swiss law are still scheduled to enter into force on 1 January 2025, as confirmed
 
by the Swiss Federal Council
in June 2024.
 
We expect that the adoption of the final
 
Basel III standards in January 2025 will have
 
a similar impact on UBS AG
consolidated as
 
on UBS Group,
 
leading to low
 
single-digit percentage
 
increases in
 
UBS AG’s consolidated
 
RWA and
LRD, reducing
 
the CET1
 
capital ratio
 
by around
 
30 basis points
 
and the
 
CET1 leverage
 
ratio by
 
around 10 basis
points. This
 
estimate is
 
based on
 
our current
 
understanding
 
of the
 
relevant standards,
 
as we
 
are in
 
an active
 
dialogue
with FINMA regarding various aspects of the
 
final rules. Our estimate for the RWA and
 
CET1 capital ratio does not
take into account the impact of the output
 
floor, which is to be phased in over time.
In
 
September
 
2024,
 
the
 
UK
 
Prudential
 
Regulatory
 
Authority
 
(the
 
PRA)
 
published
 
its
 
final
 
rules
 
covering
 
the
implementation of
 
the final Basel III
 
standards. As
 
part of the
 
package, the PRA
 
announced the
 
pushing back
 
of the
implementation date,
 
from 1 July 2025
 
to 1 January
 
2026, with
 
full phase-in
 
of the
 
output floor
 
by 1 January
 
2030.
The overall impact on UBS is expected to be
 
limited.
 
In the US,
 
the banking agencies, including the
 
Federal Reserve Board, have been
 
discussing amendments to their
original proposals
 
regarding the
 
implementation
 
of the
 
final Basel III
 
standards. The
 
banking agencies
 
have indicated
that they plan to issue a revised proposal before
 
issuing the final rules.
 
The Federal Reserve Board stress capital buffer
 
requirements
In August 2024, the Federal Reserve Board
 
assigned UBS Americas Holding LLC a stress capital
 
buffer (an SCB) of
9.3% as of 1
 
October 2024 (previously 9.1%)
 
under the Federal Reserve
 
Board’s SCB rule, resulting in
 
a total CET1
capital requirement of 13.8%.
 
The SCB for our
 
US-based intermediate holding
 
company is based
 
on the previously
released
 
results
 
of the
 
Federal Reserve
 
Board’s 2024
 
Dodd–Frank Act
 
Stress
 
Test
 
(DFAST),
 
where
 
UBS Americas
Holding LLC exceeded the minimum capital
 
requirements under the severely adverse scenario.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
6
UBS AG consolidated performance
Income statement
For the quarter ended
% change from
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
2Q24
3Q23
30.9.24
30.9.23
Net interest income
 
1,560
 
722
 
984
 
116
 
59
 
3,088
 
3,678
Other net income from financial instruments measured
 
at fair value through profit or loss
 
3,592
 
3,271
 
2,467
 
10
 
46
 
9,809
 
7,476
Net fee and commission income
 
6,334
 
5,601
 
4,666
 
13
 
36
 
17,084
 
13,883
Other income
 
510
 
306
 
231
 
67
 
120
 
1,025
 
624
Total revenues
 
11,997
 
9,900
 
8,348
 
21
 
44
 
31,006
 
25,661
Credit loss expense / (release)
 
167
 
84
 
27
 
98
 
528
 
303
 
80
Personnel expenses
 
5,788
 
4,797
 
3,951
 
21
 
46
 
14,746
 
11,697
General and administrative expenses
 
4,014
 
4,584
 
2,585
 
(12)
 
55
 
11,584
 
8,011
Depreciation, amortization and impairment of non-financial
 
assets
 
838
 
631
 
510
 
33
 
64
 
2,000
 
1,686
Operating expenses
 
10,640
 
10,012
 
7,047
 
6
 
51
 
28,329
 
21,393
Operating profit / (loss) before tax
 
1,191
 
(196)
 
1,275
 
(7)
 
2,374
 
4,188
Tax expense / (benefit)
 
 
194
 
28
 
339
 
601
 
(43)
 
587
 
1,115
Net profit / (loss)
 
997
 
(224)
 
936
 
6
 
1,787
 
3,072
Net profit / (loss) attributable to non-controlling interests
 
1
 
40
 
5
 
(98)
 
(85)
 
49
 
17
Net profit / (loss) attributable to shareholders
 
996
 
(264)
 
932
 
7
 
1,738
 
3,055
Comprehensive income
Total comprehensive income
 
3,623
 
271
 
(93)
 
3,724
 
2,251
Total comprehensive income attributable to non-controlling interests
 
21
 
20
 
(6)
 
3
 
37
 
8
Total comprehensive income attributable to shareholders
 
3,602
 
251
 
(86)
 
3,687
 
2,243
Integration-related expenses, by business division and Group Items
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Global Wealth Management
 
416
 
378
 
133
 
1,022
 
156
Personal & Corporate Banking
 
171
 
113
 
50
 
368
 
58
Asset Management
 
86
 
69
 
19
 
189
 
21
Investment Bank
 
154
 
161
 
102
 
430
 
130
Non-core and Legacy
 
268
 
187
 
115
 
515
 
115
Group Items
 
21
 
9
 
47
 
30
 
288
Total integration-related expenses
 
1,116
 
916
 
467
 
2,555
 
768
of which: total revenues
 
35
 
10
 
0
 
45
 
0
of which: operating expenses
 
1,081
 
906
 
467
 
2,510
 
768
3Q24 compared with 3Q23
The legal merger
 
of UBS AG
 
and Credit Suisse
 
AG on 31 May
 
2024 has had
 
a significant impact
 
on the results
 
from
June 2024 onward. This discussion and analysis of results compares the
 
third quarter of 2024, which covers three
full months of post-merger results, with the third
 
quarter of 2023, which included only pre-merger results. This
 
is
a material driver in many of the increases across
 
both revenues and operating expenses.
›
Refer to “Note 2 Accounting for the merger of UBS AG and Credit Suisse AG” in the “Consolidated financial
statements” section of this report for more information about the accounting for the merger of UBS AG and Credit
Suisse AG
Results: 3Q24 vs 3Q23
Operating profit
 
before
 
tax decreased
 
by USD 84m,
 
or 7%,
 
to USD 1,191m,
 
reflecting an
 
increase in
 
operating
expenses,
 
partly
 
offset
 
by
 
higher
 
total
 
revenues.
 
Operating
 
expenses
 
increased
 
by
 
USD 3,593m,
 
or
 
51%,
 
to
USD 10,640m, largely due
 
to an increase of USD 1,837m
 
in personnel expenses
 
and an increase of USD 1,429m
 
in
general and administrative expenses.
 
Depreciation, amortization and impairment of non-financial assets increased
by USD 328m. Total
 
revenues increased by USD 3,649m, or 44%, to USD 11,997m, largely due to a USD 1,702m
increase in combined net interest income
 
and other net income from financial instruments measured
 
at fair value
through profit
 
or loss
 
and due
 
to a
 
USD 1,668m increase
 
in net
 
fee and
 
commission
 
income. Other
 
income increased
by USD 279m. Net credit loss expenses were USD 167m, compared with
 
USD 27m in the third quarter of 2023.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
7
Integration-related
 
expenses
 
in
 
general
 
and
 
administrative
 
expenses,
 
primarily
 
included
 
shared
 
services
 
costs
charged
 
from
 
other
 
companies
 
in
 
the
 
UBS
 
Group
 
reporting
 
scope,
 
consulting
 
fees
 
and
 
outsourcing
 
costs.
Integration-related
 
personnel
 
expenses
 
were
 
mainly
 
due
 
to
 
salaries
 
and
 
variable
 
compensation
 
related
 
to
 
the
integration
 
of
 
Credit
 
Suisse.
 
In
 
addition,
 
there
 
was
 
accelerated
 
depreciation
 
of
 
properties
 
and
 
leasehold
improvements in depreciation, amortization and
 
impairment of non-financial assets.
 
Total revenues: 3Q24 vs 3Q23
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 1,702m to USD 5,153m,
 
mainly driven by
 
increases in Global Wealth Management,
Personal & Corporate Banking and the Investment
 
Bank.
 
Global Wealth Management increased by USD 527m
 
to USD 2,089m, mainly driven by the consolidation
 
of Credit
Suisse AG net interest income. The remaining variance was due to lower deposit margins, including the
 
effects of
shifts to
 
lower-margin deposit
 
products and
 
the effects
 
of liquidity
 
and funding
 
costs, partly
 
offset by
 
higher deposit
volumes. The remaining variance was also due
 
to lower loan revenues, reflecting lower
 
average volumes.
Personal & Corporate Banking increased by USD 543m
 
to USD 1,449m, largely due to the consolidation of Credit
Suisse AG net
 
interest income,
 
with the
 
remaining variance
 
mainly attributable
 
to higher
 
liquidity and
 
funding costs,
as well as lower
 
deposit margins resulting from
 
both lower reinvestment rates and
 
shifts to lower-margin deposit
products.
The
 
Investment
 
Bank
 
increased
 
by
 
USD 369m
 
to
 
USD 1,513m,
 
mainly
 
due
 
to
 
higher
 
revenues
 
in
 
Derivatives
 
&
Solutions, reflecting
 
increases mostly
 
in
 
Equity
 
Derivatives,
 
Foreign
 
Exchange and
 
Rates
 
revenues, as
 
well
 
as
 
an
increase in Global
 
Banking, mainly from
 
higher revenues across
 
Public Capital Markets.
 
In addition, there
 
was an
increase
 
in
 
Execution
 
Services
 
revenues,
 
mainly
 
due
 
to
 
higher
 
Cash
 
Equities
 
revenues
 
across
 
all
 
regions.
 
These
increases were partly offset by lower revenues
 
in Financing, particularly in the Capital Markets
 
Financing business.
Non-core
 
and
 
Legacy increased
 
by
 
USD 31m
 
to
 
USD 63m, mainly
 
due
 
to
 
the
 
consolidation of
 
Credit
 
Suisse AG
revenues. Total
 
revenues reflected
 
net gains
 
from position
 
exits, along
 
with net
 
interest income
 
from securitized
products and credit products.
Group Items was USD 14m compared with
 
negative USD 178m. Higher gains during the
 
third quarter of 2024 in
Group hedging and own debt,
 
including hedge accounting ineffectiveness, were driven
 
by mark-to-market effects
on portfolio-level economic hedges, mainly due
 
to decreasing interest rates.
 
›
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
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
1
2Q24
3Q23
30.9.24
30.9.23
1
Net interest income from financial instruments measured
 
at amortized cost and fair value
through other comprehensive income
 
(485)
 
(188)
 
617
 
158
 
(486)
 
2,454
Net interest income from financial instruments measured
 
at fair value through profit or
loss and other
 
2,045
 
910
 
368
 
125
 
456
 
3,573
 
1,224
Other net income from financial instruments measured
 
at fair value through profit or loss
 
3,592
 
3,271
 
2,467
 
10
 
46
 
9,809
 
7,476
Total
 
5,153
 
3,993
 
3,451
 
29
 
49
 
12,896
 
11,154
Global Wealth Management
 
2,089
 
1,640
 
1,562
 
27
 
34
 
5,287
 
5,075
of which: net interest income
 
1,662
 
1,317
 
1,269
 
26
 
31
 
4,183
 
4,192
of which: transaction-based income from foreign exchange and other
 
intermediary
activity
2
 
427
 
323
 
294
 
32
 
45
 
1,104
 
883
Personal & Corporate Banking
 
 
1,449
 
1,023
 
906
 
42
 
60
 
3,376
 
2,685
of which: net interest income
 
 
1,233
 
863
 
775
 
43
 
59
 
2,868
 
2,298
of which: transaction-based income from foreign exchange and other
 
intermediary
activity
2
 
216
 
161
 
130
 
34
 
65
 
509
 
387
Asset Management
 
24
 
(11)
 
(14)
 
1
 
(28)
Investment Bank
3
 
1,513
 
1,507
 
1,144
 
0
 
32
 
4,577
 
4,033
Non-core and Legacy
 
63
 
121
 
32
 
(48)
 
99
 
203
 
76
Group Items
 
14
 
(288)
 
(178)
 
(548)
 
(688)
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 “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 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.
 
3 Investment Bank information is provided
 
at the business-line level rather than by financial statement reporting line, in order to reflect the underlying business
 
activities, which is consistent with the structure
of the management discussion and analysis in the “Investment Bank” section of this report.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
8
Net fee and commission income
Net fee and commission income increased by USD 1,668m
 
to USD 6,334m.
Fees
 
for
 
portfolio
 
management
 
and
 
related
 
services
 
and
 
investment
 
fund
 
fees
 
increased
 
by
 
USD 788m
 
and
USD 359m, respectively,
 
predominantly in
 
Global Wealth
 
Management and
 
Asset Management.
 
These increases
were largely attributable
 
to the consolidation
 
of Credit
 
Suisse AG revenues,
 
as well
 
as positive market
 
performance.
Net brokerage
 
fees increased by
 
USD 304m to USD 1,042m,
 
predominantly due to
 
higher revenues
 
in Execution
Services
 
in
 
the
 
Investment
 
Bank,
 
mainly
 
due
 
to
 
increases
 
in
 
Cash
 
Equities
 
across
 
all
 
regions,
 
as
 
well
 
as
 
higher
revenues in
 
Global Wealth
 
Management,
 
which were
 
mainly due to
 
the consolidation
 
of Credit
 
Suisse revenues
 
and
higher levels of client activity, particularly in
 
the Americas, Asia Pacific and Switzerland
 
regions.
›
Refer to “Note 5 Net fee and commission income” in the “Consolidated financial statements” section of this report
for more information
Other income
Other
 
income
 
was
 
USD 510m,
 
compared
 
with
 
USD 231m
 
in
 
the
 
third
 
quarter
 
of
 
2023,
 
which
 
included
 
the
consolidation of Credit Suisse AG income. The increase was largely due to a USD 119m gain related to the sale of
our investment in an associate, recognized within the Investment Bank and in Non-core
 
and Legacy,
 
as well as an
USD 84m gain
 
in Asset
 
Management from
 
the closing
 
of the
 
remaining portion
 
of the
 
sale of
 
our Brazilian
 
real
estate fund management business.
 
›
Refer to “Note 6 Other income” in the “Consolidated financial statements” section of this report for more
information
Credit loss expense / release: 3Q24 vs
 
3Q23
Total
 
net
 
credit loss
 
expenses in
 
the
 
third quarter
 
of 2024
 
were USD 167m,
 
reflecting net
 
releases of
 
USD 15m
related
 
to
 
performing
 
positions
 
and
 
net
 
expenses
 
of
 
USD 182m
 
on
 
credit-impaired
 
positions.
 
Net
 
credit
 
loss
expenses were USD 27m
 
in the prior-year quarter.
›
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
Total
For the quarter ended 30.9.24
Global Wealth Management
 
(11)
 
14
 
3
Personal & Corporate Banking
 
(10)
 
94
 
84
Asset Management
 
0
 
0
 
0
Investment Bank
 
9
 
(4)
 
4
Non-core and Legacy
 
(2)
 
77
 
76
Group Items
 
0
 
0
 
0
Total
 
(15)
 
182
 
167
For the quarter ended 30.6.24
Global Wealth Management
 
(14)
 
12
 
(2)
Personal & Corporate Banking
 
(15)
 
125
 
110
Asset Management
 
0
 
0
 
0
Investment Bank
 
1
 
(2)
 
(1)
Non-core and Legacy
 
(1)
 
(22)
 
(23)
Group Items
 
0
 
0
 
0
Total
 
(29)
 
113
 
84
For the quarter ended 30.9.23
Global Wealth Management
 
(7)
 
15
 
8
Personal & Corporate Banking
 
16
 
(15)
 
1
Asset Management
 
0
 
0
 
0
Investment Bank
 
10
 
7
 
17
Non-core and Legacy
 
0
 
(1)
 
(1)
Group Items
 
1
 
0
 
1
Total
 
20
 
6
 
27
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
9
Operating expenses: 3Q24 vs 3Q23
Operating expenses
For the quarter ended
% change from
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
2Q24
3Q23
30.9.24
30.9.23
Personnel expenses
 
 
5,788
 
4,797
 
3,951
 
21
 
46
 
14,746
 
11,697
of which: salaries and variable compensation
 
4,999
 
4,205
 
3,431
 
19
 
46
 
12,824
 
10,151
of which: variable compensation – financial advisors
1
 
1,335
 
1,291
 
1,150
 
3
 
16
 
3,893
 
3,372
General and administrative expenses
 
 
4,014
 
4,584
 
2,585
 
(12)
 
55
 
11,584
 
8,011
of which: net expenses for litigation, regulatory and similar
 
matters
 
(47)
 
1,161
 
8
 
1,121
 
784
Depreciation, amortization and impairment of non-financial
 
assets
 
838
 
631
 
510
 
33
 
64
 
2,000
 
1,686
Total operating expenses
 
10,640
 
10,012
 
7,047
 
6
 
51
 
28,329
 
21,393
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.
Personnel expenses
Personnel
 
expenses
 
increased
 
by
 
USD 1,837m
 
to
 
USD 5,788m,
 
which
 
included
 
the
 
consolidation
 
of
 
Credit
Suisse AG
 
expenses.
 
Salaries and
 
variable
 
compensation increased
 
by
 
USD 1,568m,
 
due
 
to
 
the
 
aforementioned
consolidation
 
effect,
 
as
 
well
 
as
 
annual
 
salary
 
increases
 
and
 
unfavorable
 
foreign
 
currency
 
exchange
 
impacts.
 
In
addition, financial advisor compensation
 
increased, reflecting higher compensable revenues.
 
›
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 1,429m
 
to USD 4,014m,
 
largely due
 
to a
 
USD 767m increase
in shared services costs charged
 
by other subsidiaries of
 
UBS Group AG, which included
 
the effect of consolidating
Credit Suisse
 
AG expenses.
 
Consulting, legal
 
and audit
 
fees increased
 
by USD
 
153m
 
and outsourcing
 
costs increased
by USD 138m. Excluding the aforementioned effects, the remaining increase is largely due to the consolidation of
Credit Suisse AG expenses.
›
Refer to “Note 8 General and administrative expenses” in the “Consolidated financial statements” section of this
report for more information
›
Refer to “Note 16 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 AG Annual Report 2023,
available under “Annual reporting” at
ubs.com/investors
, for more information about litigation, regulatory and
similar matters on a UBS AG consolidated basis
Depreciation, amortization and impairment of
 
non-financial assets
Depreciation, amortization and
 
impairment of
 
non-financial assets increased
 
by USD 328m
 
to USD 838m, which
included
 
the
 
consolidation
 
of
 
Credit
 
Suisse
 
AG
 
expenses.
 
Excluding
 
the
 
aforementioned
 
effect,
 
there
 
was
 
a
USD 107m
 
increase
 
in
 
depreciation
 
of
 
internally
 
generated
 
capitalized
 
software,
 
reflecting
 
a
 
higher
 
level
 
of
capitalized cost,
 
as well as a USD 47m increase in depreciation of both owned and own use leased properties due
to an increase in accelerated depreciation related to decisions to vacate
 
properties.
 
Tax: 3Q24 vs 3Q23
UBS AG had a
 
net income tax
 
expense of USD 194m
 
in the third
 
quarter of 2024,
 
compared with USD 339m
 
in the
prior-year quarter.
 
The net current
 
tax expense
 
was USD 343m, compared
 
with USD 484m, and
 
primarily related to
 
the taxable profits
of UBS Switzerland AG and other entities.
 
There
 
was
 
a
 
net
 
deferred
 
tax
 
benefit
 
of
 
USD 150m,
 
compared
 
with
 
USD 145m
 
in
 
the
 
prior-year
 
quarter.
 
This
included benefits
 
of USD 218m
 
in respect
 
of increases
 
in recognized
 
deferred tax
 
assets (DTAs),
 
which included
USD 41m reflecting updated
 
expectations of
 
future profits that
 
are available
 
to utilize
 
tax losses
 
carried forward,
USD 120m in respect of
 
an increase in
 
tax loss DTAs
 
and USD 57m in
 
respect of an increase
 
in tax credits
 
carried
forward in relation to US corporate alternative minimum
 
tax. These benefits were partly offset by a net expense
 
of
USD 68m that primarily related
 
to the amortization of
 
DTAs previously recognized in
 
relation to tax losses
 
carried
forward and deductible temporary differences.
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
10
Total comprehensive income attributable
 
to shareholders
In the third quarter of 2024, total comprehensive income
 
attributable to shareholders was USD 3,602m, reflecting
a net profit of USD 996m and other comprehensive income
 
(OCI), net of tax, of USD 2,606m.
OCI related
 
to cash
 
flow hedges
 
was USD 1,593m,
 
mainly reflecting
 
net unrealized
 
gains on
 
US dollar
 
hedging
derivatives resulting from decreases in the relevant
 
US dollar long-term interest rates.
Foreign
 
currency
 
translation
 
OCI
 
was
 
USD 1,461m,
 
mainly
 
resulting
 
from
 
the
 
Swiss
 
franc
 
and
 
the
 
euro
 
both
strengthening against the US dollar.
OCI related to own credit on financial
 
liabilities designated at fair value was negative USD 323m, primarily due
 
to
a tightening of our own credit spreads.
Defined benefit plan OCI was
 
negative USD 119m, primarily reflecting
 
negative pre-tax OCI in our
 
non-Swiss plans
of
 
USD 102m,
 
mainly
 
driven
 
by
 
the
 
Credit
 
Suisse
 
UK
 
plan
 
following
 
a
 
buy-in
 
insurance
 
transaction to
 
mitigate
inherent risks.
›
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 20 Fair value measurement” in the “Consolidated financial statements” section of the UBS AG
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 26 Post-employment benefit plans” in the “Consolidated financial statements” section of the
UBS AG 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 30 September
 
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 1.7bn in
 
the first
year after
 
such a
 
shift. Of
 
this increase,
 
approximately USD 1.0bn, 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 0.3bn. Of
 
this decrease,
 
approximately USD 0.4bn
 
and USD 0.1bn
 
would result
 
from changes
in US dollar and euro
 
interest rates, respectively. Swiss franc interest rates
 
would provide an offsetting increase of
approximately USD 0.3bn, driven by both contractual
 
and assumed flooring benefits under negative
 
interest 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
 
30 September
 
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 UBS AG
 
consolidated. For
 
further information
 
about key
 
figures
related to capital management, refer to
 
the “Capital management” section of this
 
report.
 
Cost / income ratio: 3Q24 vs 3Q23
The cost / income
 
ratio was
 
88.7%, compared
 
with 84.4%,
 
mainly reflecting
 
an increase
 
in operating
 
expenses,
partly offset by an increase in total revenues.
 
Personnel: 3Q24 vs 2Q24
The number
 
of internal
 
personnel employed
 
as of
 
30 September 2024
 
was 69,185
 
(full-time equivalents),
 
a net
decrease of 1,565
 
compared with 30 June 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
11
Equity, CET1 capital and returns
As of or for the quarter ended
Year-to-date
USD m, except where indicated
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Net profit
Net profit attributable to shareholders
 
996
 
(264)
 
932
 
1,738
 
3,055
Equity
 
Equity attributable to shareholders
 
96,943
 
93,392
 
52,836
 
96,943
 
52,836
less: goodwill and intangible assets
 
6,739
 
7,023
 
6,240
 
6,739
 
6,240
Tangible equity attributable to shareholders
 
90,204
 
86,369
 
46,596
 
90,204
 
46,596
less: other CET1 adjustments
 
5,781
 
3,368
 
3,218
 
5,781
 
3,218
CET1 capital
 
84,423
 
83,001
 
43,378
 
84,423
 
43,378
Returns
Return on equity (%)
 
4.2
 
(1.4)
 
7.0
 
3.1
 
7.4
Return on tangible equity (%)
 
4.5
 
(1.6)
 
8.0
 
3.4
 
8.3
Return on CET1 capital (%)
 
4.8
 
(1.7)
 
8.6
 
3.6
 
9.5
Common equity tier 1 capital: 3Q24 vs 2Q24
During the third quarter of 2024, CET1 capital increased by USD 1.4bn to USD 84.4bn, primarily due to operating
profit before tax of
 
USD 1.2bn, foreign currency translation
 
gains of USD 1.5bn
 
and an increase
 
in eligible deferred
tax assets recognized for temporary differences of USD 0.3bn, partly
 
offset by dividend accruals
 
of USD 1.0bn and
current tax expenses
 
of USD 0.3bn.
Return on common equity tier 1 capital: 3Q24
 
vs 3Q23
The annualized
 
return on
 
CET1 capital
 
was 4.8%,
 
compared with
 
8.6%, driven
 
by an
 
increase in
 
average CET1
capital, partly offset by higher net profit attributable to
 
shareholders.
Risk-weighted assets: 3Q24 vs 2Q24
During the third quarter of 2024, RWA increased by USD 5.6bn
 
to USD 515.5bn, driven by a USD 10.8bn
 
increase
in currency effects, partly offset by
 
decreases of USD 3.6bn resulting from asset
 
size and other movements,
 
as well
as USD 1.6bn resulting from model updates and methodology
 
changes.
Common equity tier 1 capital ratio: 3Q24 vs 2Q24
The CET1
 
capital ratio
 
increased to
 
16.4% from
 
16.3%, reflecting
 
the aforementioned
 
increase in
 
CET1 capital,
partly offset by the aforementioned increase in RWA.
Leverage ratio denominator: 3Q24 vs 2Q24
During the third quarter of 2024, the
 
LRD increased by USD 47.2bn to USD 1,611.2bn, driven by currency effects
of USD 54.2bn, partly offset by asset size and other
 
movements of USD 7.1bn.
Common equity tier 1 leverage ratio: 3Q24
 
vs 2Q24
The CET1 leverage ratio decreased to 5.2%
 
from 5.3%, reflecting the aforementioned increase
 
in the LRD, partly
offset by the aforementioned increase in CET1 capital.
Results 9M24 vs 9M23
Operating profit before tax
 
decreased by USD 1,814m,
 
or 43%, to USD 2,374m, reflecting
 
a USD 6,936m
 
increase
in operating expenses,
 
which was
 
partly offset by
 
a USD 5,345m
 
increase in total
 
revenues. Net credit
 
loss expenses
were USD 303m
 
compared with net credit loss expenses
 
of USD 80m
 
in the first nine months of 2023.
 
Net fee
 
and commission
 
income increased
 
by USD 3,201m
 
to USD 17,084m.
 
Portfolio management
 
and related
service
 
fees
 
and
 
investment
 
fund
 
fees
 
increased
 
by
 
USD 1,458m
 
and
 
USD 561m
 
respectively,
 
predominantly
 
in
Global
 
Wealth
 
Management
 
and
 
Asset
 
Management,
 
respectively,
 
largely
 
attributable
 
to
 
positive
 
market
performance
 
and
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
 
Suisse AG
 
revenues.
 
Net
 
brokerage
 
fees
 
increased
 
by
USD 686m, mainly reflecting higher
 
levels of client
 
activity and the
 
consolidation of Credit
 
Suisse AG revenues in
Global Wealth Management,
 
as well as due to increases
 
in Cash Equities across all regions in Execution Services in
the
 
Investment
 
Bank.
 
M&A
 
and
 
corporate
 
finance
 
fees
 
increased
 
by
 
USD 265m, mainly
 
due
 
to
 
higher
 
advisory
revenues in our Global
 
Banking business within the
 
Investment Bank.
 
Underwriting fees increased by
 
USD 208m,
largely attributable to a USD 158m increase
 
in debt underwriting revenues, mainly due to
 
increased deal volumes
in the Global Banking business in the Investment
 
Bank.
 
UBS AG third quarter 2024 report |
UBS AG | UBS AG consolidated performance
 
12
Total combined
 
net interest
 
income and
 
other net
 
income from
 
financial instruments
 
measured at
 
fair value
 
through
profit or
 
loss increased
 
by USD 1,742m
 
to USD 12,896m.
 
Revenues in
 
Global Wealth
 
Management increased by
USD 212m, mainly driven by an
 
increase in transaction-based income mostly due to
 
higher levels of client activity
and an
 
increase resulting from
 
the consolidation of
 
Credit Suisse AG
 
revenues. This increase
 
was partly offset
 
by
lower deposit
 
revenues, mainly
 
as a
 
result
 
of lower
 
margins and
 
including the
 
effects of
 
shifts to
 
lower-margin
deposit
 
products,
 
higher
 
liquidity
 
and
 
funding
 
costs,
 
as
 
well
 
as
 
lower
 
loan
 
revenues,
 
reflecting
 
lower
 
average
volumes.
 
Personal
 
&
 
Corporate
 
Banking
 
increased
 
by
 
USD 691m,
 
largely
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG net interest income. The
 
Investment Bank increased by
 
USD 544m, reflecting an increase in
 
Derivatives
& Solutions
 
revenues, mainly
 
due to
 
increases in
 
Equity Derivatives
 
and Foreign
 
Exchange,
 
and higher
 
revenues from
Public
 
Capital
 
Markets
 
in
 
Global
 
Banking,
 
partly
 
offset
 
by
 
lower
 
Financing
 
revenues,
 
particularly
 
in
 
the
 
Capital
Markets Financing business.
Other income
 
was USD 1,025m,
 
compared with
 
USD 624m in
 
the first
 
nine months
 
of 2023,
 
and included
 
the
consolidation of Credit Suisse income. This change was mainly due to a USD 119m gain related to
 
the sale of our
investment in an
 
associate,
 
as well as
 
a USD 113m gain
 
in Asset Management
 
from the sale
 
of our Brazilian
 
real
estate fund management
 
business. Other income
 
also included higher
 
costs charged to shared
 
services subsidiaries
of UBS Group AG.
General and
 
administrative expenses
 
increased by
 
USD 3,573m to
 
USD 11,584m, largely
 
due
 
to
 
a
 
USD 1,952m
increase in shared services costs charged by other subsidiaries of
 
the UBS Group. Litigation, regulatory and similar
matters increased by USD 337m, largely
 
reflecting UBS agreeing in the second
 
quarter of 2024 to fund an offer
 
by
the Credit Suisse supply chain finance funds
 
to redeem all of the outstanding units
 
of the respective funds, partly
offset
 
by
 
a
 
USD 665m
 
increase
 
in
 
provisions
 
recognized
 
in
 
the
 
first
 
half
 
of
 
2023
 
related
 
to
 
the
 
US
 
residential
mortgage-backed
 
securities
 
litigation
 
matter.
 
Excluding
 
the
 
aforementioned
 
effect,
 
general
 
and
 
administrative
expenses
 
increased
 
due
 
to
 
the
 
inclusion
 
of
 
Credit
 
Suisse AG
 
expenses
 
and
 
higher
 
expenses
 
for
 
consulting,
technology and outsourcing costs.
Personnel
 
expenses
 
increased
 
by
 
USD 3,049m
 
to
 
USD 14,746m,
 
which
 
included
 
the
 
consolidation
 
of
 
Credit
Suisse AG expenses.
 
Salaries and variable compensation increased by USD 2,673m, including
 
the aforementioned
consolidation effect,
 
as well as an increase in financial advisor compensation,
 
which reflected higher compensable
revenues.
 
Depreciation, amortization and impairment of
 
non-financial assets increased by USD 314m to
 
USD 2,000m, which
included
 
the
 
consolidation
 
of
 
Credit
 
Suisse AG
 
expenses.
 
Excluding
 
the
 
aforementioned
 
consolidation
 
effect,
depreciation of internally developed
 
software increased by
 
USD 158m, reflecting
 
a higher level of capitalized
 
costs,
and depreciation
 
of owned
 
and own
 
use leased
 
properties increased
 
by USD
 
100m. These
 
increases
 
were partly
offset by a USD 206m impairment of software projects in progress in the second quarter of 2023 resulting from a
reprioritization of software development activity
 
following the acquisition of the Credit Suisse
 
Group.
Outlook
In the third
 
quarter of 2024 we
 
saw strong client activity
 
against a market backdrop
 
that, while constructive, still
exhibited periods of high volatility and dislocation.
 
Entering the fourth quarter, we see a continuation of these market conditions sustained
 
by the prospects of a soft
landing in
 
the US
 
economy. However,
 
the macroeconomic
 
outlook in
 
the rest
 
of the
 
world remains
 
clouded. In
addition to seasonality, the ongoing
 
geopolitical conflicts and the
 
outcome of the US elections create
 
uncertainties
that are likely to affect investor behavior.
 
As we stay
 
close to clients, helping
 
them navigate this
 
environment, and execute
 
on our priorities,
 
we will continue
to invest
 
to drive
 
sustainable long-term
 
value for
 
our stakeholders
 
while maintaining
 
a balance
 
sheet for
 
all seasons.
 
UBS AG third quarter 2024 report |
Business divisions and Group Items
 
13
Business divisions and Group
Items
Management report
Our businesses
We report
 
five business
 
divisions, each
 
of which
 
qualifies as
 
an operating
 
segment pursuant
 
to 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.
 
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.
This discussion and
 
analysis of the
 
results of
 
the business divisions
 
and Group Items
 
compares the
 
results for the
third quarter of 2024, which
 
are based entirely on
 
consolidated data following the merger of
 
UBS AG and Credit
Suisse AG, with those for the third quarter of 2023, which only included
 
pre-merger UBS AG consolidated results.
It also compares the nine-month period ended 30 September 2024, based on
 
four months of post-merger results
and five months
 
of pre-merger
 
UBS AG consolidated
 
results only,
 
with the nine-month
 
period ended 30 September
2023, which
 
included
 
pre-merger UBS AG
 
consolidated results
 
only. This
 
is a
 
material driver
 
in many
 
of the
 
increases
across both revenues and operating expenses.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Global Wealth Management
 
14
Global Wealth Management
Global Wealth Management
1
As of or for the quarter ended
% change from
Year-to-date
USD m, except where indicated
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Net interest income
 
1,662
 
1,317
 
1,269
 
26
 
31
 
4,183
 
4,192
Recurring net fee income
3
 
3,235
 
2,893
 
2,601
 
12
 
24
 
8,821
 
7,590
Transaction-based income
3
 
1,143
 
960
 
765
 
19
 
49
 
3,088
 
2,356
Other income
 
16
 
22
 
15
 
(29)
 
5
 
74
 
29
Total revenues
 
6,056
 
5,192
 
4,650
 
17
 
30
 
16,166
 
14,167
Credit loss expense / (release)
 
3
 
(2)
 
8
 
(62)
 
10
 
29
Operating expenses
 
5,131
 
4,473
 
3,668
 
15
 
40
 
13,579
 
10,872
Business division operating profit / (loss) before tax
 
922
 
720
 
974
 
28
 
(5)
 
2,577
 
3,267
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
(5.4)
 
(34.3)
 
(32.1)
 
(21.1)
 
(15.1)
Cost / income ratio (%)
3
 
84.7
 
86.2
 
78.9
 
84.0
 
76.7
Financial advisor compensation
4
 
1,335
 
1,291
 
1,150
 
3
 
16
 
3,892
 
3,372
Invested assets (USD bn)
3
 
4,259
 
4,038
 
2,986
 
5
 
43
 
4,259
 
2,986
Loans, gross (USD bn)
5
 
313.5
 
307.4
 
215.4
 
2
 
46
 
313.5
 
215.4
Customer deposits (USD bn)
5
 
482.2
 
477.0
 
339.3
 
1
 
42
 
482.2
 
339.3
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,6
 
0.4
 
0.4
 
0.3
 
0.4
 
0.3
Advisors (full-time equivalents)
 
9,897
 
10,068
 
8,916
 
(2)
 
11
 
9,897
 
8,916
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
 
3 Refer to “Alternative performance measures” in the appendix to this report for the definition and calculation method.
 
4 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
 
1,749m as of 30 September
 
2024.
 
5 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.
 
6 Refer to the “Risk management and
control” section of this report for more information about (credit-)impaired exposures. Excludes loans to financial advisors.
Results: 3Q24 vs 3Q23
Profit before tax
 
decreased by USD 52m,
 
or 5%, to
 
USD 922m, mainly driven
 
by higher operating
 
expenses, almost
entirely
 
offset by
 
higher
 
total
 
revenues,
 
and
 
included a
 
positive
 
impact
from the
 
merger
 
of
 
UBS AG
 
and
 
Credit
Suisse AG.
Total revenues
Total
 
revenues
 
increased
 
by
 
USD 1,406m,
 
or
 
30%,
 
to
 
USD 6,056m,
 
mainly
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG revenues. The remaining
 
increase largely reflected increases
 
in recurring net fee
 
income and transaction-
based income, partly offset by decreases in net interest income.
Net interest income
 
increased by USD 393m,
 
or 31%, to USD 1,662m,
 
mainly driven by
 
the consolidation of
 
Credit
Suisse AG net interest income. The remaining variance was due to lower deposit margins, including the
 
effects of
shifts to
 
lower-margin deposit
 
products and
 
the effects
 
of liquidity
 
and funding
 
costs, partly
 
offset by
 
higher deposit
volumes. The remaining variance was also due
 
to lower loan revenues, reflecting lower
 
average volumes.
Recurring net fee income increased by USD 634m, or 24%, to USD 3,235m, mainly driven by the consolidation
 
of
Credit Suisse AG recurring net fee income
 
and positive market performance.
Transaction-based income increased
 
by USD 378m, or 49%,
 
to USD 1,143m, mainly driven
 
by the consolidation of
Credit
 
Suisse AG transaction-based
 
income and
 
higher levels
 
of
 
client activity,
 
particularly in
 
the Americas,
 
Asia
Pacific and Switzerland regions.
Credit loss expense / release
Net credit loss expenses decreased by USD 5m to USD 3m.
Operating expenses
Operating expenses
 
increased
 
by
 
USD 1,463m, or
 
40%, to
 
USD 5,131m, mostly
 
driven
 
by
 
the
 
consolidation of
Credit
 
Suisse AG
 
operating
 
expenses.
 
The
 
remaining
 
variance
 
was
 
due
 
to
 
higher
 
personnel
 
expenses,
 
primarily
reflecting
 
an
 
increase
 
in
 
financial
 
advisor
 
compensation
 
reflecting
 
higher
 
compensable
 
revenues.
 
Operating
expenses also included higher integration-related expenses.
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Global Wealth Management
 
15
Invested assets: 3Q24 vs 2Q24
Invested assets increased
 
by USD 221bn, or
 
5%, to USD 4,259bn,
 
mainly driven by
 
positive market performance
 
of
USD 146.7bn, positive foreign currency effects
 
of USD 53.7bn and net new asset inflows.
Loans: 3Q24 vs 2Q24
Loans increased
 
by USD 6.1bn
 
to USD 313.5bn,
 
driven by positive
 
foreign currency
 
effects, partly offset
 
by negative
net new loans.
 
Customer deposits: 3Q24 vs 2Q24
Customer
 
deposits increased
 
by
 
USD 5.2bn to
 
USD 482.2bn, mainly
 
driven
 
by
 
positive
 
foreign
 
currency effects,
partly offset by net new deposit outflows.
 
Results: 9M24 vs 9M23
Profit before tax
 
decreased by USD 690m,
 
or 21%, to
 
USD 2,577m, mainly driven by
 
higher operating expenses,
partly
 
offset
 
by
 
higher
 
total
 
revenues,
 
and
 
included
 
a
 
positive
 
impact
 
from
 
the
 
merger
 
of
 
UBS AG
 
and
 
Credit
Suisse AG.
Total
 
revenues increased
 
by
 
USD 1,999m, or
 
14%, to
 
USD 16,166m, mainly
 
due
 
to
 
the
 
consolidation of
 
Credit
Suisse AG revenues. The remaining
 
increase largely reflected
 
increases in recurring
 
net fee income and transaction-
based income, partly offset by decreases in net
 
interest income.
Net interest income
 
decreased by USD 9m
 
to USD 4,183m, mainly
 
driven by lower
 
deposit revenues, mainly
 
as a
result
 
of
 
lower
 
margins
 
and
 
including
 
the
 
effects
 
of
 
shifts
 
to
 
lower-margin
 
deposit
 
products.
 
In
 
addition,
 
the
decrease was
 
due to
 
higher liquidity
 
and funding
 
costs, as
 
well as
 
lower loan
 
revenues, reflecting lower
 
average
volumes. These effects were partly offset by
 
the consolidation of Credit Suisse AG net interest
 
income.
Recurring net
 
fee income
 
increased by
 
USD 1,231m, or
 
16%, to
 
USD 8,821m, mainly
 
driven by
 
positive market
performance and the consolidation of Credit
 
Suisse AG recurring net fee income.
Transaction-based income
 
increased by
 
USD 732m, or
 
31%, to
 
USD 3,088m, mainly
 
driven by
 
higher levels
 
of client
activity,
 
particularly
 
in
 
the
 
Americas
 
and
 
Asia
 
Pacific
 
regions,
 
and
 
due
 
to
 
the
 
consolidation of
 
Credit
 
Suisse AG
transaction-based income.
Other income increased
 
by USD 45m to
 
USD 74m, mainly due
 
to an
 
increase in shared
 
services costs charged
 
to
other subsidiaries of UBS Group AG, mainly related
 
to secondments, as well as due to dividends
 
received.
Net credit loss expenses decreased by USD 19m
 
to USD 10m.
Operating expenses
 
increased by
 
USD 2,707m, or
 
25%, to
 
USD 13,579m, mostly
 
driven by
 
the consolidation
 
of
Credit
 
Suisse AG
 
operating
 
expenses.
 
The
 
remaining
 
variance
 
was
 
due
 
to
 
higher
 
personnel
 
expenses,
 
primarily
reflecting
 
an
 
increase
 
in
 
financial
 
advisor
 
compensation
 
reflecting
 
higher
 
compensable
 
revenues.
 
Operating
expenses also included higher integration-related
 
expenses.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Personal & Corporate Banking
 
16
Personal & Corporate Banking
 
Personal & Corporate Banking – in Swiss francs
1
As of or for the quarter ended
% change from
Year-to-date
CHF m, except where indicated
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Net interest income
 
1,059
 
781
 
690
 
36
 
53
 
2,522
 
2,077
Recurring net fee income
3
 
340
 
271
 
215
 
25
 
58
 
833
 
638
Transaction-based income
3
 
422
 
353
 
296
 
20
 
42
 
1,075
 
910
Other income
 
56
 
11
 
40
 
396
 
38
 
81
 
64
Total revenues
 
1,877
 
1,417
 
1,242
 
32
 
51
 
4,510
 
3,689
Credit loss expense / (release)
 
72
 
98
 
2
 
(26)
 
180
 
25
Operating expenses
 
1,244
 
905
 
657
 
37
 
89
 
2,864
 
1,915
Business division operating profit / (loss) before tax
 
561
 
413
 
583
 
36
 
(4)
 
1,467
 
1,749
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
(3.8)
 
(32.9)
 
37.1
 
(16.2)
 
45.0
Cost / income ratio (%)
3
 
66.3
 
63.9
 
53.0
 
63.5
 
51.9
Net interest margin (bps)
3
 
169
 
156
 
188
 
168
 
191
Loans, gross (CHF bn)
 
247.4
 
253.2
 
147.8
 
(2)
 
67
 
247.4
 
147.8
Customer deposits (CHF bn)
 
253.5
 
256.4
 
168.7
 
(1)
 
50
 
253.5
 
168.7
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,4
 
1.4
 
1.3
 
0.8
 
1.4
 
0.8
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
 
3 Refer to “Alternative performance measures” in the
 
appendix to this report for the definition and calculation method.
 
4 Refer to the “Risk management and control” section of this report
 
for more
information about (credit-)impaired exposures.
Results
:
3Q24 vs 3Q23
Profit before tax decreased by CHF 22m, or 4%, to CHF 561m, as higher total revenues were more than offset by
higher operating expenses and net credit loss expenses.
Total revenues
Total
 
revenues
 
increased
 
by
 
CHF 635m,
 
or
 
51%,
 
to
 
CHF 1,877m,
 
mainly
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG revenues, with the remaining variance largely reflecting increases across
 
almost all revenue lines.
 
Net interest income increased by
 
CHF 369m to CHF 1,059m, largely due to
 
the consolidation of Credit Suisse AG
net interest income, with the
 
remaining variance mainly attributable to higher
 
liquidity and funding costs, as well
as lower deposit
 
margins resulting
 
from both lower
 
reinvestment rates
 
and shifts to
 
lower-margin deposit
 
products.
Recurring net
 
fee income
 
increased by
 
CHF 125m to
 
CHF 340m,
 
mainly due
 
to the
 
consolidation of
 
Credit Suisse
 
AG
recurring net
 
fee income,
 
with the
 
remaining increase
 
including higher
 
revenues from
 
increased custody
 
asset levels.
Transaction-based
 
income
 
increased
 
by
 
CHF 126m
 
to
 
CHF 422m,
 
largely
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG transaction-based income.
Other income increased by CHF 16m to CHF
 
56m.
Credit loss expense / release
Net credit loss expenses
 
were CHF 72m, mainly
 
reflecting net credit
 
loss expenses on
 
credit-impaired positions with
a small number
 
of corporate counterparties,
 
partly offset by
 
net credit loss releases
 
related to performing
 
positions.
These compared with net credit loss expenses of CHF 2m
 
in the third quarter of 2023.
Operating expenses
Operating expenses increased
 
by CHF 587m, or
 
89%, to CHF 1,244m,
 
largely due to
 
the consolidation of
 
Credit
Suisse AG expenses, and included higher integration-related
 
expenses.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Personal & Corporate Banking
 
17
Results: 9M24 vs 9M23
Profit before tax
 
decreased by CHF 282m,
 
or 16%, to CHF 1,467m,
 
as higher total
 
revenues were more
 
than offset
by higher operating expenses and net credit
 
loss expenses.
 
Total
 
revenues
 
increased
 
by
 
CHF 821m,
 
or
 
22%,
 
to
 
CHF 4,510m,
 
mainly
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG revenues, with the remaining variance
 
largely reflecting increases
 
in all revenue lines.
 
Net interest income increased by
 
CHF 445m to CHF 2,522m, largely due to
 
the consolidation of Credit Suisse AG
net interest income.
Recurring net
 
fee income
 
increased by
 
CHF 195m to
 
CHF 833m,
 
mainly due
 
to the
 
consolidation of
 
Credit Suisse
 
AG
recurring net
 
fee income,
 
with the
 
remaining increase
 
including higher
 
revenues from
 
increased custody
 
asset levels.
Transaction-based
 
income
 
increased
 
by
 
CHF 165m
 
to
 
CHF 1,075m,
 
largely
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
Suisse AG transaction-based income.
Other income increased by CHF 17m to CHF
 
81m.
Net credit
 
loss expenses
 
were CHF 180m,
 
mainly reflecting
 
net credit
 
loss expenses
 
on credit-impaired
 
positions
with
 
a
 
small
 
number of
 
corporate
 
counterparties, partly
 
offset
 
by
 
net credit
 
loss
 
releases
 
related
 
to
 
performing
positions. These compared with net credit loss
 
expenses of CHF 25m in the first nine months
 
of 2023.
Operating expenses increased by
 
CHF 949m, or 50%,
 
to CHF 2,864m, largely
 
due to the
 
consolidation of Credit
Suisse AG expenses, and included higher integration-related
 
expenses.
Personal & Corporate Banking – in US dollars
1
As of or for the quarter ended
% change from
Year-to-date
USD m, except where indicated
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Net interest income
 
1,233
 
863
 
775
 
43
 
59
 
2,868
 
2,298
Recurring net fee income
3
 
396
 
300
 
241
 
32
 
64
 
946
 
705
Transaction-based income
3
 
492
 
389
 
333
 
26
 
48
 
1,220
 
1,007
Other income
 
64
 
12
 
45
 
423
 
45
 
93
 
70
Total revenues
 
2,185
 
1,564
 
1,394
 
40
 
57
 
5,127
 
4,080
Credit loss expense / (release)
 
84
 
110
 
1
 
(24)
 
203
 
27
Operating expenses
 
1,449
 
999
 
739
 
45
 
96
 
3,257
 
2,118
Business division operating profit / (loss) before tax
 
653
 
455
 
654
 
44
 
0
 
1,667
 
1,935
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
3
 
(0.2)
 
(33.5)
 
49.8
 
(13.9)
 
52.9
Cost / income ratio (%)
3
 
66.3
 
63.9
 
53.0
 
63.5
 
51.9
Net interest margin (bps)
3
 
172
 
155
 
191
 
169
 
192
Loans, gross (USD bn)
 
292.2
 
281.8
 
161.3
 
4
 
81
 
292.2
 
161.3
Customer deposits (USD bn)
 
299.4
 
285.3
 
184.1
 
5
 
63
 
299.4
 
184.1
Impaired loan portfolio as a percentage of total loan portfolio, gross (%)
3,4
 
1.4
 
1.3
 
0.8
 
1.4
 
0.8
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
 
3 Refer to “Alternative performance measures” in the
 
appendix to this report for the definition and calculation method.
 
4 Refer to the “Risk management and control” section of this report
 
for more
information about (credit-)impaired exposures.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Asset Management
 
18
Asset Management
Asset Management
1
As of or for the quarter ended
% change from
Year-to-date
USD m, except where indicated
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Net management fees
3
 
758
 
582
 
500
 
30
 
52
 
1,827
 
1,471
Performance fees
 
46
 
23
 
11
 
98
 
313
 
91
 
42
Net gain from disposals
 
84
 
28
 
196
 
113
Total revenues
 
888
 
634
 
511
 
40
 
74
 
2,031
 
1,513
Credit loss expense / (release)
 
0
 
0
 
0
 
0
 
(1)
Operating expenses
 
720
 
513
 
425
 
40
 
69
 
1,691
 
1,243
Business division operating profit / (loss) before tax
 
168
 
121
 
86
 
39
 
96
 
340
 
271
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
4
 
95.6
 
35.0
 
(38.1)
 
25.6
 
(78.8)
Cost / income ratio (%)
4
 
81.1
 
80.8
 
83.2
 
83.3
 
82.2
Gross margin on invested assets (bps)
4
 
20
 
17
 
17
 
18
 
18
Information by business line / asset
 
class
Invested assets (USD bn)
4
Equities
 
747
 
691
 
494
 
8
 
51
 
747
 
494
Fixed Income
 
471
 
448
 
324
 
5
 
45
 
471
 
324
of which: money market
 
153
 
146
 
143
 
5
 
7
 
153
 
143
Multi-asset & Solutions
 
285
 
277
 
164
 
3
 
73
 
285
 
164
Hedge Fund Businesses
 
60
 
59
 
55
 
2
 
10
 
60
 
55
Real Estate & Private Markets
 
152
 
147
 
98
 
4
 
55
 
152
 
98
Total invested assets excluding associates
 
1,714
 
1,622
 
1,134
 
6
 
51
 
1,714
 
1,134
of which: passive strategies
 
806
 
756
 
487
 
7
 
66
 
806
 
487
Associates
5
 
83
 
77
 
23
 
8
 
265
 
83
 
23
Total invested assets
 
1,797
 
1,699
 
1,157
 
6
 
55
 
1,797
 
1,157
Information by region
Invested assets (USD bn)
4
Americas
 
438
 
426
 
333
 
3
 
32
 
438
 
333
Asia Pacific
6
 
229
 
213
 
168
 
7
 
36
 
229
 
168
EMEA (excluding Switzerland)
 
403
 
378
 
291
 
7
 
39
 
403
 
291
Switzerland
 
728
 
682
 
366
 
7
 
99
 
728
 
366
Total invested assets
 
1,797
 
1,699
 
1,157
 
6
 
55
 
1,797
 
1,157
Information by channel
Invested assets (USD bn)
4
Third-party institutional
 
1,010
 
957
 
638
 
6
 
58
 
1,010
 
638
Third-party wholesale
 
182
 
181
 
115
 
0
 
58
 
182
 
115
UBS’s wealth management businesses
 
522
 
484
 
382
 
8
 
37
 
522
 
382
Associates
5
 
83
 
77
 
23
 
8
 
265
 
83
 
23
Total invested assets
 
1,797
 
1,699
 
1,157
 
6
 
55
 
1,797
 
1,157
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
 
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 The invested assets amounts
reported for associates are prepared in accordance with their local regulatory requirements and practices.
 
6 Includes invested assets from associates.
Results: 3Q24 vs 3Q23
Profit before
 
tax increased
 
by USD 82m,
 
or 96%,
 
to USD 168m,
 
mainly reflecting
 
the impact
 
from the
 
consolidation
of Credit Suisse AG, which included an
 
USD 84m gain from the closing of the
 
remaining portion of the sale of our
Brazilian real estate fund management business.
Total revenues
Total revenues increased by
 
USD 377m, or
 
74%, to
 
USD 888m, mainly
 
due to
 
the consolidation
 
of Credit
 
Suisse AG
revenues,
 
and included the USD 84m gain from the aforementioned
 
sale.
Net management
 
fees increased
 
by USD 258m,
 
or 52%,
 
to USD 758m,
 
largely driven
 
by the consolidation
 
of Credit
Suisse AG net management fees. The remaining
 
increase
 
largely
 
reflected
 
positive market performance and foreign
currency effects,
 
partly
 
offset by
 
continued margin
 
compression. In
 
addition, net
 
management fees
 
in
 
the third
quarter of 2024 included a revaluation of USD
 
19m related to a real estate fund
 
co-investment.
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Asset Management
 
19
Performance
 
fees
 
increased by
 
USD 35m,
 
or
 
313%, to
 
USD 46m,
 
mostly
 
due
 
to
 
increases
 
in
 
Fixed
 
Income
 
and
Hedge Fund Businesses,
 
and included Credit Suisse AG performance
 
fees.
Operating expenses
Operating expenses
 
increased by
 
USD 295m, or
 
69%, to
 
USD 720m, largely
 
due
 
to the
 
consolidation of
 
Credit
Suisse AG operating expenses,
 
and included higher integration-related expenses.
Invested assets: 3Q24 vs 2Q24
 
Invested assets
 
increased by
 
USD 98bn, or
 
6%, to
 
USD 1,797bn,
 
mainly reflecting
 
favorable foreign
 
currency effects
of
 
USD 53bn,
 
positive
 
market
 
performance
 
of
 
USD 45bn
 
and
 
net
 
new
 
money
 
of
 
USD 2bn.
 
There
 
was
 
also
 
a
USD 2bn
 
decrease
 
in
 
invested
 
assets
 
mainly
 
related
 
to
 
the
 
sale
 
of
 
our
 
Brazilian
 
real
 
estate
 
fund
 
management
business. Excluding money market flows
 
and associates, net new money was negative
 
USD 5bn.
Results: 9M24 vs 9M23
Profit before
 
tax increased
 
by USD 69m,
 
or 26%,
 
to USD 340m,
 
mainly reflecting
 
the impact
 
from the
 
consolidation
of Credit Suisse AG, which included a USD 113m gain from
 
the sale of our Brazilian real estate fund management
business.
Total revenues
 
increased by
 
USD 518m, or
 
34%, to
 
USD 2,031m, primarily reflecting
 
the consolidation of
 
Credit
Suisse AG revenues, and included the USD 113m
 
gain from the aforementioned sale.
Net management fees increased by USD 356m, or 24%, to USD 1,827m, largely
 
attributable to the consolidation
of Credit Suisse
 
AG net management
 
fees, positive
 
market performance
 
and foreign
 
currency effects,
 
as well as
 
the
revaluation of a
 
real estate
 
fund co-investment,
 
partly offset
 
by continued
 
margin compression.
 
In addition, the
 
first
nine months of 2023 included the fee income of the former UBS Hana Asset Management Co., Ltd. and negative
pass-through fees, with the corresponding offset
 
in performance fees.
Performance fees
 
increased by
 
USD 49m, or
 
119%, to
 
USD 91m, mainly
 
due to increases
 
in Hedge Fund
 
Businesses
and Fixed
 
Income, and
 
included Credit
 
Suisse AG performance
 
fees. These
 
increases were
 
partly offset
 
by lower
performance fees related to the aforementioned
 
pass-through fees in 2023.
Operating expenses increased by
 
USD 448m, or 36%, to
 
USD 1,691m, largely due
 
to the consolidation of
 
Credit
Suisse AG operating expenses,
 
and included higher integration-related expenses.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items | Investment
 
Bank
 
20
Investment Bank
Investment Bank
1
As of or for the quarter ended
% change from
Year-to-date
USD m, except where indicated
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Advisory
 
220
 
226
 
106
 
(3)
 
107
 
611
 
437
Capital Markets
 
339
 
399
 
259
 
(15)
 
31
 
1,087
 
684
Global Banking
 
558
 
625
 
365
 
(11)
 
53
 
1,698
 
1,122
Execution Services
3
 
440
 
405
 
312
 
9
 
41
 
1,243
 
992
Derivatives & Solutions
3
 
949
 
880
 
628
 
8
 
51
 
2,762
 
2,379
Financing
 
506
 
526
 
466
 
(4)
 
9
 
1,574
 
1,538
Global Markets
 
1,895
 
1,811
 
1,406
 
5
 
35
 
5,579
 
4,909
of which: Equities
 
1,417
 
1,337
 
1,039
 
6
 
36
 
4,114
 
3,483
of which: Foreign Exchange, Rates and Credit
 
477
 
474
 
367
 
1
 
30
 
1,465
 
1,426
Total revenues
 
2,453
 
2,436
 
1,770
 
1
 
39
 
7,277
 
6,030
Credit loss expense / (release)
 
4
 
(1)
 
17
 
35
 
25
Operating expenses
 
2,240
 
2,200
 
1,840
 
2
 
22
 
6,523
 
5,480
Business division operating profit / (loss) before tax
 
209
 
237
 
(87)
 
(12)
 
718
 
526
Performance measures and other information
Pre-tax profit growth (year-on-year, %)
4
n.m.
 
67.2
n.m.
 
36.6
 
(69.6)
Cost / income ratio (%)
4
 
91.3
 
90.3
 
103.9
 
89.6
 
90.9
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
 
3 Comparative figures for the quarter ended
 
30
September 2023 and for the nine-month period
 
ended 30
September 2023 have been restated as a
 
result of the shift of the foreign exchange products
that are traded over electronic platforms from
 
Execution Services to Derivatives & Solutions.
 
The restatement had no effect on
 
total Global Markets revenues.
 
4 Refer to “Alternative
 
performance measures” in the
appendix to this report for the definition and calculation method.
Results: 3Q24 vs 3Q23
Profit before
 
tax increased
 
by
 
USD 296m
 
to USD 209m,
 
mainly reflecting
 
higher total
 
revenues, partly
 
offset by
higher operating expenses.
Total revenues
Total revenues increased by USD 683m, or
 
39%, to USD 2,453m,
 
reflecting increases in
 
Global Markets
 
and Global
Banking.
Global Banking
Global Banking revenues
 
increased by USD 193m,
 
or 53%, to
 
USD 558m, with increases
 
in Advisory and
 
Capital
Markets.
 
Advisory revenues increased by USD 114m, or 107%, to USD 220m, mostly due to higher merger and
 
acquisition
transaction revenues, which increased by
 
USD 115m, or 132%.
 
Capital Markets
 
revenues increased
 
by USD 80m,
 
or 31%,
 
to USD 339m,
 
mainly due
 
to higher
 
Debt Capital
 
Markets
revenues,
 
which
 
increased
 
by
 
USD 21m,
 
or
 
27%,
 
Leveraged
 
Capital
 
Markets
 
revenues,
 
which
 
increased
 
by
USD 13m, or 16%, and Equity Capital Markets
 
revenues, which increased by USD 10m, or 24%.
 
Global Markets
Global Markets revenues increased by USD 489m, or
 
35%, to USD 1,895m, primarily driven by higher Derivatives
& Solutions and Execution Services revenues.
Execution
 
Services
 
revenues
 
increased
 
by
 
USD 128m,
 
or
 
41%,
 
to
 
USD 440m,
 
mainly
 
due
 
to
 
increases
 
in
 
Cash
Equities across all regions.
Derivatives &
 
Solutions revenues
 
increased by
 
USD 321m, or
 
51%, to
 
USD 949m, with
 
increases across
 
all products,
led by Equity Derivatives,
 
Foreign Exchange and Rates.
Financing revenues increased
 
by USD 40m, or
 
9%, to USD 506m
 
and included a
 
USD 51m gain from
 
the sale of
our investment in an associate.
Equities
Global Markets Equities revenues increased by USD 378m, or 36%,
 
to USD 1,417m, mostly driven by increases in
Equity Derivatives and Cash Equities, as well
 
as by the aforementioned gain from sale.
 
UBS AG third quarter 2024 report |
Business divisions and Group Items | Investment
 
Bank
 
21
Foreign Exchange, Rates and Credit
Global
 
Markets
 
Foreign
 
Exchange,
 
Rates
 
and
 
Credit
 
revenues
 
increased
 
by
 
USD 110m,
 
or
 
30%,
 
to
 
USD 477m,
primarily driven by increases in Foreign Exchange and Rates.
Credit loss expense / release
Net credit loss expenses decreased by USD 13m to USD 4m.
Operating expenses
Operating expenses increased by
 
USD 400m, or 22%, to
 
USD 2,240m, mainly due to
 
the consolidation of Credit
Suisse AG expenses, with
 
the remaining increase
 
including higher variable
 
compensation and
 
increased technology
expenses.
Results: 9M24 vs 9M23
Profit before tax increased
 
by USD 192m, or 37%, to
 
USD 718m, mainly due to
 
higher total revenues, partly
 
offset
by higher operating expenses.
Total
 
revenues
 
increased
 
by
 
USD 1,247m,
 
or
 
21%,
 
to
 
USD 7,277m,
 
reflecting
 
increases
 
in
 
Global
 
Markets
 
and
Global Banking.
Global Banking revenues increased by USD 576m, or 51%, to USD 1,698m, reflecting higher Capital Markets and
Advisory revenues.
 
Advisory revenues increased
 
by USD 174m, or
 
40%, to
 
USD 611m, mostly due
 
to higher
 
merger and acquisition
transaction revenues, which increased by
 
USD 157m, or 41%.
Capital Markets
 
revenues increased
 
by USD 403m,
 
or 59%,
 
to USD 1,087m,
 
mainly due
 
to higher
 
Leveraged Capital
Markets revenues, which
 
increased by USD 229m,
 
or 155%,
 
Debt Capital
 
Markets revenues, which
 
increased by
USD 94m, or 46%, and Equity Capital Markets
 
revenues, which increased by USD 78m, or 51%.
Global Markets revenues increased by USD 670m, or 14%, to
 
USD 5,579m, primarily driven by higher Derivatives
& Solutions and Execution Services revenues.
Execution Services revenues increased by USD 251m, or 25%, to USD 1,243m, mainly driven by increases in
 
Cash
Equities across all regions.
Derivatives & Solutions
 
revenues increased by USD 383m,
 
or 16%, to
 
USD 2,762m, mainly driven
 
by increases in
Equity Derivatives and Foreign Exchange
 
revenues.
Financing
 
revenues
 
increased
 
by
 
USD 36m,
 
or
 
2%,
 
to
 
USD 1,574m
 
and
 
included
 
a
 
USD 51m
 
gain
 
from
 
the
aforementioned sale of our investment in an
 
associate.
Equities
Global Markets Equities revenues increased by USD 631m, or 18%,
 
to USD 4,114m, mainly driven by increases in
Equity Derivatives and Cash Equities, as well
 
as by the aforementioned gain from sale.
Foreign Exchange, Rates and Credit
Global Markets Foreign Exchange, Rates and Credit revenues increased by
 
USD 39m, or 3%, to USD 1,465m.
Net credit loss expenses increased by USD 10m to
 
USD 35m.
Operating
 
expenses
 
increased
 
by
 
USD 1,043m,
 
or
 
19%,
 
to
 
USD 6,523m,
 
mainly
 
driven
 
by
 
integration-related
expenses,
 
with
 
the
 
remaining
 
increase
 
including
 
the
 
consolidation
 
of
 
Credit
 
Suisse AG
 
expenses
 
and
 
expenses
related to secondment of Credit Suisse employees
 
prior to the merger of UBS AG and Credit Suisse
 
AG.
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Non-core and Legacy
 
22
Non-core and Legacy
Non-core and Legacy
1
As of or for the quarter ended
% change from
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
2Q24
3Q23
30.9.24
30.9.23
Results
Total revenues
 
225
 
165
 
35
 
37
 
537
 
411
 
87
Credit loss expense / (release)
 
76
 
(23)
 
(1)
 
53
 
(1)
Operating expenses
 
851
 
1,552
 
142
 
(45)
 
499
 
2,542
 
861
Operating profit / (loss) before tax
 
(701)
 
(1,365)
 
(106)
 
(49)
 
561
 
(2,184)
 
(774)
1 Comparatives may 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.
Results: 3Q24 vs 3Q23
Loss before
 
tax was
 
USD 701m, primarily
 
driven by
 
the impact
 
of the
 
merger of
 
UBS AG and
 
Credit Suisse AG,
compared with a loss before tax of USD 106m.
Total revenues
Total
 
revenues were
 
USD 225m, which
 
was USD 190m
 
higher than
 
the amount recorded
 
in the
 
third quarter
 
of
2023,
 
mainly
 
due
 
to
 
the
 
consolidation
 
of
 
Credit
 
Suisse AG
 
revenues.
 
Total
 
revenues
 
reflected
 
net
 
gains
 
from
position exits, along with net interest income from securitized products and
 
credit products. Total
 
revenues in the
third quarter of 2024 also included a USD 67m gain from the sale
 
of our investment in an associate.
Credit loss expense / release
Net
 
credit loss
 
expenses were
 
USD 76m, almost
 
entirely
 
driven by
 
credit-impaired
 
positions,
 
compared with
 
net
credit loss releases of USD 1m in the third quarter of 2023.
Operating expenses
Operating
 
expenses
 
were
 
USD 851m,
 
compared
 
with
 
operating
 
expenses
 
of
 
USD 142m
 
recorded
 
in
 
the
 
third
quarter of 2023,
 
largely due to
 
the consolidation of
 
Credit Suisse AG
 
expenses, and included
 
integration-related
expenses of
 
USD 268m. Operating
 
expenses also
 
included litigation
 
releases of
 
USD 71m, largely
 
reflecting UBS
agreeing in the second
 
quarter of 2024
 
to fund an
 
offer by the
 
Credit Suisse supply
 
chain finance funds
 
(the SCFFs)
to redeem all of the outstanding units of the respective
 
funds.
Results: 9M24 vs 9M23
Loss before tax
 
was USD 2,184m, primarily driven
 
by the impact
 
of the merger of
 
UBS AG and Credit
 
Suisse AG,
compared with a loss before tax of USD 774m.
Total revenues
Total
 
revenues were USD 411m, which was USD 324m higher than
 
the amount recorded in the first
 
nine months
of 2023,
 
mainly due
 
to the
 
consolidation of
 
Credit Suisse AG
 
revenues. Total
 
revenues reflected
 
net gains
 
from
position exits,
 
along with
 
net interest
 
income from
 
securitized products
 
and credit
 
products. Total
 
revenues also
included the aforementioned USD 67m gain from the sale of
 
our investment in an associate.
Credit loss expense / release
Net
 
credit loss
 
expenses were
 
USD 53m, almost
 
entirely
 
driven by
 
credit-impaired
 
positions,
 
compared with
 
net
credit loss releases of USD 1m.
 
Operating expenses
Operating expenses were
 
USD 2,542m, compared with
 
operating expenses of
 
USD 861m recorded in the first
 
nine
months of 2023,
 
largely due to
 
the consolidation of Credit
 
Suisse AG expenses, and
 
included integration-related
expenses of
 
USD 515m. Operating
 
expenses also
 
included litigation
 
expenses of
 
USD 1,074m, largely
 
reflecting UBS
agreeing in the second quarter
 
of 2024 to fund an
 
offer by the SCFFs to redeem
 
all of the outstanding
 
units of the
respective
 
funds.
 
The
 
first
 
nine
 
months
 
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.
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Business divisions and Group Items |
 
Group Items
 
23
Group Items
Group Items
1
As of or for the quarter ended
% change from
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
2
2Q24
3Q23
30.9.24
30.9.23
2
Results
Total revenues
 
190
 
(90)
 
(13)
 
(6)
 
(216)
Credit loss expense / (release)
 
0
 
0
 
1
 
1
 
1
Operating expenses
 
250
 
275
 
233
 
(9)
 
7
 
737
 
819
Operating profit / (loss) before tax
 
(61)
 
(365)
 
(246)
 
(83)
 
(75)
 
(744)
 
(1,036)
1 Comparatives may 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 “Note 3 Segment reporting” in the “Consolidated financial statements” section of this report for more
information.
Results: 3Q24 vs 3Q23
Loss before
 
tax decreased by
 
USD 185m to
 
USD 61m, mostly driven
 
by higher
 
gains in
 
Group hedging
 
and own
debt,
 
including
 
hedge
 
accounting ineffectiveness,
 
reflecting
 
mark-to-market effects
 
on
 
portfolio-level
 
economic
hedges, mainly due to decreasing interest rates.
Results: 9M24 vs 9M23
Loss before
 
tax decreased
 
by USD 292m
 
to USD 744m,
 
mainly due
 
to lower
 
integration-related expenses, partly
offset by higher shared services costs charged
 
by other subsidiaries of UBS Group AG.
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
25
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 AG 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.
Following the merger of UBS AG and Credit Suisse AG in May 2024, the risk profile of UBS AG consolidated does
not differ materially from that of UBS Group AG.
Credit risk
 
Overall banking products exposure
Overall banking
 
products exposure
 
increased by
 
USD 11bn to
 
USD 1,075bn as
 
of 30 September
 
2024, primarily
reflecting currency
 
effects, partly
 
offset by
 
negative net
 
new loans
 
in Personal
 
& Corporate
 
Banking and
 
Global
Wealth Management and a decrease in balances at central
 
banks.
Total
 
net credit
 
loss
 
expenses in
 
the
 
third quarter
 
of 2024
 
were USD 167m,
 
reflecting net
 
releases of
 
USD 15m
related to performing positions and net expenses
 
of USD 182m 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 “UBS AG consolidated 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 increased by USD 1.5bn
 
to
USD 4.3bn as of
 
30 September 2024,
 
driven by new
 
mandates, partly offset
 
by deal syndications
 
and cancellations.
As of 30 September 2024, USD 0.1bn of
 
these commitments had not been
 
distributed as originally planned.
 
As of
30 September 2024, Non-core and Legacy had
 
no loan underwriting commitments.
Loan underwriting exposures
 
in the Investment
 
Bank 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 AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
26
Banking and traded products exposure in the business divisions and Group Items
30.9.24
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
 
473,574
 
453,535
 
1,676
 
88,252
 
34,389
 
23,098
 
1,074,524
of which: loans and advances to customers (on-balance sheet)
 
308,796
 
292,153
 
14
 
18,536
 
2,321
 
6,304
 
628,124
of which: guarantees and loan commitments (off-balance sheet)
 
19,348
 
47,158
 
10
 
34,539
 
2,922
 
17,977
 
121,955
Traded products
2,3
Gross exposure
 
14,834
 
4,258
 
0
 
40,420
 
59,512
of which: over-the-counter derivatives
 
10,877
 
3,681
 
0
 
9,585
 
24,143
of which: securities financing transactions
 
205
 
0
 
0
 
18,696
 
18,901
of which: exchange-traded derivatives
 
3,752
 
577
 
0
 
12,139
 
16,468
Other credit lines, gross
4
 
73,445
 
76,634
 
0
 
3,018
 
4
 
1,512
 
154,613
Total credit-impaired exposure, gross
 
1,501
 
4,251
 
0
 
396
 
1,509
 
0
 
7,658
Total allowances and provisions for expected credit losses
 
362
 
1,877
 
0
 
332
 
1,069
 
7
 
3,646
of which: stage 1
 
126
 
319
 
0
 
122
 
6
 
7
 
579
of which: stage 2
 
69
 
265
 
0
 
99
 
189
 
0
 
623
of which: stage 3
 
167
 
1,292
 
0
 
111
 
873
 
0
 
2,445
30.6.24
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
 
471,272
 
439,621
 
1,436
 
100,219
 
32,673
 
18,174
 
1,063,396
of which: loans and advances to customers (on-balance sheet)
 
302,690
 
281,758
 
11
 
17,517
 
5,763
 
3,866
 
611,606
of which: guarantees and loan commitments (off-balance sheet)
 
19,663
 
48,474
 
10
 
34,702
 
3,020
 
16,789
 
122,657
Traded products
2,3
Gross exposure
 
13,459
 
3,937
 
0
 
42,155
 
59,551
of which: over-the-counter derivatives
 
9,718
 
3,415
 
0
 
10,897
 
24,029
of which: securities financing transactions
 
343
 
0
 
0
 
21,079
 
21,422
of which: exchange-traded derivatives
 
3,398
 
522
 
0
 
10,180
 
14,099
Other credit lines, gross
4
 
69,061
 
77,501
 
0
 
2,294
 
3
 
1,591
 
150,450
Total credit-impaired exposure, gross
 
1,416
 
3,887
 
0
 
492
 
1,575
 
0
 
7,371
Total allowances and provisions for expected credit losses
 
370
 
1,762
 
0
 
338
 
1,000
 
7
 
3,478
of which: stage 1
 
136
 
327
 
0
 
121
 
6
 
7
 
597
of which: stage 2
 
68
 
235
 
0
 
96
 
207
 
0
 
606
of which: stage 3
 
166
 
1,200
 
0
 
122
 
787
 
0
 
2,275
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 Unconditionally revocable
committed credit lines.
Collateralization of Loans and advances to customers
1
Global Wealth Management
Personal & Corporate Banking
USD m, except where indicated
30.9.24
30.6.24
30.9.24
30.6.24
Secured by collateral
 
302,941
 
294,290
 
252,097
 
240,669
Residential real estate
 
114,161
 
109,196
 
200,931
 
189,385
Commercial / industrial real estate
 
9,980
 
10,165
 
40,955
 
39,608
Cash
 
29,646
 
30,182
 
2,836
 
2,913
Equity and debt instruments
 
121,758
 
119,365
 
2,993
 
3,209
Other collateral
2
 
27,396
 
25,383
 
4,382
 
5,553
Subject to guarantees
 
663
 
724
 
7,428
 
7,595
Uncollateralized and not subject to guarantees
 
5,191
 
7,676
 
32,628
 
33,494
Total loans and advances to customers, gross
 
308,796
 
302,690
 
292,153
 
281,758
Allowances
 
(278)
 
(290)
 
(1,582)
 
(1,471)
Total loans and advances to customers, net of allowances
 
308,518
 
302,400
 
290,572
 
280,287
Collateralized loans and advances to customers in % of total loans
 
and advances to customers, gross (%)
 
98.1
 
97.2
 
86.3
 
85.4
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. For legacy Credit Suisse exposure, a risk-based approach is
 
applied 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 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 AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
27
Market risk
UBS AG
 
excluding
 
certain
 
legacy
 
Credit
 
Suisse
 
components
 
continued
 
to
 
maintain
 
generally
 
low
 
levels
 
of
management value-at-risk (VaR). Average management VaR
 
(1-day, 95% confidence level) increased
 
to USD 12m
from USD 9m in the third quarter of
 
2024, mainly driven by the Investment Bank’s Rates business.
 
There were no
new
 
VaR
 
negative
 
backtesting
 
exceptions
 
in
 
the
 
third
 
quarter
 
of
 
2024.
 
The
 
number
 
of
 
negative
 
backtesting
exceptions within the most recent 250-business-day
 
window remained at zero.
Average
 
management VaR
 
(1-day,
 
98%
 
confidence level)
 
of
 
the
 
legacy
 
Credit
 
Suisse
 
components decreased
 
to
USD 11m from USD 15m in the third quarter of 2024, driven by continued strategic migration of positions
 
to UBS
from the
 
former Investment
 
Bank (Credit
 
Suisse) and
 
reductions in
 
Non-core and
 
Legacy.
 
In the
 
third quarter
 
of
2024, the aforementioned legacy
 
Credit Suisse components had three
 
new negative backtesting exceptions
 
driven
by Non-core and
 
Legacy. Two backtesting
 
exceptions were caused
 
by market moves
 
and one backtesting
 
exception
was
 
due
 
to
 
valuation
 
adjustments
 
related
 
to
 
additional
 
exit
 
cost
 
reserves.
 
The
 
number
 
of
 
negative
 
backtesting
exceptions within the most recent 250-business-day
 
window increased to four from one.
As the number
 
of negative backtesting exceptions
 
for the legacy
 
Credit Suisse components
 
also remained below
five,
 
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
UBS AG
 
excluding
 
certain
 
legacy
 
Credit
 
Suisse
 
components
 
and
 
the
 
aforementioned
 
legacy
 
Credit
 
Suisse
components.
Management value-at-risk (1-day, 95% confidence, 5 years of historical data) of the business divisions and Group Items
excluding certain legacy Credit Suisse components, by general market risk type
1,2
Average by risk type
USD m
Min.
Max.
Period end
Average
Equity
Interest
rates
Credit
spreads
Foreign
exchange
Commodities
Global Wealth Management
 
1
 
2
 
2
 
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
 
5
 
17
 
13
 
10
 
3
 
15
 
8
 
3
 
5
Non-core and Legacy
 
1
 
3
 
1
 
1
 
0
 
1
 
1
 
0
 
0
Group Items
 
4
 
6
 
6
 
5
 
1
 
4
 
3
 
1
 
0
Diversification effect
3,4
 
(6)
 
(6)
 
(1)
 
(5)
 
(4)
 
(1)
 
0
Total as of 30.9.24
 
7
 
19
 
15
 
12
 
3
 
16
 
10
 
4
 
5
Total as of 30.6.24
 
6
 
15
 
8
 
9
 
4
 
13
 
9
 
4
 
3
Management value-at-risk (1-day, 98% confidence, 2 years of historical data) of certain legacy Credit Suisse
components of the business divisions and Group Items, by general market risk type
1,2
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
 
2
 
1
 
0
 
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
 
2
 
3
 
2
 
2
 
1
 
1
 
1
 
0
 
0
Non-core and Legacy
 
8
 
11
 
8
 
9
 
3
 
3
 
8
 
1
 
0
Group Items
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Diversification effect
3,4
 
(2)
 
(2)
 
(1)
 
0
 
(2)
 
(1)
 
0
Total as of 30.9.24
 
9
 
14
 
9
 
11
 
4
 
4
 
9
 
1
 
0
Total as of 30.6.24
 
13
 
17
 
15
 
15
 
7
 
8
 
10
 
1
 
1
1 Legacy Credit
 
Suisse components not
 
included in
 
the UBS AG
 
management VaR
 
predominantly reflect
 
the portfolio in
 
Non-core and
 
Legacy and the
 
transition portfolio
 
in the Investment
 
Bank. These
 
positions
continue to
 
be managed
 
on legacy
 
Credit Suisse
 
infrastructure based
 
on legacy
 
Credit Suisse
 
management VaR
 
methodology until
 
full migration
 
of these
 
positions to
 
the UBS
 
infrastructure or
 
liquidation of
 
the
positions. This process is ongoing, and the management VaR
 
of the legacy Credit Suisse components is expected to continue decreasing over time.
 
2 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 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.
 
3 The difference between the sum
 
of the standalone VaR for the business
 
divisions and Group Items and the total VaR.
 
4 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.
Economic value of equity and net interest income
 
sensitivity
The economic
 
value of
 
equity (EVE)
 
sensitivity in
 
UBS AG’s banking
 
book to
 
a parallel
 
shift in
 
yield curves
 
of +1 basis
point was negative
 
USD 37.2m as
 
of 30 September
 
2024, compared with
 
negative USD 32.1m
 
as of 30
 
June 2024.
This excluded
 
the sensitivity
 
of USD 6.2m
 
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 UBS AG
 
increased during
 
the third
 
quarter of
 
2024, driven
 
by net
 
interest income
 
stabilization
initiatives.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
28
The majority of
 
UBS AG’s interest rate
 
risk in the banking
 
book was a
 
reflection of the
 
net asset duration that
 
it ran
to offset its modeled sensitivity of net USD 28.0m
 
(30 June 2024: USD 24.6m) assigned to its equity,
 
goodwill and
real estate,
 
with the
 
aim of
 
generating a
 
stable net
 
interest income
 
contribution. Of
 
this, USD 17.2m
 
and USD 9.0m
were
 
attributable
 
to
 
the
 
US
 
dollar
 
and
 
the
 
Swiss
 
franc
 
portfolios,
 
respectively,
 
(30 June
 
2024:
 
USD 16.1m
 
and
USD 7.5m, respectively).
In addition to the aforementioned sensitivity, UBS AG calculates 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 6.8bn, or
 
6.7%, of
 
UBS AG’s tier 1
 
capital (30 June 2024:
 
negative
USD 6.0bn, or 6.1%),
 
which is well
 
below the 15%
 
threshold set in
 
the BCBS supervisory
 
outlier test for
 
high levels
of interest rate risk in the banking book.
The immediate effect
 
on UBS AG’s tier 1
 
capital in the
 
“Parallel up” scenario
 
as of 30 September
 
2024 would have
been a
 
decrease of
 
approximately USD 0.7bn, or
 
0.7%, (30 June
 
2024: USD 0.8bn, or
 
0.9%), reflecting the
 
fact
that the vast
 
majority of UBS AG’s
 
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.
As the overall interest rate risk sensitivity shows a greater
 
impact from slower asset repricing compared with faster
liabilities repricing, the “Parallel
 
down“ scenario was the
 
most beneficial and would
 
have resulted in
 
a change in
EVE of positive USD 7.3bn (30 June 2024: positive USD 6.2bn) and a small positive immediate effect on UBS AG’s
tier 1 capital.
UBS AG also
 
applies granular
 
internal interest
 
rate shock
 
scenarios to
 
its banking
 
book positions
 
to monitor
 
the
book’s specific risk profile.
›
Refer to “Interest rate risk in the banking book” in the “Risk management and control” section of the UBS AG
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 “UBS AG consolidated performance” section of this report
for more information about the effects of increases in interest rates on the net interest income of UBS AG’s
banking book
Interest rate risk – banking book
30.9.24
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
 
(8.8)
 
(1.3)
 
(0.3)
 
(26.4)
 
(0.4)
 
(37.2)
 
6.2
 
(31.0)
Parallel up
2
 
(1,263.3)
 
(247.3)
 
(58.9)
 
(5,110.1)
 
(103.0)
 
(6,782.7)
 
1,111.4
 
(5,671.3)
Parallel down
2
 
1,383.9
 
257.2
 
81.8
 
5,434.1
 
95.0
 
7,252.0
 
(1,307.1)
 
5,944.9
Steepener
3
 
(548.4)
 
(5.8)
 
(11.2)
 
(1,326.8)
 
(15.0)
 
(1,907.2)
 
197.9
 
(1,709.4)
Flattener
4
 
303.0
 
(35.0)
 
0.1
 
156.5
 
(8.1)
 
416.6
 
55.9
 
472.5
Short-term up
5
 
(189.7)
 
(107.3)
 
(22.6)
 
(1,967.6)
 
(44.3)
 
(2,331.4)
 
528.1
 
(1,803.4)
Short-term down
6
 
187.6
 
105.7
 
22.5
 
2,081.0
 
45.3
 
2,442.1
 
(549.7)
 
1,892.4
30.6.24
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
 
(6.3)
 
(0.4)
 
0.0
 
(25.0)
 
(0.3)
 
(32.1)
 
5.4
 
(26.7)
Parallel up
2
 
(901.1)
 
(88.6)
 
(4.1)
 
(4,870.1)
 
(89.1)
 
(5,953.1)
 
979.7
 
(4,973.5)
Parallel down
2
 
984.3
 
82.0
 
(1.7)
 
5,036.6
 
86.1
 
6,187.3
 
(1,119.7)
 
5,067.5
Steepener
3
 
(402.3)
 
(38.4)
 
(3.7)
 
(1,145.1)
 
(23.8)
 
(1,613.2)
 
170.4
 
(1,442.8)
Flattener
4
 
224.5
 
24.7
 
1.8
 
21.0
 
3.7
 
275.8
 
53.5
 
329.3
Short-term up
5
 
(128.3)
 
(0.4)
 
0.3
 
(1,972.2)
 
(30.3)
 
(2,131.0)
 
467.7
 
(1,663.3)
Short-term down
6
 
123.6
 
0.6
 
(1.5)
 
2,087.4
 
31.5
 
2,241.6
 
(476.2)
 
1,765.3
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.
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
29
Country risk
 
UBS AG remains 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, the escalation of conflicts in the Middle East,
and global trade relations. As of 30 September 2024, UBS AG’s direct exposure to Israel was less
 
than USD 0.5bn
and
 
its
 
direct
 
exposure
 
to Gulf
 
Cooperation Council
 
countries was
 
less
 
than USD 5bn,
 
while direct
 
exposure to
Egypt and
 
Jordan was
 
limited, and
 
there was
 
no direct
 
exposure to
 
Iran, Iraq,
 
Lebanon or Syria.
 
UBS AG’s direct
exposure
 
to
 
Russia
 
as
 
of
 
30 September
 
2024
 
was
 
less
 
than
 
USD 0.5bn,
 
and
 
its
 
direct
 
exposure
 
to
 
Belarus
 
and
Ukraine remained
 
immaterial.
 
Potential second-order
 
impacts, such
 
as European
 
energy security,
 
continue to
 
be
monitored.
Inflation has abated
 
to some extent
 
in major Western
 
economies, although there
 
are still concerns
 
regarding future
developments, and central banks’ monetary
 
policies are in the spotlight. In
 
China, stress in the property sector
 
and
strained local
 
government finances
 
continue to
 
have an
 
adverse impact
 
on economic
 
growth, raising
 
the risk
 
of
financial instability. This
 
combination of factors
 
translates into
 
a more
 
uncertain and volatile
 
environment, which
increases the risk of financial market disruption.
UBS AG continues
 
to monitor
 
potential trade
 
policy disputes,
 
as well
 
as economic
 
and political
 
developments in
addition to those mentioned
 
above. It is closely
 
watching elections and
 
their aftermath in
 
a number of key
 
markets
in 2024.
 
As of
 
30 September 2024,
 
UBS AG’s exposure
 
to emerging
 
market countries
 
was less
 
than 10%
 
of its
total country exposure and mainly to certain countries
 
in Asia.
›
Refer to the “Risk management and control” section of the UBS AG 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.
Progress continues to be made regarding the legal entity mergers,
 
client account migrations to UBS platforms, the
integration of policies, systems and controls, and operational integration.
 
These activities continue to be managed
via the program run by our Group Integration
 
Office.
 
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.
The integration of Credit Suisse requires data to
 
be migrated to 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.
There is an increased risk of cyber-related operational
 
disruption to business activities at our
 
locations and 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.
 
We
 
continue
 
to
 
invest
 
in
 
improving
 
our
technology
 
infrastructure
 
and
 
information
 
security
 
governance
 
in
 
order
 
to
 
improve
 
our
 
cyberattack
 
defense,
detection and response capabilities.
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 third 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. We maintain
 
a program to
advance
 
our
 
frameworks
 
for
 
managing
 
third
 
parties
 
that
 
support
 
our
 
important
 
business
 
services,
 
and
 
we
 
are
continuing with actions to enhance our cyber-risk
 
assessments and controls over third-party vendors.
 
In addition, we
 
are working to
 
enhance our operational
 
resilience to address
 
these heightened risks and
 
to meet
regulatory deadlines through
 
2026. We have implemented
 
a global framework designed
 
to drive enhancements in
operational
 
resilience
 
across
 
all
 
business
 
divisions
 
and
 
relevant
 
jurisdictions,
 
and
 
we
 
are
 
working
 
with
 
the
 
third
parties, including
 
vendors, that
 
are of
 
critical importance
 
to our
 
operations, to
 
assess their
 
operational resilience
against our standards.
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Risk management and control
 
30
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 are implemented and
reviewed on a regular basis as these risks
 
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 regulations, such
 
as those relating to
 
environmental, social and
 
governance matters
 
and the upcoming EU
Markets in Financial Instruments Directive III (MiFID III), as well as the EU Artificial Intelligence Act, are expected to
have significant impacts on the financial sector and to
 
require ongoing adjustments to policies, processes,
 
controls
and surveillance.
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
 
(AML), know-your-client
 
(KYC)
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
 
client
 
accounts
 
are
 
migrated
 
to
 
UBS
platforms.
In the
 
US, UBS AG has
 
been subject to
 
a Consent Order
 
with the
 
Office of the
 
Comptroller of the
 
Currency (the
OCC)
 
since
 
May 2018
 
relating
 
to
 
our
 
US
 
branch
 
AML
 
and
 
KYC
 
programs.
 
In
 
response,
 
we
 
have
 
introduced
significant improvements
 
to our
 
framework for
 
the purpose
 
of
 
ensuring sustainable
 
remediation of
 
US-relevant
Bank Secrecy Act / AML issues across relevant
 
US legal entities.
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, which we continue to
refine, across our activities, and which is designed
 
to align our standards and conduct
 
with these objectives and to
retain momentum on fostering a strong culture.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
31
Capital management
The disclosures
 
in this
 
section are
 
provided for
 
UBS 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 AG
 
Annual Report
 
2023, available
 
under “Annual
reporting” at
ubs.com/investors
, which provides more information about relevant capital management objectives,
planning
 
and
 
activities, as
 
well
 
as
 
the
 
Swiss
 
SRB
 
total
 
loss-absorbing capacity
 
(TLAC) framework,
 
on
 
a
 
UBS AG
consolidated basis.
UBS AG contributes
 
a significant portion
 
of capital to,
 
and provides substantial
 
liquidity to, its
 
subsidiaries. Many of
these
 
subsidiaries
 
are
 
subject
 
to
 
regulations
 
requiring
 
compliance
 
with
 
minimum
 
capital,
 
liquidity
 
and
 
similar
requirements.
›
Refer to the 30 September 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information about 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
Swiss SRB going and gone concern requirements and information
As of 30.9.24
RWA
LRD
USD m, except where indicated
in %
in %
Required going concern capital
Total going concern capital
 
14.92
1
 
76,926
 
5.02
1
 
80,896
Common equity tier 1 capital
 
10.62
 
54,759
 
3.52
2
 
56,728
of which: minimum capital
 
4.50
 
23,198
 
1.50
 
24,167
of which: buffer capital
 
5.50
 
28,354
 
2.00
 
32,223
of which: countercyclical buffer
 
0.56
 
2,869
Maximum additional tier 1 capital
 
4.30
 
22,167
 
1.50
 
24,167
of which: additional tier 1 capital
 
3.50
 
18,043
 
1.50
 
24,167
of which: additional tier 1 buffer capital
 
0.80
 
4,124
Eligible going concern capital
Total going concern capital
 
19.53
 
100,673
 
6.25
 
100,673
Common equity tier 1 capital
 
16.38
 
84,423
 
5.24
 
84,423
Total loss-absorbing additional tier 1 capital
 
3.15
 
16,250
 
1.01
 
16,250
of which: high-trigger loss-absorbing additional tier 1 capital
 
2.91
 
15,012
 
0.93
 
15,012
of which: low-trigger loss-absorbing additional tier 1 capital
3
 
0.24
 
1,239
 
0.08
 
1,239
Required gone concern capital
Total gone concern loss-absorbing capacity
4,5,6
 
10.73
 
55,290
 
3.75
 
60,418
of which: base requirement including add-ons for market share and LRD
 
10.73
7
 
55,290
 
3.75
7
 
60,418
Eligible gone concern capital
Total gone concern loss-absorbing capacity
 
18.71
 
96,473
 
5.99
 
96,473
Total tier 2 capital
 
0.06
 
289
 
0.02
 
289
of which: non-Basel III-compliant tier 2 capital
 
0.06
 
289
 
0.02
 
289
TLAC-eligible unsecured debt
 
18.66
 
96,184
 
5.97
 
96,184
Total loss-absorbing capacity
Required total loss-absorbing capacity
 
25.65
 
132,216
 
8.77
 
141,314
Eligible total loss-absorbing capacity
 
38.24
 
197,146
 
12.24
 
197,146
Risk-weighted assets / leverage ratio denominator
Risk-weighted assets
 
515,520
Leverage ratio denominator
 
1,611,151
1 Includes applicable add-ons of 1.51% for risk-weighted assets (RWA) and 0.52% for leverage
 
ratio denominator (LRD), of which 7 basis points for RWA and 2 basis points
 
for LRD reflect the FINMA Pillar 2 capital
add-on of USD 338m related to the supply chain
 
finance funds matter at Credit Suisse.
 
2 Our minimum CET1 leverage ratio requirement of
 
3.52% consists of a 1.5% base requirement, a
 
1.5% base buffer capital
requirement, a 0.25% LRD add-on requirement, a 0.25% market share add-on requirement based on our Swiss credit business and a 0.02% Pillar 2 capital add-on
 
related to the supply chain finance funds matter at
Credit Suisse.
 
3 Existing outstanding low-trigger additional
 
tier 1 capital instruments qualify as
 
going concern capital at the UBS
 
AG consolidated level, as agreed
 
with FINMA, 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, FINMA
 
has 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 AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
32
UBS AG,
 
on
 
a
 
consolidated basis,
 
is
 
subject
 
to
 
the
 
going
 
and
 
gone
 
concern requirements
 
of
 
the
 
Swiss
 
Capital
Adequacy Ordinance, which 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 30 September 2024.
UBS AG and UBS Switzerland AG are subject
 
to going and gone concern requirements
 
on a standalone basis.
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 AG Annual Report 2023,
 
available under “Annual reporting” at
ubs.com/investors
.
 
Swiss SRB going and gone concern information
USD m, except where indicated
30.9.24
30.6.24
31.12.23
Eligible going concern capital
Total going concern capital
 
100,673
 
98,133
 
56,628
Total tier 1 capital
 
100,673
 
98,133
 
56,628
Common equity tier 1 capital
 
84,423
 
83,001
 
44,130
Total loss-absorbing additional tier 1 capital
 
16,250
 
15,132
 
12,498
of which: high-trigger loss-absorbing additional tier 1 capital
 
15,012
 
13,907
 
11,286
of which: low-trigger loss-absorbing additional tier 1 capital
 
1,239
 
1,225
 
1,212
Eligible gone concern capital
Total gone concern loss-absorbing capacity
 
96,473
 
98,833
 
54,458
Total tier 2 capital
 
289
 
536
 
538
of which: non-Basel III-compliant tier 2 capital
 
289
 
536
 
538
TLAC-eligible unsecured debt
 
96,184
 
98,297
 
53,920
Total loss-absorbing capacity
Total loss-absorbing capacity
 
197,146
 
196,966
 
111,086
Risk-weighted assets / leverage ratio denominator
Risk-weighted assets
 
515,520
 
509,953
 
333,979
Leverage ratio denominator
 
1,611,151
 
1,564,001
 
1,104,408
Capital and loss-absorbing capacity ratios (%)
Going concern capital ratio
 
19.5
 
19.2
 
17.0
of which: common equity tier 1 capital ratio
 
16.4
 
16.3
 
13.2
Gone concern loss-absorbing capacity ratio
 
18.7
 
19.4
 
16.3
Total loss-absorbing capacity ratio
 
38.2
 
38.6
 
33.3
Leverage ratios (%)
Going concern leverage ratio
 
6.2
 
6.3
 
5.1
of which: common equity tier 1 leverage ratio
 
5.2
 
5.3
 
4.0
Gone concern leverage ratio
 
6.0
 
6.3
 
4.9
Total loss-absorbing capacity leverage ratio
 
12.2
 
12.6
 
10.1
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
33
Total loss-absorbing capacity and movement
 
TLAC increased by USD 0.2bn to USD 197.1bn
 
in the third quarter of 2024.
Going concern capital and movement
Going concern capital increased by USD 2.5bn
 
to USD 100.7bn. Common equity tier 1 (CET1) capital
 
increased by
USD 1.4bn to USD 84.4bn, primarily due to operating profit before tax of USD 1.2bn, foreign currency translation
gains
 
of
 
USD 1.5bn
 
and
 
an
 
increase
 
in
 
eligible
 
deferred
 
tax
 
assets
 
recognized
 
for
 
temporary
 
differences
 
of
USD 0.3bn, partly offset by dividend accruals
 
of USD 1.0bn and current tax expenses of
 
USD 0.3bn.
Loss-absorbing additional tier 1 (AT1) capital issued by the Group
 
and on lent to UBS AG increased by
 
USD 1.1bn
to USD 16.3bn,
 
reflecting the
 
issuance of
 
new AT1
 
capital instruments
 
equivalent
 
to USD 1.6bn
 
and positive
 
impacts
from interest rate risk hedge, foreign currency translation and other effects, partly offset by the call of AT1 capital
instruments equivalent to USD 1.0bn.
Following the approval of a maximum amount of conversion capital by UBS Group AG’s shareholders at the 2024
Annual General
 
Meeting, AT1
 
capital instruments
 
issued by
 
UBS Group AG
 
from the
 
beginning of
 
the fourth
 
quarter
of 2023 are, 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.
 
AT1 capital
 
instruments issued
 
prior to the
 
fourth quarter
 
of 2023
 
remain
subject to
 
a write-down.
 
The corresponding
 
AT1 capital
 
instruments on
 
lent to
 
UBS AG contain
 
the same
 
provisions.
Gone concern loss-absorbing capacity and movement
Total
 
gone concern loss-absorbing capacity decreased by
 
USD 2.4bn to USD 96.5bn and
 
included USD 96.2bn of
TLAC-eligible unsecured debt instruments that were issued by the Group and on lent to UBS AG.
 
The decrease of
USD 2.4bn mainly reflected the call of USD 6.4bn equivalent of TLAC-eligible unsecured debt instruments, as well
as USD 3.1bn equivalent of TLAC-eligible
 
unsecured debt instruments and a
 
USD 0.3bn tier 2 instrument ceasing
to be
 
eligible as
 
gone concern
 
capital, as
 
they entered
 
the final
 
year before
 
maturity.
 
These effects
 
were partly
offset by
 
new issuances
 
of TLAC-eligible unsecured
 
debt instruments totaling
 
USD 1.8bn equivalent and
 
positive
impacts from interest rate risk hedge, foreign currency translation and other
 
effects.
›
Refer to “Bondholder information” at
ubs.com/investors
 
for more information about the eligibility and key features
and terms and conditions of capital instruments
Loss-absorbing capacity and leverage ratios
The CET1
 
capital ratio
 
increased to
 
16.4% from
 
16.3%, reflecting
 
a USD 1.4bn
 
increase
 
in CET1
 
capital, partly
offset by a USD 5.6bn increase in RWA.
 
The CET1 leverage ratio decreased to 5.2% from 5.3%, driven
 
by a USD 47.2bn increase in the LRD, partly offset
by the aforementioned increase in CET1 capital.
The gone concern loss-absorbing
 
capacity ratio decreased to
 
18.7% from 19.4%, reflecting a
 
USD 2.4bn decrease
in gone concern loss-absorbing capacity and
 
the aforementioned increase in RWA.
 
The gone concern leverage
 
ratio decreased to 6.0%
 
from 6.3%, reflecting the
 
aforementioned increase in
 
the LRD
and the aforementioned decrease in gone concern
 
loss-absorbing capacity.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
34
Swiss SRB total loss-absorbing capacity movement
USD m
Going concern capital
Swiss SRB
Common equity tier 1 capital as of 30.6.24
 
83,001
Operating profit / (loss) before tax
 
1,191
Current tax (expense) / benefit
 
(343)
Foreign currency translation effects, before tax
 
1,453
Eligible deferred tax assets on temporary differences
 
266
Other
1
 
(1,144)
Common equity tier 1 capital as of 30.9.24
 
84,423
Loss-absorbing additional tier 1 capital as of 30.6.24
 
15,132
Issuance of high-trigger loss-absorbing additional tier 1 capital
 
1,631
Call of high-trigger loss-absorbing additional tier 1 capital
 
(1,015)
Interest rate risk hedge, foreign currency translation and other effects
 
503
Loss-absorbing additional tier 1 capital as of 30.9.24
 
16,250
Total going concern capital as of 30.6.24
 
98,133
Total going concern capital as of 30.9.24
 
100,673
Gone concern loss-absorbing capacity
Tier 2 capital as of 30.6.24
 
536
Debt no longer eligible as gone concern loss-absorbing capacity
 
due to residual tenor falling to below one year
 
(251)
Interest rate risk hedge, foreign currency translation and other effects
 
5
Tier 2 capital as of 30.9.24
 
289
TLAC-eligible unsecured debt as of 30.6.24
 
98,297
Issuance of TLAC-eligible unsecured debt
 
1,787
Call of TLAC-eligible unsecured debt
 
(6,367)
Debt no longer eligible as gone concern loss-absorbing capacity
 
due to residual tenor falling to below one year
 
(3,052)
Interest rate risk hedge, foreign currency translation and other effects
 
5,519
TLAC-eligible unsecured debt as of 30.9.24
 
96,184
Total gone concern loss-absorbing capacity as of 30.6.24
 
98,833
Total gone concern loss-absorbing capacity as of 30.9.24
 
96,473
Total loss-absorbing capacity
Total loss-absorbing capacity as of 30.6.24
 
196,966
Total loss-absorbing capacity as of 30.9.24
 
197,146
1 Includes dividend accruals for 2024 (negative USD 1.0bn) and movements related to other items.
Reconciliation of equity under IFRS Accounting Standards to Swiss SRB common equity tier 1 capital
USD m
30.9.24
30.6.24
31.12.23
Total equity under IFRS Accounting Standards
 
97,822
 
94,247
 
55,569
Equity attributable to non-controlling interests
 
(879)
 
(855)
 
(335)
Defined benefit plans, net of tax
 
(872)
 
(940)
 
(336)
Deferred tax assets recognized for tax loss carry-forwards
 
(2,682)
 
(2,819)
 
(3,004)
Deferred tax assets for unused tax credits
 
(238)
 
(181)
 
(97)
Deferred tax assets on temporary differences, excess over threshold
 
(1,233)
Goodwill, net of tax
1
 
(6,257)
 
(6,235)
 
(5,750)
Intangible assets, net of tax
 
(125)
 
(129)
 
(146)
Expected losses on advanced internal ratings-based portfolio less provisions
 
(665)
 
(652)
 
(532)
Unrealized (gains) / losses from cash flow hedges, net of tax
 
1,830
 
3,373
 
2,961
Own credit related to (gains) / losses on financial liabilities
 
measured at fair value that existed at the balance sheet
date, net of tax
 
1,359
 
1,058
 
313
Own credit related to (gains) / losses on derivative financial instruments
 
that existed at the balance sheet date
 
(72)
 
(76)
 
(63)
Prudential valuation adjustments
 
(217)
 
(231)
 
(177)
Accruals for dividends to shareholders for 2023
 
(3,000)
Other
 
(4,580)
2
 
(3,560)
2
 
(39)
Total common equity tier 1 capital
 
84,423
 
83,001
 
44,130
1 Includes goodwill related to significant investments in financial institutions of USD 20m as of 30 September 2024 (USD 19m as of 30 June 2024, USD 20m as of 31 December 2023) presented on the balance sheet
line Investments in associates.
 
2 Includes dividend accruals for 2024 and other items.
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
35
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 23bn and our
 
CET1 capital
 
by USD 2.7bn as
 
of 30 September
 
2024 (30 June
 
2024: USD 22bn and
 
USD 2.6bn,
respectively) and decreased our CET1
 
capital ratio by 19
 
basis points (30 June 2024:
 
18 basis points). Conversely, a
10% appreciation of the US dollar against other currencies would have decreased
 
our RWA by USD 21bn and our
CET1 capital by USD 2.5bn
 
(30 June 2024: USD 20bn and USD
 
2.4bn, respectively) and increased our CET1
 
capital
ratio by 19 basis points (30 June 2024: 18
 
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 109bn as
 
of 30
 
September 2024 (30
 
June 2024: USD 101bn)
 
and decreased
 
our CET1
 
leverage ratio by
 
17
basis
 
points
 
(30
 
June
 
2024:
 
16
 
basis
 
points).
 
Conversely,
 
a
 
10%
 
appreciation
 
of
 
the
 
US
 
dollar
 
against
 
other
currencies would
 
have decreased
 
our LRD
 
by USD 99bn
 
(30 June
 
2024: USD 91bn)
 
and increased
 
our CET1
 
leverage
ratio by 18 basis points (30 June 2024: 17
 
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 foreign exchange movements” under “Capital management” in the
“Capital, liquidity and funding, and balance sheet” section of the UBS AG Annual Report 2023, available under
“Annual reporting” at
ubs.com/investors
, for more information
 
Risk-weighted assets
 
During the third quarter of 2024, RWA increased by USD
 
5.6bn to USD 515.5bn, driven by a USD 10.8bn
 
increase
in currency effects, partly offset
 
by decreases of USD 3.6bn resulting
 
from asset size and other movements,
 
as well
as USD 1.6bn resulting from model updates and
 
methodology changes.
Movement in risk-weighted assets, by key driver
USD bn
RWA as of
30.6.24
Currency
effects
Model updates
and
methodology
changes
Asset size and
other
1
RWA as of
30.9.24
Credit and counterparty credit risk
2
 
312.8
 
10.3
 
(3.0)
 
(4.6)
 
315.6
Non-counterparty-related risk
3
 
29.1
 
0.5
 
(0.1)
 
29.6
Market risk
 
22.5
 
1.4
 
1.0
 
25.0
Operational risk
 
145.4
 
145.4
Total
 
510.0
 
10.8
 
(1.6)
 
(3.6)
 
515.5
1 Includes the Pillar 3 categories “Asset
 
size”, “Credit quality of counterparties”, “Acquisitions
 
and disposals” and “Other”. For
 
more information, refer to the 30 September 2024
 
Pillar 3 Report, available under
“Pillar 3 disclosures” at ubs.com/investors.
 
2 Includes settlement risk, credit valuation
 
adjustments, equity and
 
investments in funds 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,
 
property, equipment, software and other items.
Credit and counterparty credit risk
Credit and counterparty
 
credit risk RWA
 
increased by USD
 
2.7bn USD 315.6bn as
 
of 30 September
 
2024, including
currency effects of USD 10.3bn.
Asset size and other movements resulted in
 
a USD 4.6bn decrease in RWA:
–
Non-core and
 
Legacy RWA
 
decreased by
 
USD 3.9bn,
 
mainly driven
 
by our
 
actions to
 
actively unwind
 
the portfolio,
in addition to the natural roll-off.
 
–
Personal & Corporate Banking RWA decreased
 
by USD 1.5bn, mainly driven by negative
 
net new loans.
–
Global Wealth Management RWA decreased by
 
USD 0.6bn, mainly driven by negative net new
 
loans.
 
–
Asset Management RWA decreased by USD 0.3bn,
 
mainly due to lower RWA from equity
 
investments in funds.
–
Investment Bank RWA increased by USD 1.2bn,
 
mainly due to higher RWA from loans and loan
 
commitments.
 
–
Group Items RWA increased by USD 0.4bn.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
36
Model updates and
 
methodology changes resulted in
 
an RWA decrease
 
of USD 3.0bn,
 
mainly reflecting an RWA
decrease of USD 2.3bn related
 
to the recalibration of certain
 
multipliers as a result
 
of improvements to models
 
and
an RWA
 
reduction of
 
USD 0.7bn related
 
to model
 
updates
 
and harmonizations
 
for structured
 
margin loans
 
and
similar products in Global Wealth Management.
›
Refer to the 30 September 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, for more
information on a UBS Group AG consolidated basis
 
›
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 2.4bn to USD
 
25.0bn in the third quarter
 
of 2024, mainly driven
 
by an increase
of USD 1.4bn from a capital buffer newly introduced by the Swiss Financial Market Supervisory Authority (FINMA)
to capitalize potential maturity
 
mismatches between positions
 
and hedges in the
 
incremental risk charge (IRC).
 
The
IRC,
 
including
 
the
 
capital
 
buffer,
 
will
 
no
 
longer
 
be
 
applicable
 
with
 
the
 
adoption
 
of
 
the
 
final
 
Basel III
 
standards
(including the Fundamental
 
Review of the
 
Trading Book) in
 
January 2025. Additionally,
 
in the third
 
quarter of
 
2024,
we
 
observed
 
an
 
increase
 
of
 
USD 1.0bn
 
from
 
asset
 
size
 
and
 
other
 
movements
 
that
 
reflected
 
updates
 
from
 
the
monthly
 
risks-not-in-value-at-risk assessment,
 
which
 
was
 
partially
 
offset
 
by
 
the
 
de-risking
 
within
 
Non-core
 
and
Legacy.
 
›
Refer to the 30 September 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
 
ubs.com/investors,
 
for more
information on a UBS Group AG consolidated basis
›
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.
 
›
Refer to “Non-financial risk” in the “Risk management and control” section of the UBS AG Annual Report 2023,
available under “Annual reporting” at
ubs.com/investors
, for information about the advanced measurement
approach model
 
Risk-weighted assets, by business division and Group Items
USD bn
Global Wealth
Management
Personal &
Corporate
Banking
Asset
Management
Investment
Bank
Non-core and
Legacy
Group
 
Items
Total
RWA
30.9.24
Credit and counterparty credit risk
1
 
95.2
 
129.9
 
7.1
 
63.8
 
13.7
 
5.8
 
315.6
Non-counterparty-related risk
2
 
5.6
 
2.3
 
0.6
 
3.3
 
0.9
 
16.9
 
29.6
Market risk
 
1.9
 
0.4
 
0.0
 
20.2
 
2.5
 
0.0
 
25.0
Operational risk
 
63.2
 
19.3
 
7.2
 
24.4
 
27.1
 
4.2
 
145.4
Total
 
165.9
 
151.9
 
14.9
 
111.7
 
44.2
 
26.9
 
515.5
30.6.24
Credit and counterparty credit risk
1
 
94.5
 
125.0
 
7.2
 
63.7
 
17.5
 
5.0
 
312.8
Non-counterparty-related risk
2
 
5.5
 
2.4
 
0.6
 
3.2
 
0.8
 
16.6
 
29.1
Market risk
 
1.9
 
0.5
 
0.0
 
16.6
 
3.5
 
0.0
 
22.5
Operational risk
 
63.2
 
19.3
 
7.2
 
24.4
 
27.1
 
4.2
 
145.4
Total
 
165.2
 
147.1
 
15.0
 
108.0
 
48.9
 
25.8
 
510.0
30.9.24 vs 30.6.24
Credit and counterparty credit risk
1
 
0.7
 
5.0
 
(0.1)
 
0.2
 
(3.8)
 
0.8
 
2.7
Non-counterparty-related risk
2
 
0.1
 
0.0
 
0.0
 
0.0
 
0.0
 
0.3
 
0.4
Market risk
 
0.0
 
(0.1)
 
0.0
 
3.6
 
(1.0)
 
0.0
 
2.4
Operational risk
 
0.0
 
0.0
 
0.0
 
0.0
 
0.0
 
0.0
 
0.0
Total
 
0.7
 
4.8
 
(0.1)
 
3.8
 
(4.7)
 
1.1
 
5.6
1
 
Includes settlement risk, credit valuation adjustments, equity and
 
investments in funds exposures in the banking book, and securitization exposures in the
 
banking book.
 
2 Non-counterparty-related risk includes
deferred tax assets recognized for temporary differences (30 September 2024:
 
USD 16.2bn; 30 June 2024: USD 15.8bn), as well as property,
 
equipment, software and other items (30 September 2024: USD
 
13.3bn;
30 June 2024: USD 13.4bn).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Capital management
 
37
Leverage ratio denominator
During the third quarter of 2024, the LRD
 
increased by USD 47.2bn to USD 1,611.2bn, driven by currency effects
of USD 54.2bn, partly offset by asset size and other
 
movements of USD 7.1bn.
 
Movement in leverage ratio denominator, by key driver
USD bn
LRD as of
 
30.6.24
Currency
 
effects
Asset size and
 
other
LRD as of
 
30.9.24
On-balance sheet exposures (excluding derivatives and securities
 
financing transactions)
1
 
1,208.8
 
45.6
 
(10.5)
 
1,243.9
Derivatives
 
125.2
 
2.4
 
6.2
 
133.9
Securities financing transactions
 
168.4
 
4.2
 
(1.0)
 
171.7
Off-balance sheet items
 
72.5
 
2.1
 
(2.0)
 
72.5
Deduction items
 
(11.0)
 
(0.1)
 
0.2
 
(10.8)
Total
 
1,564.0
 
54.2
 
(7.1)
 
1,611.2
1 The exposures exclude derivative financial
 
instruments, cash collateral receivables on derivative instruments, receivables from
 
securities financing transactions, and margin loans, as
 
well as prime brokerage receivables
and financial assets at fair value not held for trading, both related to securities financing transactions.
 
These exposures are presented separately under Derivatives
 
and Securities financing transactions in this table.
The LRD movements described below exclude
 
currency effects.
 
On-balance sheet exposures
 
(excluding derivatives and
 
securities financing transactions)
 
decreased by USD 10.5bn,
mainly reflecting a decrease in cash and balances at central banks, as well as decreases in lending balances due to
negative net new loans mainly in Personal & Corporate Banking and
 
Global Wealth Management. There was also
a decrease in
 
trading portfolio assets
 
in Non-core and
 
Legacy driven by
 
our actions to
 
actively unwind the
 
portfolio,
in addition to the natural roll-off. These decreases were
 
partly offset by increases in other financial assets
 
in Group
Treasury and
 
trading portfolio
 
assets, primarily
 
driven by
 
an increase
 
in positions
 
held in
 
the Investment
 
Bank to
hedge client positions, as well as market-driven
 
increases.
 
Derivative exposures increased by USD 6.2bn,
 
mainly due to client-driven increases in the
 
Investment Bank.
Securities financing transactions decreased
 
by USD 1.0bn.
 
Off-balance sheet exposures decreased by USD
 
2.0bn, primarily driven by lower commitments.
›
Refer to the “Balance sheet and off-balance sheet” section of this report for more information about balance sheet
movements
 
Leverage ratio denominator, by business division and Group Items
USD bn
Global Wealth
Management
 
Personal &
Corporate
Banking
Asset
Management
Investment
Bank
Non-core and
Legacy
Group Items
Total
 
30.9.24
On-balance sheet exposures
 
505.6
 
431.6
 
5.3
 
238.5
 
44.3
 
18.7
 
1,243.9
Derivatives
 
10.9
 
3.3
 
0.0
 
105.9
 
13.4
 
0.4
 
133.9
Securities financing transactions
 
66.0
 
45.1
 
0.0
 
52.6
 
8.1
 
(0.2)
 
171.7
Off-balance sheet items
 
18.6
 
32.3
 
0.1
 
18.6
 
2.5
 
0.4
 
72.5
Items deducted from Swiss SRB tier 1 capital
 
(5.3)
 
(0.8)
 
(1.2)
 
(0.4)
 
(0.5)
 
(2.6)
 
(10.8)
Total
 
595.7
 
511.5
 
4.2
 
415.2
 
67.8
 
16.6
 
1,611.2
30.6.24
On-balance sheet exposures
 
494.0
 
411.4
 
4.9
 
234.0
 
48.5
 
16.0
 
1,208.8
Derivatives
 
9.0
 
2.4
 
0.0
 
97.1
 
16.6
 
0.2
 
125.2
Securities financing transactions
 
59.3
 
42.9
 
0.1
 
53.4
 
12.7
 
0.1
 
168.4
Off-balance sheet items
 
18.0
 
33.8
 
0.2
 
18.3
 
1.8
 
0.5
 
72.5
Items deducted from Swiss SRB tier 1 capital
 
(5.3)
 
(0.8)
 
(1.2)
 
(0.4)
 
(0.6)
 
(2.7)
 
(11.0)
Total
 
575.0
 
489.7
 
3.9
 
402.4
 
79.0
 
14.0
 
1,564.0
30.9.24 vs 30.6.24
On-balance sheet exposures
 
11.6
 
20.2
 
0.4
 
4.6
 
(4.3)
 
2.7
 
35.1
Derivatives
 
1.9
 
0.9
 
0.0
 
8.8
 
(3.2)
 
0.2
 
8.6
Securities financing transactions
 
6.8
 
2.2
 
0.0
 
(0.8)
 
(4.6)
 
(0.3)
 
3.3
Off-balance sheet items
 
0.6
 
(1.5)
 
0.0
 
0.2
 
0.8
 
(0.1)
 
0.0
Items deducted from Swiss SRB tier 1 capital
 
0.0
 
0.0
 
0.0
 
0.0
 
0.1
 
0.1
 
0.1
Total
 
20.8
 
21.9
 
0.3
 
12.8
 
(11.2)
 
2.6
 
47.2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Liquidity and funding management
 
38
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 AG
 
Annual
 
Report
 
2023,
 
available
 
under
 
“Annual
 
reporting”
 
at
ubs.com/investors
,
 
which
 
provides
 
more
information
 
about
 
UBS AG’s
 
strategy,
 
objectives
 
and
 
governance
 
in
 
connection
 
with
 
liquidity
 
and
 
funding
management.
Liquidity coverage ratio
The quarterly average
 
liquidity coverage ratio
 
(the LCR) of
 
UBS AG consolidated increased
 
2.2 percentage points to
196.3%. The
 
movement in
 
the quarterly
 
average LCR
 
was primarily
 
driven by
 
an
 
increase in
 
high-quality liquid
assets
 
(HQLA)
 
of
 
USD 80.3bn
 
to
 
USD 360.6bn.
 
This
 
increase
 
was
 
substantially attributable
 
to
 
the
 
effect
 
of
 
the
merger of
 
UBS AG and
 
Credit Suisse AG, with
 
only 21
 
days of
 
post-merger effect being
 
included in
 
the average
LCR for the second quarter of 2024.
 
The increase
 
in HQLA
 
was partly
 
offset by
 
a USD 40.1bn
 
increase in
 
net cash
 
outflows to
 
USD 183.7bn, substantially
attributable to the effect of the merger of UBS AG
 
and Credit Suisse AG, with only 21 days of post-merger effect
being included in the average
 
LCR for the second quarter of 2024.
›
Refer to “Liquidity coverage ratio” in the “Liquidity and funding management” section of the UBS AG second
quarter 2024 report, available under “Quarterly reporting” at
ubs.com/investors
, for more information about the
basis of calculation for the average LCR for the second quarter of 2024
›
Refer to the
30 September 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, and to
“Liquidity and funding management” in the “Capital, liquidity and funding, and balance sheet” section of the
UBS AG Annual Report 2023, available under “Annual reporting” at
ubs.com/investors
, for more information about
the LCR on a UBS AG consolidated basis
 
Liquidity coverage ratio
USD bn, except where indicated
Average 3Q24
1
Average 2Q24
1
High-quality liquid assets
 
360.6
 
280.3
Net cash outflows
2
 
183.7
 
143.6
Liquidity coverage ratio (%)
3
 
196.3
 
194.1
1 Calculated based on an average of 65
 
data points in the third quarter of 2024
 
and 61 data points in the second
 
quarter of 2024, of which 40 data
 
points were before the merger of UBS AG
 
and Credit Suisse AG
(i.e. from
 
2 April 2024
 
until 30 May
 
2024), and
 
21 data
 
points were after
 
the merger (i.e.
 
from 31
 
May 2024
 
until 30 June
 
2024). The
 
post-merger,
 
21-day average
 
LCR of UBS
 
AG consolidated
 
was 203.6%.
 
2 Represents the net cash outflows
 
expected over a stress period
 
of 30 calendar days.
 
3 Calculated after the application
 
of haircuts, inflow and
 
outflow rates, as well
 
as, where applicable,
 
caps on Level 2 assets
and cash inflows.
Net stable funding ratio
 
As of 30 September 2024, the net stable funding
 
ratio (the NSFR) decreased 0.9 percentage
 
points to 126.8%.
 
Available
 
stable
 
funding increased
 
by
 
USD 20.6bn to
 
USD 903.4bn, mainly
 
driven
 
by
 
higher customer
 
deposits,
largely due to currency effects. Required stable funding increased by USD 21.3bn to USD 712.7bn, predominantly
reflecting increases in trading assets and lending
 
assets, with the latter increase mainly driven by
 
currency effects.
 
›
Refer to the 30 September 2024 Pillar 3 Report, available under “Pillar 3 disclosures” at
ubs.com/investors
, and to
“Liquidity and funding management” in the “Capital, liquidity and funding, and balance sheet” section of the
UBS AG Annual Report 2023, available under “Annual reporting” at
ubs.com/investors
, for more information about
the NSFR on a UBS AG consolidated basis
Net stable funding ratio
USD bn, except where indicated
30.9.24
30.6.24
Available stable funding
903.4
882.8
Required stable funding
712.7
691.5
Net stable funding ratio (%)
126.8
127.7
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Balance sheet and off-balance sheet
 
39
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 AG
 
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 (30 September
 
2024 vs 30 June 2024)
Total assets
 
were USD 1,626.9bn
 
as of
 
30 September 2024,
 
an increase
 
of USD 62.2bn
 
compared with
 
30 June
2024, largely reflecting currency effects as
 
a result of the depreciation of the US dollar.
Derivatives and
 
cash collateral
 
receivables on
 
derivative instruments
 
increased by
 
USD 22.8bn, predominantly
 
in
Derivatives
 
&
 
Solutions
 
and
 
Financing
 
in
 
the
 
Investment
 
Bank,
 
primarily
 
reflecting
 
increases
 
in
 
foreign
 
currency
contracts, where the contracts in
 
place at the end
 
of September 2024 had a
 
higher fair value compared with the
contracts in
 
place at
 
the end
 
of June
 
2024, and
 
in equity
 
contracts, reflecting
 
market-driven increases.
 
Lending
assets increased by USD 16.0bn,
 
primarily reflecting currency
 
effects of approximately USD
 
26.3bn, partly offset
 
by
negative net
 
new loans
 
in Personal
 
&
 
Corporate Banking
 
and
 
Global Wealth
 
Management. Securities
 
financing
transactions at
 
amortized cost
 
increased by
 
USD 10.1bn, mainly
 
reflecting net
 
new
 
excess cash
 
reinvestment in
Group
 
Treasury. Trading
 
assets increased
 
by
 
USD 9.8bn, primarily
 
driven by
 
an
 
increase
 
in
 
inventory
 
held in
 
the
Investment Bank to
 
hedge client positions,
 
as well as
 
market-driven increases,
 
partly offset by
 
the unwinding of
 
the
Credit Suisse
 
business in
 
Non-core and
 
Legacy. Other
 
financial assets
 
measured at
 
fair value
 
increased by
 
USD 6.1bn,
mainly reflecting currency effects and increases
 
in securities financing transactions
 
measured at fair value.
These increases were partly offset by
 
a USD 5.0bn decrease in Cash
 
and balances at central banks,
 
mainly due to
net redemptions
 
of debt
 
issued, net
 
increases in
 
securities financing
 
transactions and
 
net new
 
customer deposit
outflows,
 
partly
 
offset
 
by
 
inflows
 
reflecting
 
negative
 
net
 
new
 
loans
 
and
 
by
 
currency
 
effects
 
of
 
approximately
USD 10.6bn.
›
Refer to the “Consolidated financial statements” section of this report for more information
Assets
As of
% change from
USD bn
30.9.24
30.6.24
30.6.24
Cash and balances at central banks
 
243.3
 
248.3
 
(2)
Lending
1
 
645.4
 
629.4
 
3
Securities financing transactions at amortized cost
 
92.1
 
82.0
 
12
Trading assets
 
172.2
 
162.4
 
6
Derivatives and cash collateral receivables on derivative instruments
 
206.9
 
184.1
 
12
Brokerage receivables
 
24.7
 
25.3
 
(2)
Other financial assets measured at amortized cost
 
61.6
 
60.8
 
1
Other financial assets measured at fair value
2
 
131.3
 
125.2
 
5
Non-financial assets
 
49.5
 
47.2
 
5
Total assets
 
1,626.9
 
1,564.7
 
4
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.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Balance sheet and off-balance sheet
 
40
Balance sheet liabilities (30 September
 
2024 vs 30 June 2024)
Total liabilities were USD 1,529.1bn as of 30 September 2024, an increase of USD 58.7bn compared
 
with 30 June
2024, largely reflecting currency effects as
 
a result of the depreciation of the US dollar.
Derivatives and cash collateral payables
 
on derivative instruments increased by
 
USD 25.9bn, predominantly in the
Investment
 
Bank,
 
primarily
 
reflecting
 
the
 
same
 
drivers
 
as
 
on
 
the
 
asset
 
side.
 
Customer
 
deposits
 
increased
 
by
USD 18.9bn, primarily
 
driven by
 
currency effects
 
of approximately
 
USD 24.8bn, partly
 
offset by
 
net new
 
deposit
outflows. Brokerage payables increased by
 
USD 6.2bn, mainly reflecting increases in client activity
 
levels.
 
These increases were partly offset by a
 
USD 3.9bn decrease in Debt issued designated at
 
fair value and long-term
debt issued measured at amortized cost,
 
mainly driven by net redemptions of
 
debt issued measured at amortized
cost in Group Treasury, which were partly offset
 
by currency effects of approximately USD 4.8bn.
The “Liabilities,
 
by product and currency” table in this section
 
provides more information about 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
Liabilities and equity
As of
 
% change from
USD bn
30.9.24
30.6.24
30.6.24
Short-term borrowings
1,2
 
61.9
 
61.7
 
0
Securities financing transactions at amortized cost
 
16.4
 
14.8
 
10
Customer deposits
 
779.6
 
760.7
 
2
Funding from UBS Group AG measured at amortized cost
 
112.3
 
111.7
 
0
Debt issued designated at fair value and long-term debt issued measured
 
at amortized cost
2
 
182.1
 
186.0
 
(2)
Trading liabilities
 
36.4
 
33.5
 
9
Derivatives and cash collateral payables on derivative instruments
 
208.7
 
182.8
 
14
Brokerage payables
 
52.4
 
46.2
 
13
Other financial liabilities measured at amortized cost
 
21.9
 
22.1
 
(1)
Other financial liabilities designated at fair value
 
41.1
 
36.8
 
11
Non-financial liabilities
 
16.3
 
14.0
 
16
Total liabilities
 
1,529.1
 
1,470.4
 
4
Share capital
 
0.4
 
0.4
 
0
Share premium
 
84.8
 
84.8
 
0
Retained earnings
 
8.0
 
7.4
 
8
Other comprehensive income
3
 
3.8
 
0.8
 
393
Total equity attributable to shareholders
 
96.9
 
93.4
 
4
Equity attributable to non-controlling interests
 
0.9
 
0.9
 
3
Total equity
 
97.8
 
94.2
 
4
Total liabilities and equity
 
1,626.9
 
1,564.7
 
4
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.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Risk, capital, liquidity and funding, and balance
 
sheet | Balance sheet and off-balance sheet
 
41
Equity (30 September 2024 vs 30 June 2024)
Equity attributable to shareholders increased
 
by USD 3,551m to USD 96,943m as of
 
30 September 2024.
The
 
increase
 
of
 
USD 3,551m
 
was
 
mainly
 
driven
 
by
 
total
 
comprehensive income
 
attributable
 
to
 
shareholders
 
of
USD 3,602m, reflecting
 
a
 
net
 
profit of
 
USD 996m and
 
other comprehensive
 
income
 
(OCI) of
 
USD 2,606m. OCI
mainly included cash flow hedge OCI
 
of USD 1,593m,
 
OCI related to foreign currency
 
translation of USD 1,461m
and negative own credit on financial liabilities
 
designated at fair value of USD 323m.
›
Refer to the “UBS AG consolidated 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
Liabilities, by product and currency
USD equivalent
All currencies
of which: USD
of which: CHF
of which: EUR
USD bn
30.9.24
30.6.24
30.9.24
30.6.24
30.9.24
30.6.24
30.9.24
30.6.24
Short-term borrowings
61.9
61.7
28.9
32.0
7.9
8.0
11.2
8.6
of which: amounts due to banks
28.1
26.8
10.0
10.0
7.4
7.5
3.5
3.2
of which: short-term debt issued
1,2
33.9
34.9
18.9
22.0
0.5
0.5
7.7
5.4
Securities financing transactions at amortized cost
16.4
14.8
8.8
8.5
3.3
2.7
3.6
2.5
Customer deposits
779.6
760.7
311.4
308.3
320.9
303.4
76.9
77.8
of which: demand deposits
231.6
223.5
56.6
55.7
109.9
102.5
35.9
36.3
of which: retail savings / deposits
189.1
177.8
33.7
31.0
151.2
142.7
4.2
4.0
of which: sweep deposits
34.5
35.7
34.5
35.7
0.0
0.0
0.0
0.0
of which: time deposits
324.4
323.7
186.6
185.9
59.8
58.1
36.8
37.5
Funding from UBS Group AG measured at amortized cost
112.3
111.7
76.4
74.8
2.8
2.6
29.5
29.3
Debt issued designated at fair value and long-term debt issued measured
 
at amortized
cost
2
182.1
186.0
86.0
95.6
43.9
41.7
33.6
31.2
Trading liabilities
36.4
33.5
14.5
12.7
1.7
1.1
10.4
9.7
Derivatives and cash collateral payables on derivative instruments
208.7
182.8
167.4
145.3
4.2
3.5
22.3
21.3
Brokerage payables
52.4
46.2
41.7
35.4
0.7
0.7
2.6
2.9
Other financial liabilities measured at amortized cost
 
21.9
22.1
12.4
13.1
3.5
3.5
2.0
1.4
Other financial liabilities designated at fair value
41.1
36.8
10.1
9.2
0.1
0.2
8.2
6.0
Non-financial liabilities
16.3
14.0
8.1
6.5
3.0
2.9
2.6
2.4
Total liabilities
1,529.1
1,470.4
765.6
741.4
392.0
370.2
203.0
193.0
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 (30 September 2024
 
vs 30 June 2024)
Committed
 
unconditionally
 
revocable
 
credit
 
lines
 
increased
 
by
 
USD 4.1bn,
 
driven
 
by
 
currency
 
effects.
 
Forward
starting reverse repurchase and securities borrowing agreements increased by USD
 
6.4bn, reflecting an increase in
levels of business division activity in short-dated
 
securities financing transactions.
Off-balance sheet
As of
% change from
USD bn
30.9.24
30.6.24
30.6.24
Guarantees
1,2
 
39.6
 
38.8
 
2
Irrevocable loan commitments
1
 
80.5
 
81.9
 
(2)
Committed unconditionally revocable credit lines
 
154.6
 
150.5
 
3
Forward starting reverse repurchase and securities borrowing agreements
 
16.1
 
9.7
 
65
1 Guarantees and irrevocable loan commitments are shown net of sub-participations.
 
2 Includes guarantees measured at fair value through profit or loss.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | UBS
 
AG interim consolidated financial statements
 
(unaudited)
 
43
UBS AG interim consolidated
financial statements (unaudited)
Income statement
For the quarter ended
Year-to-date
USD m
Note
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Interest income from financial instruments measured at
 
amortized cost and fair value through
other comprehensive income
4
 
8,335
 
6,892
 
5,974
 
21,467
 
16,272
Interest expense from financial instruments measured at
 
amortized cost
4
 
(8,820)
 
(7,080)
 
(5,357)
 
(21,952)
 
(13,818)
Net interest income from financial instruments measured
 
at fair value through profit or loss
and other
4
 
2,045
 
910
 
368
 
3,573
 
1,224
Net interest income
4
 
1,560
 
722
 
984
 
3,088
 
3,678
Other net income from financial instruments measured
 
at fair value through profit or loss
 
3,592
 
3,271
 
2,467
 
9,809
 
7,476
Fee and commission income
5
 
6,986
 
6,190
 
5,097
 
18,783
 
15,180
Fee and commission expense
5
 
(652)
 
(589)
 
(431)
 
(1,699)
 
(1,297)
Net fee and commission income
5
 
6,334
 
5,601
 
4,666
 
17,084
 
13,883
Other income
6
 
510
 
306
 
231
 
1,025
 
624
Total revenues
 
11,997
 
9,900
 
8,348
 
31,006
 
25,661
Credit loss expense / (release)
9
 
167
 
84
 
27
 
303
 
80
Personnel expenses
7
 
5,788
 
4,797
 
3,951
 
14,746
 
11,697
General and administrative expenses
8
 
4,014
 
4,584
 
2,585
 
11,584
 
8,011
Depreciation, amortization and impairment of non-financial
 
assets
 
838
 
631
 
510
 
2,000
 
1,686
Operating expenses
 
10,640
 
10,012
 
7,047
 
28,329
 
21,393
Operating profit / (loss) before tax
 
1,191
 
(196)
 
1,275
 
2,374
 
4,188
Tax expense / (benefit)
 
194
 
28
 
339
 
587
 
1,115
Net profit / (loss)
 
997
 
(224)
 
936
 
1,787
 
3,072
Net profit / (loss) attributable to non-controlling interests
 
1
 
40
 
5
 
49
 
17
Net profit / (loss) attributable to shareholders
 
996
 
(264)
 
932
 
1,738
 
3,055
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | UBS
 
AG interim consolidated financial statements
 
(unaudited)
 
44
Statement of comprehensive income
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Comprehensive income attributable to shareholders
1
Net profit / (loss)
 
996
 
(264)
 
932
 
1,738
 
3,055
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
 
2,460
 
(109)
 
(646)
 
787
 
(114)
Effective portion of changes in fair value of hedging instruments
 
designated as net investment hedges, before tax
 
(1,008)
 
78
 
292
 
(123)
 
18
Foreign currency translation differences on foreign operations reclassified to the
 
income statement
 
2
 
2
 
2
 
4
 
(1)
Effective portion of changes in fair value of hedging instruments
 
designated as net investment hedges reclassified
 
to
 
the income statement
 
0
 
0
 
0
 
1
 
(3)
Income tax relating to foreign currency translations, including the effect of
 
net investment hedges
 
8
 
2
 
4
 
22
 
(1)
Subtotal foreign currency translation, net of tax
 
1,461
 
(27)
 
(348)
 
690
 
(102)
Financial assets measured at fair value through other comprehensive income
Net unrealized gains / (losses), before tax
 
2
 
0
 
(1)
 
1
 
0
Net realized (gains) / losses reclassified to the income statement
 
from equity
 
0
 
0
 
0
 
0
 
1
Income tax relating to net unrealized gains / (losses)
 
0
 
0
 
0
 
0
 
0
Subtotal financial assets measured at fair value through other comprehensive
 
income, net of tax
 
2
 
0
 
(1)
 
1
 
1
Cash flow hedges of interest rate risk
Effective portion of changes in fair value of derivative instruments designated
 
as cash flow hedges, before tax
 
1,579
 
(335)
 
(940)
 
169
 
(1,635)
Net (gains) / losses reclassified to the income statement from
 
equity
 
388
 
626
 
479
 
1,506
 
1,241
Income tax relating to cash flow hedges
 
(374)
 
2
 
89
 
(255)
 
86
Subtotal cash flow hedges, net of tax
 
1,593
 
294
 
(372)
 
1,420
 
(308)
Cost of hedging
Cost of hedging, before tax
 
(8)
 
(20)
 
(1)
 
(34)
 
5
Income tax relating to cost of hedging
 
 
0
 
0
 
0
 
0
 
0
Subtotal cost of hedging, net of tax
 
(8)
 
(20)
 
(1)
 
(34)
 
5
Total other comprehensive income that may be reclassified to the income statement, net
 
of tax
 
3,048
 
247
 
(722)
 
2,077
 
(405)
Other comprehensive income that will not be reclassified to the income
 
statement
Defined benefit plans
Gains / (losses) on defined benefit plans, before tax
 
(127)
 
42
 
6
 
(50)
 
26
Income tax relating to defined benefit plans
 
8
 
0
 
(17)
 
0
 
(49)
Subtotal defined benefit plans, net of tax
 
(119)
 
41
 
(12)
 
(49)
 
(23)
Own credit on financial liabilities designated at fair value
Gains / (losses) from own credit on financial liabilities designated
 
at fair value, before tax
 
(317)
 
228
 
(312)
 
(70)
 
(455)
Income tax relating to own credit on financial liabilities designated
 
at fair value
 
(6)
 
(2)
 
27
 
(8)
 
71
Subtotal own credit on financial liabilities designated at
 
fair value, net of tax
 
(323)
 
226
 
(284)
 
(78)
 
(384)
Total other comprehensive income that will not be reclassified to the income statement,
 
net of tax
 
(442)
 
267
 
(296)
 
(128)
 
(408)
Total other comprehensive income
 
2,606
 
514
 
(1,018)
 
1,949
 
(812)
Total comprehensive income attributable to shareholders
 
3,602
 
251
 
(86)
 
3,687
 
2,243
Comprehensive income attributable to non-controlling
 
interests
Net profit / (loss)
 
1
 
40
 
5
 
49
 
17
Total other comprehensive income that will not be reclassified to the income statement,
 
net of tax
 
20
 
(20)
 
(11)
 
(11)
 
(9)
Total comprehensive income attributable to non-controlling interests
 
21
 
20
 
(6)
 
37
 
8
Total comprehensive income
 
Net profit / (loss)
 
997
 
(224)
 
936
 
1,787
 
3,072
Other comprehensive income
 
 
2,626
 
494
 
(1,029)
 
1,937
 
(822)
of which: other comprehensive income that may be reclassified
 
to the income statement
 
3,048
 
247
 
(722)
 
2,077
 
(405)
of which: other comprehensive income that will not be reclassified
 
to the income statement
 
(422)
 
247
 
(307)
 
(139)
 
(417)
Total comprehensive income
 
 
3,623
 
271
 
(93)
 
3,724
 
2,251
1 Refer to the “UBS AG consolidated performance” section of this report for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | UBS
 
AG interim consolidated financial statements
 
(unaudited)
 
45
Balance sheet
USD m
Note
30.9.24
30.6.24
31.12.23
Assets
Cash and balances at central banks
 
243,261
 
248,335
 
171,806
Amounts due from banks
 
20,162
 
20,457
 
28,206
Receivables from securities financing transactions measured at amortized
 
cost
 
92,104
 
82,028
 
74,128
Cash collateral receivables on derivative instruments
11
 
47,209
 
43,637
 
32,300
Loans and advances to customers
9
 
625,249
 
608,910
 
405,633
Other financial assets measured at amortized cost
12
 
61,566
 
60,826
 
54,334
Total financial assets measured at amortized cost
 
1,089,553
 
1,064,192
 
766,407
Financial assets at fair value held for trading
10
 
172,190
 
162,358
 
135,098
of which: assets pledged as collateral that may be sold or repledged
 
by counterparties
 
46,601
 
43,452
 
44,524
Derivative financial instruments
10, 11
 
159,720
 
140,415
 
131,728
Brokerage receivables
10
 
24,656
 
25,273
 
20,883
Financial assets at fair value not held for trading
10
 
129,141
 
123,020
 
63,754
Total financial assets measured at fair value through profit or loss
 
485,706
 
451,065
 
351,463
Financial assets measured at fair value through other comprehensive income
10
 
2,179
 
2,167
 
2,233
Investments in associates
 
2,483
 
2,233
 
983
Property, equipment and software
 
12,848
 
12,990
 
11,044
Goodwill and intangible assets
 
6,739
 
7,023
 
6,265
Deferred tax assets
 
9,678
 
9,877
 
9,244
Other non-financial assets
12
 
17,707
 
15,117
 
8,377
Total assets
 
1,626,893
 
1,564,664
 
1,156,016
Liabilities
Amounts due to banks
 
28,058
 
26,750
 
16,720
Payables from securities financing transactions measured at amortized cost
 
16,358
 
14,847
 
5,782
Cash collateral payables on derivative instruments
11
 
34,267
 
33,691
 
34,886
Customer deposits
 
779,604
 
760,693
 
555,673
Funding from UBS Group AG measured at amortized cost
13
 
112,262
 
111,725
 
67,282
Debt issued measured at amortized cost
15
 
109,460
 
112,520
 
69,784
Other financial liabilities measured at amortized cost
12
 
21,923
 
22,125
 
12,713
Total financial liabilities measured at amortized cost
 
1,101,933
 
1,082,350
 
762,840
Financial liabilities at fair value held for trading
10
 
36,441
 
33,493
 
31,712
Derivative financial instruments
10, 11
 
174,449
 
149,089
 
140,707
Brokerage payables designated at fair value
10
 
52,403
 
46,198
 
42,275
Debt issued designated at fair value
10, 14
 
106,527
 
108,405
 
86,341
Other financial liabilities designated at fair value
10, 12
 
41,055
 
36,834
 
27,366
Total financial liabilities measured at fair value through profit or loss
 
410,875
 
374,019
 
328,401
Provisions
16
 
5,009
 
4,763
 
2,524
Other non-financial liabilities
12
 
11,253
 
9,285
 
6,682
Total liabilities
 
1,529,071
 
1,470,417
 
1,100,448
Equity
Share capital
 
386
 
386
 
386
Share premium
 
84,776
 
84,825
 
24,638
Retained earnings
 
8,019
 
7,417
 
28,235
Other comprehensive income recognized directly in equity, net of tax
 
3,762
 
764
 
1,974
Equity attributable to shareholders
 
96,943
 
93,392
 
55,234
Equity attributable to non-controlling interests
 
879
 
855
 
335
Total equity
 
97,822
 
94,247
 
55,569
Total liabilities and equity
 
1,626,893
 
1,564,664
 
1,156,016
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | UBS
 
AG interim consolidated financial statements
 
(unaudited)
 
46
Statement of changes in equity
USD m
Share
capital and
share
premium
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
 
25,024
 
28,235
 
1,974
 
4,947
 
(2,961)
 
55,234
Equity recognized due to the merger of UBS AG and Credit Suisse
 
AG
3
 
60,571
 
(18,848)
 
(291)
 
(291)
 
41,432
Premium on shares issued and warrants exercised
 
0
 
0
Tax (expense) / benefit
 
8
 
8
Dividends
 
(3,000)
 
(3,000)
Translation effects recognized directly in retained earnings
 
(3)
 
3
 
3
 
0
Share of changes in retained earnings of associates and
 
joint ventures
 
(3)
 
(3)
New consolidations / (deconsolidations) and other increases
 
/ (decreases)
 
(441)
4
 
26
 
(414)
Total comprehensive income for the period
 
1,610
 
2,077
 
690
 
1,420
 
3,687
of which: net profit / (loss)
 
1,738
 
1,738
of which: OCI, net of tax
 
(128)
 
2,077
 
690
 
1,420
 
1,949
Balance as of 30 September 2024
2
 
85,162
 
8,019
 
3,762
 
5,637
 
(1,830)
 
96,943
Non-controlling interests as of 30 September 2024
 
879
5
Total equity as of 30 September 2024
 
97,822
Balance as of 1 January 2023
2
 
24,985
 
31,746
 
(133)
 
4,098
 
(4,234)
 
56,598
Premium on shares issued and warrants exercised
 
(5)
6
 
(5)
Tax (expense) / benefit
 
0
 
0
Dividends
 
(6,000)
 
(6,000)
Translation effects recognized directly in retained earnings
 
18
 
(18)
 
(18)
 
0
Share of changes in retained earnings of associates and
 
joint ventures
 
(1)
 
(1)
New consolidations / (deconsolidations) and other increases
 
/ (decreases)
 
0
 
0
Total comprehensive income for the period
 
2,648
 
(405)
 
(102)
 
(308)
 
2,243
of which: net profit / (loss)
 
3,055
 
3,055
of which: OCI, net of tax
 
(408)
 
(405)
 
(102)
 
(308)
 
(812)
Balance as of 30 September 2023
2
 
24,981
 
28,410
 
(556)
 
3,996
 
(4,560)
 
52,836
Non-controlling interests as of 30 September 2023
 
345
Total equity as of 30 September 2023
 
53,181
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 Refer to Note 2 for more information.
 
4 Mainly reflecting
 
effects from transactions
 
between Credit Suisse
 
AG and its
 
subsidiaries and UBS
 
AG and its
 
subsidiaries prior to
 
the merger in
 
May 2024.
 
5 Includes an increase
 
of USD 490m
 
in the second
quarter of 2024
 
due to the
 
merger of UBS
 
AG and
 
Credit Suisse AG.
 
6 Includes decreases
 
related to recharges
 
by UBS Group
 
AG for share-based
 
compensation awards
 
granted to employees
 
of UBS AG
 
or its
subsidiaries.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | UBS
 
AG interim consolidated financial statements
 
(unaudited)
 
47
Statement of cash flows
Year-to-date
USD m
30.9.24
30.9.23
Cash flow from / (used in) operating activities
Net profit / (loss)
 
1,787
 
3,072
Non-cash items included in net profit and other adjustments
Depreciation, amortization and impairment of non-financial
 
assets
 
2,000
 
1,686
Credit loss expense / (release)
 
303
 
80
Share of net (profit) / loss of associates and joint ventures
 
and impairment related to associates
 
(107)
 
(79)
Deferred tax expense / (benefit)
 
(477)
 
(208)
Net loss / (gain) from investing activities
 
(98)
 
33
Net loss / (gain) from financing activities
 
5,574
 
(423)
Other net adjustments
1
 
(5,705)
 
1,333
Net change in operating assets and liabilities
1,2
Amounts due from banks and amounts due to banks
 
2,968
 
(3,255)
Receivables from securities financing transactions measured at amortized
 
cost
 
10,729
 
5,747
Payables from securities financing transactions measured at amortized cost
 
1,189
 
2,061
Cash collateral on derivative instruments
 
(11,320)
 
(5,375)
Loans and advances to customers
 
14,141
 
3,255
Customer deposits
 
(13,449)
 
(6,322)
Financial assets and liabilities at fair value held for trading and derivative financial
 
instruments
 
(11,213)
 
(15,217)
Brokerage receivables and payables
 
6,159
 
(10,726)
Financial assets at fair value not held for trading and other financial assets
 
and liabilities
 
(15,823)
 
178
Provisions and other non-financial assets and liabilities
 
738
 
370
Income taxes paid, net of refunds
 
(1,275)
 
(1,321)
Net cash flow from / (used in) operating activities
 
(13,879)
3
 
(25,111)
Cash flow from / (used in) investing activities
Cash and cash equivalents obtained due to the merger of UBS
 
AG and Credit Suisse AG
4
 
121,258
Purchase of subsidiaries, associates and intangible assets
 
(1)
Disposal of subsidiaries, associates and intangible assets
 
166
 
35
Purchase of property, equipment and software
 
(1,066)
 
(947)
Disposal of property, equipment and software
 
9
 
33
Net (purchase) / redemption of financial assets measured
 
at fair value through other comprehensive income
 
28
 
25
Purchase of debt securities measured at amortized cost
 
(3,841)
 
(11,632)
Disposal and redemption of debt securities measured at amortized
 
cost
 
6,857
 
7,227
Net cash flow from / (used in) investing activities
 
123,412
 
(5,260)
Cash flow from / (used in) financing activities
Repayment of Swiss National Bank funding
 
(10,304)
Net issuance (repayment) of short-term debt measured at amortized
 
cost
 
(3,882)
 
6,658
Distributions paid on UBS AG shares
 
(3,000)
 
(6,000)
Issuance of debt designated at fair value and long-term debt measured
 
at amortized cost
5
 
82,921
 
84,278
Repayment of debt designated at fair value and long-term debt measured
 
at amortized cost
5
 
(98,381)
 
(65,547)
Inflows from securities financing transactions measured at amortized
 
cost
6
 
4,979
Outflows from securities financing transactions measured at amortized
 
cost
6
 
(1,113)
Net cash flows from other financing activities
 
(457)
 
(369)
Net cash flow from / (used in) financing activities
 
(29,238)
 
19,020
Total cash flow
Cash and cash equivalents at the beginning of the period
 
190,469
 
195,200
Net cash flow from / (used in) operating, investing and financing
 
activities
 
80,296
 
(11,350)
Effects of exchange rate differences on cash and cash equivalents
1
 
3,153
 
(713)
Cash and cash equivalents at the end of the period
7
 
273,918
8
 
183,136
of which: cash and balances at central banks
7
 
243,261
 
161,640
of which: amounts due from banks
7
 
18,540
 
10,950
of which: money market paper
7,9
 
11,915
 
10,545
Additional information
Net cash flow from / (used in) operating activities includes:
Interest received in cash
 
34,522
 
23,579
Interest paid in cash
 
30,623
 
18,052
Dividends on equity investments, investment funds and associates
 
received in cash
10
 
2,234
 
1,812
1 Foreign currency translation and foreign exchange effects on operating assets and liabilities and on cash
 
and cash equivalents are presented within the Other net adjustments line. Does not include foreign currency
hedge effects related to foreign
 
exchange swaps.
 
2 Excludes non-cash items
 
arising from the accounting
 
for the merger of UBS
 
AG and Credit Suisse
 
AG. Refer to
 
Note 2 for more information.
 
3 Includes cash
receipts from the sale of loans and loan commitments of USD 2,980m within Non-core and Legacy for the nine-month period ended 30 September 2024.
 
4 Refer to Note 2 for more information about the merger of
UBS AG and Credit Suisse AG.
 
5 Includes funding from UBS Group AG measured at amortized cost (recognized
 
on the balance sheet in Funding from UBS Group AG) and
 
measured at fair value (recognized on the
balance sheet in Debt issued designated at fair value and Other financial liabilities designated at fair value).
 
6 Reflects cash flows from securities financing transactions measured at amortized cost that use UBS debt
instruments as the underlying.
 
7 Includes only balances with an original maturity of
 
three months or less.
 
8 The balance includes USD 0.2bn related to cash held
 
in Assets of disposal groups held for
 
sale, recognized
within Other
 
non-financial assets.
 
9 Money
 
market paper
 
is included
 
in the
 
balance sheet
 
under Financial
 
assets at
 
fair value
 
not held
 
for trading
 
(30 September
 
2024: USD 11,130m;
 
30 September
 
2023:
USD 10,158m), Other financial assets measured at
 
amortized cost (30 September 2024: USD 455m; 30
 
September 2023: USD 187m) and Financial assets at fair
 
value held for trading (30 September 2024: USD 331m;
30 September 2023: USD 199m).
 
10 Includes dividends received from associates reported within Net cash flow from / (used in) investing activities.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
48
Notes to the UBS AG interim consolidated financial
statements (unaudited)
Note 1
 
Basis of accounting
Basis of preparation
The consolidated financial statements (the financial statements) of UBS AG and its subsidiaries (together, UBS AG)
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 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. Note 2 sets
out
 
the
 
accounting
 
for
 
the
 
merger
 
of
 
UBS AG
 
and
 
Credit
 
Suisse AG.
 
These
 
interim
 
financial
 
statements
 
are
unaudited
 
and
 
should
 
be
 
read
 
in
 
conjunction
 
with
 
UBS AG’s
 
audited
 
consolidated
 
financial
 
statements
 
in
 
the
UBS AG Annual
 
Report 2023
 
and the
 
“Management report”
 
sections of
 
this report,
 
including the
 
disclosures in
“Integration of Credit
 
Suisse” in the “Recent
 
developments” section of
 
this report. In
 
the opinion of management,
all
 
necessary
 
adjustments
 
have
 
been
 
made
 
for
 
a
 
fair
 
presentation
 
of
 
UBS AG’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 this
 
Note and
 
Note 2, as
 
well as
“Note 1a Material accounting policies” in the “Consolidated financial statements” section of the UBS AG Annual
Report 2023.
Amendments to IAS 12,
Income Taxes
UBS AG
 
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 or
 
later and
have had no material effect on UBS AG.
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; and
–
enhanced guidance on aggregation and disaggregation of
 
information on the face of
 
financial statements and
in the notes thereto.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
49
Note 1
 
Basis of accounting (continued)
IFRS 18 is
 
effective from
 
1 January 2027
 
and will
 
also apply
 
to comparative
 
information. UBS AG
 
will first
 
apply
these new
 
requirements in
 
the Annual
 
Report 2027
 
and, for
 
interim reporting,
 
in the
 
first quarter
 
2027 interim
report. UBS AG
 
is assessing
 
the impact
 
of the
 
new requirements
 
on its
 
reporting but
 
expects it
 
to be
 
limited. UBS AG
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.
Amendments to IFRS 9,
Financial Instruments
, and IFRS 7,
Financial Instruments: Disclosures
In
 
May
 
2024,
 
the
 
IASB
 
issued
 
Amendments
 
to
 
the
Classification
 
and
 
Measurement
 
of
 
Financial
 
Instruments
 
–
Amendments to IFRS 9 and IFRS 7
 
(Amendments).
 
The Amendments relate to:
–
derecognition of financial liabilities settled
 
through electronic transfer systems;
–
assessment
 
of
 
contractual
 
cash
 
flow
 
characteristics
 
in
 
classifying
 
financial
 
assets,
 
including
 
those
 
with
environmental, social and
 
corporate governance and
 
similar features, non-recourse
 
features, and
 
contractually
linked instruments; and
–
disclosure of information about
 
financial instruments with contingent features
 
that can change
 
the amount of
contractual
 
cash
 
flows,
 
as
 
well
 
as
 
equity
 
instruments
 
designated
 
at
 
fair
 
value
 
through
 
other
 
comprehensive
income.
The Amendments
 
are effective
 
from 1 January 2026,
 
with early
 
application permitted either
 
for the
 
entire set
 
of
amendments or
 
for only
 
those that
 
relate to
 
classification of
 
financial instruments. UBS AG
 
is currently
 
assessing
the impact of the new requirements on its
 
financial statements.
Incremental accounting policies related
 
to the transactions and activities associated
 
with the merger of
UBS AG and Credit Suisse AG
Business combinations under common control
UBS AG’s
 
material
 
accounting
 
policies
 
in
 
respect
 
of
 
business
 
combinations
 
are
 
set
 
out
 
in
 
“Note 1a
 
Material
accounting
 
policies,
 
item
 
1
 
Consolidation”
 
in
 
the
 
“Consolidated
 
financial
 
statements”
 
section
 
of
 
the
 
UBS AG
Annual
 
Report
 
2023.
 
The
 
merger
 
of
 
UBS AG
 
and
 
Credit
 
Suisse AG
 
on
 
31 May
 
2024
 
constitutes
 
a
 
business
combination under
 
common control
 
as defined
 
in IFRS
 
3,
Business Combinations
, i.e.
 
a business
 
combination in
which the combining entities or businesses are ultimately
 
controlled by the same entity both
 
before and after the
business combination and where
 
that control is
 
not transitory.
 
Business combinations under common control
 
are
outside
 
the
 
scope
 
of
 
IFRS 3.
 
In
 
the
 
absence
 
of
 
specific
 
accounting
 
requirements
 
in
 
IFRS
 
Accounting Standards,
UBS AG has
 
adopted an
 
accounting policy
 
that provides
 
relevant information
 
for the
 
economic decision-making
needs of users and is reflective of the economic substance
 
of the transaction.
UBS AG accounts for business
 
combinations under common
 
control using the historic
 
carrying values of
 
assets and
liabilities of
 
the transferred
 
entity
 
or business
 
as of
 
the date
 
of
 
the transfer,
 
determined under
 
IFRS Accounting
Standards.
 
The
 
balances
 
of
 
each
 
of
 
the
 
equity
 
reserves
 
of
 
the
 
transferred
 
entity,
 
accumulated
 
after
 
that
 
entity
becomes part of the
 
UBS Group, are combined with
 
the corresponding equity reserves (
Share premium
,
Retained
earnings
 
and
Other
 
comprehensive income
 
recognized directly
 
in
 
equity,
 
net
 
of
 
tax
)
 
of
 
UBS AG.
 
The
 
difference
between the
 
aggregate carrying
 
value of
 
the assets
 
and liabilities
 
and equity
 
reserves is
 
recognized as
 
an adjustment
to
Share premium
, net
 
of any
 
consideration that
 
may be
 
payable. Comparative
 
periods prior
 
to the
 
dates of
 
business
combinations under common control are not restated,
 
because such transactions
 
are accounted for prospectively.
 
Allowances and provisions for expected credit
 
losses
UBS AG’s material accounting
 
policies in respect of
 
allowances and provisions for
 
expected credit losses are
 
set out
in
 
“Note 1a
 
Material
 
accounting policies,
 
item 2g
 
Allowances and
 
provisions
 
for
 
expected
 
credit
 
losses”
 
in
 
the
“Consolidated financial
 
statements” section
 
of the
 
UBS AG Annual
 
Report 2023.
 
Financial instruments
 
acquired
through
 
a business
 
combination under
 
common control
 
that are
 
not classified
 
by UBS AG
 
at fair
 
value through
profit or loss are subject to IFRS 9 expected credit loss requirements.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
50
Note 1
 
Basis of accounting (continued)
Goodwill and other intangible assets
UBS AG’s
 
material
 
accounting policies
 
regarding
 
goodwill
 
are
 
set
 
out
 
in
 
“Note 1a
 
Material
 
accounting policies,
item 9 Goodwill”
 
in the “Consolidated
 
financial statements”
 
section of the
 
UBS AG Annual Report
 
2023. Goodwill
recognized
 
in
 
the
 
transferred
 
entity
 
prior
 
to
 
the
 
date
 
of
 
the
 
business
 
combination
 
under
 
common
 
control
 
is
recognized in
 
these financial statements
 
at the
 
historic carrying value,
 
subsequently allocated to
 
respective cash-
generating units and tested for impairment.
 
Business
 
combinations
 
under
 
common
 
control
 
do
 
not
 
result
 
in
 
a
 
recognition
 
of
 
incremental
 
goodwill
 
or
 
other
intangible assets,
 
in addition
 
to those
 
already recognized
 
by the
 
transferred entity
 
prior to
 
the date
 
of business
combination under common control.
 
Currency translation rates
The following table shows the rates of the
 
main currencies used to translate the
 
financial information of UBS AG’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
Year-to-date
30.9.24
30.6.24
31.12.23
30.9.23
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
1 CHF
 
1.18
 
1.11
 
1.19
 
1.09
 
1.17
 
1.10
 
1.12
 
1.14
 
1.11
1 EUR
 
1.11
 
1.07
 
1.10
 
1.06
 
1.10
 
1.07
 
1.08
 
1.09
 
1.08
1 GBP
 
1.34
 
1.26
 
1.28
 
1.22
 
1.31
 
1.26
 
1.26
 
1.28
 
1.24
100 JPY
 
0.69
 
0.62
 
0.71
 
0.67
 
0.69
 
0.63
 
0.69
 
0.66
 
0.72
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
 
UBS AG with
 
the same functional
 
currency for each
 
month. Weighted average
 
rates for individual
 
business
divisions may deviate from the weighted average rates for UBS AG.
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
51
Note 2
 
Accounting for the merger of UBS AG and
 
Credit Suisse AG
Merger of UBS AG and Credit Suisse AG
The merger of UBS AG and Credit Suisse AG effected on 31 May 2024
 
with no consideration payable by UBS AG
constitutes a business combination under
 
common control accounted for based
 
on the accounting policies set out
in Note 1 to these financial statements.
 
Assets and liabilities
UBS AG accounted
 
for the
 
merger with
 
Credit Suisse AG
 
using the
 
historic carrying
 
values of
 
the assets
 
and liabilities
of Credit Suisse AG as
 
at the date
 
of the transaction
 
(31 May 2024), determined
 
under IFRS Accounting
 
Standards.
–
No fair
 
value adjustments
 
were made
 
to assets
 
and liabilities
 
(which is
 
different to
 
the UBS
 
Group AG consolidated
financial statements where
 
acquisition method accounting
 
was required under
 
IFRS 3,
Business Combinations
,
on 31 May 2023 for the acquisition of Credit
 
Suisse Group AG).
 
–
UBS AG has elected
 
to retain historic
 
accumulated depreciation and impairment
 
of non-financial assets
 
arising
since
 
31 May 2023, i.e.
 
the
 
date
 
on
 
which
 
Credit
 
Suisse AG
 
came
 
to
 
be
 
under
 
the
 
common
 
control
 
of
 
UBS
Group AG.
 
–
Expected credit
 
loss allowances
 
and provisions
 
for performing
 
and credit-impaired
 
exposures were
 
recognized
under IFRS 9.
–
No new
 
goodwill, intangible
 
assets or
 
contingent liabilities
 
have been
 
recognized as
 
a result
 
of the
 
merger of
UBS AG and Credit Suisse AG.
 
–
Uniform accounting policies for like transactions and events
 
have been applied throughout UBS AG
 
and Credit
Suisse AG as of 31 May 2023 (the date of the
 
acquisition of Credit Suisse Group AG by
 
UBS Group AG).
Equity reserves
The equity
 
reserve balances
 
of Credit
 
Suisse AG recorded
 
from 31 May
 
2023 to
 
31 May 2024
 
have been
 
added
across
 
to the
 
corresponding equity
 
reserves
 
of UBS AG,
 
except for
 
the foreign
 
currency
 
translation reserve
 
that
UBS AG
 
has
 
elected
 
to
 
reset
 
and
 
has
 
been
 
added
 
to
Share
 
premium
.
 
As
 
a
 
result,
 
the
 
net
 
investment
 
hedge
accounting reserve
 
has been
 
added to
Retained earnings
 
as if
 
no net
 
investment hedge
 
accounting had
 
been applied
by Credit Suisse. The results of Credit Suisse AG from 31
 
May 2023
 
to 31 May 2024 have been added
 
to
Retained
earnings
. Equity reserve balances
 
of Credit Suisse AG recorded prior
 
to 31 May 2023 (i.e.
 
the date on which
 
Credit
Suisse AG came under the common control of UBS
 
Group AG) have not been retained.
The
 
difference between
 
the aggregated
 
carrying value
 
of the
 
assets and
 
liabilities and
 
equity reserves
 
has been
recognized as
 
an adjustment
 
to
Share premium
 
(reflecting the
 
contribution of
 
the Credit
 
Suisse AG business
 
to
UBS AG from the common parent, UBS Group
 
AG).
 
Comparability
Profit and loss
 
information for
 
the third quarter
 
of 2024
 
is based
 
entirely on consolidated
 
data following
 
the merger
of UBS AG and Credit
 
Suisse AG. Profit and loss
 
information for the second
 
quarter of 2024 includes one
 
month
(June 2024)
 
of post-merger
 
consolidated data
 
and two
 
months of
 
pre-merger UBS AG
 
data only
 
(April and
 
May
2024). Profit
 
and loss
 
information for
 
the third
 
quarter of
 
2023 includes pre
 
-merger UBS AG data
 
only.
 
Year-to-
date information for 2024 includes four months (June to September
 
2024) of post-merger consolidated data and
five
 
months of
 
pre-merger UBS AG
 
data only
 
(January to
 
May 2024).
 
Comparative year-to-date
 
information for
2023 includes pre-merger UBS AG data only.
Balance
 
sheet
 
information
 
as
 
at
 
30 September
 
2024
 
and
 
30 June
 
2024
 
includes
 
post-merger
 
consolidated
information. Balance sheet dates prior to 30 June
 
2024 reflect pre-merger UBS AG information
 
only.
The comparative periods prior to the
 
merger date have not been restated,
 
as the transaction has been accounted
for
 
prospectively
 
since
 
31 May
 
2024,
 
i.e.
 
the
 
date
 
on
 
which
 
the
 
merger
 
of
 
UBS AG
 
and
 
Credit
 
Suisse AG
 
was
effected.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
52
Note 2
 
Accounting for the merger of UBS AG and
 
Credit Suisse AG (continued)
The table below presents the assets, liabilities and equity of Credit Suisse AG that were
 
recognized by UBS AG on
31 May 2024 as a result of the merger.
 
Credit Suisse AG assets, liabilities and equity
 
transferred to UBS AG on the merger date
USD m
Assets
Cash and balances at central banks
 
114,759
Amounts due from banks
 
6,861
Receivables from securities financing transactions measured at amortized
 
cost
 
28,380
Cash collateral receivables on derivative instruments
 
10,373
Loans and advances to customers
 
222,937
Other financial assets measured at amortized cost
 
10,852
Total financial assets measured at amortized cost
 
394,162
Financial assets at fair value held for trading
 
15,504
Derivative financial instruments
 
31,975
Brokerage receivables
 
130
Financial assets at fair value not held for trading
 
36,592
Total financial assets measured at fair value through profit or loss
 
84,201
Financial assets measured at fair value through other comprehensive income
 
0
Investments in associates
 
1,330
Property, equipment and software
 
2,627
Goodwill and intangible assets
 
819
Deferred tax assets
 
224
Other non-financial assets
 
5,943
Total assets
 
489,306
Liabilities
Amounts due to banks
 
20,715
Payables from securities financing transactions measured at amortized cost
 
6,077
Cash collateral payables on derivative instruments
 
6,459
Customer deposits
 
224,627
Funding from UBS Group AG measured at amortized cost
 
45,298
Debt issued measured at amortized cost
 
44,521
Other financial liabilities measured at amortized cost
 
8,984
Total financial liabilities measured at amortized cost
 
356,681
Financial liabilities at fair value held for trading
 
1,870
Derivative financial instruments
 
33,200
Brokerage payables designated at fair value
 
339
Debt issued designated at fair value
 
25,947
Other financial liabilities designated at fair value
 
5,494
Total financial liabilities measured at fair value through profit or loss
 
66,850
Provisions
 
2,817
Other non-financial liabilities
 
3,381
Total liabilities
 
429,729
Equity
Equity attributable to shareholders
1
 
41,432
Equity attributable to non-controlling interests
 
490
Total equity
 
41,922
1 Refer to the Statement of changes in equity in this report for more information.
Transactions between UBS AG and
 
Credit Suisse AG
 
have been
 
eliminated from the
 
balances presented
 
in the
 
table
above. They amounted to USD 7.1bn of assets
 
and USD 24.8bn of liabilities of Credit Suisse AG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
53
Note 2
 
Accounting for the merger of UBS AG and
 
Credit Suisse AG (continued)
Agreement to sell Select Portfolio Servicing
On 13 August 2024,
 
UBS entered into
 
an agreement to
 
sell Select Portfolio
 
Servicing, the US
 
mortgage servicing
business of Credit
 
Suisse, which is
 
managed in Non-core
 
and Legacy. Completion
 
of the
 
transaction is subject
 
to
regulatory
 
approvals
 
and
 
other
 
customary
 
closing
 
conditions.
 
The
 
associated
 
assets
 
and
 
liabilities
 
are
 
disclosed
in
Assets of disposal
 
groups held
 
for sale
 
and
Liabilities of
 
disposal groups
 
held for
 
sale
, respectively,
 
within Note 12
to these
 
financial statements. The
 
transaction is expected
 
to close in
 
the first quarter
 
of 2025.
 
UBS AG
 
does not
expect to recognize a material profit or loss upon
 
completion of the transaction.
 
Note 3
 
Segment reporting
As part of the continued refinement of UBS AG’s reporting structure and organizational setup, in
 
the first quarter
of
 
2024
 
certain
 
changes
 
to
 
Group
 
Treasury
 
allocations
 
were
 
made
 
with
 
an
 
impact
 
on
 
segment
 
reporting
 
for
UBS AG’s business divisions and Group Items.
 
Prior-period information has been adjusted
 
for comparability.
 
UBS AG has
 
allocated to the
 
business divisions nearly
 
all Group
 
Treasury costs that
 
historically were retained
 
and
reported in Group
 
Items. Costs that continue
 
to be retained
 
in Group Items
 
include costs related
 
to hedging and
own debt,
 
and deferred
 
tax asset
 
funding costs.
 
In parallel with
 
these changes,
 
UBS AG has
 
increased the
 
allocation
of balance sheet resources from Group Treasury
 
to the business divisions.
Following the
 
changes outlined
 
above, prior-period
 
information for
 
the nine-month
 
period ended
 
30 September
2023 has been restated,
 
resulting in decreases in
 
Operating profit / (loss) before
 
tax of USD 42m for
 
Global Wealth
Management and USD 30m for Personal & Corporate
 
Banking, and increases in Operating profit / (loss)
 
before tax
of USD
 
46m for
 
Group Items,
 
USD 26m
 
for the
 
Investment Bank
 
and USD 1m
 
for Asset
 
Management, with
 
no
change to Non-core and Legacy.
Prior-period information as
 
of 31 December
 
2023 has also
 
been restated, resulting
 
in increases
 
of Total
 
assets of
USD 35.6bn in Global Wealth Management,
 
USD 26.9bn in Personal & Corporate Banking and
 
USD 21.4bn in the
Investment Bank, with a corresponding decrease
 
of assets of USD 83.9bn in Group Items.
These changes had no effect on the reported
 
results or financial position of UBS AG.
›
Refer to the “Consolidated financial statements” section of the UBS AG Annual Report 2023 for more information
about UBS AG’s business divisions
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group
 
Items
UBS AG
For the nine months ended 30 September 2024
1
Net interest income
 
4,183
 
2,868
 
(38)
 
(2,667)
 
(17)
 
(1,243)
 
3,088
Non-interest income
 
11,982
 
2,259
 
2,069
 
9,944
 
427
 
1,237
 
27,918
Total revenues
 
16,166
 
5,127
 
2,031
 
7,277
 
411
 
(6)
 
31,006
Credit loss expense / (release)
 
10
 
203
 
0
 
35
 
53
 
1
 
303
Operating expenses
 
13,579
 
3,257
 
1,691
 
6,523
 
2,542
 
737
 
28,329
Operating profit / (loss) before tax
 
2,577
 
1,667
 
340
 
718
 
(2,184)
 
(744)
 
2,374
Tax expense / (benefit)
 
587
Net profit / (loss)
 
1,787
As of 30 September 2024
Total assets
 
578,624
 
477,040
 
23,655
 
448,284
 
83,715
 
15,576
 
1,626,893
USD m
Global Wealth
Management
Personal &
Corporate
Banking
Asset
 
Management
Investment
Bank
Non-core and
Legacy
Group
Functions
UBS AG
For the nine months ended 30 September 2023
1, 2
Net interest income
 
4,192
 
2,298
 
(26)
 
(1,818)
 
23
 
(991)
 
3,678
Non-interest income
 
9,975
 
1,782
 
1,539
 
7,848
 
64
 
775
 
21,983
Total revenues
 
14,167
 
4,080
 
1,513
 
6,030
 
87
 
(216)
 
25,661
Credit loss expense / (release)
 
29
 
27
 
(1)
 
25
 
(1)
 
1
 
80
Operating expenses
 
10,872
 
2,118
 
1,243
 
5,480
 
861
 
819
 
21,393
Operating profit / (loss) before tax
 
3,267
 
1,935
 
271
 
526
 
(774)
 
(1,036)
 
4,188
Tax expense / (benefit)
 
1,115
Net profit / (loss)
 
3,072
As of 31 December 2023
2
Total assets
 
404,747
 
283,980
 
19,662
 
402,415
 
13,845
 
31,368
 
1,156,016
1 Refer to
 
“Note 3 Segment
 
reporting” in the
 
“Consolidated financial statements”
 
section of the
 
UBS AG Annual
 
Report 2023 for
 
more information about
 
UBS AG’s
 
reporting segments.
 
2 Comparative-period
information has been restated for changes
 
in business division perimeters,
 
Group Treasury allocations
 
and Non-core and Legacy cost allocations.
 
Refer to “Note 3 Segment reporting”
 
in the “Consolidated financial
statements” section of this report.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
54
Note 4
 
Net interest income
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Interest income from loans and deposits
1
 
7,620
 
6,070
 
5,279
 
19,128
 
14,228
Interest income from securities financing transactions measured
 
at amortized cost
2
 
898
 
1,008
 
894
 
2,894
 
2,492
Interest income from other financial instruments measured
 
at amortized cost
 
346
 
320
 
291
 
989
 
826
Interest income from debt instruments measured at fair
 
value through other comprehensive income
 
26
 
26
 
27
 
80
 
75
Interest income from derivative instruments designated as cash
 
flow hedges
 
 
(556)
 
(532)
 
(517)
 
(1,625)
 
(1,350)
Total interest income from financial instruments measured at amortized cost and fair
 
value through other comprehensive
income
 
8,335
 
6,892
 
5,974
 
21,467
 
16,272
Interest expense on loans and deposits
3
 
6,634
 
5,453
 
4,090
 
16,923
 
10,451
Interest expense on securities financing transactions measured
 
at amortized cost
4
 
569
 
499
 
454
 
1,476
 
1,293
Interest expense on debt issued
 
1,575
 
1,099
 
788
 
3,461
 
2,000
Interest expense on lease liabilities
 
41
 
29
 
24
 
93
 
74
Total interest expense from financial instruments measured at amortized cost
 
8,820
 
7,080
 
5,357
 
21,952
 
13,818
Total net interest income from financial instruments measured at amortized cost and fair
 
value through other comprehensive
income
 
(485)
 
(188)
 
617
 
(486)
 
2,454
Net interest income from financial instruments measured at fair value through profit
 
or loss and other
 
2,045
 
910
 
368
 
3,573
 
1,224
Total net interest income
 
1,560
 
722
 
984
 
3,088
 
3,678
1 Consists of
 
interest income from
 
cash and balances
 
at central banks,
 
amounts due from
 
banks, and
 
cash collateral receivable
 
s
 
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, customer deposits, and funding from UBS Group AG, 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.
 
Note 5
 
Net fee and commission income
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Underwriting fees
 
174
 
235
 
143
 
632
 
424
M&A and corporate finance fees
 
243
 
262
 
139
 
739
 
474
Brokerage fees
 
1,122
 
1,095
 
784
 
3,237
 
2,464
Investment fund fees
 
1,552
 
1,358
 
1,193
 
4,111
 
3,550
Portfolio management and related services
 
3,111
 
2,678
 
2,323
 
8,245
 
6,787
Other
 
785
 
562
 
515
 
1,819
 
1,482
Total fee and commission income
1
 
6,986
 
6,190
 
5,097
 
18,783
 
15,180
of which: recurring
4,693
 
4,076
 
3,573
12,437
 
10,483
of which: transaction-based
2,249
 
2,089
 
1,512
6,253
 
4,655
of which: performance-based
44
 
25
 
11
93
 
42
Fee and commission expense
 
652
 
589
 
431
 
1,699
 
1,297
Net fee and commission income
 
6,334
 
5,601
 
4,666
 
17,084
 
13,883
1 Reflects third-party fee and commission income for the third quarter of 2024 of USD 4,148m for Global Wealth Management (second quarter of 2024: USD 3,697m; third quarter of 2023: USD 3,197m), USD 761m
for Personal & Corporate Banking (second quarter of 2024: USD 589m; third
 
quarter of 2023: USD 471m), USD 926m for Asset Management (second quarter of 2024: USD 774m;
 
third quarter of 2023: USD 670m),
USD 1,041m for the Investment Bank (second quarter of 2024: USD 1,110m; third quarter of 2023: USD 760m), USD 13m for
 
Group Items (second quarter of 2024: negative USD 22m; third quarter of 2023: negative
USD 5m) and USD 97m for Non-core
 
and Legacy (second quarter of 2024:
 
USD 42m; third quarter of
 
2023: USD 5m). Comparative-period information has
 
been restated for changes in business
 
division perimeters,
Group Treasury allocations and Non-core and Legacy cost allocations.
 
Refer to Note 3 for more information.
 
 
Note 6
 
Other income
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Associates, joint ventures and subsidiaries
Net gains / (losses) from acquisitions and disposals of
 
subsidiaries
1
 
(2)
 
(2)
 
(2)
 
(4)
 
4
Net gains / (losses) from disposals of investments in associates
 
and joint ventures
 
116
2
 
0
 
0
 
116
2
 
0
Share of net profits of associates and joint ventures
 
67
 
24
 
55
 
107
 
79
Total
 
182
 
22
 
53
 
219
 
84
Income from properties
3
 
13
 
7
 
4
 
24
 
13
Net gains / (losses) from properties held for sale
 
(16)
 
0
 
8
 
(17)
 
8
Income from shared services provided to UBS Group AG or its subsidiaries
 
169
 
215
 
145
 
552
 
428
Other
 
163
4
 
63
 
21
 
247
4
 
92
Total other income
 
510
 
306
 
231
 
1,025
 
624
1 Includes foreign exchange gains / (losses) reclassified from other comprehensive income related to the disposal or closure of
 
foreign operations.
 
2 Includes a gain of USD 119m related to the sale of our investment
in an associate.
 
3 Includes rent received
 
from third parties.
 
4 Includes an
 
USD 84m gain in
 
Asset Management from
 
the sale of our
 
Brazilian real estate
 
fund management business (nine
 
-month period ended
30 September 2024: USD 113m).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
55
Note 7
 
Personnel expenses
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Salaries and variable compensation
1
 
4,999
 
4,205
 
3,431
 
12,824
 
10,151
of which: variable compensation – financial advisors
2
 
1,335
 
1,291
 
1,150
 
3,893
 
3,372
Contractors
 
33
 
24
 
24
 
78
 
74
Social security
 
315
 
251
 
216
 
774
 
612
Post-employment benefit plans
 
242
 
159
 
133
 
587
 
446
Other personnel expenses
 
200
 
158
 
147
 
482
 
413
Total personnel expenses
 
5,788
 
4,797
 
3,951
 
14,746
 
11,697
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.
 
Note 8
 
General and administrative expenses
For the quarter ended
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Outsourcing costs
 
255
 
191
 
117
 
567
 
362
Technology costs
 
257
 
206
 
142
 
625
 
403
Consulting, legal and audit fees
 
315
 
240
 
162
 
756
 
430
Real estate and logistics costs
 
267
 
190
 
210
 
587
 
462
Market data services
 
177
 
126
 
97
 
409
 
297
Marketing and communication
 
90
 
70
 
46
 
226
 
124
Travel and entertainment
 
60
 
72
 
44
 
186
 
145
Litigation, regulatory and similar matters
1
 
(47)
 
1,161
 
8
 
1,121
 
784
Other
 
2,640
 
2,329
 
1,760
 
7,106
 
5,004
of which: shared services costs charged by UBS Group AG or its subsidiaries
 
2,330
 
2,097
 
1,563
 
6,360
 
4,408
Total general and administrative expenses
 
4,014
 
4,584
 
2,585
 
11,584
 
8,011
1 Reflects the net increase in provisions for Litigation, regulatory and similar matters recognized in the income statement, as well as recoveries from third parties
 
or other UBS Group entities. Refer to Note 16b for
more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
56
Note 9
 
Expected credit loss measurement
a) Credit loss expense / release
 
Total net credit loss
 
expenses in the
 
third quarter of 2024
 
were USD 167m, reflecting
 
USD 15m net releases
 
related
to performing positions and USD 182m net
 
expenses on credit-impaired positions.
Stage 1 and 2 net releases of USD 15m
 
included scenario-update-related net
 
releases of USD 8m, mainly from real
estate lending,
 
and portfolio changes.
Credit
 
loss
 
expenses of
 
USD 182m for
 
credit-impaired positions
 
almost entirely
 
related
 
to Personal
 
&
 
Corporate
Banking and Non-core and Legacy exposures with a small number
 
of corporate counterparties.
 
Credit loss expense / (release)
Performing positions
Credit-impaired positions
USD m
Stages 1 and 2
Stage 3
Total
For the quarter ended 30.9.24
Global Wealth Management
 
(11)
 
14
 
3
Personal & Corporate Banking
 
(10)
 
94
 
84
Asset Management
 
0
 
0
 
0
Investment Bank
 
9
 
(4)
 
4
Non-core and Legacy
 
(2)
 
77
 
76
Group Items
 
0
 
0
 
0
Total
 
(15)
 
182
 
167
For the quarter ended 30.6.24
Global Wealth Management
 
(14)
 
12
 
(2)
Personal & Corporate Banking
 
(15)
 
125
 
110
Asset Management
 
0
 
0
 
0
Investment Bank
 
1
 
(2)
 
(1)
Non-core and Legacy
 
(1)
 
(22)
 
(23)
Group Items
 
0
 
0
 
0
Total
 
(29)
 
113
 
84
For the quarter ended 30.9.23
Global Wealth Management
 
(7)
 
15
 
8
Personal & Corporate Banking
 
16
 
(15)
 
1
Asset Management
 
0
 
0
 
0
Investment Bank
 
10
 
7
 
17
Non-core and Legacy
 
0
 
(1)
 
(1)
Group Items
 
1
 
0
 
1
Total
 
20
 
6
 
27
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
57
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 third quarter
 
of 2024 through a
 
series
of
 
governance
 
meetings,
 
with
 
input
 
and
 
feedback
 
from
 
UBS AG
 
Risk
 
and
 
Finance
 
experts
 
across
 
the
 
business
divisions
 
and
 
regions.
 
ECLs
 
for
 
former
 
Credit
 
Suisse positions
 
were
 
calculated based
 
on
 
Credit
 
Suisse’s models,
including the same scenarios and scenario weight
 
inputs as for UBS.
UBS AG kept
 
the scenarios
 
and scenario
 
weights in
 
line with
 
those applied
 
in the
 
UBS AG second
 
quarter 2024
report. The baseline scenario
 
was updated with the latest
 
macroeconomic forecasts as of
 
30 September 2024. The
assumptions on a calendar-year basis are included
 
in the table below.
 
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.
 
The scenario-update-related
 
ECL releases
 
in the
 
third quarter
 
of 2024
 
mainly stemmed
 
from real
 
estate lending,
driven by the upward revision of Swiss house
 
price and rental income levels, as well as
 
interest rate assumptions in
the stagflation scenario.
Post-model adjustments
Total
 
stage 1 and
 
2
 
allowances and
 
provisions
 
were
 
USD 1,202m as
 
of 30 September
 
2024 and
 
included post-
model
 
adjustments
 
of
 
USD 281m
 
(30 June
 
2024:
 
USD 300m).
 
Post-model
 
adjustments
 
are
 
intended
 
to
 
cover
uncertainty levels, including the geopolitical
 
situation, and to align
 
outputs from Credit
 
Suisse models with those
from UBS AG models for dedicated segments.
›
Refer to Note 2 for more information
Comparison of shock factors
Baseline
Key parameters
2023
2024
2025
Real GDP growth (annual percentage change)
US
 
 
2.9
 
2.6
 
1.6
Eurozone
 
0.5
 
0.6
 
1.2
Switzerland
 
0.7
 
1.4
 
1.5
Unemployment rate (%, annual average)
US
 
 
3.6
 
4.1
 
4.3
Eurozone
 
6.6
 
6.5
 
6.9
Switzerland
 
2.0
 
2.4
 
2.6
Fixed income: 10-year government bonds (%, Q4)
USD
 
3.9
 
3.8
 
3.8
EUR
 
2.0
 
2.1
 
2.1
CHF
 
0.7
 
0.4
 
0.5
Real estate (annual percentage change, Q4)
US
 
 
5.3
 
2.4
 
2.9
Eurozone
 
(1.1)
 
0.6
 
3.1
Switzerland
 
0.1
 
3.0
 
4.0
Economic scenarios and weights applied
Assigned weights in %
ECL scenario
30.9.24
30.6.24
30.9.23
Baseline
 
60.0
 
60.0
 
60.0
Mild debt crisis
 
 
15.0
 
15.0
 
15.0
Stagflationary geopolitical crisis
 
25.0
 
25.0
 
25.0
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
58
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.
No
 
purchased
 
credit-impaired
 
financial
 
assets
 
were
 
recognized
 
in
 
the
 
third
 
quarter
 
of
 
2024.
 
Originated
 
credit-
impaired financial assets were not material
 
and are not presented in the table below.
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
30.9.24
Carrying amount
1
ECL allowances
Financial instruments measured at amortized cost
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Cash and balances at central banks
 
243,261
 
243,130
 
131
 
0
 
(212)
 
0
 
(212)
 
0
Amounts due from banks
 
20,162
 
19,949
 
201
 
13
 
(76)
 
(5)
 
(2)
 
(68)
Receivables from securities financing transactions measured at amortized
 
cost
 
92,104
 
92,105
 
0
 
0
 
(1)
 
(1)
 
0
 
0
Cash collateral receivables on derivative instruments
 
47,209
 
47,209
 
0
 
0
 
0
 
0
 
0
 
0
Loans and advances to customers
 
625,249
 
594,453
 
26,049
 
4,748
 
(2,874)
 
(331)
 
(321)
 
(2,222)
of which: Private clients with mortgages
 
268,774
 
256,960
 
10,407
 
1,408
 
(232)
 
(54)
 
(82)
 
(96)
of which: Real estate financing
 
91,028
 
85,545
 
5,201
 
281
 
(110)
 
(25)
 
(31)
 
(54)
of which: Large corporate clients
 
29,724
 
24,682
 
3,988
 
1,055
 
(798)
 
(79)
 
(101)
 
(619)
of which: SME clients
 
23,880
 
19,485
 
2,960
 
1,435
 
(787)
 
(56)
 
(49)
 
(681)
of which: Lombard
 
150,202
 
149,734
 
353
 
115
 
(121)
 
(7)
 
(1)
 
(114)
of which: Credit cards
 
2,145
 
1,658
 
446
 
42
 
(44)
 
(7)
 
(11)
 
(26)
of which: Commodity trade finance
 
3,761
 
3,596
 
153
 
12
 
(113)
 
(13)
 
(1)
 
(98)
of which: Ship / aircraft financing
 
8,300
 
7,782
 
518
 
0
 
(54)
 
(36)
 
(8)
 
(10)
of which: Consumer financing
 
2,977
 
2,741
 
142
 
93
 
(132)
 
(21)
 
(26)
 
(85)
Other financial assets measured at amortized cost
 
61,566
 
60,853
 
531
 
182
 
(146)
 
(33)
 
(8)
 
(106)
of which: Loans to financial advisors
 
2,677
 
2,494
 
82
 
101
 
(46)
 
(4)
 
(1)
 
(41)
Total financial assets measured at amortized cost
 
1,089,553
 
1,057,699
 
26,912
 
4,942
 
(3,309)
 
(371)
 
(543)
 
(2,395)
Financial assets measured at fair value through other comprehensive income
 
2,179
 
2,179
 
0
 
0
 
0
 
0
 
0
 
0
Total on-balance sheet financial assets in scope of ECL requirements
2
 
1,091,732
 
1,059,878
 
26,912
 
4,942
 
(3,309)
 
(371)
 
(543)
 
(2,395)
Total exposure
ECL provisions
Off-balance sheet (in scope of ECL)
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Guarantees
 
41,450
 
40,019
 
1,279
 
151
 
(62)
 
(24)
 
(18)
 
(20)
of which: Large corporate clients
 
8,120
 
7,470
 
620
 
30
 
(26)
 
(8)
 
(9)
 
(9)
of which: SME clients
 
2,616
 
2,214
 
301
 
101
 
(12)
 
(4)
 
(4)
 
(4)
of which: Financial intermediaries and hedge funds
 
 
22,810
 
22,737
 
73
 
0
 
(12)
 
(8)
 
(4)
 
0
of which: Lombard
 
4,197
 
3,985
 
206
 
6
 
(3)
 
0
 
0
 
(3)
of which: Commodity trade finance
 
1,773
 
1,771
 
1
 
0
 
(1)
 
(1)
 
0
 
0
Irrevocable loan commitments
 
80,506
 
76,601
 
3,736
 
169
 
(187)
 
(113)
 
(45)
 
(29)
of which: Large corporate clients
 
48,794
 
45,464
 
3,208
 
123
 
(119)
 
(77)
 
(34)
 
(7)
Forward starting reverse repurchase and securities borrowing agreements
 
16,063
 
16,063
 
0
 
0
 
0
 
0
 
0
 
0
Unconditionally revocable loan commitments
 
154,613
 
151,814
 
2,543
 
255
 
(86)
 
(68)
 
(17)
 
0
of which: Real estate financing
 
11,547
 
11,249
 
297
 
1
 
(7)
 
(6)
 
0
 
0
of which: Large corporate clients
 
16,378
 
15,853
 
523
 
3
 
(24)
 
(16)
 
(6)
 
(2)
of which: SME clients
 
11,099
 
10,381
 
509
 
209
 
(36)
 
(29)
 
(6)
 
0
of which: Lombard
 
62,624
 
62,562
 
61
 
1
 
0
 
0
 
0
 
0
of which: Credit cards
 
10,400
 
9,910
 
487
 
3
 
(9)
 
(7)
 
(2)
 
0
Irrevocable committed prolongation of existing loans
 
3,701
 
3,691
 
5
 
5
 
(3)
 
(3)
 
0
 
0
Total off-balance sheet financial instruments and other credit lines
2
 
296,333
 
288,188
 
7,564
 
581
 
(337)
 
(208)
 
(80)
 
(49)
Total allowances and provisions
2
 
(3,646)
 
(579)
 
(623)
 
(2,445)
1 The carrying amount of financial assets measured at amortized cost represents the total gross exposure net of the respective
 
ECL allowances.
 
2 Refer to Note 2 for more information about the merger of UBS AG
and Credit Suisse AG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
59
Note 9
 
Expected credit loss measurement (continued)
USD m
30.6.24
Carrying amount
1
ECL allowances
Financial instruments measured at amortized cost
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Cash and balances at central banks
 
248,335
 
248,241
 
94
 
0
 
(230)
 
(1)
 
(228)
 
0
Amounts due from banks
 
20,457
 
20,125
 
319
 
13
 
(73)
 
(5)
 
0
 
(67)
Receivables from securities financing transactions measured at amortized
 
cost
 
82,027
 
82,028
 
0
 
0
 
(2)
 
(2)
 
0
 
0
Cash collateral receivables on derivative instruments
 
43,637
 
43,637
 
0
 
0
 
0
 
0
 
0
 
0
Loans and advances to customers
 
608,910
 
578,841
 
25,506
 
4,563
 
(2,696)
 
(354)
 
(299)
 
(2,044)
of which: Private clients with mortgages
 
255,281
 
244,008
 
10,104
 
1,169
 
(181)
 
(56)
 
(77)
 
(48)
of which: Real estate financing
 
88,141
 
83,214
 
4,580
 
347
 
(104)
 
(28)
 
(31)
 
(46)
of which: Large corporate clients
 
28,619
 
23,612
 
3,867
 
1,140
 
(741)
 
(93)
 
(95)
 
(553)
of which: SME clients
 
23,698
 
19,766
 
2,591
 
1,341
 
(871)
 
(60)
 
(40)
 
(771)
of which: Lombard
 
148,546
 
147,529
 
880
 
137
 
(101)
 
(7)
 
(2)
 
(92)
of which: Credit cards
 
1,927
 
1,479
 
408
 
40
 
(41)
 
(6)
 
(11)
 
(25)
of which: Commodity trade finance
 
5,795
 
5,558
 
222
 
16
 
(149)
 
(18)
 
(2)
 
(129)
of which: Ship / aircraft financing
 
8,549
 
8,096
 
427
 
25
 
(42)
 
(38)
 
(4)
 
0
of which: Consumer financing
 
2,886
 
2,689
 
120
 
78
 
(112)
 
(20)
 
(21)
 
(71)
Other financial assets measured at amortized cost
 
60,826
 
60,098
 
537
 
191
 
(148)
 
(34)
 
(8)
 
(106)
of which: Loans to financial advisors
 
2,601
 
2,408
 
83
 
110
 
(47)
 
(4)
 
(1)
 
(41)
Total financial assets measured at amortized cost
 
1,064,192
 
1,032,970
 
26,456
 
4,766
 
(3,148)
 
(396)
 
(535)
 
(2,217)
Financial assets measured at fair value through other comprehensive income
 
2,167
 
2,167
 
0
 
0
 
0
 
0
 
0
 
0
Total on-balance sheet financial assets in scope of ECL requirements
2
 
1,066,359
 
1,035,137
 
26,456
 
4,766
 
(3,148)
 
(396)
 
(535)
 
(2,217)
Total exposure
ECL provisions
Off-balance sheet (in scope of ECL)
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Guarantees
 
40,791
 
39,207
 
1,382
 
203
 
(69)
 
(26)
 
(15)
 
(28)
of which: Large corporate clients
 
8,323
 
7,421
 
820
 
82
 
(26)
 
(9)
 
(7)
 
(9)
of which: SME clients
 
2,539
 
2,153
 
287
 
99
 
(12)
 
(4)
 
(4)
 
(4)
of which: Financial intermediaries and hedge funds
 
 
21,270
 
21,080
 
190
 
0
 
(11)
 
(8)
 
(3)
 
0
of which: Lombard
 
3,895
 
3,872
 
10
 
13
 
(4)
 
0
 
0
 
(4)
of which: Commodity trade finance
 
1,642
 
1,629
 
13
 
0
 
(1)
 
(1)
 
0
 
0
Irrevocable loan commitments
 
81,866
 
77,446
 
4,236
 
184
 
(178)
 
(104)
 
(44)
 
(30)
of which: Large corporate clients
 
46,696
 
42,890
 
3,699
 
107
 
(128)
 
(85)
 
(37)
 
(6)
Forward starting reverse repurchase and securities borrowing agreements
 
9,724
 
9,724
 
0
 
0
 
0
 
0
 
0
 
0
Unconditionally revocable loan commitments
 
150,450
 
148,053
 
2,154
 
244
 
(81)
 
(69)
 
(13)
 
0
of which: Real estate financing
 
11,706
 
11,154
 
552
 
0
 
(7)
 
(7)
 
0
 
0
of which: Large corporate clients
 
16,000
 
15,677
 
314
 
9
 
(22)
 
(16)
 
(4)
 
(2)
of which: SME clients
 
11,001
 
10,575
 
346
 
80
 
(34)
 
(28)
 
(5)
 
0
of which: Lombard
 
60,961
 
60,934
 
26
 
1
 
0
 
0
 
0
 
0
of which: Credit cards
 
10,056
 
9,576
 
477
 
4
 
(8)
 
(6)
 
(2)
 
0
Irrevocable committed prolongation of existing loans
 
3,328
 
3,319
 
7
 
2
 
(2)
 
(2)
 
0
 
0
Total off-balance sheet financial instruments and other credit lines
2
 
286,160
 
277,748
 
7,779
 
633
 
(330)
 
(201)
 
(71)
 
(58)
Total allowances and provisions
2
 
(3,478)
 
(597)
 
(606)
 
(2,275)
1 The carrying amount of financial assets measured at amortized cost represents the total gross exposure net of the respective
 
ECL allowances.
 
2 Refer to Note 2 for more information about the merger of UBS AG
and Credit Suisse AG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
60
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
Total
Stage 1
Stage 2
Stage 3
Cash and balances at central banks
 
171,806
 
171,788
 
18
 
0
 
(26)
 
0
 
(26)
 
0
Amounts due from banks
2
 
28,206
 
28,191
 
14
 
0
 
(7)
 
(6)
 
(1)
 
0
Receivables from securities financing transactions measured at amortized
 
cost
 
74,128
 
74,128
 
0
 
0
 
(2)
 
(2)
 
0
 
0
Cash collateral receivables on derivative instruments
 
32,300
 
32,300
 
0
 
0
 
0
 
0
 
0
 
0
Loans and advances to customers
 
405,633
 
385,493
 
18,131
 
2,009
 
(935)
 
(173)
 
(185)
 
(577)
of which: Private clients with mortgages
 
174,400
 
163,617
 
9,955
 
828
 
(156)
 
(39)
 
(89)
 
(28)
of which: Real estate financing
 
54,305
 
50,252
 
4,038
 
15
 
(46)
 
(20)
 
(25)
 
(1)
of which: Large corporate clients
 
14,431
 
12,594
 
1,331
 
506
 
(241)
 
(34)
 
(32)
 
(174)
of which: SME clients
 
12,694
 
10,662
 
1,524
 
508
 
(262)
 
(34)
 
(24)
 
(204)
of which: Lombard
 
117,924
 
117,874
 
0
 
50
 
(22)
 
(5)
 
0
 
(17)
of which: Credit cards
 
2,041
 
1,564
 
438
 
39
 
(42)
 
(6)
 
(11)
 
(24)
of which: Commodity trade finance
 
2,889
 
2,873
 
12
 
4
 
(119)
 
(7)
 
0
 
(111)
Other financial assets measured at amortized cost
 
54,334
 
53,882
 
312
 
141
 
(87)
 
(16)
 
(5)
 
(66)
of which: Loans to financial advisors
 
2,615
 
2,422
 
79
 
114
 
(49)
 
(4)
 
(1)
 
(44)
Total financial assets measured at amortized cost
 
766,407
 
745,782
 
18,475
 
2,150
 
(1,057)
 
(197)
 
(217)
 
(643)
Financial assets measured at fair value through other comprehensive income
 
2,233
 
2,233
 
0
 
0
 
0
 
0
 
0
 
0
Total on-balance sheet financial assets in scope of ECL requirements
 
768,640
 
748,015
 
18,475
 
2,150
 
(1,057)
 
(197)
 
(217)
 
(643)
Total exposure
ECL provisions
Off-balance sheet (in scope of ECL)
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 3
Guarantees
 
33,211
 
32,332
 
761
 
118
 
(40)
 
(14)
 
(7)
 
(19)
of which: Large corporate clients
 
3,624
 
3,051
 
486
 
87
 
(10)
 
(3)
 
(2)
 
(6)
of which: SME clients
 
1,506
 
1,299
 
177
 
31
 
(7)
 
(1)
 
(1)
 
(5)
of which: Financial intermediaries and hedge funds
 
 
22,549
 
22,504
 
46
 
0
 
(12)
 
(8)
 
(3)
 
0
of which: Lombard
 
3,009
 
3,009
 
0
 
0
 
(1)
 
0
 
0
 
(1)
of which: Commodity trade finance
 
1,811
 
1,803
 
8
 
0
 
(1)
 
(1)
 
0
 
0
Irrevocable loan commitments
 
44,018
 
42,085
 
1,878
 
56
 
(95)
 
(55)
 
(38)
 
(2)
of which: Large corporate clients
 
26,096
 
24,444
 
1,622
 
30
 
(76)
 
(45)
 
(28)
 
(2)
Forward starting reverse repurchase and securities borrowing agreements
 
10,373
 
10,373
 
0
 
0
 
0
 
0
 
0
 
0
Committed unconditionally revocable credit lines
 
47,421
 
45,452
 
1,913
 
56
 
(49)
 
(39)
 
(10)
 
0
of which: Real estate financing
 
9,439
 
8,854
 
585
 
0
 
(4)
 
(3)
 
(1)
 
0
of which: Large corporate clients
 
5,110
 
4,951
 
151
 
8
 
(6)
 
(4)
 
(3)
 
0
of which: SME clients
 
5,408
 
5,188
 
191
 
29
 
(21)
 
(17)
 
(3)
 
0
of which: Lombard
 
8,964
 
8,964
 
0
 
1
 
0
 
0
 
0
 
0
of which: Credit cards
 
10,458
 
9,932
 
522
 
4
 
(10)
 
(8)
 
(2)
 
0
Irrevocable committed prolongation of existing loans
 
4,183
 
4,169
 
11
 
4
 
(4)
 
(3)
 
0
 
0
Total off-balance sheet financial instruments and other credit lines
 
139,206
 
134,410
 
4,562
 
234
 
(188)
 
(111)
 
(56)
 
(21)
Total allowances and provisions
 
(1,244)
 
(308)
 
(272)
 
(664)
1 The carrying amount of financial assets measured at amortized cost represents the total gross exposure net of the respective
 
ECL allowances.
 
2 Includes USD 14.8bn against Credit Suisse AG.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
61
Note 9
 
Expected credit loss measurement (continued)
The table
 
below provides
 
information about
 
the ECL gross
 
exposure and
 
the ECL
 
coverage ratio
 
for UBS AG’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.
The overall coverage ratio for
 
performing positions decreased by 1 basis
 
point to 10 basis points. Compared
 
with
30 June 2024, coverage ratios for performing positions
 
related to real estate lending (on-balance sheet) decreased
by 1 basis
 
point to 5 basis
 
points, and coverage
 
ratios for performing
 
positions related to
 
corporate lending (on-
balance sheet) increased by 2 basis points
 
to 56 basis points.
Coverage ratios for core loan portfolio
30.9.24
Gross carrying amount (USD m)
ECL coverage (bps)
On-balance sheet
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
269,006
 
257,013
 
10,489
 
1,504
 
9
 
2
 
79
 
5
 
636
Real estate financing
 
91,138
 
85,570
 
5,233
 
336
 
12
 
3
 
60
 
6
 
1,613
Total real estate lending
 
360,144
 
342,583
 
15,722
 
1,839
 
9
 
2
 
72
 
5
 
814
Large corporate clients
 
30,522
 
24,760
 
4,088
 
1,673
 
262
 
32
 
246
 
62
 
3,697
SME clients
 
24,666
 
19,541
 
3,009
 
2,116
 
319
 
29
 
163
 
47
 
3,218
Total corporate lending
 
55,189
 
44,301
 
7,097
 
3,790
 
287
 
31
 
211
 
56
 
3,429
Lombard
 
150,323
 
149,741
 
354
 
229
 
8
 
0
 
21
 
1
 
4,967
Credit cards
 
2,189
 
1,664
 
457
 
68
 
203
 
40
 
251
 
85
 
3,879
Commodity trade finance
 
3,874
 
3,609
 
155
 
110
 
291
 
37
 
89
 
39
 
8,917
Ship / aircraft financing
 
8,354
 
7,818
 
526
 
11
 
65
 
46
 
146
 
52
 
9,831
Consumer financing
 
3,109
 
2,762
 
168
 
179
 
425
 
75
 
1,538
 
159
 
4,781
Other loans and advances to customers
 
44,942
 
42,306
 
1,891
 
745
 
107
 
8
 
55
 
10
 
5,886
Loans to financial advisors
 
2,723
 
2,497
 
83
 
142
 
169
 
15
 
135
 
18
 
2,892
Total other lending
 
215,514
 
210,397
 
3,634
 
1,483
 
46
 
6
 
162
 
8
 
5,485
Total
1
 
630,847
 
597,282
 
26,453
 
7,112
 
46
 
6
 
122
 
11
 
3,182
Gross exposure (USD m)
ECL coverage (bps)
Off-balance sheet
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
7,687
 
7,428
 
221
 
38
 
5
 
5
 
32
 
5
 
39
Real estate financing
 
12,680
 
12,341
 
338
 
1
 
6
 
6
 
1
 
6
 
0
Total real estate lending
 
20,366
 
19,769
 
559
 
39
 
6
 
5
 
14
 
5
 
39
Large corporate clients
 
73,307
 
68,801
 
4,350
 
155
 
23
 
15
 
115
 
21
 
1,164
SME clients
 
15,639
 
14,318
 
996
 
325
 
48
 
28
 
165
 
37
 
554
Total corporate lending
 
88,946
 
83,119
 
5,346
 
481
 
27
 
17
 
124
 
23
 
751
Lombard
 
70,232
 
69,957
 
268
 
7
 
1
 
0
 
2
 
0
 
12,815
Credit cards
 
10,400
 
9,910
 
487
 
3
 
8
 
7
 
38
 
8
 
0
Commodity trade finance
 
3,128
 
3,124
 
4
 
0
 
9
 
8
 
289
 
9
 
0
Ship / aircraft financing
 
2,239
 
2,233
 
6
 
0
 
31
 
28
 
1,006
 
31
 
0
Consumer financing
 
150
 
150
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Financial intermediaries and hedge funds
 
39,035
 
38,597
 
438
 
0
 
4
 
3
 
87
 
4
 
0
Other off-balance sheet commitments
 
45,772
 
45,265
 
456
 
52
 
9
 
6
 
146
 
8
 
865
Total other lending
 
170,957
 
169,237
 
1,659
 
61
 
5
 
3
 
79
 
4
 
2,123
Total
2
 
280,269
 
272,125
 
7,564
 
581
 
12
 
8
 
106
 
10
 
849
Total on- and off-balance sheet
3
 
911,116
 
869,406
 
34,017
 
7,693
 
36
 
6
 
118
 
10
 
3,006
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 AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
62
Note 9
 
Expected credit loss measurement (continued)
Coverage ratios for core loan portfolio
30.6.24
Gross carrying amount (USD m)
ECL coverage (bps)
On-balance sheet
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
255,462
 
244,063
 
10,181
 
1,217
 
7
 
2
 
76
 
5
 
397
Real estate financing
 
88,246
 
83,242
 
4,611
 
393
 
12
 
3
 
66
 
7
 
1,167
Total real estate lending
 
343,708
 
327,305
 
14,792
 
1,610
 
8
 
3
 
73
 
6
 
585
Large corporate clients
 
29,360
 
23,705
 
3,962
 
1,693
 
253
 
39
 
240
 
68
 
3,268
SME clients
 
24,569
 
19,827
 
2,631
 
2,112
 
354
 
31
 
151
 
45
 
3,649
Total corporate lending
 
53,929
 
43,532
 
6,593
 
3,804
 
299
 
35
 
205
 
58
 
3,480
Lombard
 
148,647
 
147,536
 
882
 
229
 
7
 
0
 
18
 
1
 
4,024
Credit cards
 
1,968
 
1,485
 
419
 
64
 
208
 
39
 
252
 
86
 
3,826
Commodity trade finance
 
5,945
 
5,576
 
224
 
144
 
251
 
33
 
97
 
35
 
8,910
Ship / aircraft financing
 
8,591
 
8,134
 
432
 
25
 
49
 
47
 
103
 
50
 
0
Consumer financing
 
2,998
 
2,709
 
141
 
149
 
374
 
74
 
1,506
 
144
 
4,771
Other loans and advances to customers
 
45,821
 
42,918
 
2,322
 
581
 
77
 
7
 
68
 
10
 
5,328
Loans to financial advisors
 
2,647
 
2,412
 
84
 
151
 
176
 
18
 
146
 
22
 
2,736
Total other lending
 
216,617
 
210,770
 
4,504
 
1,343
 
39
 
6
 
127
 
8
 
4,967
Total
1
 
614,254
 
581,607
 
25,889
 
6,758
 
45
 
6
 
116
 
11
 
3,086
Gross exposure (USD m)
ECL coverage (bps)
Off-balance sheet
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
8,090
 
7,833
 
226
 
31
 
5
 
4
 
32
 
5
 
11
Real estate financing
 
12,715
 
12,143
 
572
 
0
 
5
 
6
 
0
 
5
 
0
Total real estate lending
 
20,805
 
19,975
 
799
 
31
 
5
 
5
 
0
 
5
 
11
Large corporate clients
 
71,091
 
66,060
 
4,833
 
198
 
25
 
17
 
100
 
22
 
904
SME clients
 
15,520
 
14,590
 
719
 
210
 
51
 
27
 
207
 
35
 
1,206
Total corporate lending
 
86,611
 
80,650
 
5,553
 
408
 
30
 
19
 
114
 
25
 
1,060
Lombard
 
68,071
 
68,017
 
40
 
14
 
1
 
0
 
16
 
0
 
2,706
Credit cards
 
10,056
 
9,576
 
477
 
4
 
8
 
7
 
35
 
8
 
0
Commodity trade finance
 
3,701
 
3,681
 
20
 
0
 
9
 
8
 
53
 
9
 
0
Ship / aircraft financing
 
1,836
 
1,817
 
19
 
0
 
11
 
12
 
0
 
11
 
0
Consumer financing
 
152
 
152
 
0
 
0
 
0
 
0
 
0
 
0
 
0
Financial intermediaries and hedge funds
 
47,842
 
47,381
 
461
 
0
 
3
 
2
 
76
 
3
 
0
Other off-balance sheet commitments
 
37,362
 
36,774
 
411
 
177
 
8
 
5
 
67
 
5
 
611
Total other lending
 
169,020
 
167,398
 
1,427
 
195
 
4
 
2
 
57
 
3
 
751
Total
2
 
276,436
 
268,023
 
7,779
 
633
 
12
 
7
 
92
 
10
 
914
Total on- and off-balance sheet
3
 
890,690
 
849,630
 
33,668
 
7,391
 
35
 
7
 
110
 
11
 
2,900
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).
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
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
174,555
 
163,656
 
10,044
 
856
 
9
 
2
 
88
 
7
 
326
Real estate financing
 
54,351
 
50,272
 
4,063
 
16
 
9
 
4
 
61
 
8
 
594
Total real estate lending
 
228,906
 
213,928
 
14,107
 
872
 
9
 
3
 
81
 
8
 
331
Large corporate clients
 
14,671
 
12,628
 
1,363
 
680
 
164
 
27
 
237
 
48
 
2,558
SME clients
 
12,956
 
10,696
 
1,548
 
712
 
202
 
32
 
155
 
47
 
2,861
Total corporate lending
 
27,627
 
23,324
 
2,911
 
1,392
 
182
 
29
 
193
 
48
 
2,714
Lombard
 
117,946
 
117,879
 
0
 
67
 
2
 
0
 
0
 
0
 
2,487
Credit cards
 
2,083
 
1,571
 
449
 
63
 
200
 
40
 
253
 
87
 
3,801
Commodity trade finance
 
3,008
 
2,881
 
12
 
115
 
394
 
25
 
62
 
25
 
9,676
Other loans and advances to customers
 
26,997
 
26,083
 
837
 
77
 
18
 
10
 
44
 
11
 
2,379
Loans to financial advisors
 
2,665
 
2,426
 
80
 
159
 
185
 
17
 
122
 
20
 
2,793
Total other lending
 
152,699
 
150,840
 
1,378
 
481
 
18
 
3
 
117
 
4
 
4,462
Total
1
 
409,232
 
388,092
 
18,396
 
2,744
 
24
 
5
 
101
 
9
 
2,263
Gross exposure (USD m)
ECL coverage (bps)
Off-balance sheet
Total
Stage 1
Stage 2
Stage 3
Total
Stage 1
Stage 2
Stage 1&2
Stage 3
Private clients with mortgages
 
6,801
 
6,560
 
226
 
15
 
8
 
7
 
29
 
8
 
40
Real estate financing
 
10,662
 
10,064
 
599
 
0
 
6
 
5
 
22
 
6
 
0
Total real estate lending
 
17,463
 
16,624
 
824
 
15
 
6
 
6
 
24
 
6
 
40
Large corporate clients
 
34,829
 
32,446
 
2,259
 
125
 
27
 
16
 
147
 
25
 
628
SME clients
 
7,872
 
7,337
 
456
 
80
 
47
 
29
 
230
 
41
 
626
Total corporate lending
 
42,702
 
39,782
 
2,715
 
205
 
30
 
18
 
161
 
28
 
627
Lombard
 
13,609
 
13,609
 
0
 
1
 
1
 
1
 
0
 
1
 
0
Credit cards
 
10,458
 
9,932
 
522
 
4
 
10
 
8
 
35
 
10
 
0
Commodity trade finance
 
2,354
 
2,346
 
8
 
0
 
4
 
4
 
36
 
4
 
0
Financial intermediaries and hedge funds
 
25,378
 
25,148
 
230
 
0
 
5
 
4
 
157
 
5
 
0
Other off-balance sheet commitments
 
16,869
 
16,596
 
264
 
9
 
12
 
5
 
170
 
8
 
0
Total other lending
 
68,668
 
67,630
 
1,024
 
14
 
7
 
4
 
97
 
6
 
5,921
Total
2
 
128,833
 
124,037
 
4,562
 
234
 
15
 
9
 
122
 
13
 
908
Total on- and off-balance sheet
3
 
538,065
 
512,129
 
22,958
 
2,978
 
22
 
6
 
105
 
10
 
2,157
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 AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
63
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 nine months of 2024, and
 
with regard to assets and liabilities now accounted for
 
by UBS AG as a
result of the merger of UBS AG and
 
Credit Suisse AG for the period between the date of
 
the merger (i.e. 31 May
2024) and 30 September 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
30.9.24
30.6.24
31.12.23
USD m
Level 1
Level 2
Level 3
Total
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
 
136,786
 
30,256
 
5,148
 
172,190
 
124,627
 
29,689
 
8,042
 
162,358
 
115,345
 
17,936
 
1,817
 
135,098
of which: Equity instruments
 
124,897
 
1,049
 
172
 
126,117
 
112,441
 
830
 
185
 
113,456
 
99,510
 
721
 
140
 
100,372
of which: Government bills / bonds
 
4,005
 
4,642
 
18
 
8,665
 
5,603
 
5,319
 
75
 
10,997
 
6,843
 
2,195
 
14
 
9,052
of which: Investment fund units
 
6,649
 
1,003
 
176
 
7,827
 
5,677
 
1,222
 
240
 
7,139
 
8,008
 
1,082
 
9
 
9,098
of which: Corporate and municipal bonds
 
1,232
 
19,213
 
863
 
21,307
 
896
 
16,875
 
900
 
18,671
 
982
 
11,956
 
648
 
13,586
of which: Loans
 
0
 
4,118
 
3,712
 
7,830
 
0
 
5,246
 
6,420
 
11,666
 
0
 
1,870
 
904
 
2,775
of which: Asset-backed securities
 
4
 
225
 
163
 
393
 
10
 
192
 
169
 
370
 
3
 
111
 
101
 
215
Derivative financial instruments
 
1,484
 
155,670
 
2,566
 
159,720
 
836
 
137,254
 
2,325
 
140,415
 
593
 
129,871
 
1,264
 
131,728
of which: Foreign exchange
 
 
829
 
60,641
 
177
 
61,646
 
331
 
50,576
 
121
 
51,029
 
317
 
65,070
 
0
 
65,387
of which: Interest rate
 
 
0
 
47,143
 
640
 
47,783
 
0
 
49,199
 
403
 
49,602
 
0
 
35,028
 
284
 
35,311
of which: Equity / index
 
 
0
 
40,818
 
996
 
41,815
 
0
 
32,239
 
1,154
 
33,393
 
0
 
26,649
 
667
 
27,317
of which: Credit
 
0
 
2,694
 
608
 
3,302
 
0
 
2,553
 
478
 
3,031
 
0
 
1,452
 
301
 
1,752
of which: Commodities
 
6
 
4,027
 
18
 
4,051
 
3
 
2,563
 
16
 
2,582
 
0
 
1,627
 
12
 
1,639
Brokerage receivables
 
0
 
24,656
 
0
 
24,656
 
0
 
25,273
 
0
 
25,273
 
0
 
20,883
 
0
 
20,883
Financial assets at fair value not held for trading
 
45,903
 
75,172
 
8,066
 
129,141
 
34,765
 
80,293
 
7,961
 
123,020
 
29,529
 
30,124
 
4,101
 
63,754
of which: Financial assets for unit-linked
investment contracts
 
18,274
 
6
 
0
 
18,280
 
16,957
 
6
 
0
 
16,963
 
15,814
 
0
 
0
 
15,814
of which: Corporate and municipal bonds
 
85
 
15,701
 
152
 
15,937
 
61
 
14,338
 
210
 
14,609
 
62
 
16,716
 
215
 
16,994
of which: Government bills / bonds
 
27,043
 
8,036
 
0
 
35,079
 
17,262
 
7,817
 
0
 
25,079
 
13,262
 
3,332
 
0
 
16,594
of which: Loans
 
0
 
4,464
 
2,545
 
7,010
 
0
 
3,699
 
2,553
 
6,252
 
0
 
4,172
 
1,254
 
5,426
of which: Securities financing transactions
 
0
 
45,665
 
484
 
46,149
 
0
 
53,069
 
268
 
53,337
 
0
 
5,541
 
4
 
5,545
of which: Asset-backed securities
 
0
 
1,058
 
553
 
1,611
 
0
 
1,108
 
500
 
1,608
 
0
 
18
 
0
 
18
of which: Auction rate securities
 
0
 
0
 
190
 
190
 
0
 
0
 
191
 
191
 
0
 
0
 
1,208
 
1,208
of which: Investment fund units
 
409
 
147
 
645
 
1,201
 
395
 
160
 
670
 
1,225
 
367
 
233
 
205
 
804
of which: Equity instruments
 
92
 
0
 
3,022
 
3,114
 
91
 
5
 
2,913
 
3,009
 
24
 
0
 
1,088
 
1,112
Financial assets measured at fair value through other
 
comprehensive income on a recurring basis
Financial assets measured at fair value through
other comprehensive income
 
65
 
2,114
 
0
 
2,179
 
62
 
2,105
 
0
 
2,167
 
68
 
2,165
 
0
 
2,233
of which: Commercial paper and certificates of
deposit
 
0
 
1,935
 
0
 
1,935
 
0
 
1,891
 
0
 
1,891
 
0
 
1,948
 
0
 
1,948
of which: Corporate and municipal bonds
 
65
 
178
 
0
 
243
 
62
 
205
 
0
 
267
 
68
 
207
 
0
 
276
Non-financial assets measured at fair value on a recurring
 
basis
Precious metals and other physical commodities
 
6,965
 
0
 
0
 
6,965
 
6,445
 
0
 
0
 
6,445
 
4,426
 
0
 
0
 
4,426
Non-financial assets measured at fair value on a non-recurring
 
basis
Other non-financial assets
2
 
0
 
0
 
110
 
110
 
0
 
0
 
43
 
43
 
0
 
0
 
17
 
17
Total assets measured at fair value
 
191,203
 
287,867
 
15,890
 
494,960
 
166,735
 
274,615
 
18,371
 
459,721
 
149,962
 
200,979
 
7,198
 
358,139
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
64
Note 10
 
Fair value measurement (continued)
Determination of fair values from quoted market
 
prices or valuation techniques (continued)
1
30.9.24
30.6.24
31.12.23
USD m
Level 1
Level 2
Level 3
Total
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
26,201
10,041
199
36,441
24,476
8,906
111
33,493
25,451
6,110
151
31,712
of which: Equity instruments
 
19,379
 
552
 
58
 
19,990
 
16,956
 
417
 
66
 
17,438
 
16,310
 
236
 
87
 
16,632
of which: Corporate and municipal bonds
 
29
 
8,054
 
135
 
8,218
 
33
 
7,118
 
35
 
7,186
 
28
 
4,893
 
58
 
4,979
of which: Government bills / bonds
 
4,390
 
1,069
 
0
 
5,458
 
6,171
 
1,260
 
5
 
7,437
 
8,320
 
806
 
0
 
9,126
of which: Investment fund units
 
2,403
 
285
 
4
 
2,691
 
1,315
 
38
 
4
 
1,357
 
794
 
117
 
4
 
915
Derivative financial instruments
1,633
167,462
5,354
174,449
877
143,764
4,448
149,089
716
136,833
3,158
140,707
of which: Foreign exchange
 
 
881
 
68,571
 
36
 
69,488
 
326
 
51,660
 
48
 
52,034
 
400
 
71,322
 
21
 
71,743
of which: Interest rate
 
 
0
 
43,065
 
298
 
43,363
 
0
 
47,021
 
243
 
47,264
 
0
 
32,656
 
107
 
32,763
of which: Equity / index
 
 
0
 
48,901
 
4,299
 
53,200
 
0
 
38,001
 
3,379
 
41,380
 
0
 
30,209
 
2,717
 
32,926
of which: Credit
 
0
 
3,426
 
422
 
3,848
 
0
 
3,456
 
371
 
3,827
 
0
 
1,341
 
273
 
1,614
of which: Commodities
 
5
 
3,303
 
38
 
3,345
 
2
 
1,951
 
14
 
1,967
 
0
 
1,271
 
20
 
1,291
of which: Loan commitments measured at FVTPL
 
0
 
73
 
188
 
260
 
0
 
1,547
 
288
 
1,835
 
0
 
3
 
17
 
21
Financial liabilities designated at fair value on a recurring
 
basis
Brokerage payables designated at fair
 
value
0
52,403
0
52,403
0
46,198
0
46,198
0
42,275
0
42,275
Debt issued designated at fair value
0
95,641
10,886
106,527
0
96,915
11,490
108,405
0
78,509
7,832
86,341
Other financial liabilities designated at fair value
0
36,873
4,182
41,055
0
31,957
4,877
36,834
0
25,069
2,297
27,366
of which: Financial liabilities related to unit-linked
investment contracts
 
0
 
18,389
 
0
 
18,389
 
0
 
17,080
 
0
 
17,080
 
0
 
15,922
 
0
 
15,922
of which: Securities financing transactions
 
0
 
10,893
 
0
 
10,893
 
0
 
7,801
 
0
 
7,801
 
0
 
6,927
 
0
 
6,927
of which: Funding from UBS Group AG
 
0
 
4,035
 
1,656
 
5,691
 
0
 
3,370
 
1,487
 
4,857
 
0
 
1,327
 
1,623
 
2,950
of which: Over-the-counter debt instruments
and others
 
0
 
3,557
 
2,525
 
6,082
 
0
 
3,706
 
3,390
 
7,096
 
0
 
892
 
674
 
1,566
Total liabilities measured at fair value
27,835
362,420
20,621
410,875
25,352
327,740
20,927
374,019
26,167
288,796
13,438
328,401
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
Year-to-date
USD m
30.9.24
30.6.24
30.9.23
30.9.24
30.9.23
Reserve balance at the beginning of the period
 
388
 
379
 
396
 
397
 
422
Effect from merger of UBS AG and Credit Suisse AG
1
 
1
 
1
Profit / (loss) deferred on new transactions
 
85
 
59
 
34
 
187
 
196
(Profit) / loss recognized in the income statement
 
(54)
 
(50)
 
(39)
 
(164)
 
(227)
Foreign currency translation
 
(1)
 
(1)
 
(1)
 
(2)
 
(1)
Reserve balance at the end of the period
 
418
 
388
 
390
 
418
 
390
1 Refer to Note 2 for more information about the merger of UBS AG and Credit Suisse AG.
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
30.9.24
30.6.24
31.12.23
Own credit adjustments on financial liabilities designated at fair value
1
 
(1,367)
 
(1,062)
 
(312)
of which: debt issued designated at fair value
 
(928)
 
(747)
 
(208)
of which: other financial liabilities designated at fair value
 
(439)
 
(315)
 
(105)
Credit valuation adjustments
2
 
(145)
 
(104)
 
(37)
Funding and debit valuation adjustments
 
(94)
 
(81)
 
(82)
Other valuation adjustments
 
(1,616)
 
(1,744)
 
(730)
of which: liquidity
 
(1,074)
 
(1,229)
 
(308)
of which: model uncertainty
 
(542)
 
(516)
 
(423)
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 AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
65
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
30 September 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
UBS AG’s estimates
 
and assumptions,
 
but rather
 
the different
 
underlying characteristics
 
of the
 
relevant assets
 
and
liabilities
 
held by UBS
 
AG.
 
The significant unobservable
 
inputs disclosed in
 
the table below
 
are consistent with
 
those included in
 
“Note 20 Fair
value measurement” in the “Consolidated financial
 
statements” section of the UBS AG 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)
30.9.24
31.12.23
USD bn
30.9.24
31.12.23
30.9.24
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
 
1.0
 
0.9
 
0.1
 
0.1
Relative value to
market comparable
Bond price equivalent
 
17
 
126
 
98
 
9
 
114
 
93
points
Discounted expected
cash flows
Discount margin
 
829
 
829
 
829
 
491
 
491
basis
points
Traded loans,
 
loans
designated at fair value
and guarantees
 
6.4
 
2.3
 
0.0
 
0.0
Relative value to
market comparable
Loan price equivalent
 
1
 
258
 
81
 
6
 
101
 
98
points
Discounted expected
cash flows
Credit spread
 
18
 
1,533
 
334
 
200
 
275
 
252
basis
points
Investment fund units
3
 
0.8
 
0.2
 
0.0
 
0.0
Relative value to
market comparable
Net asset value
Equity instruments
3
 
3.2
 
1.2
 
0.1
 
0.1
Relative value to
market comparable
Price
Debt issued designated at
fair value
4
 
10.9
 
7.8
Other financial liabilities
designated at fair value
 
4.2
 
2.3
Discounted expected
cash flows
Funding spread
 
106
 
201
 
51
 
201
basis
points
Derivative financial instruments
Interest rate
 
0.6
 
0.3
 
0.3
 
0.1
Option model
Volatility of interest rates
 
47
 
156
 
84
 
112
basis
points
Volatility of inflation
 
1
 
6
%
IR-to-IR correlation
 
70
 
99
%
Discounted expected
cash flows
Funding spread
 
5
 
20
basis
points
Credit
 
0.6
 
0.3
 
0.4
 
0.3
Discounted expected
cash flows
Credit spreads
 
 
2
 
1,270
 
1
 
306
basis
points
Credit correlation
 
50
 
66
%
Credit volatility
 
60
 
60
%
Recovery rates
5
 
0
 
100
%
Equity / index
 
1.0
 
0.7
 
4.3
 
2.7
Option model
Equity dividend yields
 
0
 
11
 
0
 
14
%
Volatility of equity stocks,
equity and other indices
 
4
 
140
 
4
 
104
%
Equity-to-FX correlation
 
(40)
 
70
 
(40)
 
70
%
Equity-to-equity correlation
 
0
 
100
 
13
 
100
%
Loan commitments
measured at FVTPL
 
0.2
 
0.0
Relative value to
market comparable
Loan price equivalent
 
15
 
100
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.
 
5 Recovery rates reflect the estimated recovery that will be realized given expected defaults; they may
vary significantly depending upon the specific assets and terms of each transaction.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
66
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
30.9.24
30.6.24
31.12.23
USD m
Favorable
 
changes
Unfavorable
 
changes
Favorable
 
changes
Unfavorable
 
changes
Favorable
 
changes
Unfavorable
 
changes
Traded loans, loans measured at fair value and guarantees
 
295
 
(271)
 
453
 
(433)
 
15
 
(19)
Securities financing transactions
 
32
 
(28)
 
34
 
(31)
 
24
 
(24)
Auction rate securities
 
9
 
(6)
 
8
 
(6)
 
67
 
(21)
Asset-backed securities
 
40
 
(44)
 
44
 
(48)
 
25
 
(22)
Equity instruments
 
353
 
(318)
 
428
 
(403)
 
189
 
(178)
Investment fund units
 
138
 
(139)
 
140
 
(141)
 
21
 
(23)
Loan commitments measured at FVTPL
 
88
 
(83)
 
85
 
(110)
 
7
 
(10)
Interest rate derivatives, net
 
145
 
(47)
 
139
 
(81)
 
27
 
(18)
Credit derivatives, net
 
119
 
(122)
 
124
 
(128)
 
2
 
(5)
Foreign exchange derivatives, net
 
4
 
(4)
 
3
 
(4)
 
5
 
(4)
Equity / index derivatives, net
 
690
 
(695)
 
651
 
(546)
 
358
 
(285)
Other
 
281
 
(134)
 
83
 
(90)
 
41
 
(39)
Total
 
2,194
 
(1,891)
 
2,192
 
(2,021)
 
781
 
(648)
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 AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
67
Note 10
 
Fair value measurement (continued)
Movements of Level 3 instruments
USD bn
Balance at
the
beginning
of the
period
Effect from
merger of
UBS AG
and Credit
Suisse AG
1
Net gains /
losses
included in
compre-
hensive
income
2
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 nine months ended 30 September 2024
3
Financial assets at fair value held for
trading
 
1.8
 
7.8
 
0.2
 
0.1
 
0.4
 
(3.3)
 
1.1
 
(2.6)
 
0.1
 
(0.4)
 
0.0
 
5.1
of which: Equity instruments
 
0.1
 
0.1
 
(0.0)
 
(0.0)
 
0.0
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
(0.0)
 
0.0
 
0.2
of which: Corporate and municipal
bonds
 
0.6
 
0.4
 
(0.1)
 
(0.1)
 
0.3
 
(0.3)
0.0
0.0
 
0.0
 
(0.0)
 
0.0
 
0.9
of which: Loans
 
0.9
 
7.0
 
0.3
 
0.2
 
0.0
 
(2.7)
 
1.1
 
(2.6)
 
0.0
 
(0.3)
 
(0.0)
 
3.7
Derivative financial instruments –
assets
 
1.3
 
0.7
 
(0.1)
 
(0.2)
 
0.0
 
(0.1)
 
0.9
 
(0.6)
 
0.7
 
(0.1)
 
(0.0)
 
2.6
of which: Interest rate
 
0.3
 
0.0
 
0.1
 
0.0
 
0.0
 
(0.1)
 
0.3
 
(0.1)
 
0.2
 
(0.0)
 
(0.0)
 
0.6
of which: Equity / index
 
0.7
 
0.2
 
(0.0)
 
(0.0)
 
0.0
 
(0.0)
 
0.5
 
(0.3)
 
0.1
 
(0.1)
 
(0.0)
 
1.0
of which: Credit
 
0.3
 
0.1
 
(0.1)
 
(0.0)
0.0
 
(0.0)
 
0.1
 
(0.1)
 
0.3
 
(0.0)
 
(0.0)
 
0.6
Financial assets at fair value not held
for trading
 
4.1
 
4.1
 
0.1
 
0.1
 
0.4
 
(0.3)
 
1.5
 
(1.9)
 
0.4
 
(0.3)
 
0.0
 
8.1
of which: Loans
 
1.3
 
0.8
 
0.1
 
0.1
 
0.1
 
0.0
 
0.9
 
(0.5)
0.0
 
(0.1)
 
(0.0)
 
2.5
of which: Auction rate securities
 
1.2
0.0
 
0.0
 
(0.0)
0.0
0.0
0.0
 
(1.1)
0.0
0.0
0.0
 
0.2
of which: Equity instruments
 
1.1
 
1.8
 
0.0
 
0.0
 
0.1
 
(0.1)
 
0.0
0.0
 
0.1
0.0
 
0.0
 
3.0
of which: Investment fund units
 
0.2
 
0.4
 
0.0
 
(0.0)
 
0.1
 
(0.1)
0.0
0.0
 
0.0
 
(0.0)
 
(0.0)
 
0.6
of which: Asset-backed securities
 
0.0
 
0.5
 
0.0
 
0.0
 
0.0
 
(0.1)
 
0.0
 
0.0
 
0.2
 
(0.1)
 
0.0
 
0.6
Derivative financial instruments –
liabilities
 
3.2
 
0.9
 
0.8
 
1.0
 
0.0
 
(0.0)
 
1.8
 
(1.6)
 
0.6
 
(0.3)
 
(0.0)
 
5.4
of which: Interest rate
 
0.1
 
0.1
 
0.1
 
0.3
0.0
 
(0.0)
 
0.0
 
(0.1)
 
0.1
 
(0.0)
 
(0.0)
 
0.3
of which: Equity / index
 
2.7
 
0.2
 
0.9
 
0.9
0.0
 
(0.0)
 
1.6
 
(1.3)
 
0.4
 
(0.3)
 
(0.0)
 
4.3
of which: Credit
 
0.3
 
0.2
 
(0.1)
 
(0.1)
0.0
 
(0.0)
 
0.1
 
(0.1)
 
0.0
 
(0.0)
 
(0.0)
 
0.4
of which: Loan commitments
measured at FVTPL
 
0.0
 
0.4
 
(0.2)
 
(0.1)
 
0.0
 
(0.0)
 
0.0
 
(0.0)
 
0.0
 
(0.0)
 
0.0
 
0.2
Debt issued designated at fair value
 
7.8
 
4.5
 
0.6
 
0.4
0.0
 
(0.0)
 
3.2
 
(2.7)
 
1.2
 
(3.8)
 
0.0
 
10.9
Other financial liabilities designated
at fair value
 
2.3
 
1.9
 
0.0
 
0.0
0.0
0.0
 
0.9
 
(0.9)
 
0.0
 
(0.1)
 
0.0
 
4.2
For the nine months ended 30 September 2023
Financial assets at fair value held for
trading
 
1.5
 
(0.0)
 
(0.1)
 
0.4
 
(0.7)
 
1.0
0.0
 
0.1
 
(0.3)
 
(0.0)
 
2.0
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)
 
0.4
 
(0.2)
0.0
0.0
 
0.0
 
(0.0)
 
(0.0)
 
0.7
of which: Loans
 
0.6
 
0.0
 
(0.0)
 
0.0
 
(0.4)
 
1.0
0.0
0.0
 
(0.2)
 
(0.0)
 
1.1
Derivative financial instruments –
assets
 
1.5
 
(0.1)
 
(0.0)
 
0.0
 
(0.0)
 
0.5
 
(0.3)
 
0.1
 
(0.2)
 
0.0
 
1.5
of which: Interest rate
 
0.5
 
0.1
 
0.1
 
0.0
0.0
 
0.1
 
(0.0)
0.0
 
(0.0)
 
(0.0)
 
0.6
of which: Equity / index
 
0.7
 
(0.1)
 
(0.0)
0.0
0.0
 
0.3
 
(0.2)
 
0.0
 
(0.2)
 
(0.0)
 
0.5
of which: Credit
 
0.3
 
(0.1)
 
(0.1)
0.0
0.0
 
0.0
 
(0.0)
 
0.1
 
(0.0)
 
0.0
 
0.4
Financial assets at fair value not held
for trading
 
3.7
 
0.3
 
0.3
 
0.6
 
(0.6)
0.0
 
(0.0)
 
0.1
 
(0.1)
 
0.0
 
4.0
of which: Loans
 
0.7
 
0.3
 
0.3
 
0.2
 
(0.0)
0.0
 
(0.0)
 
0.1
 
(0.1)
 
(0.0)
 
1.1
of which: Auction rate securities
 
1.3
 
0.0
 
0.0
0.0
 
(0.1)
0.0
0.0
0.0
0.0
0.0
 
1.2
of which: Equity instruments
 
0.8
 
0.0
 
(0.0)
 
0.4
 
(0.2)
0.0
0.0
 
0.0
0.0
 
(0.0)
 
1.0
Derivative financial instruments –
liabilities
 
1.7
 
(0.1)
 
(0.1)
 
0.0
 
(0.0)
 
1.1
 
(0.4)
 
0.1
 
(0.5)
 
(0.0)
 
1.8
of which: Interest rate
 
0.1
 
0.0
 
0.0
 
0.0
0.0
 
0.1
 
(0.1)
 
0.0
 
(0.0)
 
(0.0)
 
0.1
of which: Equity / index
 
1.2
 
(0.1)
 
(0.1)
0.0
0.0
 
0.6
 
(0.3)
 
0.0
 
(0.1)
 
(0.0)
 
1.3
of which: Credit
 
0.3
 
(0.0)
 
(0.0)
0.0
0.0
 
0.3
 
0.0
 
0.0
 
(0.3)
 
(0.0)
 
0.2
Debt issued designated at fair value
 
9.2
 
0.1
 
0.0
0.0
0.0
 
4.5
 
(2.9)
 
0.4
 
(1.5)
 
(0.1)
 
9.8
Other financial liabilities designated at
fair value
 
2.0
 
(0.0)
 
(0.0)
0.0
0.0
 
0.1
 
(0.1)
 
0.0
 
(0.0)
 
(0.0)
 
2.1
1 Refer to Note 2 for more information about the merger of UBS AG
 
and Credit Suisse AG.
 
2 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.
 
3 Total Level 3 assets as of 30 September 2024 were USD 15.9bn (31 December 2023: USD 7.2bn). Total Level 3 liabilities as of 30 September 2024 were USD 20.6bn (31 December 2023:
USD 13.4bn).
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
68
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 20
 
Fair value measurement” in the “Consolidated financial statements”
section of the UBS AG Annual Report 2023.
Financial instruments not measured at fair value
30.9.24
30.6.24
31.12.23
USD bn
Carrying
amount
Fair
value
Carrying
amount
Fair
value
Carrying
amount
Fair
value
Assets
Cash and balances at central banks
 
243.3
 
243.3
 
248.3
 
248.3
 
171.8
 
171.8
Amounts due from banks
 
20.2
 
20.2
 
20.5
 
20.5
 
28.2
 
28.2
Receivables from securities financing transactions measured at amortized
 
cost
 
92.1
 
92.1
 
82.0
 
82.0
 
74.1
 
74.1
Cash collateral receivables on derivative instruments
 
47.2
 
47.2
 
43.6
 
43.6
 
32.3
 
32.3
Loans and advances to customers
 
625.2
 
620.0
 
608.9
 
598.7
 
405.6
 
396.5
Other financial assets measured at amortized cost
 
61.6
 
60.2
 
60.8
 
58.6
 
54.3
 
54.1
Liabilities
Amounts due to banks
 
28.1
 
28.1
 
26.8
 
26.7
 
16.7
 
16.7
Payables from securities financing transactions measured at amortized cost
 
16.4
 
16.4
 
14.8
 
14.9
 
5.8
 
5.8
Cash collateral payables on derivative instruments
 
34.3
 
34.3
 
33.7
 
33.7
 
34.9
 
34.9
Customer deposits
 
779.6
 
780.8
 
760.7
 
761.1
 
555.7
 
556.6
Funding from UBS Group AG measured at amortized cost
 
112.3
 
116.6
 
111.7
 
115.9
 
67.3
 
67.7
Debt issued measured at amortized cost
 
109.5
 
110.6
 
112.5
 
112.7
 
69.8
 
69.8
Other financial liabilities measured at amortized cost
1
 
17.6
 
17.6
 
17.8
 
17.8
 
9.8
 
9.8
1 Excludes lease liabilities.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
69
Note 11
 
Derivative instruments
a) Derivative instruments
As of 30.9.24, 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
 
47.8
 
43.4
 
4,058
 
19,927
Credit derivatives
 
3.3
 
3.8
 
166
Foreign exchange
 
61.6
 
69.5
 
7,860
 
270
Equity / index
 
41.8
 
53.2
 
1,545
 
99
Commodities
 
4.1
 
3.3
 
169
 
21
Other
3
 
1.1
 
1.2
 
172
Total derivative financial instruments, based on netting under IFRS Accounting Standards
4
 
159.7
 
174.4
 
13,970
 
20,317
Further netting potential not recognized on the balance
 
sheet
5
 
(145.1)
 
(155.3)
of which: netting of recognized financial liabilities / assets
 
(122.2)
 
(122.2)
of which: netting with collateral received / pledged
 
(22.9)
 
(33.1)
Total derivative financial instruments, after consideration of further netting potential
 
14.7
 
19.2
As of 30.6.24, USD bn
Derivative financial instruments
Interest rate
 
49.6
 
47.3
 
3,478
 
20,200
Credit derivatives
 
3.0
 
3.8
 
170
Foreign exchange
 
51.0
 
52.0
 
7,158
 
213
Equity / index
 
33.4
 
41.4
 
1,432
 
96
Commodities
 
2.6
 
2.0
 
153
 
18
Other
3
 
0.8
 
2.6
 
151
Total derivative financial instruments, based on netting under IFRS Accounting Standards
4
 
140.4
 
149.1
 
12,543
 
20,526
Further netting potential not recognized on the balance
 
sheet
5
 
(125.0)
 
(132.1)
of which: netting of recognized financial liabilities / assets
 
(101.1)
 
(101.1)
of which: netting with collateral received / pledged
 
(23.9)
 
(31.0)
Total derivative financial instruments, after consideration of further netting potential
 
15.4
 
17.0
As of 31.12.23, USD bn
Derivative financial instruments
Interest rate
 
35.3
 
32.8
 
2,472
 
13,749
Credit derivatives
 
1.8
 
1.6
 
93
Foreign exchange
 
65.4
 
71.7
 
6,367
 
180
Equity / index
 
27.3
 
32.9
 
1,191
 
84
Commodities
 
1.6
 
1.3
 
129
 
16
Other
3
 
0.3
 
0.4
 
86
Total derivative financial instruments, based on netting under IFRS Accounting Standards
4
 
131.7
 
140.7
 
10,338
 
14,028
Further netting potential not recognized on the balance
 
sheet
5
 
(122.7)
 
(123.8)
of which: netting of recognized financial liabilities / assets
 
(99.3)
 
(99.3)
of which: netting with collateral received / pledged
 
(23.4)
 
(24.5)
Total derivative financial instruments, after consideration of further netting potential
 
9.1
 
16.9
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. 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 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 21 Offsetting financial assets and financial liabilities” in the
“Consolidated financial statements” section of the UBS AG Annual Report 2023 for more information.
 
b) Cash collateral on derivative instruments
USD bn
Receivables
30.9.24
Payables
30.9.24
Receivables
30.6.24
Payables
30.6.24
Receivables
31.12.23
Payables
31.12.23
Cash collateral on derivative instruments, based on netting under IFRS Accounting
Standards
1
 
47.2
 
34.3
 
43.6
 
33.7
 
32.3
 
34.9
Further netting potential not recognized on the balance
 
sheet
2
 
(28.7)
 
(18.7)
 
(27.2)
 
(19.8)
 
(22.8)
 
(20.6)
of which: netting of recognized financial liabilities / assets
 
(26.4)
 
(16.4)
 
(24.6)
 
(17.3)
 
(20.4)
 
(17.2)
of which: netting with collateral received / pledged
 
(2.3)
 
(2.3)
 
(2.5)
 
(2.5)
 
(2.5)
 
(3.4)
Cash collateral on derivative instruments, after consideration of further netting potential
 
18.5
 
15.5
 
16.5
 
13.9
 
9.5
 
14.3
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 21
 
Offsetting financial assets
 
and financial
liabilities” in the “Consolidated
 
financial statements” section of the UBS AG Annual Report 2023 for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
70
Note
12
 
Other assets and liabilities
 
a) Other financial assets measured at
 
amortized cost
USD m
30.9.24
30.6.24
31.12.23
Debt securities
 
42,175
 
41,487
 
43,245
Loans to financial advisors
 
2,677
 
2,601
 
2,615
Fee- and commission-related receivables
 
2,609
 
2,482
 
1,883
Finance lease receivables
 
6,425
 
6,068
 
1,427
Settlement and clearing accounts
 
 
461
 
534
 
311
Accrued interest income
 
2,319
 
2,648
 
2,004
Other
1
 
4,901
 
5,006
 
2,849
Total other financial assets measured at amortized cost
 
61,566
 
60,826
 
54,334
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
30.9.24
30.6.24
31.12.23
Precious metals and other physical commodities
 
 
6,965
 
6,445
 
4,426
Deposits and collateral provided in connection with litigation,
 
regulatory and similar matters
1
 
2,060
 
1,969
 
1,379
Prepaid expenses
 
1,382
 
1,420
 
1,062
Current tax assets
 
 
1,802
 
1,832
 
184
VAT,
 
withholding tax and other tax receivables
 
1,168
 
965
 
561
Properties and other non-current assets held for sale
 
234
 
151
 
105
Assets of disposal groups held for sale
2
 
1,841
Other
 
2,254
 
2,334
 
660
Total other non-financial assets
 
17,707
 
15,117
 
8,377
1 Refer to Note 16 for more information.
 
2 Refer to Note 2 for more information about the agreement to sell Select Portfolio Servicing.
c) Other financial liabilities measured at
 
amortized cost
USD m
30.9.24
30.6.24
31.12.23
Other accrued expenses
 
2,808
 
2,761
 
1,613
Accrued interest expenses
 
6,421
 
6,795
 
4,186
Settlement and clearing accounts
 
1,763
 
1,797
 
1,314
Lease liabilities
 
4,295
 
4,323
 
2,904
Other
 
 
6,636
 
6,449
 
2,695
Total other financial liabilities measured at amortized cost
 
21,923
 
22,125
 
12,713
d) Other financial liabilities designated at
 
fair value
USD m
30.9.24
30.6.24
31.12.23
Financial liabilities related to unit-linked investment contracts
 
18,389
 
17,080
 
15,922
Securities financing transactions
 
10,893
 
7,801
 
6,927
Over-the-counter debt instruments and other
 
6,082
 
7,096
 
1,566
Funding from UBS Group AG
1
 
5,691
 
4,857
 
2,950
Total other financial liabilities designated at fair value
 
41,055
 
36,834
 
27,366
1 Funding from UBS Group
 
AG consists of subordinated
 
debt of UBS AG
 
and its subsidiaries toward
 
UBS Group AG.
 
Subordinated debt consists of
 
unsecured debt obligations that are
 
contractually subordinated in
right of payment to all other present and future non-subordinated obligations of the respective issuing entity.
 
e) Other non-financial liabilities
USD m
30.9.24
30.6.24
31.12.23
Compensation-related liabilities
 
6,567
 
5,506
 
4,526
of which: net defined benefit liability
 
733
 
695
 
487
Current tax liabilities
 
1,119
 
1,219
 
932
Deferred tax liabilities
 
285
 
288
 
162
VAT,
 
withholding tax and other tax payables
 
972
 
949
 
712
Deferred income
 
717
 
841
 
276
Liabilities of disposal groups held for sale
1
 
1,291
Other
 
303
 
482
 
74
Total other non-financial liabilities
 
11,253
 
9,285
 
6,682
1
 
Refer to Note 2 for more information about the agreement to sell Select Portfolio Servicing.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
71
Note
13
 
Funding from UBS Group AG measured
 
at amortized cost
USD m
30.9.24
30.6.24
31.12.23
Debt contributing to total loss-absorbing capacity (TLAC)
 
90,959
 
93,711
 
51,102
Debt eligible as high-trigger loss-absorbing additional tier
 
1 capital instruments
 
15,012
 
13,907
 
11,286
Debt eligible as low-trigger loss-absorbing additional
 
tier 1 capital instruments
 
1,239
 
1,225
 
1,212
Other
1
 
5,053
 
2,882
 
3,682
Total funding from UBS Group AG measured at amortized cost
2,3
 
112,262
 
111,725
 
67,282
1 Includes debt no longer eligible as TLAC
 
having a residual maturity of less than
 
one year and high-trigger loss-absorbing additional
 
tier 1 capital instruments that ceased to
 
be eligible when UBS Group AG
 
issued
notice of redemption.
 
2 Consists of subordinated debt of UBS AG and its subsidiaries toward UBS Group AG. Subordinated debt consists of unsecured debt obligations that are contractually subordinated
 
in right of
payment to all other present and future non-subordinated obligations
 
of the respective issuing entity.
 
3 UBS AG has also recognized funding from UBS
 
Group AG that is designated at fair value.
 
Refer to Note 12d
for more information.
 
 
Note
14
 
Debt issued designated at fair value
USD m
30.9.24
30.6.24
31.12.23
Equity-linked
1
 
56,691
 
55,911
 
46,269
Rates-linked
 
 
22,466
 
25,811
 
16,880
Credit-linked
 
5,990
 
6,510
 
4,506
Fixed-rate
 
15,811
 
15,271
 
14,295
Commodity-linked
 
3,638
 
3,507
 
3,704
Other
 
1,930
 
1,396
 
687
Total debt issued designated at fair value
2
 
106,527
 
108,405
 
86,341
1 Includes investment fund unit-linked instruments issued.
 
2 As of 30 September 2024, 99% of Total debt issued designated at fair value was unsecured
 
(as of 30 June 2024: 99%).
 
Note
15
 
Debt issued measured at amortized cost
USD m
30.9.24
30.6.24
31.12.23
Short-term debt
1
 
33,851
 
34,944
 
37,285
Senior unsecured debt
 
 
35,348
 
39,685
 
18,450
Covered bonds
 
10,265
 
8,583
 
1,006
Subordinated debt
 
720
 
715
 
3,008
of which: eligible as non-Basel III-compliant tier 2 capital
 
instruments
 
289
 
536
 
538
Debt issued through the Swiss central mortgage institutions
 
28,807
 
27,010
 
10,035
Other long-term debt
 
468
 
1,583
Long-term debt
2
 
75,609
 
77,576
 
32,499
Total debt issued measured at amortized cost
3,4
 
109,460
 
112,520
 
69,784
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 (88% secured), 100% of the balance was unsecured
as of 30 September 2024.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
72
Note 16
 
Provisions and contingent liabilities
a) Provisions
The table below presents an overview of total provisions.
USD m
30.9.24
30.6.24
31.12.23
Provisions other than provisions for expected credit losses
 
4,672
 
4,433
 
2,336
Provisions for expected credit losses
1
 
337
 
330
 
188
Total provisions
 
5,009
 
4,763
 
2,524
1 Refer to Note 9c for more information about ECL provisions recognized for off-balance sheet financial instruments and credit lines.
 
The table below presents additional information
 
for provisions other than provisions for
 
expected credit losses.
USD m
Litigation,
regulatory and
similar matters
1
Restructuring
2
Real estate
3
Other
4
Total
Balance as of 31 December 2023
 
1,810
 
209
 
135
 
181
 
2,336
Balance as of 30 June 2024
 
3,174
 
760
 
212
 
287
 
4,433
Increase in provisions recognized in the income statement
 
167
 
197
 
4
 
23
 
391
Release of provisions recognized in the income statement
 
(37)
 
(30)
 
(2)
 
(12)
 
(81)
Reclassifications
 
86
5
 
0
 
0
 
0
 
86
Provisions used in conformity with designated purpose
 
(70)
 
(186)
 
(3)
 
(12)
 
(271)
Foreign currency translation and other movements
 
60
 
34
 
12
 
8
 
114
Balance as of 30 September 2024
 
3,381
 
775
 
223
 
294
 
4,672
1 Consists of provisions
 
for losses resulting
 
from legal, liability
 
and compliance risks.
 
2 Consists of USD
 
482m of provisions
 
for onerous contracts
 
related to real
 
estate as of
 
30 September 2024 (30 June
 
2024:
USD 461m; 31 December
 
2023: USD 146m),
 
USD 272m of
 
personnel-related restructuring
 
provisions as
 
of 30 September
 
2024 (30 June
 
2024: USD 299m;
 
31 December 2023:
 
USD 64m) and
 
onerous contracts
related to technology.
 
3 Mainly includes provisions for reinstatement costs with respect to leased properties.
 
4 Mainly includes provisions related to employee benefits and operational risks.
 
5 Mainly includes a
reclassification from derivative liabilities to IAS 37 provisions reflecting the funding obligation relating to investors who did not accept the redemption
 
offer for the Credit Suisse supply chain finance funds.
Information about provisions and
 
contingent liabilities in respect of
 
litigation, regulatory and similar matters,
 
as a
class,
 
is
 
included
 
in
 
Note
 
16b.
 
There
 
are
 
no
 
material
 
contingent
 
liabilities
 
associated
 
with
 
the
 
other
 
classes
 
of
provisions.
b) Litigation, regulatory and similar matters
UBS 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
 
is involved in
 
various disputes and
 
legal proceedings,
including litigation, arbitration, and regulatory and criminal investigations. “UBS”, “we”
 
and “our”, for purposes
of this Note, refer to UBS AG and / or one or more
 
of its subsidiaries, as applicable.
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 UBS 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
 
UBS
 
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. UBS 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 UBS
 
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 UBS,
 
but are
 
nevertheless
expected to be, based on UBS’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
 
UBS
 
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.
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
73
Note 16
 
Provisions and contingent liabilities
 
(continued)
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. UBS provides
 
below an estimate of the aggregate liability for
 
our litigation,
regulatory and
 
similar matters
 
as a
 
class of
 
contingent liabilities.
 
Estimates of
 
contingent liabilities
 
are inherently
imprecise and
 
uncertain as
 
these estimates
 
require UBS
 
to make
 
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.
 
Taking into
account these uncertainties
 
and the other factors
 
described herein, UBS
 
estimates the future
 
losses that could
 
arise
from litigation,
 
regulatory and
 
similar matters
 
disclosed below
 
for which
 
an estimate
 
is possible,
 
that are
 
not covered
by existing provisions are in the range of USD
 
0bn to USD 4.2bn.
 
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.
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 AG
Balance as of 31 December 2023
 
1,220
 
156
 
12
 
286
 
4
 
132
 
1,810
Balance as of 30 June 2024
 
1,199
 
152
 
2
 
280
 
1,406
 
135
 
3,174
Increase in provisions recognized in the income statement
 
21
 
0
 
6
 
1
 
139
 
0
 
167
Release of provisions recognized in the income statement
 
(4)
 
0
 
0
 
(2)
 
(32)
 
0
 
(37)
Reclassifications
2
 
0
 
0
 
0
 
0
 
86
 
0
 
86
Provisions used in conformity with designated purpose
 
(14)
 
0
 
(6)
 
(3)
 
(46)
 
(1)
 
(70)
Foreign currency translation and other movements
 
43
 
6
 
0
 
7
 
4
 
0
 
60
Balance as of 30 September 2024
 
1,247
 
157
 
2
 
283
 
1,557
 
135
 
3,381
1 Provisions, if
 
any, for the
 
matters described in items
 
2 and 10 of
 
this Note are recorded
 
in Global Wealth
 
Management. Provisions,
 
if any, for
 
the matters described in
 
items 5, 6, 7,
 
8, 9 and 11
 
of this Note are
recorded in Non-core
 
and Legacy.
 
Provisions, if
 
any, for
 
the matters described
 
in item 1
 
of this Note
 
are allocated between
 
Global Wealth
 
Management, Personal
 
& Corporate
 
Banking and Non-core
 
and Legacy.
Provisions, if any, for the matters described in item 3 of this Note are allocated between the Investment Bank, Non-core and Legacy and Group Items.
 
Provisions, if any, for the matters described in item 4 of this Note
are allocated between Global Wealth
 
Management and Personal &
 
Corporate Banking. Provisions,
 
if any, for the
 
matters described in item 12
 
of this Note are allocated
 
between the Investment Bank and
 
Non-core
and Legacy.
 
2 Mainly includes a reclassification from derivative liabilities to
 
IAS 37 provisions reflecting the funding obligation relating to investors
 
who did not accept the redemption offer for the Credit
 
Suisse supply
chain finance funds.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
74
Note 16
 
Provisions and contingent liabilities
 
(continued)
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. Credit Suisse
 
offices in various
 
locations, including
 
the UK,
the Netherlands, France and
 
Belgium, have been contacted
 
by regulatory and law enforcement
 
authorities 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.
 
The UK and
 
French aspects of
 
these issues have
 
been
closed. UBS is continuing to cooperate with
 
the authorities.
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.
In
 
May
 
2014,
 
Credit
 
Suisse
 
entered
 
into
 
settlement
 
agreements
 
with
 
the
 
SEC,
 
Federal
 
Reserve
 
and
 
New
 
York
Department of
 
Financial
 
Services and
 
plead
 
guilty
 
to conspiring
 
to
 
aid
 
and
 
abet US
 
taxpayers
 
in
 
filing
 
false
 
tax
returns. Credit Suisse continued to report
 
to and cooperate with US authorities in
 
accordance with its obligations
under the
 
plea and
 
agreements, including
 
by conducting
 
a review
 
of cross-border
 
services provided
 
by Credit
 
Suisse.
In this connection, Credit Suisse provided information to US authorities regarding potentially
 
undeclared US assets
held by clients at
 
Credit Suisse since the
 
May 2014 plea. UBS
 
continues to cooperate with the
 
authorities in their
ongoing reviews. 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.
In February 2021, a
 
qui tam complaint was filed
 
in the Eastern District of
 
Virginia, alleging that Credit Suisse 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 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.
 
On appeal,
 
the US Court
 
of Appeals for
 
the
Fourth Circuit affirmed the dismissal of the action.
Our balance sheet
 
at 30 September 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.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
75
Note 16
 
Provisions and contingent liabilities
 
(continued)
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 against
 
UBS defendants
 
except those
 
for the
 
recovery of
 
approximately USD
 
125m of
 
payments
alleged to be
 
fraudulent conveyances
 
and preference
 
payments. Similar
 
claims have
 
been filed against
 
Credit Suisse
entities seeking to recover
 
redemption payments. In
 
2016, the bankruptcy
 
court dismissed these
 
claims against the
UBS entities and
 
most of
 
the Credit
 
Suisse entities.
 
In 2019, the
 
Court of Appeals
 
reversed the
 
dismissal of
 
the BMIS
Trustee’s remaining claims. 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. In December 2021, the European Commission issued a
 
decision imposing a fine of EUR 83.3m
on
 
Credit
 
Suisse
 
entities based
 
on
 
findings of
 
anticompetitive practices
 
in
 
the foreign
 
exchange
 
market. Credit
Suisse has
 
appealed the
 
decision to
 
the European
 
General Court.
 
UBS received
 
leniency and
 
accordingly no
 
fine
was assessed.
Foreign exchange-related civil litigation:
 
Putative class actions have been filed since 2013 in US federal
 
courts and
in
 
other
 
jurisdictions
 
against
 
UBS,
 
Credit
 
Suisse
 
and
 
other
 
banks
 
on
 
behalf
 
of
 
putative
 
classes
 
of
 
persons
 
who
engaged in foreign
 
currency transactions with
 
any of the defendant
 
banks. UBS and
 
Credit Suisse have 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. Certain
 
class members
 
have excluded
themselves from
 
that settlement
 
and filed individual
 
actions in
 
US and English
 
courts against
 
UBS, Credit Suisse
 
and
other banks, alleging
 
violations of US
 
and European competition
 
laws and unjust
 
enrichment. UBS, Credit
 
Suisse
and the other
 
banks have resolved
 
those individual matters. Credit
 
Suisse and UBS,
 
together with other
 
financial
institutions, were named in
 
a consolidated putative
 
class action in
 
Israel, which made
 
allegations similar to those
made in the actions pursued in other jurisdictions. In April 2022,
 
Credit Suisse entered into an agreement to settle
all claims in
 
this action. In
 
February 2024, UBS
 
entered into
 
an agreement to
 
settle all
 
claims in
 
this action. Both
settlements remain subject to court approval.
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 May 2024, the Second
 
Circuit upheld the district court’s dismissal of
 
the case.
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
 
and
 
Credit
 
Suisse
 
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.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
76
Note 16
 
Provisions and contingent liabilities
 
(continued)
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,
 
Yen LIBOR,
 
EURIBOR, CHF LIBOR,
GBP LIBOR and seek unspecified compensatory
 
and other damages under various
 
legal theories.
USD LIBOR class and individual actions in the
 
US:
Beginning in 2013, putative class actions
 
were filed in US federal
district
 
courts
 
(and
 
subsequently
 
consolidated
 
in
 
the
 
SDNY)
 
by
 
plaintiffs
 
who
 
engaged
 
in
 
over-the-counter
instruments,
 
exchange
 
traded
 
Eurodollar
 
futures
 
and
 
options,
 
bonds
 
or
 
loans
 
that
 
referenced
 
USD LIBOR.
 
The
complaints allege
 
violations of
 
antitrust law
 
and the
 
Commodities Exchange
 
Act, as
 
well breach
 
of contract
 
and
unjust enrichment. Following various rulings
 
by the district court
 
and the Second Circuit
 
dismissing certain of the
causes of action and allowing others to proceed, one class
 
action with respect to transactions in over-the-counter
instruments and several actions brought by
 
individual plaintiffs are proceeding in
 
the district court. UBS and Credit
Suisse
 
have
 
entered
 
into
 
settlement
 
agreements
 
in
 
respect
 
of
 
the
 
class
 
actions
 
relating
 
to
 
exchange
 
traded
instruments, bonds
 
and
 
loans.
 
These
 
settlements
 
have
 
received
 
final
 
court
 
approval
 
and
 
the
 
actions
 
have been
dismissed as
 
to UBS
 
and Credit
 
Suisse. In
 
addition, an
 
individual action
 
was filed
 
in the
 
Northern District
 
of California
against UBS, Credit
 
Suisse 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 ICE LIBOR
 
rate and monopolized the
 
market for
LIBOR-based consumer
 
loans and
 
credit cards. The
 
court dismissed
 
the initial complaint
 
and subsequently
 
dismissed
an amended complaint with
 
prejudice. In January 2024,
 
plaintiffs appealed the dismissal
 
to the Ninth Circuit
 
Court
of Appeals.
Other benchmark
 
class actions
 
in the
 
US:
The Yen
 
LIBOR/Euroyen TIBOR,
 
EURIBOR and
 
GBP LIBOR
 
actions have
been dismissed. Plaintiffs have appealed the
 
dismissals.
In November 2022, defendants have moved to dismiss the
 
complaint in the CHF LIBOR action. In
 
2023, the court
approved a settlement by Credit Suisse of the
 
claims against it in this matter.
Government bonds:
 
In 2021,
 
the European
 
Commission issued
 
a decision
 
finding that
 
UBS and
 
six other
 
banks
breached European
 
Union antitrust
 
rules between
 
2007 and
 
2011 relating
 
to European
 
government bonds. The
European Commission
 
fined UBS EUR
 
172m. UBS has
 
appealed the
 
amount of the
 
fine. Also in
 
2021, the
 
European
Commission
 
issued
 
a
 
decision
 
finding
 
that
 
Credit
 
Suisse
 
and
 
four
 
other
 
banks
 
had
 
breached
 
European
 
Union
antitrust
 
rules
 
relating
 
to
 
supra-sovereign,
 
sovereign
 
and
 
agency
 
bonds
 
denominated
 
in
 
USD.
 
The
 
European
Commission fined
 
Credit Suisse
 
EUR 11.9m.
 
Credit Suisse
 
appealed the
 
decision. On
 
6 November
 
2024, the
 
EU
General Court issued its decision denying Credit
 
Suisse’s appeal.
Credit Suisse, together with other financial institutions, was named in two Canadian putative class actions, which
allege that
 
defendants conspired to
 
fix the
 
prices of
 
supranational, sub-sovereign and
 
agency bonds sold
 
to and
purchased
 
from
 
investors
 
in
 
the
 
secondary market.
 
One
 
action
 
was
 
dismissed
 
against
 
Credit
 
Suisse
 
in
 
February
2020.
 
In
 
October
 
2022,
 
Credit
 
Suisse
 
entered
 
into
 
an
 
agreement
 
to
 
settle
 
all
 
claims
 
in
 
the
 
second
 
action.
 
The
settlement remains subject to court approval.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
77
Note 16
 
Provisions and contingent liabilities
 
(continued)
Credit default
 
swap auction
 
litigation –
In June
 
2021, Credit
 
Suisse, along
 
with other
 
banks and
 
entities, was
 
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. Defendants filed a motion to enforce a previous CDS class action
settlement in 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.
With respect
 
to additional
 
matters and
 
jurisdictions not
 
encompassed by
 
the settlements
 
and orders
 
referred to
above,
 
our
 
balance
 
sheet
 
at
 
30
 
September
 
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 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
 
30 September 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.
5. 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.
 
UBS
continues
 
to
 
evaluate
 
its
 
approach
 
toward
 
satisfying
 
the
 
remaining
 
consumer
 
relief
 
obligations. The
 
aggregate
amount of the consumer relief obligation increased after 2021 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
 
– Credit
 
Suisse affiliates
 
are 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. Unless
 
otherwise stated,
 
these amounts
 
reflect
 
the original
 
unpaid principal
 
balance amounts
 
as
alleged in these actions.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
78
Note 16
 
Provisions and contingent liabilities
 
(continued)
DLJ Mortgage Capital, Inc. (DLJ) is a defendant in New
 
York state court in five actions: An action brought by Asset
Backed
 
Securities
 
Corporation
 
Home
 
Equity
 
Loan
 
Trust,
 
Series
 
2006-HE7
 
alleges
 
damages
 
of
 
not
 
less
 
than
USD 374m.
 
In
 
December 2023,
 
the
 
court granted
 
in
 
part
 
DLJ’s
 
motion
 
to
 
dismiss, dismissing
 
with
 
prejudice all
notice-based
 
claims;
 
the
 
parties
 
have
 
appealed.
 
An
 
action
 
by
 
Home
 
Equity
 
Asset
 
Trust,
 
Series
 
2006-8,
 
alleges
damages of not
 
less than USD
 
436m. An
 
action by Home
 
Equity Asset Trust
 
2007-1 alleges
 
damages of not
 
less
than USD 420m.
 
A non-jury
 
trial in
 
this action
 
was held
 
between January
 
and February
 
2023, and
 
a decision
 
is
pending. An action by Home Equity Asset Trust 2007-2 alleges damages of not less than USD 495m. An action by
CSMC Asset-Backed Trust 2007-NC1 does not
 
allege a damages amount.
6. ATA litigation
Since November 2014, a
 
series of lawsuits have
 
been filed against a
 
number of banks, including
 
Credit Suisse, 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.
7. 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 has
 
investigated 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. On
 
appeal, the Criminal
 
Court of Appeals
 
of Geneva
and, subsequently, the Swiss Federal Supreme Court upheld the main findings of the
 
Geneva criminal court.
Civil lawsuits have been initiated against
 
Credit Suisse AG and/or certain
 
affiliates in various jurisdictions, based
 
on
the findings established in the criminal proceedings
 
against the former relationship manager.
In Singapore,
 
in a
 
civil lawsuit
 
against Credit
 
Suisse Trust
 
Limited, the
 
Singapore International Commercial
 
Court
issued a judgment
 
finding for
 
the plaintiffs and,
 
in September 2023,
 
the court awarded
 
damages of USD 742.73m,
excluding post-judgment
 
interest. This
 
figure does
 
not exclude
 
potential overlap
 
with the
 
Bermuda proceedings
against Credit Suisse Life (Bermuda)
 
Ltd., described below, and the
 
court ordered the parties to
 
ensure that there
shall be no double
 
recovery in relation to
 
this award and the
 
Bermuda proceedings.
 
On appeal from this
 
judgment,
in
 
July
 
2024,
 
the court
 
ordered some
 
changes to
 
the calculation
 
of
 
damages and
 
directed the
 
parties to
 
agree
adjustments to
 
the award.
 
The court ordered
 
a revised
 
award of USD
 
461m, including
 
interest and
 
costs, in
 
October
2024.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
79
Note 16
 
Provisions and contingent liabilities
 
(continued)
In Bermuda, in the civil
 
lawsuit brought against Credit Suisse Life
 
(Bermuda) Ltd., the Supreme Court of Bermuda
issued a
 
judgment finding for
 
the plaintiff
 
and awarded damages
 
of USD
 
607.35m to the
 
plaintiff. Credit
 
Suisse
Life (Bermuda) Ltd.
 
appealed the decision
 
and in June
 
2023, the Bermuda
 
Court of Appeal
 
confirmed the award
issued by the
 
Supreme Court of Bermuda
 
and the finding that
 
Credit Suisse Life (Bermuda)
 
Ltd. had breached
 
its
contractual
 
and
 
fiduciary
 
duties,
 
but
 
overturning
 
the
 
finding
 
that
 
Credit
 
Suisse
 
Life
 
(Bermuda)
 
Ltd.
 
had
 
made
fraudulent misrepresentations. In
 
March 2024,
 
the Bermuda
 
Court of
 
Appeal granted
 
a motion
 
by Credit
 
Suisse
Life (Bermuda) Ltd for leave to appeal the judgment to the Judicial Committee of the Privy Council and the notice
of such appeal was filed.
 
The Court of Appeal also ordered
 
that the current stay continue pending determination
of the
 
appeal on
 
the condition
 
that the
 
damages awarded
 
remain within
 
the escrow
 
account plus
 
interest calculated
at the Bermuda statutory rate of
 
3.5%. In December 2023, USD 75m
 
was released from the escrow account and
paid to plaintiffs.
 
In
 
Switzerland,
 
civil
 
lawsuits
 
have
 
been
 
commenced
 
against
 
Credit
 
Suisse
 
AG
 
in
 
the
 
Court
 
of
 
First
 
Instance
 
of
Geneva, with statements of claim served in March
 
2023 and March 2024.
8. Mozambique matter
Credit
 
Suisse
 
was
 
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 CSSEL entered into a Plea Agreement and pleaded guilty to one count
 
of conspiracy to violate the US federal
wire fraud statute.
 
Under the terms
 
of the DPA, UBS
 
Group AG (as
 
successor to Credit
 
Suisse Group AG)
 
continued
compliance enhancement and remediation efforts agreed by
 
Credit Suisse, and undertake additional measures as
outlined in the DPA. If the DPA’s conditions are complied
 
with, the charges will be dismissed within six months of
the end of the DPA’s three-year term.
 
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
 
(XIV
 
ETNs).
 
The
 
complaints have
 
been
 
consolidated and
 
asserts
 
claims
 
against
 
Credit
Suisse
 
for
 
violations
 
of
 
various
 
anti-fraud
 
and
 
anti-manipulation provision
 
s
 
of
 
US
 
securities
 
laws
 
arising
 
from
 
a
decline in the value of XIV ETNs in February 2018. On appeal from an order of the SDNY dismissing all claims, the
Second Circuit issued an
 
order that reinstated a
 
portion of the
 
claims. In decisions
 
in March 2023 and
 
March 2024,
the court
 
denied class
 
certification for
 
two of
 
the three
 
classes proposed
 
by plaintiffs
 
and certified
 
the third
 
proposed
class.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
80
Note 16
 
Provisions and contingent liabilities
 
(continued)
10. Bulgarian former clients matter
In December 2020, the Swiss Office
 
of the Attorney General brought charges against Credit
 
Suisse AG and other
parties 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
 
June 2022,
 
following a
 
trial, 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. Credit Suisse AG
 
appealed the decision to
 
the Swiss Federal Court
 
of Appeals.
Following the merger of UBS AG and Credit Suisse
 
AG, UBS AG confirmed the appeal.
 
The trial before the Federal
Court of Appeals occurred in October 2024.
11. Supply chain finance funds
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 (SCFFs) 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.
In
 
February
 
2023,
 
FINMA
 
announced
 
the
 
conclusion
 
of
 
its
 
enforcement
 
proceedings
 
against
 
Credit
 
Suisse
 
in
connection with the
 
SCFFs 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
 
had
 
already
 
taken
 
extensive
 
organizational
 
measures
 
to
 
strengthen
 
its
governance
 
and
 
control
 
processes,
 
FINMA
 
ordered
 
certain
 
additional
 
remedial
 
measures.
 
These
 
include
 
a
requirement that
 
Credit Suisse
 
documents the
 
responsibilities
 
of approximately
 
600 of
 
its highest-ranking
 
managers.
This
 
measure
 
has
 
been
 
made
 
applicable
 
to
 
UBS
 
Group.
 
FINMA
 
has
 
also
 
separately
 
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 SCFFs
 
matter.
The Attorney
 
General of
 
the Canton
 
of Zurich
 
has initiated
 
a criminal
 
procedure in
 
connection with
 
the SCFFs
 
matter
and several fund investors have joined the procedure as interested parties. Certain former and active Credit Suisse
employees, among others, have been named as accused persons, but Credit Suisse itself was not made a party to
the proceeding.
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. In
 
June 2024,
 
the Credit
 
Suisse SCFFs
 
made a
 
voluntary offer
 
to the
 
SCFFs
investors to
 
redeem all
 
outstanding fund
 
units. The
 
offer expired
 
on
 
31 July 2024,
 
and
 
fund
 
units representing
around 92%
 
of the
 
SCFFs’ net
 
asset value
 
were tendered
 
in the
 
offer and
 
accepted. Fund
 
units accepted
 
in the
offer were redeemed at 90% of the net
 
asset value determined on 25 February 2021, net of any payments made
by the relevant
 
fund to the
 
fund investors
 
since that
 
time. Investors
 
whose units
 
were redeemed
 
released any
 
claims
they may have had against the SCFFs, Credit Suisse or
 
UBS. The offer was funded by UBS through the purchase
 
of
units of feeder sub-funds.
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Notes
 
to the UBS AG interim consolidated financial
 
statements (unaudited)
 
81
Note 16
 
Provisions and contingent liabilities
 
(continued)
12. Archegos
Credit
 
Suisse
 
and
 
UBS
 
have
 
received
 
requests
 
for
 
documents
 
and
 
information
 
in
 
connection
 
with
 
inquiries,
investigations
 
and/or
 
actions
 
relating
 
to
 
their
 
relationships
 
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.
 
UBS
 
is
 
cooperating
 
with
 
the
 
authorities
 
in
 
these
 
matters.
 
In
 
July
 
2023,
 
CSI
 
and
 
CSSEL
entered into a settlement agreement
 
with the PRA providing for
 
the resolution of the PRA’s
 
investigation. Also in
July 2023, FINMA
 
issued a decree
 
ordering remedial measures
 
and the Federal
 
Reserve Board issued
 
an Order
 
to
Cease and Desist. Under the terms of the order,
 
Credit Suisse paid a civil money penalty 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. UBS Group, as
 
the legal
successor to Credit Suisse Group AG,
 
is a party to the FINMA
 
decree and Federal Reserve Board
 
Cease and Desist
Order.
 
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.
 
Note 17
 
Events after the reporting period
In
 
October 2024,
 
UBS entered
 
into
 
an
 
agreement
 
to sell
 
to American
 
Express
 
Swiss Holdings
 
GmbH (American
Express)
 
its 50% interest in
 
Swisscard AECS GmbH (Swisscard),
 
a joint venture between
 
UBS and American Express
in Switzerland. In addition, UBS and
 
Swisscard entered into an
 
agreement to transition the Credit
 
Suisse-branded
card portfolios to UBS.
 
Both transactions are subject to
 
certain closing conditions and are
 
not expected to have
 
a
material impact for UBS.
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Comparison between UBS AG
 
consolidated and UBS Group AG consolidated
 
82
Comparison between UBS AG consolidated and
 
UBS Group AG consolidated
The table below provides
 
a comparison of selected
 
financial and capital information of
 
UBS AG consolidated and
of UBS Group AG consolidated.
 
UBS AG and
 
UBS Group AG
 
both prepare
 
consolidated financial statements
 
in accordance
 
with IFRS
 
Accounting
Standards. UBS Group AG has applied acquisition accounting as defined by IFRS 3,
Business Combinations
, to the
acquisition of
 
the Credit
 
Suisse Group.
 
The merger
 
of UBS AG
 
and Credit
 
Suisse AG on
 
31 May 2024
 
has been
accounted for as
 
a business combination under
 
common control,
 
as defined in
 
IFRS 3, using
 
the historic carrying
values of the assets and liabilities of Credit Suisse AG as at the date
 
of the transaction (31 May 2024), determined
under IFRS
 
Accounting Standards. Therefore, differences
 
exist between the
 
accounting treatments applied
 
at the
UBS Group AG and
 
UBS AG consolidated
 
levels. There
 
are also certain
 
scope and
 
presentation differences,
 
as noted
below.
›
Refer to Note 2 for more information about the accounting for the merger of UBS AG and Credit Suisse AG
Assets,
 
liabilities,
 
revenues,
 
operating
 
expenses
 
and
 
tax
 
expenses
 
/
 
(benefits)
 
relating
 
to
 
UBS
 
Group AG and
 
its
directly held
 
subsidiaries,
 
including UBS
 
Business Solutions
 
AG, are
 
reflected in
 
the consolidated
 
financial statements
of UBS Group AG but
 
not in those of
 
UBS AG. UBS AG’s
 
assets, liabilities, revenues
 
and operating expenses
 
related
to transactions
 
with UBS
 
Group AG and its
 
directly held
 
subsidiaries, including
 
UBS Business
 
Solutions AG and
 
other
shared services subsidiaries,
 
are not subject to
 
elimination in the
 
UBS AG consolidated financial
 
statements, but are
eliminated in the UBS Group AG consolidated financial
 
statements.
In
 
the third
 
quarter of
 
2024,
 
UBS AG
 
consolidated recognized
 
a
 
net profit
 
of USD 997m,
 
while UBS Group
 
AG
consolidated recognized
 
a net profit
 
of USD 1,428m.
 
The USD 431m
 
difference was
 
mainly due to
 
certain purchase
price allocation (PPA)
 
effects recognized
 
at the UBS Group
 
AG level upon
 
the acquisition of
 
the Credit Suisse
 
Group
which resulted
 
in net
 
accretion income
 
at the
 
UBS Group AG
 
level, net
 
of tax
 
effects, whereas
 
UBS AG has
 
not
applied
 
acquisition
 
accounting
 
and
 
does
 
not
 
have
 
the
 
PPA
 
effects
 
or
 
the
 
corresponding
 
net
 
income.
 
Other
differences
 
in
 
net
 
profit
 
mainly
 
arise
 
as
 
UBS
 
Business
 
Solutions AG
 
and
 
other
 
shared
 
services
 
subsidiaries
 
of
UBS Group AG charge other legal
 
entities within the UBS AG consolidation scope a
 
markup on costs incurred for
services provided.
 
The equity
 
of UBS Group AG
 
consolidated was USD 10.2bn
 
lower than the
 
equity of
 
UBS AG consolidated as
 
of
30 September 2024. This difference was mainly driven by
 
PPA effects of USD 6.1bn recognized at
 
the UBS Group
AG level
 
upon the
 
acquisition of
 
the Credit
 
Suisse Group
 
that did
 
not impact
 
UBS AG consolidated,
 
primarily related
to loans and loan commitments measured at amortized cost and contingent liabilities recognized under IFRS 3 for
litigation, as well as consolidation scope differences
 
of USD 4.1bn.
The going concern capital of UBS Group AG consolidated
 
was USD 9.7bn lower than the going concern capital
 
of
UBS AG consolidated as of 30 September 2024,
 
reflecting the common equity tier 1 (CET1)
 
capital of UBS Group
AG
 
being lower
 
by
 
USD 10.2bn, partly
 
offset by
 
its
 
going
 
concern loss-absorbing
 
additional tier 1
 
(AT1) capital
being USD 0.6bn higher.
 
The
 
USD 10.2bn
 
lower
 
CET1
 
capital
 
of
 
UBS Group
 
AG
 
consolidated
 
was
 
primarily
 
due
 
to
 
UBS Group
 
AG
consolidated
 
IFRS
 
equity
 
being
 
USD 10.2bn
 
lower,
 
compensation-related
 
regulatory
 
capital
 
accruals
 
at
 
the
UBS Group AG
 
level and
 
a UBS Group
 
AG capital
 
reserve for
 
potential share
 
repurchases, partly
 
offset by
 
lower
UBS Group AG accruals for dividends to shareholders.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Consolidated financial statements | Comparison between UBS AG
 
consolidated and UBS Group AG consolidated
 
83
Comparison between UBS AG consolidated and UBS Group AG consolidated
As of or for the quarter ended 30.9.24
As of or for the quarter ended 30.6.24
USD m, except where indicated
UBS AG
consolidated
UBS Group AG
consolidated
Difference
(absolute)
UBS AG
consolidated
UBS Group AG
consolidated
Difference
(absolute)
Income statement
Total revenues
 
11,997
 
12,334
 
(336)
 
9,900
 
11,904
 
(2,003)
Credit loss expense / (release)
 
167
 
121
 
46
 
84
 
95
 
(11)
Operating expenses
 
10,640
 
10,283
 
357
 
10,012
 
10,340
 
(328)
Operating profit / (loss) before tax
 
1,191
 
1,929
 
(739)
 
(196)
 
1,469
 
(1,665)
Net profit / (loss)
 
 
997
 
1,428
 
(431)
 
(224)
 
1,175
 
(1,399)
Balance sheet
Total assets
 
1,626,893
 
1,623,941
 
2,951
 
1,564,664
 
1,560,976
 
3,688
Total liabilities
 
1,529,071
 
1,536,352
 
(7,282)
 
1,470,417
 
1,476,758
 
(6,341)
Total equity
 
 
97,822
 
87,589
 
10,233
 
94,247
 
84,218
 
10,029
Capital information
Common equity tier 1 capital
 
84,423
 
74,213
 
10,210
 
83,001
 
76,104
 
6,897
Going concern capital
 
100,673
 
91,024
 
9,650
 
98,133
 
91,804
 
6,329
Risk-weighted assets
 
515,520
 
519,363
 
(3,843)
 
509,953
 
511,376
 
(1,423)
Common equity tier 1 capital ratio (%)
 
16.4
 
14.3
 
2.1
 
16.3
 
14.9
 
1.4
Going concern capital ratio (%)
 
19.5
 
17.5
 
2.0
 
19.2
 
18.0
 
1.3
Total loss-absorbing capacity ratio (%)
 
38.2
 
37.5
 
0.7
 
38.6
 
38.7
 
0.0
Leverage ratio denominator
 
1,611,151
 
1,608,341
 
2,810
 
1,564,001
 
1,564,201
 
(200)
Common equity tier 1 leverage ratio (%)
 
5.2
 
4.6
 
0.6
 
5.3
 
4.9
 
0.4
Liquidity coverage ratio (%)
1
 
196.3
 
199.2
 
(2.9)
 
194.1
 
212.0
 
(17.9)
Net stable funding ratio (%)
 
126.8
 
126.9
 
(0.1)
 
127.7
 
128.0
 
(0.3)
1 The disclosed ratios represent quarterly averages
 
for the quarter presented and are calculated based on an average of 65
 
data points in the third quarter of 2024 and 61 data points in the
 
second quarter of 2024,
of which for UBS AG
 
consolidated, 40 data points
 
were before the merger
 
of UBS AG and
 
Credit Suisse AG (i.e.
 
from 2 April 2024
 
until 30 May 2024),
 
and 21 data points were
 
after the merger (i.e.
 
from 31 May
2024 until 30 June 2024). Refer to the “Liquidity and funding management” section of this report for more information.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Appendix
 
84
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
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 total revenues.
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.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Appendix
 
85
APM label
Calculation
 
Information content
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.
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 the
UBS Group third quarter 2024 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 the
UBS Group third quarter 2024 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.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Appendix
 
86
APM label
Calculation
 
Information content
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 (%)
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.
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 the
UBS Group third quarter 2024 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.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
UBS AG third quarter 2024 report |
Appendix
 
87
APM label
Calculation
 
Information content
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 the third quarter of 2024 is based entirely on consolidated data following the merger of UBS AG and Credit
 
Suisse AG and for the purpose of the calculation of return measures has been
annualized by multiplying such by four.
 
Profit and loss information for the second
 
quarter of 2024 includes one month (June
 
2024) of post-merger consolidated data and
 
two months of pre-merger UBS AG
 
data only
(April and May 2024) and for the purpose of the calculation of return measures has been annualized by multiplying such by four. Profit or loss information for each of the fourth quarter of 2023 and the third quarter of
2023 includes pre-merger
 
UBS AG data
 
only and for
 
the purpose of
 
the calculation of
 
return measures has
 
been annualized by
 
multiplying such by
 
four.
 
Profit or loss
 
information for the
 
first nine months
 
of 2024
includes four months (June to September 2024) of post-merger consolidated data and five months of pre-merger UBS AG data only (January to May 2024) and for the purpose of the calculation of return measures has
been annualized by dividing such by three and then multiplying by four. Profit or loss information for the first nine months of 2023 includes pre-merger UBS AG data only and for the purpose of the calculation of return
measures has been annualized by dividing such by three and then multiplying 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 AG third quarter 2024 report |
Appendix
 
88
Abbreviations frequently used in our financial reports
A
ABS
 
asset-backed securities
AG
 
Aktiengesellschaft
AGM
 
Annual General Meeting of
shareholders
AI
 
artificial intelligence
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 AG third quarter 2024 report |
Appendix
 
89
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
P&L
 
profit or loss
PPA
 
purchase price allocation
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 AG third quarter 2024 report |
Appendix
 
90
Information sources
 
Reporting publications
Annual publications
UBS
 
AG
 
Annual
 
Report
:
 
Published
 
in
 
English,
 
this
 
report
 
provides
 
descriptions
 
of:
 
the
 
UBS
 
AG
 
(consolidated)
performance; the
 
strategy and
 
performance of
 
the business
 
divisions and
 
Group Items;
 
risk, treasury
 
and capital
management; corporate governance;
 
and financial information, including the financial
 
statements.
 
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 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 AG third quarter 2024 report |
Appendix
 
91
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, the global economy
 
may be negatively affected
 
by
shifting political circumstances, including as a result of elections, increased tension
 
between world powers, growing conflicts in the Middle East, as well
 
as the
continuing Russia–Ukraine war.
 
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 further 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 its
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 UBS’s
performance and ability to
 
achieve its 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
 
elevated 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 its 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 its 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 its
 
reputation and the
 
additional consequences
 
that this may
 
have on its
 
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. UBS’s business and financial performance could be affected by other factors identified in
 
its 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.
edgarq24ubsagp95i0
UBS AG
P.O. Box, CH-8098 Zurich
P.O. Box, CH-4002 Basel
ubs.com
This
 
Form 6-K
 
is
 
hereby incorporated
 
by reference
 
into (1)
 
the
 
registration statements
 
of
 
UBS AG
 
on
 
Form
 
F-3
(Registration
 
Number
 
333-263376
 
and
 
333-278934),
 
and
 
into
 
each
 
prospectus
 
outstanding
 
under
 
the
 
foregoing
registration statement,
 
(2) any
 
outstanding offering
 
circular or
 
similar document
 
issued or
 
authorized by
 
UBS AG
that incorporates by reference any Forms 6-K of
 
UBS AG 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
 
registrant has duly caused this
report to be signed on its behalf by the undersigned, thereunto duly authorized.
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
Date:
 
November 8, 2024