UBS Q4 Results +CHF1.2Bio

UBS reports a fourth quarter profit of CHF 1,205 million

Fourth quarter 2009 results
Net profit attributable to UBS shareholders was CHF 1,205 million, with all business divisions reporting a pre-tax profit in fourth quarter 2009
Improvement compared with the third quarter due to lower costs, lower own credit charges and a tax credit

Greater efficiency and cost control
Cost reduction and efficiency programs initiated in early 2009 have led to a sharp reduction in fixed costs to CHF 20.2 billion in 2009, broadly in line with the CHF 20 billion target set for 2010
Headcount reduced by 16% to 65,233 during the year, broadly in line with the 2010 target of 65,000

Financial strength
Year-end BIS tier 1 capital ratio of 15.4% compared with 11.0% on 31 December 2008; FINMA leverage ratio of 3.9% in fourth quarter 2009 compared with 2.5% in fourth quarter 2008
Further reductions in risk exposures and balance sheet: assets1 down 21% year-on-year to CHF 919 billion and total risk-weighted assets down 32% year-on-year to CHF 207 billion on 31 December 2009

Net new money and invested assets
Net new money outflows in fourth quarter 2009 were CHF 33.2 billion for Wealth Management & Swiss Bank, CHF 12.0 billion for Wealth Management Americas, and CHF 11.0 billion for Global Asset Management
Invested assets were CHF 2,233 billion on 31 December 2009, up 3% year-on-year and down 1% compared with the prior quarter-end

CEO comment and outlook
Group CEO Grübel says UBS is delivering on its plan for a new UBS, as demonstrated by its return to profitability and strengthened capitalization
Addressing the causes of net new money outflows remains a main priority – management is confident that reputation will be restored with tangible results
Effects of the progress made in improving efficiency, reducing risk and rebuilding and refocusing businesses are expected to be felt in the coming quarters

Full-year 2009 results

Net loss attributable to shareholders decreased to CHF 2,736 million for full-year 2009 from CHF 21,292 million in 2008. Adjusted for the items below, the underlying pre-tax profit for 2009 was CHF 1.4 billion. In 2009, the biggest negative accounting impact came from losses on own credit on financial liabilities designated at fair value. These own credit losses were driven by the improved perception of UBS's creditworthiness during 2009, which was a positive development but led to a net charge of CHF 2.0 billion. The other items were a loss in relation to the closing of the UBS Pactual sale (CHF 1.4 billion), restructuring charges (CHF 0.8 billion) and a gain on the mandatory convertible notes formerly held by the Swiss Confederation and converted in August 2009 (CHF 0.3 billion).