UBS - Business Group reporting

In fourth quarter 2006, the Investment Bank posted a pre-tax profit of CHF 1,356 million, down 1% from the same period last year, but up 6% in US dollar terms. Revenues increased in all three business areas, particularly in equities and investment banking. This was matched by higher costs, for both personnel and general and administrative expenses, as we continued to expand our range of products and services.

Search only in Quarterly Reporting Q4 2006

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Business Group reporting

Business Group reporting
	Quarter ended			% change from		Year ended
CHF million	31.12.06	30.9.06	31.12.05	3Q06	4Q05	31.12.06	31.12.05
Equities	2,545	1,728	1,916	47	33	9,397	6,980
Fixed income, rates and currencies	2,018	1,964	1,817	3	11	9,056	7,962
Investment banking	1,015	797	850	27	19	3,273	2,506
Income	5,578	4,489	4,583	24	22	21,726	17,448
Adjusted expected credit loss ¹	24	11	7	118	243	61	36
Total operating income	5,602	4,500	4,590	24	22	21,787	17,484
Cash components	2,452	2,007	2,017	22	22	9,801	8,065
Share-based components ²	366	346	297	6	23	1,552	1,194
Total personnel expenses	2,818	2,353	2,314	20	22	11,353	9,259
General and administrative expenses	996	752	671	32	48	3,260	2,215
Services (to) / from other business units	312	260	178	20	75	956	640
Depreciation of property and equipment	91	38	40	139	128	203	136
Amortization of intangible assets	29	14	15	107	93	72	53
Total operating expenses	4,246	3,417	3,218	24	32	15,844	12,303
Business Group performance before tax	1,356	1,083	1,372	25	(1)	5,943	5,181
1 In management accounts, adjusted expected credit loss rather than credit loss expense is reported for the business groups (see note 2 to the financial statements). 2 Additionally includes related social security contributions and expenses related to alternative investment awards.

	As of or for the quarter ended			% change from		Year ended
CHF million, except where indicated	31.12.06	30.9.06	31.12.05	3Q06	4Q05	31.12.06	31.12.05

KPIs
Compensation ratio (%) ¹	50.5	52.4	50.5			52.3	53.1
Cost / income ratio (%) ²	76.1	76.1	70.2			72.9	70.5
Non-performing loans as a % of lending portfolio, gross ³	0.1	0.1	0.1
Impaired lending portfolio as a % of lending portfolio, gross ³	0.1	0.1	0.2
Average VaR (10-day 99%)	391.0	452.6	315.4	(14)	24

Capital return and BIS data
Return on allocated regulatory capital (%) ⁴						29.4	28.6
BIS risk-weighted assets	174,599	163,804	151,313	7	15
Goodwill and excess intangible assets ⁵	5,465	4,442	4,309	23	27
Allocated regulatory capital ⁶	22,925	20,822	19,440	10	18

Additional information
Deferral (included in adjusted expected credit loss)	68	59	41	15	66	232	155
Client assets (CHF billion)	174	169	164	3	6
Personnel (full-time equivalents)	21,899	20,652	18,174	6	20
1 Personnel expenses / income. 2 Operating expenses / income. 3 Figures reflect the prime brokerage reclassification as explained in note 1 to the financial statements. 4 Business Group performance before tax / average allocated regulatory capital. 5 Goodwill and intangible assets in excess of 4% of BIS Tier 1 Capital. 6 10% of BIS risk-weighted assets plus goodwill and excess intangible assets.