UBS - Note 2 Reporting by Business Group

Search only in Quarterly Reporting Q1 2007

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For the three months ended 31 March 2007

Internal charges and transfer pricing adjustments are reflected in the performance of each business. Revenue-sharing agreements are used to allocate external customer revenues to a Business Group on a reasonable basis. Transactions between Business Groups are conducted at internally agreed transfer prices or at arm’s length. The presentation of the business segments below reflects UBS‘s organization structure and management responsibilities. UBS‘s financial businesses are organized on a worldwide basis into three Business Groups and the Corporate Center. Global Wealth Management & Business Banking is segregated into three segments: Wealth Management International & Switzerland, Wealth Management US and Business Banking Switzerland. The Industrial Holdings segment holds all industrial operations controlled by the Group. In total, UBS reports seven business segments.

			Financial Businesses				Industrial Holdings	UBS
	Global Wealth Management & Business Banking			Global Asset Management	Investment Bank	Corporate Center
CHF million	Wealth Management International & Switzerland	Wealth Management US	Business Banking Switzerland
Income	3,071	1,610	1,280	997	6,258	130	249	13,595
Credit loss (expense) / recovery	0	0	21	0	(20)	0	0	1
Total operating income	3,071	1,610	1,301	997	6,238	130	249	13,596
Personnel expenses	920	1,108	649	423	3,389	320	32	6,841
General and administrative expenses	232	216	264	115	769	304	23	1,923
Services (to) / from other business units	381	80	(160)	43	193	(539)	2	0
Depreciation of property and equipment	20	19	13	7	54	187	3	303
Amortization of intangible assets	9	16	0	5	54	0	1	85
Goods and materials purchased							59	59
Total operating expenses	1,562	1,439	766	593	4,459	272	120	9,211
Business Group performance from continuing operations before tax	1,509	171	535	404	1,779	(142)	129	4,385
Business Group performance from discontinued operations before tax						8	(1)	7
Business Group performance before tax	1,509	171	535	404	1,779	(134)	128	4,392
Tax expense on continuing operations								953
Tax expense on discontinued operations								2
Net profit								3,437
Management reporting based on expected credit loss
For internal management reporting purposes, credit loss is measured using an expected loss concept. This table shows Business Group performance consistent with the way in which the businesses are managed and the way Business Group performance is measured. Expected credit loss reflects the average annual costs that are expected to arise from positions in the current portfolio that become impaired. The adjusted expected credit loss reported for each Business Group is the expected credit loss on its portfolio plus the difference between credit loss expense and expected credit loss, amortized over a three year period. The difference between these adjusted expected credit loss figures and the credit loss expense recorded at Group level for reporting purposes is reported in Corporate Center as adjusted expected credit loss.
Income	3,071	1,610	1,280	997	6,258	130	249	13,595
Adjusted expected credit loss	(8)	0	58	0	2	(51)	0	1
Total operating income	3,063	1,610	1,338	997	6,260	79	249	13,596
Personnel expenses	920	1,108	649	423	3,389	320	32	6,841
General and administrative expenses	232	216	264	115	769	304	23	1,923
Services (to) / from other business units	381	80	(160)	43	193	(539)	2	0
Depreciation of property and equipment	20	19	13	7	54	187	3	303
Amortization of intangible assets	9	16	0	5	54	0	1	85
Goods and materials purchased							59	59
Total operating expenses	1,562	1,439	766	593	4,459	272	120	9,211
Business Group performance from continuing operations before tax	1,501	171	572	404	1,801	(193)	129	4,385
Business Group performance from discontinued operations before tax						8	(1)	7
Business Group performance before tax	1,501	171	572	404	1,801	(185)	128	4,392
Tax expense on continuing operations								953
Tax expense on discontinued operations								2
Net profit								3,437

For the three months ended 31 March 2006

Internal charges and transfer pricing adjustments are reflected in the performance of each business. Revenue-sharing agreements are used to allocate external customer revenues to a Business Group on a reasonable basis. Transactions between Business Groups are conducted at internally agreed transfer prices or at arm’s length. The presentation of the business segments below reflects UBS‘s organization structure and management responsibilities. UBS‘s financial businesses are organized on a worldwide basis into three Business Groups and the Corporate Center. Global Wealth Management & Business Banking is segregated into three segments: Wealth Management International & Switzerland, Wealth Management US and Business Banking Switzerland. The Industrial Holdings segment holds all industrial operations controlled by the Group. In total, UBS reports seven business segments.

			Financial Businesses				Industrial Holdings	UBS
	Global Wealth Management & Business Banking			Global Asset Management	Investment Bank	Corporate Center
CHF million	Wealth Management International & Switzerland	Wealth Management US	Business Banking Switzerland
Income	2,649	1,478	1,261	809	5,958	142	164	12,461
Credit loss (expense) / recovery	(1)	0	54	0	30	0	0	83
Total operating income	2,648	1,478	1,315	809	5,988	142	164	12,544
Personnel expenses	777	968	633	317	3,194	311	47	6,247
General and administrative expenses	208	227	272	84	799	314	23	1,927
Services (to) / from other business units	362	65	(169)	29	175	(465)	3	0
Depreciation of property and equipment	17	19	16	5	37	176	4	274
Amortization of intangible assets	2	13	0	0	15	4	2	36
Goods and materials purchased							68	68
Total operating expenses	1,366	1,292	752	435	4,220	340	147	8,552
Business Group performance from continuing operations before tax	1,282	186	563	374	1,768	(198)	17	3,992
Business Group performance from discontinued operations before tax							630	630
Business Group performance before tax	1,282	186	563	374	1,768	(198)	647	4,622
Tax expense on continuing operations								844
Tax expense on discontinued operations								85
Net profit								3,693

Management reporting based on expected credit loss
For internal management reporting purposes, credit loss is measured using an expected loss concept. This table shows Business Group performance consistent with the way in which the businesses are managed and the way Business Group performance is measured. Expected credit loss reflects the average annual costs that are expected to arise from positions in the current portfolio that become impaired. The adjusted expected credit loss reported for each Business Group is the expected credit loss on its portfolio plus the difference between credit loss expense and expected credit loss, amortized over a three year period. The difference between these adjusted expected credit loss figures and the credit loss expense recorded at Group level for reporting purposes is reported in Corporate Center as adjusted expected credit loss.
Income	2,649	1,478	1,261	809	5,958	142	164	12,461
Adjusted expected credit loss	(7)	0	50	0	12	28	0	83
Total operating income	2,642	1,478	1,311	809	5,970	170	164	12,544
Personnel expenses	777	968	633	317	3,194	311	47	6,247
General and administrative expenses	208	227	272	84	799	314	23	1,927
Services (to) / from other business units	362	65	(169)	29	175	(465)	3	0
Depreciation of property and equipment	17	19	16	5	37	176	4	274
Amortization of intangible assets	2	13	0	0	15	4	2	36
Goods and materials purchased							68	68
Total operating expenses	1,366	1,292	752	435	4,220	340	147	8,552
Business Group performance from continuing operations before tax	1,276	186	559	374	1,750	(170)	17	3,992
Business Group performance from discontinued operations before tax							630	630
Business Group performance before tax	1,276	186	559	374	1,750	(170)	647	4,622
Tax expense on continuing operations								844
Tax expense on discontinued operations								85
Net profit								3,693

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