Investment Bank

Business Group reporting

In fourth quarter 2005, the Investment Bank posted a pre-tax profit of CHF 1,372 million, up 8% from the same period last year. Before goodwill, pre-tax profit was up 2%. Strong revenues in investment banking, equity derivatives and prime brokerage were offset by an increase in costs, primarily for personnel and IT.

Search only in Quarterly Reporting Q4 2005

Spreadsheets

Business Group reporting

	Quarter ended			% change from		Year ended

CHF million	31.12.05	30.9.05	31.12.04	3Q05	4Q04	31.12.05	31.12.04


Equities	1,916	1,980	1,598	(3)	20	6,980	5,906
Fixed income, rates and currencies	1,817	2,108	1,812	(14)	0	7,962	8,269
Investment banking	850	592	593	44	43	2,506	1,915


Income	4,583	4,680	4,003	(2)	14	17,448	16,090
Adjusted expected credit loss¹	7	11	5	(36)	40	36	(7)


Total operating income	4,590	4,691	4,008	(2)	15	17,484	16,083


Cash components	2,017	2,196	1,627	(8)	24	8,065	7,130
Share-based components²	297	313	251	(5)	18	1,194	1,022


Total personnel expenses	2,314	2,509	1,878	(8)	23	9,259	8,152
General and administrative expenses	671	582	664	15	1	2,215	2,538
Services to / from other business units	178	164	60	9	197	640	226
Depreciation of property and equipment	40	37	57	8	(30)	136	243
Amortization of goodwill	0	0	65		(100)	0	278
Amortization of other intangible assets	15	13	10	15	50	53	36


Total operating expenses	3,218	3,305	2,734	(3)	18	12,303	11,473


Business Group performance before tax	1,372	1,386	1,274	(1)	8	5,181	4,610


Business Group performance before tax and amortization of goodwill	1,372	1,386	1,339	(1)	2	5,181	4,888



KPIs

Compensation ratio (%)³	50	54	47			53	51


Cost / income ratio (%)⁴	70.2	70.6	68.3			70.5	71.3
Cost / income ratio before goodwill (%)⁴	70.2	70.6	66.7			70.5	69.6


Non-performing loans / gross loans (%)	0.2	0.2	0.4
Impaired loans / gross loans (%)	0.2	0.2	0.6
Average VaR (10-day 99%)⁵	315	343	358	(8)	(12)



Capital return and BIS data

Return on adjusted regulatory capital (%)⁶						28.6	30.5
Return on adjusted regulatory capital before goodwill (%)⁶						28.6	32.4
BIS risk-weighted assets	151,313	155,103	116,512	(2)	30
Goodwill	4,309	4,256	3,579	1	20
Adjusted regulatory capital⁷	19,440	19,766	15,230	(2)	28

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.
3 Personnel expenses / income.
4 Operating expenses / income.
5 VaR for the Investment Bank includes the municipal securities business of Wealth Management US which was transferred to the Investment Bank on 1 July 2005.
6 Business Group performance before tax / adjusted regulatory capital year ended average.
7 10% of BIS risk-weighted assets plus goodwill.

Additional information	As at or for the quarter ended			% change from		Year ended

	31.12.05	30.9.05	31.12.04	3Q05	4Q04	31.12.05	31.12.04


Deferral (included in adjusted expected credit loss)	41	41	30	0	37	155	85
Client assets (CHF billion)	164	168	147	(2)	12
Personnel (full-time equivalents)	18,174	17,954	16,970	1	7

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