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Financial Statements
Income Statement | |||||
For the year ended | % change from | ||||
CHF million, except per share data | Note | 31.12.07 | 31.12.06 | 31.12.05 | 31.12.06 |
Continuing operations | |||||
Interest income | 3 | 109,112 | 87,401 | 59,286 | 25 |
Interest expense | 3 | (103,775) | (80,880) | (49,758) | 28 |
Net interest income | 3 | 5,337 | 6,521 | 9,528 | (18) |
Credit loss (expense) / recovery | (238) | 156 | 375 | ||
Net interest income after credit loss expense | 5,099 | 6,677 | 9,903 | (24) | |
Net fee and commission income | 4 | 30,634 | 25,456 | 21,184 | 20 |
Net trading income | 3 | (8,353) | 13,743 | 8,248 | |
Other income | 5 | 4,332 | 1,598 | 1,127 | 171 |
Revenues from industrial holdings | 268 | 262 | 229 | 2 | |
Total operating income | 31,980 | 47,736 | 40,691 | (33) | |
Personnel expenses | 6 | 24,798 | 23,591 | 20,067 | 5 |
General and administrative expenses | 7 | 8,465 | 7,980 | 6,504 | 6 |
Depreciation of property and equipment | 15 | 1,251 | 1,252 | 1,247 | 0 |
Amortization of intangible assets | 16 | 282 | 153 | 133 | 84 |
Goods and materials purchased | 119 | 116 | 97 | 3 | |
Total operating expenses | 34,915 | 33,092 | 28,048 | 6 | |
Operating profit from continuing operations before tax | (2,935) | 14,644 | 12,643 | ||
Tax expense | 22 | 1,311 | 2,785 | 2,465 | (53) |
Net profit from continuing operations | (4,246) | 11,859 | 10,178 | ||
Discontinued operations | |||||
Operating profit from discontinued operations before tax | 36 | 135 | 879 | 5,094 | (85) |
Tax expense | 22 | (266) | (12) | 582 | |
Net profit from discontinued operations | 401 | 891 | 4,512 | (55) | |
Net profit | (3,845) | 12,750 | 14,690 | ||
Net profit attributable to minority interests | 539 | 493 | 661 | 9 | |
from continuing operations | 539 | 390 | 430 | 38 | |
from discontinued operations | 0 | 103 | 231 | (100) | |
Net profit attributable to UBS shareholders | (4,384) | 12,257 | 14,029 | ||
from continuing operations | (4,785) | 11,469 | 9,748 | ||
from discontinued operations | 401 | 788 | 4,281 | (49) | |
Earnings per share | |||||
Basic earnings per share (CHF) | 8 | (2.28) | 6.20 | 6.97 | |
from continuing operations | (2.49) | 5.80 | 4.84 | ||
from discontinued operations | 0.21 | 0.40 | 2.13 | (48) | |
Diluted earnings per share (CHF) | 8 | (2.28) | 5.95 | 6.68 | |
from continuing operations | (2.49) | 5.57 | 4.65 | ||
from discontinued operations | 0.21 | 0.38 | 2.03 | (45) | |
Balance Sheet | ||||
% change from | ||||
CHF million | Note | 31.12.07 | 31.12.06 | 31.12.06 |
Assets | ||||
Cash and balances with central banks | 18,793 | 3,495 | 438 | |
Due from banks | 9 | 60,907 | 50,426 | 21 |
Cash collateral on securities borrowed | 10 | 207,063 | 351,590 | (41) |
Reverse repurchase agreements | 10 | 376,928 | 405,834 | (7) |
Trading portfolio assets | 11 | 610,061 | 627,036 | (3) |
Trading portfolio assets pledged as collateral | 11 | 164,311 | 251,478 | (35) |
Positive replacement values | 23 | 428,217 | 292,975 | 46 |
Financial assets designated at fair value | 12 | 11,765 | 5,930 | 98 |
Loans | 9 | 335,864 | 297,842 | 13 |
Financial investments available-for-sale | 13 | 4,966 | 8,937 | (44) |
Accrued income and prepaid expenses | 11,953 | 10,361 | 15 | |
Investments in associates | 14 | 1,979 | 1,523 | 30 |
Property and equipment | 15 | 7,234 | 6,913 | 5 |
Goodwill and intangible assets | 16 | 14,538 | 14,773 | (2) |
Other assets | 17, 22 | 18,000 | 17,249 | 4 |
Total assets | 2,272,579 | 2,346,362 | (3) | |
Liabilities | ||||
Due to banks | 18 | 145,762 | 203,689 | (28) |
Cash collateral on securities lent | 10 | 31,621 | 63,088 | (50) |
Repurchase agreements | 10 | 305,887 | 545,480 | (44) |
Trading portfolio liabilities | 11 | 164,788 | 204,773 | (20) |
Negative replacement values | 23 | 443,539 | 297,063 | 49 |
Financial liabilities designated at fair value | 19 | 191,853 | 145,687 | 32 |
Due to customers | 18 | 641,892 | 555,886 | 15 |
Accrued expenses and deferred income | 21,848 | 21,527 | 1 | |
Debt issued | 19 | 222,077 | 190,143 | 17 |
Other liabilities | 20, 21, 22 | 60,776 | 63,251 | (4) |
Total liabilities | 2,230,043 | 2,290,587 | (3) | |
Equity | ||||
Share capital | 207 | 211 | (2) | |
Share premium | 8,884 | 9,870 | (10) | |
Net income recognized directly in equity, net of tax | (1,188) | 815 | ||
Revaluation reserve from step acquisitions, net of tax | 38 | 38 | 0 | |
Retained earnings | 38,081 | 49,151 | (23) | |
Equity classified as obligation to purchase own shares | (74) | (185) | 60 | |
Treasury shares | (10,363) | (10,214) | (1) | |
Equity attributable to UBS shareholders | 35,585 | 49,686 | (28) | |
Equity attributable to minority interests | 6,951 | 6,089 | 14 | |
Total equity | 42,536 | 55,775 | (24) | |
Total liabilities and equity | 2,272,579 | 2,346,362 | (3) | |
Statement of Changes in Equity | |||
For the year ended | |||
CHF million | 31.12.07 | 31.12.06 | 31.12.05 |
Share capital | |||
Balance at the beginning of the year | 211 | 871 | 901 |
Issue of share capital | 0 | 1 | 2 |
Capital repayment by par value reduction | 0 | (631) | 0 |
Cancellation of second trading line treasury shares | (4) | (30) | (32) |
Balance at the end of the year attributable to UBS shareholders | 207 | 211 | 871 |
Share premium | |||
Balance at the beginning of the year | 9,870 | 9,992 | 9,231 |
Premium on shares issued and warrants exercised | 12 | 46 | 36 |
Net premium / (discount) on treasury share and own equity derivative activity | (560) | (271) | (309) |
Employee share and share option plans | 139 | (508) | 768 |
Tax benefits from deferred compensation awards | (577) | 611 | 266 |
Balance at the end of the year attributable to UBS shareholders | 8,884 | 9,870 | 9,992 |
Balance at the end of the year attributable to minority interests | 556 | 461 | 2,415 |
Balance at the end of the year | 9,440 | 10,331 | 12,407 |
Net income recognized directly in equity, net of tax | |||
Foreign currency translation | |||
Balance at the beginning of the year | (1,618) | (432) | (2,520) |
Movements during the year | (1,009) | (1,186) | 2,088 |
Subtotal – balance at the end of the year attributable to UBS shareholders 1 | (2,627) | (1,618) | (432) |
Balance at the end of the year attributable to minority interests | (480) | (208) | (26) |
Subtotal – balance at the end of the year | (3,107) | (1,826) | (458) |
Net unrealized gains / (losses) on financial investments available-for-sale, net of tax | |||
Balance at the beginning of the year | 2,876 | 931 | 761 |
Net unrealized gains / (losses) on financial investments available-for-sale | 1,213 | 2,574 | 463 |
Impairment charges reclassified to the income statement | 14 | 19 | 96 |
Realized gains reclassified to the income statement | (2,638) | (649) | (396) |
Realized losses reclassified to the income statement | 6 | 1 | 7 |
Subtotal – balance at the end of the year attributable to UBS shareholders | 1,471 | 2,876 | 931 |
Balance at the end of the year attributable to minority interests | 32 | 30 | 21 |
Subtotal – balance at the end of the year | 1,503 | 2,906 | 952 |
Changes in fair value of derivative instruments designated as cash flow hedges, net of tax | |||
Balance at the beginning of the year | (443) | (681) | (322) |
Net unrealized gains / (losses) on the revaluation of cash flow hedges | 239 | 1 | (474) |
Net realized (gains) / losses reclassified to the income statement | 172 | 237 | 115 |
Subtotal – balance at the end of the year attributable to UBS shareholders | (32) | (443) | (681) |
Balance at the end of the year attributable to minority interests | 0 | 0 | 0 |
Subtotal – balance at the end of the year | (32) | (443) | (681) |
Net income recognized directly in equity, net of tax - attributable to UBS shareholders | (1,188) | 815 | (182) |
Net income recognized directly in equity - attributable to minority interests | (448) | (178) | (5) |
Balance at the end of the year | (1,636) | 637 | (187) |
Revaluation reserve from step acquisitions, net of tax | |||
Balance at the beginning of the year | 38 | 101 | 90 |
Movements during the year | 0 | (63) | 11 |
Balance at the end of the year attributable to UBS shareholders | 38 | 38 | 101 |
Retained earnings | |||
Balance at the beginning of the year | 49,151 | 44,105 | 36,692 |
Net profit attributable to UBS shareholders for the year | (4,384) | 12,257 | 14,029 |
Dividends paid 2 | (4,275) | (3,214) | (3,105) |
Cancellation of second trading line treasury shares | (2,411) | (3,997) | (3,511) |
Balance at the end of the year attributable to UBS shareholders | 38,081 | 49,151 | 44,105 |
Balance at the end of the year attributable to minority interests | 16 | (25) | 170 |
Balance at the end of the year | 38,097 | 49,126 | 44,275 |
Equity classified as obligation to purchase own shares | |||
Balance at the beginning of the year | (185) | (133) | (96) |
Movements during the year | 111 | (52) | (37) |
Balance at the end of the year attributable to UBS shareholders | (74) | (185) | (133) |
Treasury shares | |||
Balance at the beginning of the year | (10,214) | (10,739) | (11,105) |
Acquisitions | (7,169) | (8,314) | (8,375) |
Disposals | 4,605 | 4,812 | 5,198 |
Cancellation of second trading line treasury shares | 2,415 | 4,027 | 3,543 |
Balance at the end of the year attributable to UBS shareholders | (10,363) | (10,214) | (10,739) |
Minority interests – preferred securities | 6,827 | 5,831 | 5,039 |
Total equity attributable to UBS shareholders | 35,585 | 49,686 | 44,015 |
Total equity attributable to minority interests | 6,951 | 6,089 | 7,619 |
Total equity | 42,536 | 55,775 | 51,634 |
Additional information: Equity attributable to minority interests | |||
For the year ended | |||
CHF million | 31.12.07 | 31.12.06 | 31.12.05 |
Balance at the beginning of the year | 6,089 | 7,619 | 5,426 |
Issuance of preferred securities | 996 | 1,219 | 1,539 |
Other increases | 101 | 131 | 44 |
Decreases and dividend payments | (502) | (3,191) | (595) |
Foreign currency translation | (272) | (182) | 544 |
Minority interest in net profit | 539 | 493 | 661 |
Balance at the end of the year | 6,951 | 6,089 | 7,619 |
Shares issued | ||||
For the year ended | % change from | |||
Number of shares | 31.12.07 | 31.12.06 | 31.12.05 | 31.12.06 |
Balance at the beginning of the year | 2,105,273,286 | 2,177,265,044 | 2,253,716,354 | (3) |
Issuance of share capital | 1,294,058 | 2,208,242 | 3,418,878 | (41) |
Cancellation of second trading line treasury shares | (33,020,000) | (74,200,000) | (79,870,188) | 55 |
Balance at the end of the year | 2,073,547,344 | 2,105,273,286 | 2,177,265,044 | (2) |
Treasury shares | ||||
For the year ended | % change from | |||
Number of shares | 31.12.07 | 31.12.06 | 31.12.05 | 31.12.06 |
Balance at the beginning of the year | 164,475,699 | 208,519,748 | 249,326,620 | (21) |
Acquisitions | 102,074,942 | 117,160,339 | 156,436,070 | (13) |
Disposals | (75,425,117) | (87,004,388) | (117,372,754) | 13 |
Cancellation of second trading line treasury shares | (33,020,000) | (74,200,000) | (79,870,188) | 55 |
Balance at the end of the year | 158,105,524 | 164,475,699 | 208,519,748 | (4) |
During the year a total of 33,020,000 shares acquired under the second trading line buyback program 2006 were cancelled. The 36,400,000 shares purchased under the buy back program 2007 (CHF 2,599 million) previously intended for cancellation have been rededicated for further use.
On 31 December 2007, a maximum of 144,338 shares could be issued against the future exercise of options from former PaineWebber employee option plans. These shares are shown as conditional share capital in the UBS AG (Parent Bank) disclosure. In addition, during 2006, shareholders approved the creation of conditional capital of up to a maximum of 150 million shares to fund UBS's employee share option programs. As of 31 December 2007 and 31 December 2006, 5,704 shares and zero shares, respectively, have been issued under this program.
All issued shares are fully paid.
Statement of Recognized Income and Expense | |||||||||
For the year ended | 31.12.07 | 31.12.06 | 31.12.05 | ||||||
Attributable to | Total | Attributable to | Total | Attributable to | Total | ||||
CHF million | UBS share- holders | Minority interests | UBS shareholders | Minority interests | UBS shareholders | Minority interests | |||
Net unrealized gains / (losses) on financial investments available-for-sale, before tax | (1,825) | 2 | (1,823) | 2,610 | 9 | 2,619 | 152 | (58) | 94 |
Change in fair value of derivative instruments designated as cash flow hedges, before tax | 541 | 0 | 541 | 332 | 0 | 332 | (479) | 0 | (479) |
Foreign currency translation |
| (272) | (1,281) | (1,186) | (182) | (1,368) | 2,088 | 544 | 2,632 |
Tax on items transferred to / (from) equity | 290 | 0 | 290 | (759) | 0 | (759) | 138 | 0 | 138 |
Net income recognized directly in equity | (2,003) | (270) | (2,273) | 997 | (173) | 824 | 1,899 | 486 | 2,385 |
Net income recognized in the income statement | (4,384) | 539 | (3,845) | 12,257 | 493 | 12,750 | 14,029 | 661 | 14,690 |
Total recognized income and expense | (6,387) | 269 | (6,118) | 13,254 | 320 | 13,574 | 15,928 | 1,147 | 17,075 |
Statement of Cash Flows | |||
For the year ended | |||
CHF million | 31.12.07 | 31.12.06 | 31.12.05 |
Cash flow from / (used in) operating activities | |||
Net profit | (3,845) | 12,750 | 14,690 |
Adjustments to reconcile net profit to cash flow from / (used in) operating activities | |||
Non-cash items included in net profit and other adjustments: | |||
Depreciation of property and equipment | 1,253 | 1,325 | 1,556 |
Amortization of intangible assets | 282 | 196 | 340 |
Credit loss expense / (recovery) | 238 | (156) | (374) |
Equity in income of associates | (120) | (117) | (152) |
Deferred tax expense / (benefit) | (437) | (517) | (382) |
Net loss / (gain) from investing activities | (4,085) | (2,092) | (5,062) |
Net loss / (gain) from financing activities | 3,779 | 3,659 | 4,025 |
Net (increase) / decrease in operating assets: | |||
Net due from / to banks | (60,762) | 80,269 | (1,690) |
Reverse repurchase agreements and cash collateral on securities borrowed | 173,433 | (61,382) | (125,097) |
Trading portfolio, net replacement values and financial assets designated at fair value | 60,729 | (177,087) | (74,799) |
Loans / due to customers | 47,955 | 64,029 | 47,265 |
Accrued income, prepaid expenses and other assets | (2,467) | (4,536) | (1,227) |
Net increase / (decrease) in operating liabilities: | |||
Repurchase agreements, cash collateral on securities lent | (271,060) | 66,370 | 64,558 |
Accrued expenses and other liabilities | 7,494 | 14,975 | 15,536 |
Income taxes paid | (3,663) | (2,607) | (2,394) |
Net cash flow from / (used in) operating activities | (51,276) | (4,921) | (63,207) |
Cash flow from / (used in) investing activities | |||
Investments in subsidiaries and associates | (2,337) | 2,856 | (1,540) |
Disposal of subsidiaries and associates | 885 | 1,154 | 3,240 |
Purchase of property and equipment | (1,910) | (1,793) | (1,892) |
Disposal of property and equipment | 134 | 499 | 270 |
Net (investment in) / divestment of financial investments available-for-sale | 5,981 | 1,723 | (2,487) |
Net cash flow from / (used in) investing activities | 2,753 | 4,439 | (2,409) |
Cash flow from / (used in) financing activities | |||
Net money market paper issued / (repaid) | 32,672 | 16,921 | 23,221 |
Net movements in treasury shares and own equity derivative activity | (3,550) | (3,624) | (2,416) |
Capital issuance | 0 | 1 | 2 |
Capital repayment by par value reduction | 0 | (631) | 0 |
Dividends paid | (4,275) | (3,214) | (3,105) |
Issuance of long-term debt, including financial liabilities designated at fair value | 110,874 | 97,675 | 76,307 |
Repayment of long-term debt, including financial liabilities designated at fair value | (62,407) | (59,740) | (30,457) |
Increase in minority interests 1 | 1,094 | 1,331 | 1,572 |
Dividend payments to / purchase from minority interests | (619) | (1,072) | (575) |
Net cash flow from / (used in) financing activities | 73,789 | 47,647 | 64,549 |
Effects of exchange rate differences | (12,251) | (2,117) | 5,018 |
Net increase / (decrease) in cash and cash equivalents | 13,015 | 45,048 | 3,951 |
Cash and cash equivalents, beginning of the year | 136,090 | 91,042 | 87,091 |
Cash and cash equivalents, end of the year | 149,105 | 136,090 | 91,042 |
Cash and cash equivalents comprise: | |||
Cash and balances with central banks | 18,793 | 3,495 | 5,359 |
Money market paper 2 | 77,215 | 87,144 | 57,826 |
Due from banks with original maturity of less than three months | 53,097 | 45,451 | 27,857 |
Total | 149,105 | 136,090 | 91,042 |
For the year ended | |||
CHF million | 31.12.07 | 31.12.06 | 31.12.05 |
Additional information | |||
Cash received as interest | 103,828 | 79,805 | 53,117 |
Cash paid as interest | 97,358 | 76,109 | 44,392 |
Cash received as dividends on equities (including associates, see Note 14) | 5,313 | 4,839 | 3,869 |
Significant non-cash investing and financing activities | |||
Private Banks and GAM, deconsolidation | |||
Financial investments available-for-sale | 60 | ||
Property and equipment | 180 | ||
Goodwill and intangible assets | 362 | ||
Debt issued | 5 | ||
Private equity investments, deconsolidation | |||
Property and equipment | 24 | 264 | 248 |
Goodwill and intangible assets | 3 | ||
Minority interests | 62 | 27 | |
Acquisitions of businesses | |||
Financial investments available-for-sale | 35 | ||
Property and equipment | 112 | ||
Goodwill and intangible assets | 377 | ||
Minority interests | 6 | ||
Motor-Columbus , deconsolidation | |||
Financial investments available-for-sale | 178 | ||
Property and equipment | 2,229 | ||
Goodwill and intangible assets | 951 | ||
Debt issued | 718 | ||
Minority interests | 2,057 | ||
Acquisition of ABN AMRO's Global Futures and Options Business | |||
Property and equipment | 13 | ||
Goodwill and intangible assets | 428 | ||
Acquisition of Banco Pactual | |||
Financial investments available-for-sale | 36 | ||
Property and equipment | 9 | ||
Goodwill and intangible assets | 2,218 | ||
Debt issued | 1,496 | ||
Acquisition of Piper Jaffray | |||
Goodwill and intangible assets | 605 | ||
Acquisition of McDonald Investments branch network | |||
Property and equipment | 3 | ||
Goodwill and intangible assets | 262 | ||
Acquisition of Daehan Investment Trust Management Company | |||
Property and equipment | 2 | ||
Goodwill and intangible assets | 224 | ||
Minority interests | 60 | ||
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