Our strategy

Who we are

The world’s largest and only truly global wealth manager

Our strategy is centered on our leading wealth management businesses and our premier universal bank in Switzerland, which are enhanced by Asset Management and the Investment Bank. We focus on businesses that have a strong competitive position in their targeted markets, are capital efficient, and have an attractive long-term structural growth or profitability outlook. We are the world’s largest and only truly global wealth manager, with a strong presence in the largest and fastest growing markets. Our wealth management businesses benefit from significant scale in an industry with attractive growth prospects, increasingly high barriers to entry, and their leading position across the attractive high net worth and ultra high net worth client segments. We are the preeminent universal bank in Switzerland, the only country where we operate in all business divisions. Our leading position in our home market is central to UBS’s global brand and profit stability. The partnership between our wealth management businesses and our other businesses is a key differentiating factor and a source of competitive advantage.

Strong capital position and capital efficient business model

Capital strength is the foundation of our strategy and provides another competitive advantage. Our fully applied common equity tier 1 (CET1) capital ratio is one of the highest among large global banks, and we are well-positioned to meet the revised fully applied Swiss too big to fail provisions as of 1 January 2020. Our capital-accretive and efficient business model helps us adapt to changes in regulatory requirements, while pursuing growth opportunities without the need for significant earnings retention. We believe that our business model can generate an adjusted return on tangible equity of more than 15% in a normalized market environment.

We are committed to an attractive capital returns policy

Our earnings capacity and capital efficiency support our objective to deliver sustainable and growing capital returns to our shareholders. We are committed to a total capital return of at least 50% of net profit attributable to shareholders, provided that we maintain a fully applied CET1 capital ratio of at least 13% and consistent with our objective of maintaining a post-stress fully applied CET1 capital ratio of at least 10%. Total capital returns will consist of an ordinary dividend, which we intend to grow steadily over time, and other forms of capital returns. For the financial year 2016, our Board of Directors intends to propose a dividend payment of CHF 0.60 per share, which is in line with the ordinary dividend paid for 2015, and which represents a payout ratio of 71%.

Our priorities

1. Continue to execute our strategy and deliver on our performance targets

The strategic change we initiated in 2011 was driven by our decision to focus on our strengths and our anticipation of more demanding regulation. Having successfully completed our strategic transformation in 2014, we intend to continue building on our successful track record and to focus on disciplined execution to deliver on our performance targets.

2. Improve effectiveness and efficiency

Our effectiveness and efficiency programs focus on creating the right infrastructure and cost framework for the future, including optimizing our global workforce and footprint. Delivering on our cost savings target is critical to offsetting the escalating costs associated with regulatory change and to achieve our return objectives.

3. Invest for growth

We continue to upgrade and enhance our capabilities in technology and digitalization with a focus on innovation, better serving our clients and further strengthening our competitive position. We are also committed to investing in the development of our employees and attracting the best available talent.

To find out more about our strategy for UBS Group and our business divisions, please see pages 27-28 of our 2016 Annual Report.