Annual report, Group and Parent Bank financial statements for the financial year 2013
1.1. Approval of annual report and Group and Parent Bank financial statements
The Board of Directors proposes that the report on the financial year 2013 and the Group and Parent Bank financial statements for 2013 be approved.
The “Financial information” section of UBS’s Annual Report 2013 contains the consolidated financial statements of the UBS Group and the financial statements of UBS AG, the Parent Bank. Additional information on the strategy, organization and activities of the Group, the business divisions and the Corporate Center, as well as on risk management and control, may be found in the sections “Operating environment and strategy,” “Financial and operating performance” and “Risk, treasury and capital management” of the Annual Report 2013. Information relating to corporate governance as required by the applicable Swiss laws and regulations, in particular the SIX Swiss Exchange’s Directive on Information Relating to Corporate Governance and the Swiss Code of Obligations, can be found in the section “Corporate governance, responsibility and compensation” of the Annual Report 2013. The Annual Report 2013 is also available on the internet at www.ubs.com/investors. Shareholders registered in the share register in Switzerland and shareholders in the US who are registered with Computershare will receive the abovementioned reporting as per their individual orders.
UBS Group net profit attributable to UBS shareholders for 2013 was CHF 3,172 million compared with a loss of CHF 2,480 million in 2012. Operating profit before tax was 3,272 million compared with a loss of CHF 1,794 million in the prior year. Operating income increased by CHF 2,309 million and operating expenses decreased by CHF 2,755 million. Furthermore, we recorded a net tax benefit of CHF 110 million compared with a net tax expense of CHF 461 million in the prior year. Total balance sheet assets stood at CHF 1,010 billion on 31 December 2013 compared with CHF 1,260 billion on 31 December 2012. Equity attributable to UBS shareholders increased by CHF 2.1 billion to CHF 48.0 billion in 2013.
On a fully applied basis, UBS Group’s Basel III common equity tier 1 (CET1) capital stood at CHF 28,908 million and risk-weighted assets were CHF 225,153 million, resulting in a CET1 capital ratio of 12.8%. On a phase in basis, UBS Group’s Basel III common equity tier 1 (CET1) capital stood at CHF 42,179 million and risk-weighted assets were CHF 228,557 million, resulting in a CET1 capital ratio of 18.5%.
The net profit for UBS AG (Parent Bank) for the period was CHF 2,753 million. Total operating income of CHF 17,074 million and total operating expenses of CHF 13,197 million resulted in an operating profit of CHF 3,877 million. Impairment, depreciation, allowances, provisions and losses amounted to CHF 2,513 million. Extraordinary income was CHF 1,667 million, extraordinary expenses totaled CHF 9 million and the net tax expense amounted to CHF 270 million.
In their reports to the Annual General Meeting, Ernst & Young Ltd, Basel, as auditors, recommended without qualification that the consolidated financial statements and Parent Bank financial statements be approved. The auditors confirm that, in their opinion, the consolidated financial statements present fairly, in all material respects, the financial position of UBS AG and its subsidiaries and the consolidated results of operations and the cash flows, in accordance with the International Financial Reporting Standards (IFRS), and that they comply with Swiss law. With respect to the Parent Bank, the auditors confirm that the financial statements and the proposal of the Board of Directors relating to the appropriation of available earnings comply with Swiss law and with the Articles of Association of UBS AG.
1.2. Advisory vote on the Compensation Report 2013
The Board of Directors proposes that the Compensation Report 2013 be ratified in an advisory vote.
The Compensation Report 2013 is a chapter in the Annual Report 2013. It explains the governance and principles behind the compensation structure at UBS AG, including the link between pay and performance. It contains information on the Total Reward Principles for all employees, which were re-affirmed on 30 August 2013 by the Board of Directors’ Human Resources and Compensation Committee. The Compensation Report also sets out the compensation of the management and Board of Directors in accordance with all applicable laws and regulations.
The vote on the Compensation Report 2013 of UBS AG is advisory in nature.