Business Context and Reporting Period
This Form 6-K filing, dated March 6, 2023, presents the audited standalone financial statements and regulatory information for UBS Switzerland AG for the year ended December 31, 2022. UBS Switzerland AG is a wholly-owned subsidiary of UBS AG and operates as a systemically relevant bank (SRB) under Swiss banking law. The financial statements are prepared in accordance with Swiss GAAP.
Key Financial Metrics
| Metric | 2022 (CHF m) | 2021 (CHF m) |
|---|---|---|
| Total Operating Income | 8,760 | 8,490 |
| Net Profit | 2,707 | 2,452 |
| Total Assets | 315,657 | 320,656 |
| Total Equity | 15,493 | 14,736 |
| Common Equity Tier 1 (CET1) Capital | 12,586 | 12,609 |
| Risk-Weighted Assets (RWA) | 107,208 | 106,399 |
| CET1 Ratio | 11.74% | 11.85% |
| Liquidity Coverage Ratio (LCR) | 142.41% | 142.57% |
| Net Stable Funding Ratio (NSFR) | 136.59% | 142.49% |
Material Changes vs. Prior Period
- Profitability: Net profit increased by CHF 255 million (10.4%) to CHF 2.7 billion, driven by higher operating income (up CHF 270 million) despite a slight increase in total operating expenses.
- Balance Sheet: Total assets decreased by CHF 5.0 billion to CHF 315.7 billion. This reduction was primarily due to a decrease in "Due from customers" and "Receivables from securities financing transactions."
- Capital Ratios: The CET1 ratio decreased slightly to 11.74% from 11.85%, while the Leverage Ratio improved to 5.41% from 5.30%.
- Liquidity: The NSFR decreased by 4.5 percentage points to 136.6%, driven by an increase in required stable funding (due to higher loans) and a decrease in available stable funding (due to lower customer deposits). The LCR remained robust at 142.4%.
- Invested Assets: Total invested assets (including double counts) declined to CHF 644 billion from CHF 715 billion, largely due to market movements of CHF -84 billion.
Guidance, Outlook, and Risks
- Dividend Proposal: The Board of Directors proposes an ordinary dividend distribution of CHF 2,700 million out of the total profit of CHF 2,707 million for the year ended December 31, 2022.
- Regulatory Compliance: The entity remains well above prudential requirements for capital and liquidity. The going concern capital requirement is 15.07%, and the eligible capital ratio stands at 16.77%.
- Joint and Several Liability: UBS Switzerland AG retains joint and several liability for approximately CHF 4 billion of contractual obligations of UBS AG existing as of the 2015 asset transfer date. Management assesses the probability of an outflow under this liability as remote.
- Climate Risk: Climate-related risks are managed at the Group level. Specific metrics for UBS Switzerland AG are reported in conjunction with UBS Group AG disclosures.
Investor Verification Checklist
- Verify the proposed dividend distribution of CHF 2,700 million at the Annual General Meeting of Shareholders.
- Confirm the impact of the NSFR decrease (to 136.6%) on future funding strategies and deposit retention.
- Review the composition of the CHF 4 billion joint and several liability exposure to UBS AG obligations.
- Monitor the trend in invested assets, which declined significantly due to market movements in 2022.
- Assess the stability of the CET1 ratio (11.74%) against the Swiss SRB going concern requirement of 15.07% (including buffers).