Business Context and Reporting Period
This Form 6-K filing by UBS Group AG and UBS AG, dated July 29, 2022, presents standalone interim financial information for the six months ended June 30, 2022. The filing includes unaudited financial statements for UBS Group AG (the holding company) and UBS Switzerland AG (a significant regulated subsidiary), prepared in accordance with Swiss GAAP.
Key Financial Metrics
UBS Group AG (Holding Company)
| Metric (USD millions) | YTD Jun 30, 2022 | YTD Jun 30, 2021 |
|---|---|---|
| Operating Income | 5,374 | 5,607 |
| Operating Profit Before Tax | 4,409 | 4,672 |
| Net Profit | 4,399 | 4,668 |
| Total Assets | 107,916 | 105,448 (Dec 31, 2021) |
| Total Liabilities | 67,380 | 64,727 (Dec 31, 2021) |
| Equity Attributable to Shareholders | 40,536 | 40,720 (Dec 31, 2021) |
Primary Income Source: Dividend income from the investment in UBS AG totaled USD 4,200 million.
UBS Switzerland AG (Subsidiary)
| Metric (CHF millions) | YTD Jun 30, 2022 | YTD Jun 30, 2021 |
|---|---|---|
| Total Operating Income | 4,404 | 4,224 |
| Net Interest Income | 1,627 | 1,588 |
| Net Fee and Commission Income | 2,221 | 2,131 |
| Operating Profit | 1,593 | 1,382 |
| Net Profit | 1,298 | 1,121 |
| Total Assets | 323,248 | 320,656 (Dec 31, 2021) |
| Total Liabilities | 309,164 | 305,919 (Dec 31, 2021) |
| Total Equity | 14,084 | 14,736 (Dec 31, 2021) |
Material Changes vs. Prior Period
- UBS Group AG Profitability: Net profit decreased by approximately 5.8% year-over-year (from USD 4,668 million to USD 4,399 million), primarily driven by a decline in dividend income from UBS AG (USD 4,200 million vs. USD 4,539 million).
- UBS Switzerland AG Profitability: Net profit increased by approximately 15.8% year-over-year (from CHF 1,121 million to CHF 1,298 million). This was supported by higher net fee and commission income (CHF 2,221 million vs. CHF 2,131 million) and net trading income (CHF 497 million vs. CHF 391 million), despite a shift from a credit loss release in 2021 to a credit loss expense of CHF 46 million in 2022.
- Balance Sheet Movements: UBS Group AG current assets decreased significantly from USD 7,872 million to USD 4,340 million, while non-current assets increased. UBS Switzerland AG saw a rise in mortgage loans (CHF 162,407 million) and cash at central banks (CHF 86,800 million).
Guidance, Outlook, and Unusual Items
Dividends and Capital Management: In Q2 2022, UBS Group AG paid an ordinary cash dividend of USD 0.50 per share (totaling USD 1,668 million). Half was funded from the capital contribution reserve and half from total profit available for appropriation. The remaining profit was appropriated to the voluntary earnings reserve.
Share Repurchases: The filing notes the cancellation of 177,787,273 shares under the 2021 share repurchase program, reducing share capital by USD 18 million and impacting reserves by USD 1,502 million each for the capital contribution and voluntary earnings reserves.
Joint and Several Liability: UBS Switzerland AG retains joint liability for approximately CHF 4 billion of contractual obligations of UBS AG existing as of the 2015 asset transfer date (down from CHF 5 billion at year-end 2021). Management assesses the probability of an outflow under this liability as remote.
Guidance: The filing text does not provide specific forward-looking guidance or outlook for future periods beyond the historical data presented.
Investor Verification Checklist
- Verify the impact of the 2021 share repurchase program cancellation on the capital contribution and voluntary earnings reserves.
- Confirm the composition of the USD 4,200 million dividend income received by UBS Group AG from UBS AG.
- Review the credit loss expense of CHF 46 million at UBS Switzerland AG compared to the release in the prior year to assess asset quality trends.
- Monitor the CHF 4 billion joint and several liability exposure of UBS Switzerland AG regarding UBS AG obligations.
- Check the full UBS Group Annual Report 2021 for detailed accounting policies referenced in the "Basis of accounting" sections.