UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
Date: March 10, 2017
UBS Group AG
Commission File Number: 1-36764
UBS AG
Commission File Number: 1-15060
(Registrants' Names)
Bahnhofstrasse 45, Zurich, Switzerland, and
Aeschenvorstadt 1, Basel, Switzerland
(Address of
principal executive office)
Indicate by check mark whether the registrant
files or will file annual reports under cover of Form 20‑F or Form 40-F.
This Form 6-K consists of the UBS Group AG audited
standalone financial statements for the year ended 31 December 2016, as well as
the consent of Ernst & Young Ltd. with respect thereto, which appear
immediately following this page.
UBS Group AG
Standalone financial statements for the
year ended 31 December 2016
UBS Group AG standalone financial
statements
Audited |
|
Income
statement
|
|
|
|
|
|
|
|
|
|
|
|
|
For the year ended
|
|
% change from
|
|
CHF million
|
|
Note
|
|
31.12.16
|
31.12.15
|
|
31.12.15
|
|
Dividend income from the investment in UBS AG
|
|
3
|
|
5,684
|
2,869
|
|
98
|
|
Other operating income
|
|
4
|
|
44
|
49
|
|
(11)
|
|
Financial income
|
|
5
|
|
475
|
294
|
|
61
|
|
Operating income
|
|
|
|
6,202
|
3,213
|
|
93
|
|
Personnel expenses
|
|
6
|
|
23
|
9
|
|
146
|
|
Other operating expenses
|
|
7
|
|
35
|
171
|
|
(80)
|
|
Financial expenses
|
|
8
|
|
512
|
267
|
|
91
|
|
Operating expenses
|
|
|
|
569
|
447
|
|
27
|
|
Profit / (loss) before income taxes
|
|
|
|
5,633
|
2,765
|
|
104
|
|
Tax expense / (benefit)
|
|
|
|
27
|
9
|
|
201
|
|
Net profit / (loss)
|
|
|
|
5,606
|
2,756
|
|
103
|
UBS Group AG standalone financial statements
|
Balance
sheet
|
|
|
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
Note
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
Liquid assets
|
|
9
|
|
1,714
|
|
1,442
|
|
19
|
|
Marketable securities
|
|
10
|
|
78
|
|
85
|
|
(8)
|
|
Other short-term receivables
|
|
11
|
|
2,830
|
|
632
|
|
348
|
|
Accrued income and prepaid expenses
|
|
12
|
|
469
|
|
264
|
|
78
|
|
Total current assets
|
|
|
|
5,090
|
|
2,422
|
|
110
|
|
Investments in subsidiaries
|
|
13
|
|
40,451
|
|
40,431
|
|
0
|
|
of which: investment in UBS
AG
|
|
|
|
40,376
|
|
40,376
|
|
0
|
|
Financial assets
|
|
14
|
|
8,162
|
|
5,475
|
|
49
|
|
Prepaid assets
|
|
|
|
27
|
|
54
|
|
(49)
|
|
Other intangible assets
|
|
|
|
21
|
|
0
|
|
|
|
Total non-current assets
|
|
|
|
48,661
|
|
45,959
|
|
6
|
|
Total assets
|
|
|
|
53,751
|
|
48,381
|
|
11
|
|
of which: amounts due from
subsidiaries
|
|
|
|
12,762
|
|
7,503
|
|
70
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
Current interest-bearing liabilities
|
|
|
|
595
|
|
736
|
|
(19)
|
|
Accrued expenses and deferred income
|
|
15
|
|
1,487
|
|
1,006
|
|
48
|
|
Total short-term liabilities
|
|
|
|
2,082
|
|
1,741
|
|
20
|
|
Long-term interest-bearing liabilities
|
|
16
|
|
7,865
|
|
5,106
|
|
54
|
|
Compensation-related long-term liabilities
|
|
17
|
|
3,479
|
|
3,119
|
|
12
|
|
Total long-term liabilities
|
|
|
|
11,344
|
|
8,225
|
|
38
|
|
Total liabilities
|
|
|
|
13,427
|
|
9,966
|
|
35
|
|
of which: amounts due to
subsidiaries
|
|
|
|
612
|
|
750
|
|
(18)
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
18
|
|
385
|
|
385
|
|
0
|
|
General reserves
|
|
|
|
34,886
|
|
37,006
|
|
(6)
|
|
of which: statutory capital
reserve
|
|
|
|
34,886
|
|
37,006
|
|
(6)
|
|
of which: capital
contribution reserve
|
|
|
|
34,886
|
|
38,035
|
|
(8)
|
|
of which: other capital
reserve
|
|
|
|
0
|
|
(1,029)
|
|
(100)
|
|
Voluntary earnings reserve
|
|
|
|
1,716
|
|
(10)
|
|
|
|
Treasury shares
|
|
19
|
|
(2,271)
|
|
(1,724)
|
|
32
|
|
Reserve for own shares held by subsidiaries
|
|
|
|
2
|
|
1
|
|
144
|
|
Net profit / (loss)
|
|
|
|
5,606
|
|
2,756
|
|
103
|
|
Equity attributable to
shareholders
|
|
|
|
40,324
|
|
38,415
|
|
5
|
|
Total liabilities and equity
|
|
|
|
53,751
|
|
48,381
|
|
11
|
Statement of
appropriation of retained earnings and proposed dividend distribution out of
capital contribution reserve
The Board of Directors proposes that
the Annual General Meeting of Shareholders (AGM) on
4
May 2017
approves the following appropriation of retained earnings.
Proposed appropriation of retained earnings
|
|
For the year ended
|
|
CHF million
|
31.12.16
|
|
Net profit for the period
|
5,606
|
|
Retained earnings carried forward
|
0
|
|
Total retained earnings
available for appropriation
|
5,606
|
|
|
|
|
Proposed appropriation of
retained earnings
|
|
|
Appropriation to voluntary earnings reserve
|
(5,606)
|
|
Retained earnings carried
forward
|
0
|
Proposed dividend distribution out
of capital contribution reserve
The Board of Directors proposes that
the AGM on 4 May 2017 approves an ordinary dividend distribution of CHF 0.60 in
cash per share of CHF 0.10 par value payable out of the capital contribution
reserve. Provided that the proposed dividend distribution out of the capital
contribution reserve is approved, the payment of CHF 0.60 per share will be
made on 10 May 2017 to holders of shares on the record date 9 May 2017. The
shares will be traded ex-dividend as of 8 May 2017 and, accordingly, the last
day on which the shares may be traded with entitlement to receive the dividend
will be 5 May 2017.
|
CHF million, except where
indicated
|
31.12.16
|
|
Total statutory capital
reserve: capital contribution reserve before proposed distribution¹
|
34,886
|
|
Proposed ordinary distribution of capital contribution reserve
within statutory capital reserve: CHF 0.60 per dividend-bearing share²
|
(2,310)
|
|
Total statutory capital
reserve: capital contribution reserve after proposed distribution
|
32,576
|
|
1 The Swiss Federal Tax Administration confirmed that UBS Group
AG would be able to repay to shareholders a maximum amount of CHF 23.4
billion of the disclosed capital contribution reserve (status as of 31 December
2015) without being subject to the withholding tax deduction that applies to
dividends paid out of retained earnings. As of 31 December 2016, the amount
decreased by CHF 3.2 billion as a consequence of the dividend distribution in
2016. 2 Dividend-bearing shares are all shares issued except for treasury
shares held by UBS Group AG as of the record date. The amount of CHF 2,310
million presented is based on the total number of shares issued as of 31
December 2016.
|
UBS Group AG standalone financial statements
Note
1
Corporate information
UBS Group AG is incorporated and
domiciled in Switzerland and its registered office is at Bahnhofstrasse 45,
CH-8001 Zurich, Switzerland. UBS Group AG operates under the Swiss Code of
Obligations as a corporation limited by shares (Aktiengesellschaft), a
corporation that has issued shares of common stock to investors.
UBS Group AG is the ultimate holding company
of the UBS Group, the grantor of the majority of UBS’s deferred compensation
plans, and also issues long-term capital instruments.
Establishment of UBS Group AG
UBS Group AG was incorporated on 10
June 2014 as a wholly owned subsidiary of UBS AG and on 29 September 2014, UBS
Group AG launched an offer to acquire all issued ordinary shares of UBS AG.
Following the exchange offer and subsequent private exchanges, UBS Group AG
acquired 96.68% of UBS AG shares by 31 December 2014.
In March 2015, UBS Group AG initiated a
procedure under article 33 of the Swiss Stock Exchange Act (SESTA procedure).
After the successful completion of the SESTA procedure in August 2015, UBS
Group AG owns 100% of the issued shares of UBS AG.
Transfer of
deferred compensation plans
As part of the Group reorganization
in 2014, UBS Group AG assumed obligations of UBS AG as grantor in connection
with certain outstanding awards under employee share, option, notional fund and
deferred cash compensation plans. At the same time, UBS Group AG acquired the
beneficial ownership of the financial assets and 90.5 million treasury shares
of UBS Group AG held to hedge the economic exposure arising from these plans.
As a result of the transfer, UBS Group AG assumed all responsibilities and
rights associated with the grantor role for these plans from UBS AG, including
the right of recharge to its subsidiaries employing the personnel.
Obligations relating to deferred compensation
plans which are required to be, and have been, granted by employing and / or
sponsoring subsidiaries have not been assumed by UBS Group AG and continue on
this basis. Furthermore, obligations related to other compensation awards, such
as defined benefit pension plans and other local awards, have not been assumed
by UBS Group AG and are retained by the relevant employing and / or sponsoring
subsidiaries.
Issuance of
additional tier 1 capital instruments
During 2016, UBS Group AG continued
to issue perpetual capital notes, which qualify as Basel III additional tier 1
(AT1) capital on a consolidated UBS Group basis. The proceeds from the
issuances of those instruments were on-lent to UBS AG for funding purposes.
®
Refer to Note 16 for more information on the main terms and
conditions of the perpetual capital notes issued during 2016 and 2015
Furthermore, UBS Group AG granted Deferred Contingent
Capital Plan (DCCP) awards to UBS Group employees during 2016 and 2015. These
DCCP awards also qualify as Basel III AT1 capital on a consolidated UBS Group
basis.
As of 31 December 2016, UBS Group AG
’
s distributable items for the purpose of additional tier 1
capital instruments were CHF 39.9 billion (31 December 2015: CHF 38.0 billion).
For this purpose, distributable items are defined in the terms and conditions
of the relevant instruments as the aggregate of (i) net profits carried forward
and (ii) freely distributable reserves, in each case, less any amounts that
must be contributed to legal reserves under applicable law.
Note
2 Accounting policies
The UBS Group AG standalone financial
statements are prepared in accordance with the principles of the Swiss Law on
Accounting and Financial Reporting (32nd title of the Swiss Code of
Obligations).
The functional currency of UBS Group AG is
the Swiss franc. The significant accounting and valuation principles applied
are described below.
Foreign currency translation
Transactions denominated in foreign
currency are translated into Swiss francs at the spot exchange rate on the date
of the transaction. At the balance sheet date, all current assets and short-term
liabilities as well as
Financial assets
measured at
fair value, which are denominated in a foreign currency, are translated into
Swiss francs using the closing exchange rate. For other non-current assets and long-term
liabilities, where the asset mirrors the terms of a corresponding liability or
the asset and liability otherwise form an economic hedge relationship, the
asset and liability are treated as one unit of account for foreign currency
translation purposes, with offsetting unrealized foreign currency translation
gains and losses based on the closing exchange rate presented net in the income
statement.
Investments in subsidiaries
measured at
historic cost are translated at the spot exchange rate on the date of the
transaction. All currency translation effects are recognized in the income
statement.
The main currency translation rates used by
UBS Group AG are provided in Note 34 to the consolidated financial statements.
Marketable securities
Marketable
securities
include investments in alternative
investment vehicles (AIVs) with a short-term holding period. The holding period
is deemed short-term if the vesting of the awards hedged by the AIV is within
12 months after the balance sheet date. These are equity instruments and are
measured at fair value based on quoted market prices or other observable market
prices as of the balance sheet date. Gains and losses resulting from fair value
changes are recognized in
Financial income
and
Financial expenses,
respectively.
Financial assets
Financial assets
include investments in AIVs with a long-term holding period. The
holding period is deemed long-term if the vesting of the awards hedged by the
AIV is more than 12 months after the balance sheet date. These are equity
instruments and are measured at fair value based on their quoted market prices
or other observable market prices as of the balance sheet date. Gains and
losses resulting from fair value changes are recognized in
Financial
income
and
Financial expenses,
respectively.
Investments in AIVs that have no quoted
market price or no other observable market price are recognized as
Financial assets
and are measured at their acquisition cost
adjusted for impairment losses.
Financial assets
further include loans granted to UBS AG which substantially mirror the
terms of additional tier 1 perpetual capital notes issued. The loans are
measured at nominal value.
®
Refer to Note 14 for more information
Investments in subsidiaries
Investments in subsidiaries are
equity interests that are held to carry on the business of UBS Group or for
other strategic purposes. They include all subsidiaries directly held by UBS
Group AG through which UBS conducts its business on a global basis. The
investments are measured individually and carried at cost less impairment.
®
Refer to Note 13 for more information
®
Refer to Note
2
in the “Consolidated
financial statements” section of this report for a description of businesses of
the UBS Group
Treasury shares
Treasury shares acquired by UBS Group
AG are recognized at acquisition cost and are presented as a deduction from
shareholders’ equity. Upon disposal or settlement of related share awards, the
realized gain or loss is recognized through the income statement as
Financial income
and
Financial expenses
,
respectively. For settlement of related share awards, the realized gains and
losses on treasury shares represent the difference between the market price of
the treasury shares at settlement and their acquisition cost.
For shares of UBS Group AG acquired by a
direct or indirect subsidiary, a
Reserve for own shares held
by subsidiaries
is generally created in UBS Group AG’s equity. However,
where UBS AG or UBS Switzerland AG acquire shares of UBS Group AG and hold them
in their trading portfolios, no
Reserve for own shares held
by subsidiaries
is
created.
®
Refer to Note 19 for more information
UBS Group AG standalone financial statements
Note
2 Accounting policies
(continued)
Equity
participation and other compensation plans
Transfer from UBS AG to UBS Group AG
The transfer of the deferred
compensation plans and related hedging assets in 2014 was conducted on an arm’s
length basis, with a step-up of the plan obligation to fair value. This step-up
resulted in a net liability that was recorded in the standalone financial
statements of UBS AG and transferred to UBS Group AG (net liability related to
deferred compensation plan transfer) in 2014. The fair value of this net
liability is taken into account in the income statement over the average
vesting period (for share awards) or upon exercise / expiry (for option awards)
as
Other operating
income.
Upon exercise of option awards that are settled using
conditional capital, the fair value of this net liability is recorded in the
Statutory capital reserve
within
General reserves.
The difference between the fair value of the hedging assets and the
fair value of the obligations on the plans transferred was compensated for with
a loan from UBS AG to UBS Group AG.
Equity participation plans
The grant date fair value of
equity-settled share-based compensation awards granted to employees is
generally recognized over the vesting period of the awards. Awards granted in
the form of UBS Group AG shares and notional shares are settled by delivering
UBS Group AG shares at vesting and are recognized as
Compensation-related
long-term liabilities
if vesting is more than 12 months after the
balance sheet date or as
Accrued expenses and deferred
income
if vesting is within 12 months from the balance sheet date. The
amount recognized is adjusted for forfeiture assumptions, such that the amount
ultimately recognized is based on the number of awards that meet the related
service conditions at the vesting date. The grant date fair value is based on
the UBS Group AG share price, taking into consideration post-vesting sale and
hedge restrictions, non-vesting conditions and market conditions, where
applicable.
Upon settlement of the share awards, any
realized gain or loss is recognized in the income statement as
Other operating income
and
Other
operating expenses,
respectively. Realized gains and losses on share
awards represent the difference between the market price of the treasury shares
at settlement and the grant date fair value of the share awards.
For certain awards, employees receive
beneficial and legal ownership of the underlying UBS Group AG shares at the
grant date (prepaid awards). Such prepaid awards are recognized as
Prepaid assets
if vesting is more than 12 months after the
balance sheet date or as
Accrued income and prepaid expenses
if vesting is within 12 months from the balance sheet date.
Shares awarded to employees that are settled
using conditional capital are accounted for as follows at settlement: the
amount paid by the employees for the nominal value of the shares awarded is
recorded in
Share capital
, while any paid amount
exceeding the nominal value is considered to be share premium and is recorded
in the
Statutory capital reserve
within
General reserves.
Other compensation plans
Deferred compensation plans that are
not share-based, including DCCP awards and awards in the form of AIVs, are
accounted for as cash-settled awards. The present value or fair value of the
amount payable to employees that is settled in cash is recognized as a
liability generally over the vesting period, as
Compensation-related
long-term liabilities
if vesting is more than 12 months after the
balance sheet date and as
Accrued expenses and deferred
income
if vesting is within 12 months from the balance sheet date. The
liabilities are remeasured at each balance sheet date at the present value of
the corresponding DCCP award and the fair value of investments in AIVs,
respectively. Gains and losses resulting from remeasurement of the liabilities
are recognized in
Other operating income
and
Other operating expenses
, respectively.
Recharge of compensation expenses
Expenses related to deferred
compensation plans are recharged by UBS Group AG to its subsidiaries employing
the personnel. Upon recharge, UBS Group AG recognizes a receivable from its
subsidiaries corresponding to a liability representing its obligation toward employees.
Dispensations in the standalone
financial statements
As UBS Group AG prepares consolidated
financial statements in accordance with IFRS, UBS Group AG is exempt from
various disclosures in the standalone financial statements. The dispensations
include the management report and the statement of cash flows, as well as
certain note disclosures.
Income statement notes
Note
3 Dividend income from the investment in UBS AG
Dividend income received from UBS AG in 2016 consists of CHF 3,434
million related to the financial year ended 31 December 2015, which was
approved by the Annual General Meeting of Shareholders of UBS AG on 4 May 2016,
and CHF 2,250 million related to the financial year ended 31 December 2016,
which was approved by the Annual General Meeting of Shareholders of UBS AG on 2
March 2017.
Note
4 Other operating income
|
|
|
For the year ended
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Fair value gains on alternative investment vehicles awards
|
|
6
|
|
13
|
|
(57)
|
|
Gains related to equity-settled awards
|
|
24
|
|
29
|
|
(18)
|
|
Amortization of net liability related to deferred compensation
plan transfer
|
|
2
|
|
6
|
|
(64)
|
|
Commission income from guarantees issued
|
|
12
|
|
1
|
|
813
|
|
Total other operating income
|
|
44
|
|
49
|
|
(11)
|
Note
5 Financial income
|
|
|
For the year ended
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Treasury share gains
|
|
0
|
|
32
|
|
(100)
|
|
Interest income on long-term receivables from UBS AG
|
|
470
|
|
253
|
|
86
|
|
Foreign currency translation gains
|
|
4
|
|
10
|
|
(58)
|
|
Total financial income
|
|
475
|
|
294
|
|
61
|
Note
6 Personnel expenses
Personnel expenses include recharges
from UBS AG for personnel-related costs for activities performed by UBS AG
personnel for the benefit of UBS Group AG.
UBS Group AG had no employees throughout 2016
and 2015. All employees of the UBS Group, including the members of the Group
Executive Board (GEB) of UBS Group AG, were employed by subsidiaries of UBS
Group AG. As of 31 December 2016, the UBS Group employed 59,387 personnel (31
December 2015: 60,099) on a full-time equivalent basis.
Note
7 Other operating expenses
|
|
|
For the year ended
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Losses related to equity-settled awards
|
|
3
|
|
147
|
|
(98)
|
|
Capital tax
|
|
13
|
|
13
|
|
(1)
|
|
Stamp tax
|
|
0
|
|
1
|
|
(75)
|
|
Other
|
|
18
|
|
11
|
|
71
|
|
Total other operating
expenses
|
|
35
|
|
171
|
|
(80)
|
Note
8 Financial expenses
|
|
|
For the year ended
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Fair value losses on marketable securities and financial assets
|
|
3
|
|
12
|
|
(77)
|
|
Impairment losses on financial assets
|
|
3
|
|
1
|
|
322
|
|
Treasury share losses
|
|
35
|
|
0
|
|
|
|
Interest expense on interest-bearing liabilities
|
|
469
|
|
255
|
|
84
|
|
Brokerage fees paid
|
|
2
|
|
0
|
|
|
|
Total financial expenses
|
|
512
|
|
267
|
|
91
|
UBS Group AG standalone financial statements
Balance sheet notes
Liquid assets comprise current
accounts held at UBS Switzerland AG.
Note
10 Marketable
securities
Marketable securities include investments in AIVs related to
compensation awards vesting within 12 months after the balance sheet date.
Note
11 Other
short-term receivables
As of 31 December 2016, other short-term receivables were mainly
comprised of a CHF 2,250 million dividend receivable from UBS AG related to the
financial year ended 31 December 2016 and CHF 557 million in receivables from
employing entities related to compensation awards. As of 31 December 2015,
other short-term receivables were mainly comprised of CHF 632 million in
receivables from employing entities related to compensation awards.
Note
12 Accrued income and prepaid expenses
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Accrued interest income
|
|
375
|
|
257
|
|
46
|
|
Other prepaid expenses
|
|
93
|
|
7
|
|
|
|
Total accrued income and
prepaid expenses
|
|
469
|
|
264
|
|
78
|
Note
13
Investments in subsidiaries
Unless otherwise stated, the
subsidiaries listed in the tables below have share capital consisting solely of
ordinary shares, which are held by UBS Group AG or UBS AG, respectively. The proportion
of ownership interest held is equal to the voting rights held by UBS Group AG
or UBS AG, respectively. The country where the respective registered office is
located is also the principal place of business. UBS AG operates through a
global network of branches and a significant proportion of its business
activity is conducted outside Switzerland in the UK, US, Asia Pacific and other
countries. UBS Europe SE has branches and offices in a number of EU member
states, including branches in Germany, Italy, Luxembourg and Spain.
|
Subsidiaries
of UBS Group AG as of 31 December 2016
|
|
Company
|
Registered office
|
|
Share capital in million
|
Equity interest accumulated in %
|
|
UBS AG
|
Zurich and Basel, Switzerland
|
|
CHF
|
385.8
|
100.0
|
|
UBS Business Solutions AG
|
Zurich, Switzerland
|
|
CHF
|
1.0
|
100.0
|
|
UBS Group Funding (Jersey) Ltd.
|
St. Helier, Jersey
|
|
CHF
|
0.0
|
100.0
|
|
UBS Group Funding (Switzerland) AG
|
Zurich, Switzerland
|
|
CHF
|
0.1
|
100.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Individually
significant subsidiaries of UBS AG as of 31 December 2016
|
|
Company
|
Registered office
|
Primary business division
|
Share capital in million
|
Equity interest accumulated in %
|
|
UBS Americas Holding LLC
|
Wilmington, Delaware, USA
|
Corporate Center
|
USD
|
2,250.0¹
|
100.0
|
|
UBS Asset Management AG
|
Zurich, Switzerland
|
Asset Management
|
CHF
|
43.2
|
100.0
|
|
UBS Bank USA
|
Salt Lake City, Utah, USA
|
Wealth Management Americas
|
USD
|
0.0
|
100.0
|
|
UBS Europe SE
|
Frankfurt, Germany
|
Wealth Management
|
EUR
|
176.0
|
100.0
|
|
UBS Financial Services Inc.
|
Wilmington, Delaware, USA
|
Wealth Management Americas
|
USD
|
0.0
|
100.0
|
|
UBS Limited
|
London, United Kingdom
|
Investment Bank
|
GBP
|
226.6
|
100.0
|
|
UBS Securities LLC
|
Wilmington, Delaware, USA
|
Investment Bank
|
USD
|
1,283.1²
|
100.0
|
|
UBS Switzerland AG
|
Zurich, Switzerland
|
Personal & Corporate Banking
|
CHF
|
10.0
|
100.0
|
|
1 Comprised of common share capital of USD 1,000 and non-voting
preferred share capital of USD 2,250,000,000. 2 Comprised of common share
capital of USD 100,000 and non-voting preferred share capital of USD
1,283,000,000.
|
Individually significant subsidiaries
of UBS AG are those entities that contribute significantly to the Group’s
financial position or results of operations, based on a number of criteria,
including the subsidiaries’ equity and their contribution to the Group’s total assets
and profit or loss before tax, in accordance with Swiss regulations.
During 2016, the majority of the operating
subsidiaries of Asset Management were transferred to UBS Asset Management AG to
create a holding structure spanning the division’s global activities outside
the US. Also in 2016
,
UBS AG’s direct Wealth Management subsidiaries UBS (Italia) SpA,
UBS (Luxembourg) S.A. (including its branches in Austria, Denmark and Sweden),
UBS Bank S.A. (Madrid) and UBS Bank (Netherlands) B.V. were merged into UBS
Deutschland AG, which was renamed to UBS Europe SE and is headquartered in
Frankfurt, Germany.
UBS Americas Holding LLC, UBS Asset
Management AG, UBS Europe SE, UBS Limited and UBS Switzerland AG are fully held
by UBS AG. UBS Bank USA, UBS Financial Services Inc. and UBS Securities LLC are
fully held, directly or indirectly, by UBS Americas Holding LLC.
®
Refer to Note 28 in the “Consolidated financial statements” section
of this report for more information
Note
14 Financial assets
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Long-term receivables from UBS AG¹
|
|
7,865
|
|
5,171
|
|
52
|
|
Investments in alternative investment vehicles at fair value
related to awards vesting after 12 months
|
|
291
|
|
294
|
|
(1)
|
|
Investments in alternative investment vehicles at cost less
impairment
|
|
6
|
|
9
|
|
(33)
|
|
Total financial assets
|
|
8,162
|
|
5,475
|
|
49
|
|
1 Long-term receivables from UBS AG include the onward lending
of the proceeds from the issuances of additional tier 1 perpetual capital
notes.
|
UBS Group AG standalone financial statements
Note
15 Accrued
expenses and deferred income
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Short-term portion of net liability related to deferred
compensation plan transfer
|
|
1
|
|
2
|
|
(70)
|
|
Short-term portion of compensation liabilities
|
|
1,048
|
|
720
|
|
46
|
|
of which: Deferred
Contingent Capital Plan
|
|
93
|
|
65
|
|
44
|
|
of which: other deferred compensation
plans
|
|
955
|
|
655
|
|
46
|
|
Accrued interest expense
|
|
374
|
|
255
|
|
46
|
|
Other
|
|
65
|
|
29
|
|
126
|
|
Total accrued expenses and
deferred income
|
|
1,487
|
|
1,006
|
|
48
|
Note
16 Long-term interest-bearing liabilities
|
Notes
issued, overview by amount, maturity and coupon
|
|
31.12.16
|
|
|
|
|
31.12.15
|
|
in million, except where
indicated
|
|
|
Carrying value in transaction currency
|
Carrying value in CHF
|
|
Maturity¹
|
Coupon¹
|
|
Carrying value in transaction currency
|
Carrying value in CHF
|
|
Euro-denominated low-trigger loss-absorbing additional tier 1
perpetual capital notes
|
|
|
1,000
|
1,071
|
|
19.02.22
|
5.750%
|
|
988
|
1,075
|
|
US dollar-denominated low-trigger loss-absorbing additional tier
1 perpetual capital notes
|
|
|
1,250
|
1,272
|
|
19.02.25
|
7.000%
|
|
1,234
|
1,236
|
|
US dollar-denominated high-trigger loss-absorbing additional
tier 1 perpetual capital notes
|
|
|
1,250
|
1,272
|
|
19.02.20
|
7.125%
|
|
1,234
|
1,236
|
|
US dollar-denominated high-trigger loss-absorbing additional
tier 1 perpetual capital notes
|
|
|
1,575
|
1,603
|
|
07.08.25
|
6.875%
|
|
1,555
|
1,558
|
|
US dollar-denominated high-trigger loss-absorbing additional
tier 1 perpetual capital notes
|
|
|
1,500
|
1,527
|
|
22.03.21
|
6.875%
|
|
|
|
|
US dollar-denominated high-trigger loss-absorbing additional
tier 1 perpetual capital notes
|
|
|
1,100
|
1,120
|
|
10.08.21
|
7.125%
|
|
|
|
|
Total long-term
interest-bearing liabilities
|
|
|
|
7,865
|
|
|
|
|
|
5,106
|
|
1 The disclosed maturity refers to the optional first call date
of the respective issuance and the disclosed coupon refers to the fixed
coupon rate from the issue date up to, but excluding, the optional first call
date.
|
Note
17 Compensation-related long-term liabilities
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Long-term portion of net liability related to deferred
compensation plan transfer
|
|
10
|
|
11
|
|
(11)
|
|
Long-term portion of compensation liabilities
|
|
3,469
|
|
3,107
|
|
12
|
|
of which: Deferred
Contingent Capital Plan
|
|
1,532
|
|
1,109
|
|
38
|
|
of which: other deferred
compensation plans
|
|
1,937
|
|
1,999
|
|
(3)
|
|
Total compensation-related
long-term liabilities
|
|
3,479
|
|
3,119
|
|
12
|
On
31
December 2016
, the issued share capital consisted of 3,850,766,389 (31
December 2015: 3,849,731,535) registered shares at a par value of CHF 0.10
each.
®
Refer to the “UBS shares” section of this report for more
information on UBS Group AG shares
Note
19 Treasury
shares
|
|
Number of registered shares
|
Average price in CHF
|
|
Balance as of 31 December
2014
|
87,871,737
|
16.94
|
|
of which: treasury shares
held by UBS Group AG
|
90,176,988
|
16.95
|
|
of which: short sales of
treasury shares by UBS AG and other subsidiaries
|
(2,305,251)
|
17.30
|
|
Share-for-share exchange
|
(100,923)
|
19.90
|
|
Acquisitions
|
89,594,586
|
17.57
|
|
Disposals
|
(27,510,789)
|
17.08
|
|
Delivery of shares to settle equity-settled awards
|
(51,148,336)
|
17.29
|
|
Balance as of 31 December
2015
|
98,706,275
|
17.51
|
|
of which: treasury shares
held by UBS Group AG¹
|
98,465,708
|
17.50
|
|
of which: treasury shares
held by UBS AG and other subsidiaries
|
240,567
|
19.51
|
|
Acquisitions
|
90,448,847
|
15.49
|
|
Disposals
|
(2,721,710)
|
17.82
|
|
Delivery of shares to settle equity-settled awards
|
(47,991,640)
|
16.86
|
|
Balance as of 31 December
2016
|
138,441,772
|
16.41
|
|
of which: treasury shares
held by UBS Group AG¹
|
138,386,307
|
16.41
|
|
of which: treasury shares
held by UBS AG and other subsidiaries
|
55,465
|
16.06
|
|
1 Treasury shares held by UBS Group AG had a carrying value of
CHF 2,271 million as of 31 December 2016 (31 December 2015: CHF 1,724
million).
|
UBS Group AG standalone financial statements
Additional information
As of 31 December 2016, UBS Group AG had
issued senior unsecured debt through its subsidiary UBS Group Funding (Jersey)
Ltd for a nominal amount equivalent to CHF 17,281 million (31 December 2015:
CHF 5,668 million). This debt contributes to the total loss-absorbing capacity
(TLAC) of the Group. UBS Group AG issued guarantees to the external investors
against any default in payments of interest and principal by UBS Group Funding
(Jersey) Ltd.
Note
21 Assets
pledged to secure own liabilities
As of 31 December 2016, total pledged
assets of UBS Group AG amounted to CHF 4,134 million. These assets consisted of
certain liquid assets, marketable securities and financial assets and were
pledged to UBS AG. As of 31 December 2015, total pledged assets of UBS Group AG
amounted to CHF 41,835 million and primarily consisted of the investment in UBS
AG. The associated liabilities secured by these pledged assets were CHF 524 million
and CHF 581 million as of 31 December 2016 and 31 December 2015, respectively.
Note
22
Contingent liabilities
UBS Group AG is jointly and severally
liable for the combined value added tax (VAT) liability of UBS entities that
belong to the VAT group of UBS in Switzerland.
Note
23 Significant shareholders
|
Shareholders
registered in the UBS Group AG share register with 3% or more of total share
capital
|
|
% of share capital
|
31.12.16
|
31.12.15
|
|
Chase Nominees Ltd., London
|
9.43
|
9.14
|
|
GIC Private Limited, Singapore
|
|
6.38
|
|
DTC (Cede & Co.), New York¹
|
6.62
|
6.14
|
|
Nortrust Nominees Ltd., London
|
3.88
|
3.60
|
|
1 DTC (Cede & Co.), New York, “The Depository Trust
Company,” is a US securities clearing organization.
|
Under the Swiss Federal Act on
Financial Market Infrastructures and Market Conduct in Securities and
Derivatives Trading of 19 June 2015 (FMIA), anyone holding shares in a company
listed in Switzerland, or holding derivative rights related to shares of such a
company, must notify the company and the SIX Swiss Exchange (SIX) if the
holding reaches, falls below or exceeds one of the following thresholds: 3, 5,
10, 15, 20, 25, 33
1
⁄
3
, 50, or 66
2
⁄
3
%
of voting rights, regardless of whether or not such rights may be exercised.
The detailed disclosure requirements and the methodology for calculating the
thresholds are defined in the Swiss Financial Market Supervisory Authority
Ordinance on Financial Market Infrastructure (FMIO-FINMA). In particular, the
FMIO-FINMA sets forth that nominee companies that cannot autonomously decide
how voting rights are exercised are not obligated to notify the company and SIX
if they reach, exceed or fall below the threshold percentages.
In addition, pursuant to the Swiss Code of
Obligations, UBS must disclose in the Notes to its financial statements the
identity of any shareholder with a holding of more than 5% of the total share
capital of UBS Group AG.
According to disclosure notifications filed
with UBS Group AG and the SIX under the applicable Swiss rules, GIC Private
Limited disclosed on 10 December 2014 a holding of 7.07% of the total share
capital of UBS Group AG. The beneficial owner of this holding is the Government
of Singapore. On 10 December 2014, Norges Bank, Oslo, the Central Bank of
Norway, disclosed a holding of 3.30%. On 15 January 2015, BlackRock Inc., New
York, disclosed a holding of 4.89%. On 10 February 2016, MFS Investment
Management, Boston, disclosed a holding of 3.05%, and on 16 November 2016, The
Capital Group Companies, Inc., Los Angeles, disclosed a holding of 3.01%.
In accordance with the FMIA, the
aforementioned percentages were holdings that are not necessarily also
registered in the UBS share register and calculated in relation to the total
share capital of UBS Group AG reflected in the AoA at the time of the
respective disclosure notification. Information on disclosures under the FMIA
is available at
www.six-exchange-regulation.com/en/home/publications/significant-shareholders.html
.
According to the share register, the
shareholders (acting in their own name or in their capacity as nominees for
other investors or beneficial owners) listed in the table above were registered
in the UBS share register with 3% or more of the total share capital of UBS
Group AG as of 31 December 2016 or as of 31 December 2015.
Cross-shareholdings
We have no cross-shareholdings in
excess of a reciprocal ownership of 5% of capital or voting rights with any
other company.
UBS Group AG standalone financial statements
Note
24 Share and option ownership of the members of the Board
of Directors, the Group Executive Board and other employees
|
Shares
awarded
|
|
|
|
|
|
|
|
|
|
For the year ended 31.12.16
|
|
For the year ended 31.12.15
|
|
|
|
Number of shares
|
Value of shares in CHF million
|
|
Number of shares
|
Value of shares in CHF million
|
|
Awarded to members of the BoD
|
|
411,962
|
6
|
|
425,258
|
7
|
|
Awarded to members of the GEB
|
|
2,572,329
|
39
|
|
2,230,800
|
37
|
|
Awarded to other UBS Group employees
|
|
79,900,730
|
1,107
|
|
64,213,472
|
1,042
|
|
Total
|
|
82,885,021
|
1,152
|
|
66,869,530
|
1,087
|
®
Refer to the “Corporate governance, responsibility and compensation”
section in this report for more information on the terms and conditions of the
shares and options awarded to the members of the Board of Directors and the
Group Executive Board
|
Number
of shares of BoD members¹
|
|
Name, function
|
on 31 December
|
Number of shares held
|
Voting rights in %
|
|
Axel A. Weber, Chairman
|
2016
|
635,751
|
0.038
|
|
2015
|
488,889
|
0.026
|
|
Michel Demaré, Vice Chairman
|
2016
|
254,287
|
0.015
|
|
2015
|
215,992
|
0.012
|
|
David Sidwell, Senior Independent Director
|
2016
|
205,540
|
0.012
|
|
2015
|
163,317
|
0.009
|
|
Reto Francioni, member
|
2016
|
51,567
|
0.003
|
|
2015
|
28,787
|
0.002
|
|
Ann F. Godbehere, member
|
2016
|
201,457
|
0.012
|
|
2015
|
169,054
|
0.009
|
|
Axel P. Lehmann, former member²
|
2016
|
–
|
–
|
|
2015
|
252,761
|
0.014
|
|
William G. Parrett, member
|
2016
|
104,385
|
0.006
|
|
2015
|
104,271
|
0.006
|
|
Isabelle Romy, member
|
2016
|
91,038
|
0.005
|
|
2015
|
66,490
|
0.004
|
|
Robert W. Scully, member²
|
2016
|
0
|
0.000
|
|
2015
|
–
|
–
|
|
Beatrice Weder di Mauro, member
|
2016
|
99,737
|
0.006
|
|
2015
|
71,261
|
0.004
|
|
Dieter Wemmer, member²
|
2016
|
0
|
0.000
|
|
2015
|
–
|
–
|
|
Joseph Yam, member
|
2016
|
109,938
|
0.007
|
|
2015
|
87,354
|
0.005
|
|
Total
|
2016
|
1,753,700
|
0.104
|
|
2015
|
1,648,176
|
0.088
|
|
1 Includes blocked and unblocked shares held by BoD members,
including those held by related parties. No options were granted in 2016 and
2015. 2 Dieter Wemmer and Robert W. Scully were newly elected at the AGM
on 10 May 2016 and Axel P. Lehmann stepped down from the BoD as of 31
December 2015 and joined the GEB on 1 January 2016.
|
Note
24 Share and option ownership of the members of the Board
of Directors, the Group Executive Board and other employees
(continued)
|
Share
and option ownership / entitlements of GEB members¹
|
|
Name, function
|
on
31 December
|
Number of
unvested
shares / at risk²
|
Number of
vested shares
|
Total number of shares
|
Potentially
conferred
voting
rights in %
|
Number of options³
|
Potentially
conferred
voting
rights in %⁴
|
|
Sergio P. Ermotti, Group Chief Executive Officer
|
2016
|
1,365,537
|
265,515
|
1,631,052
|
0.097
|
0
|
0.000
|
|
2015
|
947,964
|
155,736
|
1,103,700
|
0.059
|
0
|
0.000
|
|
Martin Blessing, President Personal & Corporate Banking and
President UBS Switzerland
|
2016
|
0
|
0
|
0
|
0.000
|
0
|
0.000
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Christian Bluhm, Group Chief Risk Officer
|
2016
|
0
|
0
|
0
|
0.000
|
0
|
0.000
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Markus U. Diethelm, Group General Counsel
|
2016
|
538,520
|
154,820
|
693,340
|
0.041
|
0
|
0.000
|
|
2015
|
447,694
|
61,797
|
509,491
|
0.027
|
0
|
0.000
|
|
Lukas Gähwiler, former President Personal & Corporate
Banking and President UBS Switzerland
|
2016
|
–
|
–
|
–
|
|
–
|
|
|
2015
|
558,657
|
1,515
|
560,172
|
0.030
|
0
|
0.000
|
|
Kirt Gardner, Group Chief Financial Officer
|
2016
|
142,646
|
38,581
|
181,227
|
0.011
|
0
|
0.000
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Sabine Keller-Busse, Group Head Human Resources
|
2016
|
200,272
|
120,897
|
321,169
|
0.019
|
0
|
0.000
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Ulrich Körner, President Asset Management and President UBS EMEA
|
2016
|
797,165
|
95,597
|
892,762
|
0.053
|
0
|
0.000
|
|
2015
|
642,813
|
95,597
|
738,410
|
0.039
|
0
|
0.000
|
|
Axel P. Lehmann, Group Chief Operating Officer
|
2016
|
0
|
277,978
|
277,978
|
0.017
|
0
|
0.000
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Tom Naratil, President Wealth Management Americas and President
UBS Americas
|
2016
|
838,193
|
352,634
|
1,190,827
|
0.071
|
412,917
|
0.025
|
|
2015
|
598,172
|
310,054
|
908,226
|
0.049
|
555,115
|
0.030
|
|
Andrea Orcel, President Investment Bank
|
2016
|
1,203,535
|
207,114
|
1,410,649
|
0.084
|
0
|
0.000
|
|
2015
|
933,686
|
117,646
|
1,051,332
|
0.056
|
0
|
0.000
|
|
Kathryn Shih, President UBS Asia Pacific
|
2016
|
567,777
|
0
|
567,777
|
0.034
|
143,869
|
0.009
|
|
2015
|
–
|
–
|
–
|
|
–
|
|
|
Jürg Zeltner, President Wealth Management
|
2016
|
881,976
|
1,075
|
883,051
|
0.053
|
64,164
|
0.004
|
|
2015
|
683,767
|
3,721
|
687,488
|
0.037
|
86,279
|
0.005
|
|
Total
|
2016
|
6,535,621
|
1,514,211
|
8,049,832
|
0.479
|
620,950
|
0.037
|
|
2015
|
6,747,010
|
1,677,989
|
8,424,999
|
0.450
|
1,401,686
|
0.075
|
|
1 Includes all vested and unvested shares and options of GEB
members, including those held by related parties. 2 Includes shares
granted under variable compensation plans with forfeiture provisions. The
actual number of shares vesting in the future will be calculated under the
terms of the plans. Refer to the “Our deferred variable compensation plans
for 2016” in the “Compensation” section of this report for more information
on the plans. 3 Refer to “Note 27 Equity participation and other
compensation plans” in the “Consolidated financial statements” section of
this report for more information. 4 No conversion rights outstanding.
|
Related parties are defined under the
Swiss Code of Obligations as direct and indirect participants with voting
rights of 20% or more, management bodies (BoD and GEB), external auditors and
direct and indirect investments in subsidiaries. Payables due to members of the
GEB are provided in the table below. Amounts due from and due to subsidiaries
are provided on the face of the balance sheet.
|
|
|
|
|
|
|
% change from
|
|
CHF million
|
|
31.12.16
|
|
31.12.15
|
|
31.12.15
|
|
Payables due to the members of the GEB
|
|
119
|
|
139
|
|
(14)
|
|
of which: Deferred
Contingent Capital Plan
|
|
51
|
|
53
|
|
(4)
|
|
of which: other deferred
compensation plans
|
|
68
|
|
86
|
|
(21)
|
▲
This Form 6-K is hereby
incorporated by reference into (1) each of the registration statements of UBS
AG on Form F-3 (Registration Number 333-204908) and of UBS Group AG on Form S-8
(Registration Numbers 333-200634; 333-200635; 333-200641; 333-200665; 333-215254;
and 333-215255), and into each prospectus outstanding under any of the
foregoing registration statements, (2) any outstanding offering circular or
similar document issued or authorized by UBS AG that incorporates by reference
any Form 6-K’s of UBS 111572), the AG that are incorporated into its
registration statements filed with the SEC, and (3) the base prospectus of
Corporate Asset Backed Corporation (“CABCO”) dated June 23, 2004 (Registration
Number 333- Form 8-K of CABCO filed and dated June 23, 2004 (SEC File Number
001-13444), and the Prospectus Supplements relating to the CABCO Series
2004-101 Trust dated May 10, 2004 and May 17, 2004 (Registration Number
033-91744 and 033-91744-05).
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
UBS Group AG
By:
_/s/ Todd Tuckner
___________
Name: Todd Tuckner
Title: Group Controller and
Chief Accounting Officer
By:
_/s/ David Kelly _____________
Name: David Kelly
Title: Managing Director
UBS AG
By:
_/s/ Todd Tuckner
___________
Name: Todd Tuckner
Title: Group Controller and
Chief Accounting Officer
By:
_/s/ David Kelly _____________
Name: David Kelly
Title: Managing Director
Date: March 10, 2017
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