UBS : third-quarter 2024 results Quarterly full report

UBS Group

Third quarter 2024 report

Corporate calendar UBS Group

Publication of the UBS Group fourth quarter 2024 report	Tuesday, 4 February 2025
Information about future publication dates is available at
ubs.com/global/en/investor-relations/events/calendar.html
Publication of the UBS AG third quarter 2024 report	Friday, 8 November 2024

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1. Share information and earnings per share

4. Consolidated financial statements

56 UBS Group AG interim consolidated financial statements (unaudited)

Appendix

1. Alternative performance measures

1. Abbreviations frequently used in our financial reports

1. Information sources
2. Cautionary statement

Publisher: UBS Group AG, Zurich, Switzerland | ubs.com

Language: English

© UBS 2024. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved.

Terms used in this report, unless the context requires otherwise

"UBS", "UBS Group", "UBS Group AG consolidated", "Group", "we", "us" and "our"	UBS Group AG and its consolidated subsidiaries
"UBS AG" and "UBS AG consolidated"	UBS AG and its consolidated subsidiaries
"Credit Suisse AG" and "Credit Suisse AG consolidated"	Credit Suisse AG and its consolidated subsidiaries before the merger
	with UBS AG
"Credit Suisse Group" and "Credit Suisse Group AG consolidated"	Pre-acquisition Credit Suisse Group
"Credit Suisse"	Credit Suisse AG and its consolidated subsidiaries before the merger
	with UBS AG, Credit Suisse Services AG, and other small former
	Credit Suisse Group entities now directly held by UBS Group AG
"UBS Group AG" and "UBS Group AG standalone"	UBS Group AG on a standalone basis
"UBS AG standalone"	UBS AG on a standalone basis
"UBS Switzerland AG" and "UBS Switzerland AG standalone"	UBS Switzerland AG on a standalone basis
"UBS Europe SE consolidated"	UBS Europe SE and its consolidated subsidiaries
"UBS Americas Holding LLC" and "UBS Americas Holding LLC consolidated"	UBS Americas Holding LLC and its consolidated subsidiaries
"1m"	One million, i.e. 1,000,000
"1bn"	One billion, i.e. 1,000,000,000
"1trn"	One trillion, i.e. 1,000,000,000,000

In this report, unless the context requires otherwise, references to any gender shall apply to all genders.

Alternative performance measures

An alternative performance measure (an APM) is a financial measure of historical or future financial performance, financial position or cash flows other than a financial measure defined or specified in the applicable recognized accounting standards or in other applicable regulations. We report a number of APMs in the discussion of the financial and operating performance of the Group, our business divisions and Group Items. We use APMs to provide a more complete picture of our operating performance and to reflect management's view of the fundamental drivers of our business results. A definition of each APM, the method used to calculate it and the information content are presented under "Alternative performance measures" in the appendix to this report. Our APMs may qualify as non-GAAP measures as defined by US Securities and Exchange Commission (SEC) regulations. Our underlying results are APMs and are non-GAAP financial measures.

• Refer to the "Group performance" section of this report and to "Alternative performance measures" in the appendix to this report for additional information about underlying results

Comparability

Comparative information in this report is presented as follows.

Profit and loss information for all quarters covered by this report and for 2024 year-to-date information is based entirely on consolidated data following the acquisition of the Credit Suisse Group. Comparative year-to-date information for 2023 includes four months (June to September 2023) of post-acquisition consolidated data and five months of UBS Group data only (January to May 2023).

All balance sheet information presented in this report includes only post-acquisition consolidated information.

Significant regulated subsidiary and sub-group information

Financial and regulatory key figures for our significant regulated subsidiaries and sub-groups will be published on 8 November 2024 and will be available under "Holding company and significant regulated subsidiaries and sub- groups" at ubs.com/investors.

UBS Group third quarter 2024 report

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Our key figures

			As of or for the quarter ended			As of or year-to-date
USD m, except where indicated	30.9.24	30.6.24	31.12.231	30.9.231	30.9.24	30.9.231
Group results
Total revenues	12,334	11,904	10,855	11,695	36,976	29,979
Negative goodwill								27,264
Credit loss expense / (release)	121	95	136	239	322	901
Operating expenses	10,283	10,340	11,470	11,640	30,880	27,336
Operating profit / (loss) before tax	1,929	1,469	(751)	(184)	5,773	29,006
Net profit / (loss) attributable to shareholders	1,425	1,136	(279)	(715)	4,315	27,645
Diluted earnings per share (USD)2	0.43	0.34	(0.09)	(0.22)	1.29	8.46
Profitability and growth3,4
Return on equity (%)	6.7	5.4	(1.3)	(3.4)	6.8	52.1
Return on tangible equity (%)	7.3	5.9	(1.4)	(3.7)	7.4	57.7
Underlying return on tangible equity (%)5	9.0	8.4	4.8	1.5	9.1	3.8
Return on common equity tier 1 capital (%)	7.6	5.9	(1.4)	(3.7)	7.5	60.0
Underlying return on common equity tier 1 capital (%)5	9.4	8.4	4.8	1.5	9.2	4.0
Return on leverage ratio denominator, gross (%)	3.1	3.0	2.6	2.8	3.1	3.0
Cost / income ratio (%)6	83.4	86.9	105.7	99.5	83.5	91.2
Underlying cost / income ratio (%)5,6	78.5	80.6	93.0	89.3	78.8	85.1
Effective tax rate (%)	26.0	20.0	n.m.7	n.m.7	24.4	4.6
Net profit growth (%)		n.m.	(95.8)	n.m.	n.m.	(84.4)	362.5
Resources3
Total assets	1,623,941	1,560,976	1,716,924	1,643,684	1,623,941	1,643,684
Equity attributable to shareholders	87,025	83,683	85,624	83,265	87,025	83,265
Common equity tier 1 capital8	74,213	76,104	78,002	76,926	74,213	76,926
Risk-weighted assets8	519,363	511,376	546,505	546,491	519,363	546,491
Common equity tier 1 capital ratio (%)8	14.3	14.9	14.3	14.1	14.3	14.1
Going concern capital ratio (%)8	17.5	18.0	16.8	16.4	17.5	16.4
Total loss-absorbing capacity ratio (%)8	37.5	38.7	36.4	35.4	37.5	35.4
Leverage ratio denominator8	1,608,341	1,564,201	1,695,403	1,615,817	1,608,341	1,615,817
Common equity tier 1 leverage ratio (%)8	4.6	4.9	4.6	4.8	4.6	4.8
Liquidity coverage ratio (%)9	199.2	212.0	215.7	196.5	199.2	196.5
Net stable funding ratio (%)	126.9	128.0	124.7	120.7	126.9	120.7
Other
Invested assets (USD bn)4,10	6,199	5,873	5,714	5,373	6,199	5,373
Personnel (full-time equivalents)	109,396	109,991	112,842	115,981	109,396	115,981
Market capitalization2,11	106,528	101,903	107,355	85,768	106,528	85,768
Total book value per share (USD)2	27.32	26.13	26.68	25.75	27.32	25.75
Tangible book value per share (USD)2	25.10	23.85	24.34	23.44	25.10	23.44

1 Comparative-period information has been revised. Refer to "Note 2 Accounting for the acquisition of the Credit Suisse Group" in the "Consolidated financial statements" section of this report for more information. 2 Refer to the "Share information and earnings per share" section of this report for more information. 3 Refer to the "Targets, capital guidance and ambitions" section of the UBS Group Annual Report 2023, available under "Annual reporting" at ubs.com/investors, for more information about our performance targets. 4 Refer to "Alternative performance measures" in the appendix to this report for the definition and calculation method. 5 Refer to the "Group performance" section of this report for more information about underlying results. 6 Negative goodwill is not used in the calculation as it is presented in a separate reporting line and is not part of total revenues. 7 The effective tax rate for the fourth and third quarters of 2023 is not a meaningful measure, due to the distortive effect of current unbenefited tax losses at the former Credit Suisse entities. 8 Based on the Swiss systemically relevant bank framework as of 1 January 2020. Refer to the "Capital management" section of this report for more information. 9 The disclosed ratios represent quarterly averages for the quarters presented and are calculated based on an average of 65 data points in the third quarter of 2024, 61 data points in the second quarter of 2024, 63 data points in the fourth quarter of 2023 and 63 data points in the third quarter of 2023. Refer to the "Liquidity and funding management" section of this report for more information. 10 Consists of invested assets for Global Wealth Management, Asset Management (including invested assets from associates) and Personal & Corporate Banking. Refer to "Note 32 Invested assets and net new money" in the "Consolidated financial statements" section of the UBS Group Annual Report 2023, available under "Annual reporting" at ubs.com/investors, for more information. 11 The calculation of market capitalization reflects total shares issued multiplied by the share price at the end of the period.

UBS Group third quarter 2024 report

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UBS Group

Management report

Recent developments

Regulatory capital developments and capital returns guidance

In the third quarter of 2024, reflecting our strong capital position, completion of legal entity mergers, overall progress on the integration and the winding down of Non-core and Legacy, we voluntarily accelerated the amortization of the remaining transitional purchase price allocation (PPA) adjustments for common equity tier 1 (CET1) capital purposes. This resulted in a USD 3.4bn decrease in CET1 capital and a CET1 capital ratio of 14.3%. Excluding this adjustment, the CET1 capital ratio would have been 14.9%. In connection with the acquisition of the Credit Suisse Group in 2023, the Swiss Financial Market Supervisory Authority (FINMA) had approved neutralizing a CET1 capital effect of USD 5.0bn (net of tax) of interest-rate- and own-credit-driven fair value adjustments for UBS Group AG that are expected to fully reverse into income and be accretive to CET1 capital over time. The transitional treatment was subject to linear amortization at the rate of USD 0.3bn per quarter through 30 June 2027. This quarterly amortization was eliminated upon fully amortizing the transitional treatment in the third quarter of 2024. As these transitional adjustments only applied to UBS Group AG, the regulatory capital position of UBS AG was not impacted by the decision to fully amortize them. On a standalone basis as of 30 September 2024, UBS AG's fully applied CET1 capital ratio is expected to be around 13.3%.

We expect that the adoption of the final Basel III standards in January 2025 will lead to a low single-digit percentage increase in the UBS Group's RWA, reducing the CET1 capital ratio by around 30 basis points. This estimate is based on our current understanding of the relevant standards as we are in an active dialogue with FINMA regarding various aspects of the final rules. We continue to expect to operate with a CET1 capital ratio of around 14% after the implementation of the final Basel III standards.

We expect to complete our planned USD 1bn of share repurchases in the fourth quarter of 2024. Our ambition to continue share repurchases in 2025 and for our capital returns in 2026 to exceed pre-acquisition levels is unchanged. Our ambitions beyond 2025 are subject to our assessment of any proposed requirements from Switzerland's ongoing review of its capital regime.

• Refer to "Amortization of transitional purchase price allocation adjustments for regulatory capital" in the "Capital management" section of this report for more information.

Integration of Credit Suisse

We continue to make progress related to the integration of Credit Suisse, with the current focus on client account and platform migrations.

Following the merger of UBS AG and Credit Suisse AG in May 2024 and the transition to a single US intermediate holding company in June 2024, the merger of UBS Switzerland AG and Credit Suisse (Schweiz) AG was completed on 1 July 2024 and was another critical step on our integration roadmap.

In October 2024, we completed the migration of our Global Wealth Management client accounts in Luxembourg and Hong Kong to UBS platforms and we plan to migrate our Global Wealth Management client accounts booked in Singapore and Japan before the end of 2024. In Switzerland, we expect the next phase of Global Wealth Management and Personal & Corporate Banking client account migrations in the second quarter of 2025.

In the third quarter of 2024, we realized an additional USD 0.8bn in gross cost savings, for a total of around USD 6.8bn in annualized exit rate gross cost savings compared with the 2022 combined cost base of Credit Suisse and UBS. We expect to achieve around USD 7.5bn of gross cost savings by the end of 2024, or approximately 58% of our ambition of around USD 13bn by the end of 2026.

UBS Group third quarter 2024 report | UBS Group | Recent developments

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Our Non-core and Legacy business division continues to actively exit positions and reduce its exposures. On 13 August 2024, UBS entered into an agreement to sell Select Portfolio Servicing, the US mortgage-servicing business of Credit Suisse managed in the Non-core and Legacy business division. Completion of the transaction is subject to regulatory approvals and other customary closing conditions. The transaction is expected to close in the first quarter of 2025. UBS does not expect to recognize a material profit or loss upon completion of the transaction. Based on balances as of 30 September 2024, the completion of the transaction would reduce the Group's risk- weighted assets (RWA) by around USD 1.4bn and the Group's leverage ratio denominator (LRD) by around USD 1.7bn.

In October 2024, UBS entered into an agreement to sell to American Express Swiss Holdings GmbH (American Express) its 50% interest in Swisscard AECS GmbH (Swisscard), a joint venture between UBS and American Express in Switzerland. In addition, UBS and Swisscard entered into an agreement to transition the Credit Suisse-branded card portfolios to UBS. Both transactions are subject to certain closing conditions and are not expected to have a material impact for UBS.

Regulatory and legal developments

Withholding tax exemption period for too-big-to-fail instruments

In August 2024, the Swiss Federal Council launched a consultation related to the existing withholding tax exemption that applies to too-big-to-fail instruments issued by no later than 31 December 2026. The Federal Council had recommended an unlimited extension of the exemption as part of a broader reform package in its April 2024 report on banking stability. As these reforms are not expected to enter into force before the expiry of the existing special rules, the Swiss Federal Council proposes to extend the current exemption, from 31 December 2026 to 31 December 2031, to ensure that banks can continue to issue capital instruments on competitive terms.

Swiss legislators postpone the review of a public liquidity backstop

In August 2024, the Swiss Economic Affairs and Taxation Committee of the Council of States deferred further deliberations on the introduction of a public liquidity backstop until the Swiss parliamentary investigation committee publishes its report on the failure of the Credit Suisse Group, which is expected to be released by the end of 2024.

FINMA suspends annual approval of UBS's recovery and emergency plans

In October 2024, FINMA published its 2024 resolution reporting for UBS. FINMA noted that if the preferred resolution strategy was applied, UBS would be resolvable by means of a single point of entry recapitalization. Considering the ongoing integration activities and the additional requirements for alternative resolution strategies following the Credit Suisse crisis, including the need for legislative changes, FINMA announced that it had suspended the annual approval of UBS's recovery and emergency plans. UBS has started working on the new plans in close dialogue with FINMA.

Switzerland implements the Income Inclusion Rule

In September 2024, the Swiss Federal Council introduced the Income Inclusion Rule (the IIR), a measure developed by the Organisation for Economic Co-operation and Development (the OECD) as part of the minimum corporate taxation rules applicable to corporate groups with a worldwide turnover of at least EUR 750m. Under the IIR, the profits of foreign subsidiaries and branches of Swiss corporate groups will be taxed at a minimum rate of 15% on the OECD global minimum tax base with respect to each jurisdiction in which the corporate groups operate. The IIR complements the Swiss supplementary tax that was introduced in January 2024. The IIR will apply from 1 January 2025, and UBS expects the overall tax impact from the IIR will be limited, given that UBS is subject to a corporate tax burden of more than 15% in the vast majority of countries in which it operates.

Mutual recognition agreement with the UK submitted to the Swiss Parliament

In September 2024, the Swiss Federal Council submitted for parliamentary approval a mutual recognition agreement (an MRA) with the UK regarding financial services. The agreement facilitates cross-border financial activities based on a new model for regulatory cooperation and an outcomes-based mutual recognition of domestic rules. The MRA is supplemented by an enhanced and closer supervisory process and additional supervisory arrangements where new market access is granted. It is expected that the Parliaments in Switzerland and the UK will grant approval for the MRA in 2025.

Developments related to the final Basel III implementation

In Switzerland, the amendments to the Capital Adequacy Ordinance that will incorporate the final Basel III standards into Swiss law are still scheduled to enter into force on 1 January 2025, as confirmed by the Swiss Federal Council in June 2024.

UBS Group third quarter 2024 report | UBS Group | Recent developments

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We expect that the adoption of the final Basel III standards in January 2025 will lead to low single-digit percentage increases in the UBS Group's RWA and LRD, reducing the CET1 capital ratio by around 30 basis points and the CET1 leverage ratio by around 10 basis points. This estimate is based on our current understanding of the relevant standards, as we are in an active dialogue with FINMA regarding various aspects of the final rules. Our estimate for the RWA and CET1 capital ratio does not take into account the impact of the output floor, which is to be phased in over time.

In September 2024, the UK Prudential Regulatory Authority (the PRA) published its final rules covering the implementation of the final Basel III standards. As part of the package, the PRA announced the pushing back of the implementation date, from 1 July 2025 to 1 January 2026, with full phase-in of the output floor by 1 January 2030. The overall impact on UBS is expected to be limited.

In the US, the banking agencies, including the Federal Reserve Board, have been discussing amendments to their original proposals regarding the implementation of the final Basel III standards. The banking agencies have indicated that they plan to issue a revised proposal before issuing the final rules.

The Federal Reserve Board stress capital buffer requirements

In August 2024, the Federal Reserve Board assigned UBS Americas Holding LLC a stress capital buffer (an SCB) of 9.3% as of 1 October 2024 (previously 9.1%) under the Federal Reserve Board's SCB rule, resulting in a total CET1 capital requirement of 13.8%. The SCB for our US-based intermediate holding company is based on the previously released results of the Federal Reserve Board's 2024 Dodd-Frank Act Stress Test (DFAST), where UBS Americas Holding LLC exceeded the minimum capital requirements under the severely adverse scenario.

Group performance

Income statement

		For the quarter ended		% change from		Year-to-date
USD m	30.9.24	30.6.24	30.9.231		2Q24	3Q23	30.9.24	30.9.231
Net interest income	1,794	1,535	2,107	17	(15)	5,270	5,202
Other net income from financial instruments measured at fair value through profit or loss	3,681	3,684	3,226	0	14	11,547	8,425
Net fee and commission income	6,517	6,531	6,056	0	8	19,540	15,790
Other income	341	154	305	122	12	619	563
Total revenues	12,334	11,904	11,695	4	5	36,976	29,979
Negative goodwill										27,264
Credit loss expense / (release)	121	95	239	28	(49)	322	901
Personnel expenses	6,889	7,119	7,567	(3)	(9)	20,957	17,838
General and administrative expenses	2,389	2,318	3,124	3	(24)	7,120	7,157
Depreciation, amortization and impairment of non-financial assets	1,006	903	950	11	6	2,804	2,341
Operating expenses	10,283	10,340	11,640	(1)	(12)	30,880	27,336
Operating profit / (loss) before tax	1,929	1,469	(184)	31		5,773	29,006
Tax expense / (benefit)	502	293	526	71	(5)	1,407	1,346
Net profit / (loss)	1,428	1,175	(711)	21		4,366	27,660
Net profit / (loss) attributable to non-controlling interests	3	40	4	(92)	(22)	51	15
Net profit / (loss) attributable to shareholders	1,425	1,136	(715)	25		4,315	27,645
Comprehensive income
Total comprehensive income	3,910	1,614	(2,622)	142		5,279	25,679
Total comprehensive income attributable to non-controlling interests	27	18	(8)	47		40	4
Total comprehensive income attributable to shareholders	3,883	1,596	(2,614)	143		5,239	25,675

1 Comparative-period information has been revised. Refer to "Note 2 Accounting for the acquisition of the Credit Suisse Group" in the "Consolidated financial statements" section of this report for more information.

UBS Group third quarter 2024 report | UBS Group | Recent developments

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Selected financial information of the business divisions and Group Items

			For the quarter ended 30.9.24
		Personal &
	Global Wealth	Corporate	Asset	Investment	Non-core and
USD m	Management	Banking	Management	Bank	Legacy	Group Items	Total
Total revenues as reported	6,199	2,394	873	2,645	262	(39)	12,334
of which: PPA effects and other integration items 1	224	278		185		(25)	662
Total revenues (underlying)	5,975	2,116	873	2,461	262	(14)	11,672
Credit loss expense / (release)	2	83	0	9	28	0	121
Operating expenses as reported	5,112	1,465	722	2,231	837	(84)	10,283
of which: integration-related expenses and PPA effects 2	419	198	86	156	270	(11)	1,119
Operating expenses (underlying)	4,693	1,267	636	2,076	567	(74)	9,165
Operating profit / (loss) before tax as reported	1,085	846	151	405	(603)	45	1,929
Operating profit / (loss) before tax (underlying)	1,280	766	237	377	(333)	60	2,386
			For the quarter ended 30.6.24
		Personal &
	Global Wealth	Corporate	Asset	Investment	Non-core and
USD m	Management	Banking	Management	Bank	Legacy	Group Items	Total
Total revenues as reported	6,053	2,272	768	2,803	401	(392)	11,904
of which: PPA effects and other integration items 1	233	246		310		(8)	780
Total revenues (underlying)	5,820	2,026	768	2,493	401	(384)	11,124
Credit loss expense / (release)	(1)	103	0	(6)	(1)	0	95
Operating expenses as reported	5,183	1,396	638	2,332	807	(15)	10,340
of which: integration-related expenses and PPA effects 2	523	182	98	245	325	(2)	1,372
Operating expenses (underlying)	4,660	1,213	540	2,087	481	(13)	8,969
Operating profit / (loss) before tax as reported	871	773	130	477	(405)	(377)	1,469
Operating profit / (loss) before tax (underlying)	1,161	710	228	412	(80)	(371)	2,060
			For the quarter ended 30.9.233
		Personal &
	Global Wealth	Corporate	Asset	Investment	Non-core and
USD m	Management	Banking	Management	Bank	Legacy	Group Items	Total
Total revenues as reported	5,953	2,517	775	2,162	366	(78)	11,695
of which: PPA effects and other integration items 1	388	333		251		(14)	958
Total revenues (underlying)	5,565	2,184	775	1,911	366	(64)	10,737
Credit loss expense / (release)	10	160	0	4	59	5	239
Operating expenses as reported	5,017	1,400	738	2,412	2,068	6	11,640
of which: integration-related expenses and PPA effects 2	448	174	126	368	920	(5)	2,031
of which: acquisition-related costs						26	26
Operating expenses (underlying)	4,569	1,226	612	2,043	1,149	(15)	9,583
Operating profit / (loss) before tax as reported	926	957	37	(254)	(1,762)	(89)	(184)
Operating profit / (loss) before tax (underlying)	986	798	163	(136)	(842)	(55)	914

1 Includes accretion of PPA adjustments on financial instruments and other PPA effects, as well as temporary and incremental items directly related to the integration. 2 Includes temporary, incremental operating expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the Credit Suisse Group. 3 Comparative-period information has been restated for changes in business division perimeters, Group Treasury allocations and Non-core and Legacy cost allocations. Refer to "Note 3 Segment reporting" in the "Consolidated financial statements" section of this report.

UBS Group third quarter 2024 report | UBS Group | Group performance

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Selected financial information of the business divisions and Group Items (continued)

				Year-to-date 30.9.24
		Personal &
	Global Wealth	Corporate	Asset	Investment	Non-core and
USD m	Management	Banking	Management	Bank	Legacy	Group Items		Total
Total revenues as reported	18,395	7,089	2,416	8,199	1,664	(786)		36,976
of which: PPA effects and other integration items 1	691	780		787		(37)		2,221
Total revenues (underlying)	17,705	6,308	2,416	7,412	1,664	(749)		34,755
Credit loss expense / (release)	(2)	229	0	34	63	(2)		322
Operating expenses as reported	15,340	4,265	2,025	6,728	2,655	(132)		30,880
of which: integration-related expenses and PPA effects 2	1,347	540	255	543	837	(12)		3,511
Operating expenses (underlying)	13,993	3,725	1,770	6,185	1,817	(120)		27,370
Operating profit / (loss) before tax as reported	3,057	2,594	392	1,437	(1,054)	(652)		5,773
Operating profit / (loss) before tax (underlying)	3,713	2,354	647	1,193	(216)	(627)		7,063
				Year-to-date 30.9.233,4
		Personal &
	Global Wealth	Corporate	Asset	Investment	Non-core and		Negative
USD m	Management	Banking	Management	Bank	Legacy	Group Items	goodwill	Total
Total revenues as reported	16,002	5,604	1,861	6,562	551	(602)		29,979
of which: PPA effects and other integration items 1	574	477		306		(20)		1,336
Total revenues (underlying)	15,428	5,128	1,861	6,257	551	(582)		28,643
Negative goodwill							27,264	27,264
Credit loss expense / (release)	174	398	1	142	178	7		901
Operating expenses as reported	12,663	2,996	1,649	6,302	3,304	422		27,336
of which: integration-related expenses and PPA effects 2	516	211	140	529	1,024	342		2,763
of which: acquisition-related costs						202		202
Operating expenses (underlying)	12,147	2,785	1,509	5,773	2,279	(122)		24,371
Operating profit / (loss) before tax as reported	3,165	2,210	211	118	(2,930)	(1,031)	27,264	29,006
Operating profit / (loss) before tax (underlying)	3,107	1,945	351	341	(1,906)	(467)		3,371

1 Includes accretion of PPA adjustments on financial instruments and other PPA effects, as well as temporary and incremental items directly related to the integration. 2 Includes temporary, incremental operating expenses directly related to the integration, as well as amortization of newly recognized intangibles resulting from the acquisition of the Credit Suisse Group. 3 Comparative-period information has been restated for changes in business division perimeters, Group Treasury allocations and Non-core and Legacy cost allocations. Refer to "Note 3 Segment reporting" in the "Consolidated financial statements" section of this report. 4 Comparative-period information has been revised. Refer to "Note 2 Accounting for the acquisition of the Credit Suisse Group" in the "Consolidated financial statements" section of this report for more information.

Integration-related expenses, by business division and Group Items

		For the quarter ended			Year-to-date
USD m	30.9.24	30.6.24	30.9.231	30.9.24	30.9.231
Global Wealth Management	420	536	446	1,388	513
Personal & Corporate Banking	172	159	148	470	177
Asset Management	86	98	126	255	140
Investment Bank	156	245	368	543	529
Non-core and Legacy	270	325	920	837	1,024
Group Items	21	8	(5)	30	342
Total integration-related expenses	1,124	1,370	2,003	3,523	2,727
of which: total revenues	35	26	0	97	0
of which: operating expenses	1,090	1,344	2,003	3,426	2,727
of which: personnel expenses	561	825	1,039	1,942	1,399
of which: general and administrative expenses	415	426	860	1,197	979
of which: depreciation, amortization and impairment of non-financial assets	113	93	104	287	349

1 Comparative-period information has been restated for changes in business division perimeters, Group Treasury allocations and Non-core and Legacy cost allocations. Refer to "Note 3 Segment reporting" in the "Consolidated financial statements" section of this report.

UBS Group third quarter 2024 report | UBS Group | Group performance

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Underlying results

In addition to reporting our results in accordance with IFRS Accounting Standards, we report underlying results that exclude items of profit or loss that management believes are not representative of the underlying performance.

In the third quarter of 2024, underlying revenues exclude purchase price allocation (PPA) effects and other integration items. PPA effects mainly consist of PPA adjustments on financial instruments measured at amortized cost, including off-balance sheet positions, arising from the acquisition of the Credit Suisse Group. Accretion of PPA adjustments on financial instruments is accelerated when the related financial instrument is derecognized before its contractual maturity. No adjustment is made for accretion of PPA on financial instruments within Non- core and Legacy, due to the nature of its business model.

Underlying expenses exclude integration-related expenses that are temporary, incremental and directly related to the integration of Credit Suisse into UBS, including costs of internal staff and contractors substantially dedicated to integration activities, retention awards, redundancy costs, incremental expenses from the shortening of useful lives of property, equipment and software, and impairment charges relating to these assets. Classification as integration- related expenses does not affect the timing of recognition and measurement of those expenses or the presentation thereof in the income statement.

Results: 3Q24 vs 3Q23

Reported operating profit before tax was USD 1,929m, compared with an operating loss before tax of USD 184m, reflecting lower operating expenses, an increase in total revenues and lower net credit loss expenses. Total revenues increased by USD 639m, or 5%, to USD 12,334m, and included a decrease of USD 296m in accretion impacts resulting from PPA adjustments on financial instruments and other PPA effects. The increase in total revenues was driven by a USD 461m increase in net fee and commission income, a USD 142m increase in net interest income and other net income from financial instruments measured at fair value through profit or loss, and a USD 36m increase in other income. Operating expenses decreased by USD 1,357m, or 12%, to USD 10,283m and included a USD 913m decrease in integration-related expenses. The decrease in operating expenses was mainly driven by a USD 735m decrease in general and administrative expenses and a USD 678m decrease in personnel expenses, partly offset by a USD 56m increase in depreciation, amortization and impairment of non-financial assets. Net credit loss expenses were USD 121m, compared with USD 239m in the third quarter of 2023.

Underlying results 3Q24 vs 3Q23

Underlying results for the third quarter of 2024 excluded PPA effects and other integration items of USD 662m from total revenues and also excluded integration-related expenses and PPA effects of USD 1,119m from operating expenses.

On an underlying basis, profit before tax increased by USD 1,472m to USD 2,386m, reflecting a USD 935m increase in underlying total revenues, a USD 418m decrease in underlying operating expenses and a USD 118m decrease in net credit loss expenses.

Total revenues: 3Q24 vs 3Q23

Net interest income and other net income from financial instruments measured at fair value through profit or loss Total combined net interest income and other net income from financial instruments measured at fair value through profit or loss increased by USD 142m to USD 5,476m and included a decrease of USD 156m in accretion impacts resulting from PPA adjustments on financial instruments and other PPA effects.

Global Wealth Management decreased by USD 136m to USD 2,232m, which included USD 221m of accretion of PPA adjustments on financial instruments and other PPA effects, compared with USD 371m in the third quarter of 2023. Excluding the aforementioned effects, net interest income decreased, reflecting lower deposit margins, including the effects of shifts to lower-margin deposit products and the effects of liquidity and funding costs, partly offset by higher deposit volumes. The decrease was also due to lower loan revenues, reflecting lower average volumes. These decreases were partly offset by an increase in transaction-based income, mainly driven by higher levels of client activity.

Personal & Corporate Banking decreased by USD 106m to USD 1,638m, which included USD 255m of accretion of PPA adjustments on financial instruments and other PPA effects, compared with USD 290m in the third quarter of 2023. The remaining decrease was mainly due to higher liquidity and funding costs, as well as lower deposit margins resulting from both lower reinvestment rates and shifts to lower-margin deposit products.

UBS Group third quarter 2024 report | UBS Group | Group performance

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