13
Cautionary statement
regarding
forward-looking statements
|
This document
contains statements
that constitute
“forward-looking statements,”
including but not limited to
management’s outlook for UBS’s
financial performance, statements
relating to the anticipated
effect of transactions and strategic
initiatives on UBS’s
business and future
development and goals
or intentions to
achieve climate, sustainability
and other social objectives.
While these forward-
looking statements
represent UBS’s
judgments, expectations and
objectives concerning the
matters described,
a number
of risks,
uncertainties and
other
important factors could cause actual developments and results to differ materially from UBS’s expectations. In particular, terrorist activity and conflicts in the
Middle East, as well as the continuing
Russia–Ukraine war, may have significant impacts on
global markets, exacerbate global
inflationary pressures, and slow
global growth.
In addition,
the ongoing
conflicts may
continue to
cause significant
population displacement, and
lead to
shortages of
vital commodities,
including energy
shortages and
food insecurity
outside the
areas immediately
involved in
armed conflict. Governmental
responses to
the armed
conflicts,
including, with respect
to the Russia–Ukraine war,
coordinated successive sets
of sanctions on
Russia and Belarus,
and Russian and
Belarusian entities and
nationals, and the uncertainty as to
whether the ongoing conflicts will widen and
intensify, may continue
to have significant adverse effects
on the market
and macroeconomic conditions, including in ways
that cannot be anticipated. UBS’s
acquisition of the Credit Suisse Group has materially
changed its outlook
and strategic direction
and introduced new
operational challenges. The
integration of the
Credit Suisse
entities into the
UBS structure
is expected to
take
between three and five
years and presents significant risks,
including the risks that UBS
Group AG may be
unable to achieve the
cost reductions and other
benefits contemplated by the
transaction. This creates significantly
greater uncertainty about forward-looking
statements. Other factors that
may affect UBS’s
performance and ability to achieve its plans, outlook and other objectives also include, but are not limited to: (i) the degree to which UBS is successful in the
execution of
its strategic
plans, including its
cost reduction
and efficiency
initiatives and
its ability
to manage
its levels
of risk-weighted assets
(RWA) and
leverage ratio denominator (LRD),
liquidity coverage ratio and
other financial resources,
including changes in RWA
assets and liabilities arising
from higher
market volatility and the size of the combined Group; (ii) the degree to which UBS is successful
in implementing changes to its businesses to meet changing
market, regulatory and other conditions,
including as a result of the
acquisition of the Credit Suisse
Group; (iii) increased inflation and interest
rate volatility in
major markets; (iv) developments in the macroeconomic climate
and in the markets in which UBS operates or to which it is exposed, including
movements in
securities prices
or liquidity,
credit spreads,
currency exchange
rates, deterioration or
slow recovery
in residential
and commercial
real estate
markets, the
effects of economic
conditions, including
elevated inflationary
pressures, market developments,
increasing geopolitical tensions,
and changes to
national trade
policies on the financial position
or creditworthiness of UBS’s clients
and counterparties, as well
as on client sentiment and levels
of activity; (v) changes in the
availability of capital and funding, including
any adverse changes in UBS’s credit spreads and
credit ratings of UBS, Credit Suisse, sovereign issuers,
structured
credit products or credit-related exposures, as well as
availability and cost of funding to meet requirements for debt eligible for total loss-absorbing capacity
(TLAC), in particular in light
of the acquisition of the Credit
Suisse Group; (vi) changes in
central bank policies or the
implementation of financial legislation
and regulation in Switzerland, the
US, the UK, the EU
and other financial centers
that have imposed, or resulted
in, or may do so in
the future, more stringent
or entity-specific capital, TLAC,
leverage ratio, net stable
funding ratio, liquidity and
funding requirements, heightened operational resilience
requirements,
incremental tax requirements, additional
levies, limitations on
permitted activities, constraints
on remuneration, constraints
on transfers of capital
and liquidity
and sharing of operational costs across the Group or other
measures, and the effect these will or would have on UBS’s business
activities; (vii) UBS’s ability to
successfully implement resolvability and
related regulatory requirements
and the potential
need to make
further changes to
the legal structure
or booking
model of UBS
in response to
legal and regulatory requirements
and any additional requirements
due to its
acquisition of the Credit
Suisse Group, or
other
developments; (viii) UBS’s ability to maintain and improve its systems
and controls for complying with sanctions in a timely manner and for
the detection and
prevention of money laundering to meet evolving
regulatory requirements and expectations, in particular in current
geopolitical turmoil; (ix) the uncertainty
arising from domestic stresses in certain major economies; (x) changes in
UBS’s competitive position, including whether differences in regulatory capital and
other requirements among the
major financial centers adversely affect
UBS’s ability to compete in
certain lines of business; (xi)
changes in the standards
of
conduct applicable to its businesses that may result from new regulations or new enforcement of existing standards, including measures to impose new and
enhanced duties when interacting
with customers and in
the execution and handling
of customer transactions;
(xii) the liability to which
UBS may be exposed,
or
possible constraints
or
sanctions that
regulatory authorities
might impose
on UBS,
due to
litigation, contractual
claims and
regulatory investigations,
including the potential for disqualification from certain businesses,
potentially large fines or monetary penalties, or
the loss of licenses or privileges as a result
of regulatory or other governmental sanctions, as well as the effect that litigation, regulatory and similar matters have on the operational risk component of
its RWA, including as a
result of its acquisition
of the Credit Suisse
Group, as well as the
amount of capital available
for return to shareholders;
(xiii) the effects
on UBS’s business, in
particular cross-border banking, of sanctions,
tax or regulatory developments and
of possible changes in
UBS’s policies and practices;
(xiv) UBS’s ability
to retain and
attract the
employees necessary
to generate revenues
and to manage,
support and control
its businesses,
which may be
affected
by competitive factors; (xv) changes in accounting
or tax standards or policies, and determinations or interpretations
affecting the recognition of gain or loss,
the valuation of goodwill, the recognition of deferred tax assets and other matters; (xvi) UBS’s ability to implement new technologies and business methods,
including digital services and technologies, and ability
to successfully compete with both existing and new financial
service providers, some of which may not
be
regulated to
the same
extent; (xvii)
limitations on
the effectiveness
of
UBS’s internal
processes for
risk management,
risk
control, measurement
and
modeling, and of financial
models generally; (xviii) the
occurrence of operational failures,
such as fraud,
misconduct, unauthorized trading, financial crime,
cyberattacks, data leakage and systems failures,
the risk of which
is increased with cyberattack threats
from both nation states and
non-nation-state actors
targeting financial institutions; (xix) restrictions on the ability of UBS Group AG and UBS AG
to make payments or distributions, including due to restrictions
on the ability of its subsidiaries to make
loans or distributions, directly or indirectly, or, in the case of financial difficulties, due to the exercise by FINMA
or the
regulators of UBS’s operations in
other countries of their
broad statutory powers in
relation to protective measures, restructuring
and liquidation proceedings;
(xx) the degree to which changes
in regulation, capital or legal
structure, financial results or other factors
may affect UBS’s ability to maintain
its stated capital
return objective; (xxi) uncertainty
over the scope of actions
that may be required by UBS,
governments and others
for UBS to achieve goals
relating to climate,
environmental
and
social
matters,
as
well
as
the
evolving
nature
of
underlying
science
and
industry
and
the
possibility
of
conflict
between
different
governmental standards
and regulatory regimes;
(xxii) the ability
of UBS to
access capital markets;
(xxiii) the ability
of UBS to
successfully recover from
a disaster
or other business continuity problem due
to a hurricane, flood, earthquake, terrorist
attack, war,
conflict (e.g., the Russia–Ukraine war), pandemic, security
breach, cyberattack, power loss, telecommunications failure or other natural or man-made event, including the ability to function
remotely during long-term
disruptions such as the COVID-19 (coronavirus) pandemic; (xxiv)
the level of success in the
absorption of Credit Suisse, in the
integration of the two groups
and their businesses, and
in the execution of
the planned strategy regarding
cost reduction and divestment
of any non-core assets,
the existing assets and
liabilities of Credit Suisse, the level of
resulting impairments and write-downs, the effect of the consummation of the
integration on the operational results,
share price and credit rating of UBS – delays, difficulties, or failure in closing
the transaction may cause market disruption
and challenges for UBS to maintain
business, contractual
and operational
relationships; and
(xxv) the
effect that
these or
other factors
or unanticipated
events, including
media reports
and
speculations, may have on
its reputation and
the additional consequences that this
may have on
its business and performance. The
sequence in which the
factors above are presented is not indicative of their likelihood of occurrence or the potential magnitude of their consequences. UBS’s business and financial
performance could be affected by other factors identified in its past and future filings and reports, including those filed with the US Securities and Exchange
Commission (the SEC).
More detailed information
about those
factors is
set forth
in documents furnished
by UBS
and filings
made by
UBS with
the SEC,
including the UBS
Group AG and
UBS AG Annual
Reports on Form
20- F for
the year ended
31 December 2023.
UBS is not
under any obligation
to (and
expressly disclaims any obligation to) update or
alter its forward-looking statements, whether as
a result of new information, future events, or otherwise.
