UBS AG (NYSE:UBS) recently reported its fourth quarter earnings and discussed the following topics in its earnings conference call.
Gross Margin Development
Sergio P. Ermotti – Group CEO: Well, let me take the last questions and then Tom will take the Wealth Management one. I think that when we look at 2012, our people have worked extremely well in executing our strategy, both in terms of capital accretion in terms of reducing cost and taking risk – controlling risks in many areas of our businesses as we just to say that we achieved record profitabilities. Last year, our performance pool was down 40%, was affected by the – (owners’ rights turning) incidence, so when we look at year-on-year performance one has to look into this strategic and objectives that we achieved. The other very important point I have to say is that, when you look at our compensation framework, we have introduced a more stringent conditions for – to make sure that a big chunk of this compensation will be different over time and is subject to sustainable performance achievements. Last, but not least, I think that comparing our comp ratio to the one of large commercial banks is like comparing apple with oranges and that I think that’s – compensation framework I do think reflects the strategic objectives we have in place.
Tom Naratil – Group CFO: So then on your question on the gross margin and activity levels in the fourth quarter in Wealth Management. So one thing that I think looking at the gross margin development that we need to take into account first is net interest margin and we’ve made a choice specifically in our replication portfolios not to extend duration in a lower interest rate environment in order to try to chase yield and we think that’s a better long-term decisions for our shareholders and we’re taking a little short-term pressure on the net interest margin to preserve the capital of our shareholders when interest rates financially are rising in. Second, if you look at the activity levels of clients in 4Q, in particular we saw a decline in transactional activity in the funds area in APAC and also in the structured product areas primarily in FX related structured products as implied volatilities dropped in the fourth quarter. We also had the seasonal effects of the holiday period in the last two weeks of the year. As we look out in terms of the – some of the comments that have been made about activity levels of retail investors, potentially picking up as market levels rise, I think it’s important for us to point out that there is – that that behavior does not necessarily correlate with what you see with Wealth Management clients and that we found the high net worth and ultra-high net worth clients in making their portfolio shifts from cash assets wherein our advisory accounts and Wealth Management we have about 28% of our client’s money in cash today. That shift from cash to riskier asset classes will become a multiyear process, not a multi-quarter process and further it requires us to see better progress on the global fiscal issues in a number of countries.
Sergio P. Ermotti – Group CEO: Let’s move to Huw van Steenis on the phone.