Balance sheet

UBS’s total assets stood at CHF 2,091 billion on 30 June 2005, up from CHF 1,839 billion on 31 March 2005. Approximately a third of the CHF 252 billion rise was prompted by the strengthening of a number of major currencies against the Swiss franc. Derivative replacement values rose CHF 100.8 billion due to the flattening of the yield curves in all major currencies, the appreciation of the US dollar and new trading positions. Further increases were registered in collateral trading (CHF 79.2 billion), trading assets (CHF 59.1 billion) and, to a lesser extent, the loan book (CHF 7.0 billion).

Lending and borrowing

Our loans to customers position increased to CHF 255.4 billion on 30 June 2005, up by CHF 7.0 billion from 31 March 2005. This is mainly the result of higher levels of collateralized lending to Wealth Management clients outside Switzerland as well as mortgages in Switzerland. The Wealth Management International unit also acquired an additional CHF 28.6 billion in client deposits, partly due to the integration of acquisitions.

Repo and securities borrowing / lending

Cash collateral on securities borrowed and reverse repurchase agreements stood at CHF 704.3 billion on 30 June 2005, up by CHF 79.2 billion from 31 March 2005. This includes the effect of some netting between asset and liability positions. On a gross basis, before allowable netting, the position increased by CHF 81.6 billion. The rise was driven by the fixed income matched book (a portfolio comprised of assets and liabilities with equal maturities and equal value, so that the market risk cancels out), primarily in high quality collateral reflecting higher client demand. We also saw higher flows in our prime brokerage platform.

Trading portfolio / derivative instruments

Between 31 March 2005 and 30 June 2005, trading assets rose by CHF 59.1 billion to CHF 653.8 billion, while the value of derivative instruments increased by CHF 100.8 billion to CHF 369.0 billion due to the flattening of the yield curves in all major currencies, the appreciation of the US dollar and new trading positions. Trading assets inventory in equities rose CHF 13.6 billion, while the value of debt instruments rose CHF 36.9 billion, mainly due to higher positions in government bonds, European commercial paper as well as mortgages and asset-backed securities. The remaining growth was mainly in traded loans as a consequence of expanding the US mortgage- backed securitization business (with the corresponding increase in debt issued).