Global Asset Management

The cost/income ratio was 93.9% in second quarter 2007. Excluding DRCM-related closure expenses, the cost/income ratio would have been 58.3%, down from 59.5% in the prior quarter, reflecting higher performance-related fee revenues more than offsetting the increase in costs.

Institutional

Institutional invested assets were CHF 552 billion on 30 June 2007, up CHF 24 billion from 31 March 2007. The increase reflects higher financial markets and currency impacts partly offset by small net new money outflows.

The outflow of net new money in second quarter 2007 was CHF 2.5 billion, of which CHF 1.5 billion were paid back to DRCM outside investors. In first quarter 2007, we recorded a net new money inflow of CHF 2.7 billion. Excluding money market flows, the outflow of net new money was CHF 4.6 billion for second quarter, compared with inflows of CHF 6.6 billion in first quarter 2007. Net outflows from equity mandates were only partly offset by inflows into multi-asset mandates, alternative and quantitative investments and real estate.

In first half 2007, we recorded a net new money inflow of CHF 0.2 billion. Excluding money market flows, the inflow was CHF 2.0 billion, with inflows into multi-asset mandates, alternative and quantitative investments, fixed income and real estate, partly offset by outflows in equities.

The gross margin was 48 basis points in second quarter 2007, an increase of 3 basis points from last quarter, mainly due to strong performance-based fees in alternative and quantitative investments and from the Brazilian asset management business.

Wholesale intermediary

Invested assets were CHF 368 billion on 30 June 2007, up CHF 13 billion from 31 March 2007. The increase reflects higher financial markets and currency translation effects and, to a lesser extent, net new money inflows.

Net new money in second quarter 2007 was CHF 0.5 billion, compared with CHF 2.6 billion in first quarter 2007. Excluding money market flows, net new money was CHF 1.4 billion for the quarter, compared with CHF 4.5 billion in first quarter 2007. Net inflows into multi-asset, equity and real estate funds were mostly offset by outflows from fixed income funds.

In first half 2007, we recorded a net new money inflow of CHF 3.1 billion. Excluding money market funds, the inflow was CHF 5.9 billion, with flows into multi-asset mandates, equities and real estate partly offset by outflows in fixed income.

The gross margin was 48 basis points in second quarter 2007, an increase of 1 basis point from last quarter.

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