Financial Businesses Results

The fair value of shares granted up to and including third quarter 2007 was CHF 2,035 million, up 6% from CHF 1,926 million granted in first half 2007. This was also higher than the grant total of CHF 1,858 million for full-year 2006. The year on year increase is primarily driven by higher performance-based compensation in the respective performance years rising with earnings and also reflects an increased proportion of bonus being delivered in the form of shares.

The fair value of options granted in the first nine months of 2007 was CHF 471 million, down from CHF 536 million in the same period a year ago. The decrease reflects a 2% drop in the number of options granted and a lower fair value per option. The lower average fair value reflects changes in market parameters.

Most share-based compensation is granted in the first quarter of the year, with any further grants generally reflecting those made under the Equity Plus program, an ongoing employee participation program under which voluntary investments in UBS shares are matched with option awards each quarter. These amounts, net of estimated forfeited awards, will be recognized as compensation expense over the service period, which is generally equal to the vesting period. Most UBS share and option awards vest incrementally over a three-year period.