Wealth Management International & Switzerland

Net new money in third quarter 2007 was a record CHF 35.1 billion, up from CHF 32.7 billion in second quarter. The international clients area reported inflows of CHF 33.3 billion, up from CHF 30.1 billion, with strong contributions from all regions. The Swiss clients area showed an inflow of CHF 1.8 billion, down from CHF 2.6 billion in second quarter.

Inflows for first the nine months of 2007 totaled CHF 101.7 billion, reflecting an annualized net new money intake rate of 12% of the underlying asset base at year-end 2006, with positive contributions coming from all markets.

Invested assets on 30 September 2007 were CHF 1,297 billion, up CHF 17 billion, or 1%, from 30 June. Strong inflows of net new money more than offset the decline of the US dollar against the Swiss franc (36% of our invested assets are denominated in US dollars) and lower European equity markets. The level of invested assets managed by the international clients area exceeded the CHF 1,000 billion level for the first time this quarter. At the same time, we broke the CHF 200 billion barrier for invested assets in Asia Pacific.

In third quarter 2007, the gross margin on invested assets was 103 basis points, the same level as a quarter earlier. Recurring income made up 78 basis points of the margin, up 2 basis points from second quarter, while non-recurring income comprised 25 basis points, down 2 basis points.

In third quarter 2007, the cost / income ratio was 51.1%, down 0.5 percentage points from second quarter, with income rising at a higher pace than expenses. Excluding the European wealth management business, the cost / income ratio in third quarter 2007 was 47.7%, up marginally from 47.6% in second quarter.

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