Business Banking Switzerland

Invested assets, at CHF 165 billion on 30 September 2007, decreased by CHF 2 billion due to falling European equity markets and the US dollar's decline against the Swiss franc. In the first three quarters of 2007, we transferred CHF 7.3 billion in client assets from the Business Banking Switzerland unit to the Wealth Management International & Switzerland unit, reflecting the development of client relationships.

In third quarter 2007, the inflow of net new money was CHF 0.9 billion, a slight increase from the second quarter inflow of CHF 0.8 billion.

The cost / income ratio was 58.2% in third quarter 2007, up 1.2 percentage points from second quarter, as expenses decreased at a slower pace than revenues, with the latter lower due to the revaluation gains in second quarter.

The loan portfolio, at CHF 145.4 billion on 30 September 2007, was CHF 1.2 billion above its level on 30 June 2007, due to an increase in private client mortgage volumes as well as higher corporate client demand.

The impaired loan ratio was 1.4% at the end of September, an improvement from 1.5% at the end of June. Our recovery portfolio was CHF 2.5 billion, unchanged from the end of second quarter.

The return on allocated regulatory capital was 27.5% in the first nine months of 2007, down from 28.0% in the first six months of 2007.