UBS AG

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	Note 1 Summary of Significant Accounting Policies

	Note 2

	Note 3 Net Interest and Trading Income

	Note 4 Net Fee and Commission Income

	Note 5 Other Income

	Note 6 Personnel Expenses

	Note 7 General and Administrative Expenses

	Note 8 Earnings per Share (EPS) and Shares Outstanding

	Note 9 Financial Assets Designated at Fair Value

	Note 10

	Note 11 Securities Borrowing, Securities Lending, Repurchase and Reverse Repurchase Agreements

	Note 12 Trading Portfolio

	Note 13 Financial Investments Available-for-Sale

	Note 14 Investments in Associates

	Note 15 Property and Equipment

	Note 16 Goodwill and Other Intangible Assets

	Note 17 Other Assets

	Note 18 Due to Banks and Customers

	Note 19 Financial Liabilities Designated at Fair Value and Debt Issued

	Note 20 Other Liabilities

	Note 21 Provisions

	Note 22 Income Taxes

	Note 23 Derivative Instruments and Hedge Accounting

	Note 24 Pledgeable Off-Balance Sheet Securities

	Note 25 Fiduciary Transactions

	Note 26 Commitments and Contingent Liabilities

	Note 27 Operating Lease Commitments

	Note 28 Pledged Assets

	Note 29 Financial Instruments Risk Position

	Note 30 Fair Value of Financial Instruments and Continued Recognition of Transferred Financial Assets

	Note 31 Pension and Other Post-Retirement Benefit Plans

	Note 32 Equity Participation and Other Compensation Plans

	Note 33 Related Parties

	Note 34 Post-Balance Sheet Events

	Note 35 Significant Subsidiaries and Associates

	Note 36 Invested Assets and Net New Money

	Note 37 Business Combinations

	Note 38 Discontinued Operations

	Note 39 Currency Translation Rates

	Note 40 Swiss Banking Law Requirements

	Note 41 Reconciliation of International Financial Reporting Standards (IFRS) to United States Generally Accepted Accounting Principles (US GAAP)

	Note 42 Additional Disclosures Required under US GAAP and SEC Rules





	Parent Bank Review

	Financial Statements

	Accounting Principles

	Additional Income Statement Information

	Additional Balance Sheet Information

	Off-Balance Sheet and Other Information





	A - Introduction

	B - Selected Financial Data

	C - Information on the Company

	D - Information Required by Industry Guide 3

UBS Homepage > Analysts & Investors > Annual Reporting 2006 > Financial Report > Note 9 Financial Assets Designated at Fair Value

Note 9 Financial Assets Designated at Fair Value

Note 9 Financial Assets Designated at Fair Value
CHF million	31.12.06	31.12.05
Loans	2,104	737
Structured loans	148	229
Reverse repurchase agreements
Banks	2,942	0
Customers	307	0
Other financial assets	429	187
Total financial assets designated at fair value	5,930	1,153

The maximum exposure to credit loss of all items in the above table except for Other financial assets is equal to the fair value (CHF 5,501 million at 31 December 2006). Other financial assets are generally comprised of equity investments and are not directly exposed to credit risk. The maximum exposure to credit loss at 31 December 2006 is mitigated by collateral of CHF 3,712 million.

CHF million	31.12.06
Notional amount of loans and structured loans	2,348
Credit derivatives related to loans and structured loans – notional amounts1	663
Credit derivatives related to loans and structured loans – fair value1	2

Additional information
	For the year ended ²
CHF million	31.12.06²
Change in fair value of loans and structured loans designated at fair value, attributable to changes in credit risk3	(8)
Change in fair value of credit derivatives and similar instruments which mitigate the maximum exposure to credit loss of loans and structured loans designated at fair value3	2
1 Credit derivatives and similar instruments include credit default swaps, credit linked notes, total return swaps, put options, and similar instruments. These are generally used to manage credit risk when UBS has a direct credit exposure to the counterparty, which has not otherwise been collateralized. 2 Also equals the cumulative amount from inception for the year ended 31 December 2006. 3 Current and cumulative changes in the fair value of loans attributable to changes in their credit risk are only calculated for those loans oustanding at balance sheet date. Current and cumulative changes in the fair value of credit derivatives hedging such loans include all the derivatives which have been used to mitigate credit risk of these loans since designation at fair value. For loans reported under the fair value option, changes in fair value due to changes in the credit standing of the borrower are calculated using counterparty credit information obtained from independent market sources.

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