Additional balance sheet information

Allowances and provisions
CHF million	Balance at 31.12.07	Provisions applied in accordance with their specified purpose	Reclassifications	Recoveries, doubtful interest, currency translation differences	Provisions released to income	New provisions charged to income	Balance at 31.12.08
Default risks (credit and country risk)	1,036	(481)		3	(506)	1,504	1,556
Trading portfolio risks ¹	4,554					10,304	14,858
Litigation risks ²	158	(457)	(47)	(3)	(33)	1,460	1,078
Operational risks	164	(203)		187	(280)	289	157
Retirement benefit plans	107	(2)		(49)	(14)	52	94
Deferred taxes	31			2		3	36
Other ³	3,446	(2,672)		(68)	(244)	871	1,333
Total allowances and provisions	9,496	(3,815)	(47)	72	(1,077)	14,483	19,112
Allowances deducted from assets	5,526						16,388
Total provisions as per balance sheet	3,970						2,724
1 The increase was mainly in the area of Fixed Income, Currencies and Commodities (FICC) in the Investment Bank. 2 Includes the movements of provisions for auction rate securities (ARS): provisions have been assumed by UBS AG from a subsidiary of CHF 922 million (USD 865 million), new provisions of CHF 407 million have been expensed; the provisions have been partially applied, and the residual amount of CHF 968 million was reclassified to Negative replacement values. In addition a provision of CHF 917 million (USD 780 million) was made in connection with UBS's US cross-border case. Refer to "Note 21 Provisions and litigations"). 3 The 31 December 2008 balance includes provisions for capitalization commitments of subsidiaries that have a capital deficit of approximately CHF 592 million and provisions were applied for the writeoff of investments in subsidiaries of CHF 2,629 million. In addition, provisions for reinstatement costs for leasehold improvements, provisions for employee benefits (service anniversaries and sabbatical leaves) are mainly included in this line.

Statement of shareholders' equity
CHF million	Share capital	General statutory reserves: Share premium	General statutory reserves: Retained earnings	Reserves for own shares	Other reserves	Total shareholders' equity (before distribution of profit)
As of 31.12.06 and 1.1.07	211	6,280	2,015	9,114	27,288	44,908
Cancellation of own shares	(4)				(2,411)	(2,415)
Capital increase		23				23
Increase in reserves			457		(457)
Prior year dividend					(4,275)	(4,275)
Profit / (loss) for the period					(4,251)	(4,251)
Changes in reserves for own shares				327	(327)
As of 31.12.07 and 1.1.08	207	6,303	2,472	9,441	15,567	33,990
Cancellation of own shares
Capital increase ¹	86	15,911			(15)	15,982
Capital increase related to MCNs		16,223				16,223
Increase in reserves						0
Prior year dividend						0
Profit / (loss) for the period					(36,489)	(36,489)
Changes in reserves for own shares				(6,564)	6,564	0
Transfers ²		(11,901)	(2,472)		14,373	0
As of 31.12.08	293	26,536	0	2,877	0	29,706
1 Includes stock dividend. 2 Subject to approval by the Annual General Meeting on 15 April 2009.

Share capital
	Par value		Ranking for dividends
	No. of shares	Capital in CHF	No. of shares	Capital in CHF
As of 31.12.08
Issued and paid up	2,932,580,549	293,258,055	2,932,580,549	293,258,055
Conditional share capital	792,844,711	79,284,471
As of 31.12.07
Issued and paid up	2,073,547,344	207,354,734	2,073,547,344	207,354,734
Conditional share capital	150,138,634	15,013,863

On 31 December 2008, a maximum of 100,415 shares can be issued against the future exercise of options from former PaineWebber employee option plans. These shares are shown as conditional share capital in the UBS AG (Parent Bank) disclosure.

During 2006, shareholders approved the creation of conditional capital of up to a maximum of 150 million shares to fund UBS's employee share option programs. In 2007, 5,704 shares had been issued under this program. The remaining conditional capital to fund UBS's employee share option programs amounts to 149,994,296 shares.

On 27 February 2008 the extraordinary general meeting of shareholders approved the creation of a maximum of CHF 10,370,000 in authorized capital, allowing the distribution of a stock dividend. Additionally, on 23 April 2008, the Annual General Meeting of shareholders (AGM) approved a capital increase that resulted in the issuance of 760,295,181 fully paid registered shares. In addition, during 2008, shareholders approved the creation of conditional capital in a maximum amount of 642,750,000 shares for the two issuances of mandatory convertible notes (MCNs). For further information, refer to Note 26 to the financial statements.

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