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UBS PaineWebber's Municipal Securities Group Issues Report on California

| Media Releases Americas

UBS PaineWebber's Municipal Securities Group (MSG) Strategy Team today published an in-depth analysis of California and its outlook for 2002 in its report The Municipal Market Strategist.

According to Brad Gewehr, UBS PaineWebber¡¦s director of Municipal Research, 2001 proved a difficult transition year for California. The power crisis drained more than $6 billion from the State treasury while the recession caused the largest single-year revenue decline since World War II. ¡§We expect that the State will be able to stabilize its credit quality this year, but its ability to bring the long awaited power bond deal to market will be critical to that effort,¡¨ commented Gewehr.

Additional highlights of the report include:

* AIRPORTS-NO DEFAULTS
* RATING AGENCIES-UPGRADES OUTPACE DOWNGRADES
* FEDERAL RESERVE-EASING AND ECONOMIC RECOVERY


Produced monthly, The Municipal Market Strategist offers municipal investors a comprehensive assessment of the opportunities and risks within the municipal market. Targeted to institutional money managers, issuers of tax-exempt securities and individual investors, it considers the key issues of importance to municipal investors ranging from changes in the tax laws, to fundamental shifts in the credit outlook, to supply/demand dynamics, to the near-term cyclical outlook.

The Municipal Securities Group ranked number two in negotiated senior managed underwriting with a more than twelve and a half percent market share and ranked number three in competitive senior managed underwriting with a nine and a half percent market share.

UBS PaineWebber serves the wealth management needs of more than 2 million clients and employs approximately 21,000 in the U.S. UBS PaineWebber is a business unit of UBS Warburg ¡V a subsidiary of UBS AG (Zurich, Switzerland) ¡V NYSE:UBS.

Contact: Susan Wentworth, (212) 713-4097