Item 2

Appropriation of retained earnings and distribution

A. Proposed appropriation of retained earnings and distribution out of the capital contribution reserve
The Board of Directors proposes the following appropriation of retained earnings:

CHF million

31 December 2013

Net profit for the period

2,753

Total available for appropriation

2,753

Appropriation to general statutory reserve: retained earnings

2,753

Total appropriation

2,753

The Board of Directors proposes the payout of CHF 0.25 per share of CHF 0.10 par value out of the capital contribution reserve.

CHF million, except where indicated

31 December 2013

Total capital contribution reserves before proposed distribution 1.2

41,692

Proposed distribution of capital contribution reserve within general statutory reserve: CHF 0.25 per dividend-bearing share 3

(961)

Total capital contribution reserves after proposed distribution

40,732

B. Explanation
The profit for the financial year 2013 is proposed to be attributed to the general statutory reserve.

Provided that the proposed distribution out of the capital contribution reserve is approved, the payment of CHF 0.25 per share would be made on 15 May 2014 to holders of shares on the record date 14 May 2014. The shares will be traded ex-dividend as of 12 May 2014, and accordingly the last day on which the shares may be traded with entitlement to receive a payout will be 9 May 2014.