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UBS Investment Bank announces modifications to Equity Research Ratings System

New York Media Releases Americas

UBS Investment Bank today announced modifications to its equity research ratings system to reflect evolving client needs. While the fundamental basis of the rating system will remain unchanged, the modification will include a change to the return thresholds for "buy," "neutral" and "reduce" recommendations.

This change will be achieved by narrowing the core ratings band to +/- 6% around the market return assumption (MRA) from +/- 10%. The MRA will continue to be calculated as the country risk free rate + 5%.

"Our goal is to continue to provide rigor to our investment recommendations and given that we now live in an age of lower global inflation/interest rates and consequential total return, we believe the enhancements we have made will further improve our leading stock picking performance," said Mark Steinert, Global Head of Equity Research for UBS Investment Bank.

The changes will be implemented globally over the weekend commencing September 9, 2006, applying closing prices from September 8, 2006. The mechanism will involve applying the analysts' prevailing forecast stock return (12-month expected price appreciation plus dividend) to the revised band, therefore arriving at the new rating. As a result, it is anticipated that about a quarter of the firm's coverage universe will be subject to changes in ratings. In certain countries, stocks with moderately positive forecast stock returns may be rated "Reduce" due to the offered return being materially lower than the assumed market return.

The Predictability component of the rating system will be unaffected.


UBS is one of the world's leading financial firms, serving a discerning global client base. As an organization, it combines financial strength with an international culture that embraces change. As an integrated firm, UBS creates added value for clients by drawing on the combined resources and expertise of all its businesses.

UBS is the world's largest wealth manager, a top tier investment banking and securities firm, and one of the largest global asset managers. In Switzerland, UBS is the market leader in retail and commercial banking.

UBS is present in all major financial centers worldwide. It has offices in 50 countries, with about 39% of its employees working in the Americas, 37% in Switzerland, 16% in the rest of Europe and 8% in Asia Pacific. UBS's financial businesses employ around 72,000 people around the world. Its shares are listed on the SWX Swiss Stock Exchange, the New York Stock Exchange (NYSE) and the Tokyo Stock Exchange (TSE).


Allison Chin-Leong, Media Relations +212 882 5693
Richard Morton, Media Relations +44 20 7568 0175

New York , September 8, 2006