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Second Quarter Results 2006
Zurich, 15th August 2006Peter Wuffli (Chief Executive Officer)Clive Standish (Chief Financial Officer)Tom Hill (Chief Communication Officer)
1
Caution regarding forward looking statements
Cautionary statement regarding forward-looking statements. This communication contains statementsthat constitute “forward-looking statements”, including, but not limited to, statements relating to theimplementation of strategic initiatives, such as the European wealth management business, and otherstatements relating to our future business development and economic performance. While theseforward-looking statements represent our judgments and future expectations concerning thedevelopment of our business, a number of risks, uncertainties and other important factors could causeactual developments and results to differ materially from our expectations. These factors include, butare not limited to, (1) general market, macro-economic, governmental and regulatory trends, (2)movements in local and international securities markets, currency exchange rates and interest rates, (3)competitive pressures, (4) technological developments, (5) changes in the financial position orcreditworthiness of our customers, obligors and counterparties and developments in the markets inwhich they operate, (6) legislative developments, (7) management changes and changes to our BusinessGroup structure and (8) other key factors that we have indicated could adversely affect our business andfinancial performance which are contained in other parts of this document and in our past and futurefilings and reports, including those filed with the SEC. More detailed information about those factors isset forth elsewhere in this document and in documents furnished by UBS and filings made by UBS withthe SEC, including UBS’s Annual Report on Form 20-F for the year ended 31 December 2005. UBS is notunder any obligation to (and expressly disclaims any such obligations to) update or alter its forward-looking statements whether as a result of new information, future events, or otherwise.
SECTION 1
Group Results
3
Highlights
1 Financial Businesses only, from continuing operations2 UBS Group reported CHF 3,147m net profit attributable to UBS shareholders3 Based on UBS Group, from continuing operations4 Reference period excluding Private Banks and GAM
Net profit attributable to UBS shareholders1,2
2Q06
CHF 3.03bn
Diluted EPS3
Diluted EPS3 growth (year-on-year)CHF 1.48
+51%
Cost / income ratio1 66.7%
Net new money1 CHF 36.3bn
RoE3 year to date 29.6%
Invested Asset growth (year-on-year)1,4 10%
4
2Q06 Strategic steps
Organic growth initiatives
♦ Fixed Income: Achieved record results inleverage finance and increased personnelin credit fixed income, rates, andsecuritized products
♦ Russian Bank License: Will allow UBS tooffer wealth management, assetmanagement, Rouble fixed income andforeign exchange services
♦ Asia Pacific: Increased personnel +29%year-over-year (+1,417) and 9% quarter-on-quarter (+520)
♦ Dillon Read Capital Management:Launched on June 5th
♦ UBS Brand: Continued investment andprogress
Acquisitions
♦ Piper Jaffray: On track to close during thethird quarter
♦ Banco Pactual: On track to close towardsthe end of the second half of 2006
♦ ABN AMRO's exchange tradedderivative business: On track to closeduring the second half of 2006
5
Capital management update
Buyback -2nd line
♦ 4.3 million shares bought back during the second quarter at a total cost ofCHF 301 million.
♦ 6.7 million shares purchased under 2006/2007 buyback program whichstarted March 8, 2006 at a total cost of CHF 456 million.
Tier 1
♦ 12.2% Tier 1 ratio, -70bps quarter-on-quarter
♦ Includes 1.2% point reduction from acquisitions
♦ Operational impact of RWAs from acquisitions will be included at closings(~40bps)
♦ Risk weighted assets CHF 316bn, + ~4bn (+1%) quarter-on-quarter
Buyback -1st line
♦ Purchased stock 23 of 36 eligible days in the second quarter
6
The market in 2Q06Market performance – 2Q06 Global investment banking fee pool1
Credit spreads
1 Dealogic data2 Average exchange rates
Movement in USD/CHF exchange rate2
319
260
280
300
320
340
2Q05 1Q06 2Q06
B Credit to 10 Year Treasury
(bp
s)
17'612
0
4'000
8'000
12'000
16'000
Avg
00
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
2Q05
1Q06
2Q06
(USD
m)
2Q06 vs. 1Q06 2Q06 vs. 2Q05
-5.4%
-1.6%
-6%
-4%
-2%
0%
(% U
SD w
eake
r)
20'000
2Q06 vs. 1Q06 2Q06 vs. 2Q05
NA
SDA
Q
FTSE
100
SMI
S&P
500
DJI
A
DJ
Euro
Sto
xx
MSC
I W
orl
d
MSC
I W
orl
d
Bo
nd
-10
0
10
20
(%)
-7.2
5.6
-2.2
14.1
-4.6
22.4
-1.9
6.6
0.4
8.5
-5.5
19.0
-1.1
14.9
3.2
-0.3
30
7
Net profit from continuing operations1
1 Financial Businesses only, net profit attributable to UBS shareholders from continuing operations, pre-goodwill
Year-on-year 51%growth
Year-on-year 18% growth
3,032
0
500
1,000
1,500
2,000
2,500
3,000
3,500
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
(CH
F m
)
2001
2002
2003
2004
2005
9,442
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
(CH
F m
)
8
3,975 4,040
-1,000
0
1,000
2,000
3,000
4,000
WM Int & CH WM US BB CH Global AM InvestmentBank
CorporateCenter
FinancialBusinesses
(CH
F m
)
1Q06 2Q06
2,668
4,040
-1,000
0
1,000
2,000
3,000
4,000
WM Int & CH WM US BB CH Global AM InvestmentBank
CorporateCenter
FinancialBusinesses
(CH
F m
)
2Q05 2Q06
Pre-tax profit1 development
+33%
+90%+12% +52%
+57%
n/m
+51%
1 Financial Businesses only, from continuing operations
2Q06 versus 2Q05
2Q06 versus 1Q06
+1%
-4%+13% -11%
n/m
+2%
0%
9
2Q06 versus 1Q06
Invested assets1 development
1 Financial Businesses only, from continuing operations
-4%
360
4499
2,6572,766
2
1,600
1,800
2,000
2,200
2,400
2,600
2,800
1Q06 Net new
money
Acquisitions Market
movements /
performance
Currency Other 2Q06
(CH
F b
n)
10
Diluted EPS2
Shareholder returnsRoE1
1 Net profit attributable to UBS shareholders from continuing operations (annualized as applicable) before the amortization of goodwill / average equity attributable to UBSshareholders less assumed distributions (estimated as applicable)
2 Net profit attributable to UBS shareholders for diluted EPS from continuing operations before the amortization of goodwill / weighted average shares outstanding for dilutedEPS
29.6
0
5
10
15
20
25
30
3520
01
2002
3M03
6M03
9M03
12M
03
3M04
6M04
9M04
12M
04
3M05
6M05
9M05
12M
05
3M06
6M06
(%)
Year-on-year 51%growth
0
1.48
1.16
(CH
F)
0.5
1
1.5
2
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1 Q06
2Q06
Avg
01A
vg02
Avg
03
Avg
04
Avg
05
11
Continued cost controlCost / income1
1 Financial Businesses only. Total operating expenses less the amortization of goodwill / total operating income less credit loss expense or recovery
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
50
66.7
70.1
55
60
65
70
75
80
85
90
(%)
WM Int &CH
WM US BB CH Global AM IB FinancialBusinesses
50
68.466.7
55
60
65
70
75
80
85
90
(%)
1Q06 2Q06
12
Non-personnel expenses1 development
1 Financial Businesses only
2Q06 versus 1Q06
0
WM Int & CH WM US BB CH Global AM IB
589 605
324 309
119 119 118 95
1,026973
200
400
600
800
1,000
1,200
(CH
F m
)
1Q06 2Q06
13
NNM wealth management businesses
Net new moneyNNM UBS1
LTM CHF 166.3bn
1 Financial Businesses only, from continuing operations
LTM CHF 115.6bn
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
31.2
23.8
0.7
6.7
17.1
30.5
0
5
10
15
20
25
30
35
(CH
F b
n)
WM US WM Int & CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
0
37.036.3
5
10
15
20
25
30
35
40
45
50
55
(CH
F b
n)
14
-4%-3%
2%
-3% -3% -2%
-7%-4%(6)
0
6
12
FinancialBusinesses
WM Int(excl. EWM)
EWM Global AMInstitutional
WM CH BB CH WM US Global AMWholesale
(%)
Net new money and invested asset development2Q06 NNM generation
1 Financial Businesses only, from continuing operations
Invested asset development 2Q06 versus 1Q06
36.3
21.6
7.24.9
1.7 1.5 0.7
-1.3(5)
5
15
25
35
EWM Global AMInstitutional
WM CH BB CH WM US Global AMWholesale
(CH
F b
n)
FinancialBusinesses
WM Int(excl. EWM)
15
Fee and other income versus trading income1
Fee and other income2
(72% of total income in 2Q06)Trading income3
(28% of total income in 2Q06)
Year-on-year 45% growth
Year-on-year 29% growth
1 Financial Businesses only2 Net income from fee and commissions, interest margin, treasury and other activities, and other income3 Net Income from trading activities
8,642
7,026
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
(CH
F m
)
3,377
2,855
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
(CH
F m
)
16
Credit, treasury and other income2
Revenue trends1
Net fee & commission income
Net income from trading activities
Net income from interest marginproducts
1 Financial Businesses only2 Credit loss (expense) / recovery, net income from treasury and other activities, and other income
2,000
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
6,422
5,359
3,000
4,000
5,000
6,000
7,000
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1,000
3,377
2,855
2,000
3,000
4,000
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1,500 1,455
1,339
1,000
1,100
1,200
1,300
1,400
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
422
803
400
800
1200
1600
(CH
F m
)
17
Trends in fee income1
Underwriting and corporate finance fees
Investment fund fees
Brokerage fees received
Portfolio and other management andadvisory fees
1 Financial Businesses only
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
1,475
1,188
300
600
900
1,200
1,500
1,800
2,100
(CH
F m
)
1,365
1,079
0
300
600
900
1,200
1,500
1,800
2,100
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
1,5391,328
300
600
900
1,200
1,500
1,800
2,100
(CH
F m
)
2,096
1,680
0
300
600
900
1,200
1,500
1,800
2,100
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F m
)
18
Investment BankGlobal WM & BB
Actual credit loss (expense) / recoveryR
eco
very
Exp
en
se
Reco
very
Exp
en
se
37
-200
-160
-120
-80
-40
0
40
80
1201Q
012Q
013Q
014Q
011Q
022Q
023Q
024Q
021Q
032Q
033Q
034Q
031Q
042Q
043Q
044Q
041Q
052Q
053Q
054Q
051Q
062Q
06
CH
F m
1
-200
-160
-120
-80
-40
0
40
80
120
1Q01
2Q01
3Q01
4Q01
1Q02
2Q02
3Q02
4Q02
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
CH
F m
SECTION 2
Business Unit Results
20
Wealth Management Int & CH profitability1
1 Pre-goodwill
WM USGlobalAM
IBWM
Int & CHBB CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
500 300
1'283
1'040
1'017
884
600
700
800
900
1'000
1'100
1'200
1'300
1'400
(CH
F m
)
400
500
600
700
800
900
1'000
1'100
(CH
F bn
)
Business Unit performance before tax (LHS) Invested assets (RHS)
21
Gross margin
WM USGlobalAM
IBWM
Int & CHBB CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
107102
75
27
79
28
0
20
40
60
80
100
120
(bp
s)
Recurring income Non-recurring income
22
Net new money (NNM) and invested assets
Invested assets - 2Q06 versus 1Q06
NNMLTM CHF 89.6bn
WM USGlobalAM
IBWM
Int & CHBB CH
17.1
30.5
0
5
10
15
20
25
30
351Q
03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F b
n)
310 18
27
1,017
8
1,039
900
950
1,000
1,050
1,100
1Q06 Net new money Acquisitions Marketmovements /performance
Currency Other 2Q06
(CH
F b
n)
23
Global Wealth Management - NNM per CA
0
WM US
2003
2004
2005
1H06
WM CH
2003
2004
2005
1H06
WMI (without EWM)
2003
2004
2005
1H06
EWM
2003
2004
2005
1H06
5
10
15
20
25
30
1.3
4.8
14.7
16.8
(CH
F m
)
WM USGlobalAM
IBWM
Int & CHBB CH
19.0
26.7
4.43.6
24
NNM, invested assets
Progress in European domestic businessProfitability
2Q06 versus 2Q05 Client advisors
WM USGlobalAM
IBWM
Int & CHBB CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
14
-42
181
222252
238
-100
0
100
200
300
(CH
F m
)
EWM Income EWM Costs EWM InvestedAssets
48%
5%
29%
0
10
20
30
40
50
(%)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
5
7
100
130
0
2
4
6
8
(CH
F b
n)
0
40
80
120
(CH
F bn
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
828 813
200
400
600
800
1,000
(FTE
)
EWM pre-tax profit EWM income EWM expenses EWM net new money (LHS) EWM invested assets (RHS)
25
Net new money
Wealth Management US key figuresCost / income ratio1Profitability1
WM USGlobalAM
IBWM
Int & CHBB CH
Recurring income
1 Pre-goodwill
179
78
-150
-100
-50
0
50
100
150
2001Q
03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
00.7
6.7
2
4
6
8
10
(CH
F b
n)
854
709
62 55
400
500
600
700
800
900
(CH
F m
)
0
10
20
30
40
50
60
70
(%)
0
8794
20
40
60
80
100
120
140
(%)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
Recurring income Recurring income as % of income
26
Business Banking profitability1
1 Pre-tax profit
Year-on-year 12% growth
WM USGlobalAM
IBWM
Int & CHBB CH
632
547
0
100
200
300
400
500
600
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F m
)
700
27
Global Asset Management profitability1
1 Pre-tax profit, pre-goodwill
Year-on-year 58% growth
WM USGlobalAM
IBWM
Int & CHBB CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
334
264
685
771
0
50
100
150
200
250
300
350
400
450
(CH
F m
)
0
100
200
300
400
500
600
700
800
900
(CH
F bn
)
Pre-tax profit (LHS) Invested assets (RHS)
28
Net new money1 and gross marginInstitutional net new money Wholesale intermediary net new money
WM USGlobalAM
IBWM
Int & CHBB CH
Institutional gross margin Wholesale intermediary gross margin
1 Excluding money market flows
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
(CH
F b
n)
6.1
4.5
-2
0
2
4
6
8
10
12
14
0
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0.2
9.5
0
2
4
6
8
10
12
14
(CH
F b
n)
01Q
03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
33 34
10
20
30
40
(bp
s)
5044
40
10
20
30
40
(bp
s)
50
29
Investment Bank performanceEquities revenuesPre-tax profit and cost / income
FIRC revenues IBD revenues
WM USGlobalAM
IBWM
Int & CHBB CH
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1'754
1'295
200
600
1'000
1'400
1'800
(CH
F m
)
71
70
30
40
50
60
70
80
90
(%)
Pre-tax profit before goodwill (LHS)Cost/income ratio excl. goodwill (RHS)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
2,626
1,991
500
1,000
1,500
2,000
2,500
3,000
(CH
F m
)
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
0
2,280
1,745
500
1,000
1,500
2,000
2,500
3,000
(CH
F m
)
Avg
01
Avg
02
Avg
03
Avg
04
Avg
05
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
0
795
627
200
400
600
800
(CH
F m
)
900
30
Fixed Income, Rates and Currencies (FIRC)Revenues
WM USGlobalAM
IBWM
Int & CHBB CH
2Q06 versus 1Q06, 2Q05
Q/Q
7%
-11%
14%
17%
22%
15%
50%
29%
82%
60%
81%
-46%
2,626
1,991
0
500
1,000
1,500
2,000
2,500
3,0001Q
032Q
033Q
034Q
031Q
042Q
043Q
044Q
041Q
052Q
053Q
054Q
051Q
062Q
06
Avg
01A
vg02
Avg
03A
vg04
Avg
05
(CH
F m
)
2,626
0 1,000 2,000 3,000
Total FIRC
Rates
FixedIncome
FX/CCT
PFCA & CRE
MunicipalSecurities
(CHF m)
2Q05 1Q06 2Q06
Y/Y
31
Questions…
