Switzerland and UBS Strong Partners 2015 / 2016 “It’S Time We Reflected on Our Traditional Strengths.” Lukas Gähwiler Switzerland Continues to Be at the Forefront

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Switzerland and UBS Strong partners 2015 / 2016 “It’s time we reflected on our traditional strengths.” Lukas Gähwiler Switzerland continues to be at the forefront

There is no doubt that the Swiss economy is among the best in the world. Its liberal labor market, open economy, sound fiscal policy and excellent education system have made our country a model for success.

Closer inspection, however, reveals that Switzerland is falling slightly in the annual global rankings, although the change is subtle rather than dramatic. This trend is particularly noticeable in the field of bureaucracy and government regulation.

It’s time we reflected on our traditional strengths and boldly confronted excessive regulation. Over- regulation increases costs and stifles innovation. Particularly in the current environment, we cannot afford any additional burdens on our companies.

UBS is committed to writing the next chapter of Switzerland’s success story. For this we rely on facts. This publication provides information on the wide range of touchpoints between Switzerland as a financial center and a business location. We highlight the importance of the financial sector to Switzerland’s prosperity and the role that UBS plays in this regard.

Lukas Gähwiler President UBS Switzerland Table of contents 6 Diverse Switzerland Large and small companies make for a good mix

8 Affluent Switzerland Dynamic economy boosts prosperity

10 High-employment Switzerland Liberal labor market creates advantages

12 Livable Switzerland Sustainability increases quality of life

14 Switzerland as an export nation Quality is in demand internationally

16 Long-living Switzerland Retirement planning increasingly important

18 Financially strong Switzerland Companies strengthen government finances

20 Stable Switzerland A location characterized by security and trust

22 Balanced Switzerland Sector mix brings stability

24 Competitive Switzerland Innovation drives the economy

26 UBS in Switzerland

27 UBS’s commitment to Switzerland Diverse Switzerland

Switzerland – a small country with a diverse economy. Small and medium-sized enterprises (SMEs) – totaling nearly 560,000 according to the latest method of calculation – form the backbone of the Swiss economy. At the same time, more than 1,250 large firms are headquartered in Switzer- land. The interaction between SMEs and large companies gives rise to innovative and technologi- cally sophisticated products, which have established the “Swiss made” label as a seal of quality. This balanced mix of sizes and sectors forms the basis for Switzerland’s economic success.

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The financial sector – a source of credit for the economy. A financial system that works effectively is an integral part of a flourishing economy. Companies in Switzerland benefit from a comprehensive sup- ply of credit at low interest rates. The SME segment accounts for around 90% of all corporate lending. 42% of secured loans and 38% of unsecured loans are granted by major banks, as they have the neces- sary risk capacity to do so given their size and experi-

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“UBS serves over 120,000 Swiss companies” 7PIGFGEMVG -TGFKVG )TQUUDCPMGP ¸DTKIG$CPMGP ence. The major Swiss banks are involved in over 80% of all equity and debt transactions for large companies and SMEs in Switzerland in the public capital markets. For SMEs alone, this proportion is over 90%.

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UBS – at the service of Swiss companies. Of the more than 120,000 Swiss companies that have a -TGFKVGCP7PVGTPGJOGP -TbusinessGFKVGCP7PVGT relationshipPGJOGP with UBS, which include over /TF%*( 90%/TF of% *(the country’s 250 biggest firms, each one has differing needs depending on its size and international focus. UBS provides each client group)TQUUDCPM withGP )GFGEMVG ¸DTKIG$CPMGP the appropriate solutions for payments, foreign cur- -TGFKVG *[RQVJGMCT HQTFGTWPIGP rencies, securities, loans and export financing, coupled with specialist advice on succession planning, restructuring and takeovers. Added to this, UBS numbers among its clients around 80% of the 300 banks domiciled in Switzerland and 75% of the 7PIGFGEMVG -TGFKVG 100 largest pension funds, offering them a wide range of services. )TQUUDCPMGP ¸DTKIG$CPMGP *[RQVJGMCT 7PIGFGEMVG )GFGEMVG HQTFGTWPIGP -TGFKVG -TGFKVG

7 Affluent Switzerland

Switzerland – a wealthy country. Switzerland is one of the most affluent countries in the world. Value added per capita was around CHF 79,000 in 2014, putting Switzerland in fourth place worldwide after Luxembourg, Norway and Qatar. The average Swiss resident has personal net assets of just under CHF 180,000, which rises to total assets per capita of CHF 391,000 when net real estate value is taken into consideration. With net foreign assets per capita of around CHF 96,000, Switzerland is ranked in fifth place internationally.

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The financial center – a pillar of the economy. 10 20 30 40 50 60 70 80 The financial sector is a key pillar of the Swiss economy. It is highly productive, generating in 2014 added value in excess of CHF 66 billion, equivalent 0 to around 10.5% of GDP, putting Switzerland in third place internationally. Only the financial centers of Luxembourg and Singapore contribute a larger percentage to GDP. It also generates additional added value of CHF 23 billion in other sectors through orders to industry and purchasing of services.

10 20 30 40 50 60 70 80

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0 “The financial center generates prosperity for Switzerland”

In total, the financial center thus creates added value of CHF 89 billion or around 14% of GDP.

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UBS – firmly rooted in Switzerland.Switzerland is not only UBS’s home, it is also its main market. In 2014, CHF 6.8 billion or 24% of the bank’s operating income was generated in Switzerland. UBS also spends more than CHF 2.5 billion per year in Switzer- land on goods and services supplied by some 15,000 companies. With more than 21,000 employees and 300 branches across the country, UBS is Switzerland’s largest bank. More than 120,000 Swiss companies, one in three households and one in three pension funds in Switzerland are UBS clients.

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,QD/CUEJKPG5EJYGK\Switzerland – a liberal labor market. Employment #Plevels\CJN$GUEJÀH in SwitzerlandVKIVGKPFGZKGTV3 haveWCTVCN enjoyed dynamic growth in recent years despite the global economic crisis.

Notwithstanding growing challenges, the liberal labor market continues to be a core element for this. 109 Approximately 440,000 full-time equivalent positions have been created since 2005 and the unemploy- 106 ment rate fluctuated around 3% in 2014. In order for 5EJYGK\ &GWVUEJNCPF (TCPMTGKEJ +VCNKGP )TQUUDTKVCPPKGP 75# new vacancies in Switzerland to be filled, it’s im 103 portant that domestic potential is utilized effectively. The dual education system plays a key role here: more than 220,000 young people were doing 5EJYGK\ &GWVUEJNCPF (TCPMTGKEJ +VCNKGP )TQUUDTKVCPPKGP 75# apprenticeships in 2014. 97

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0 The financial sector – a key pillar of the Swiss labor market. Despite the financial crisis, the finan- 100 cial sector has created roughly 20,000 full-time equivalent jobs in Switzerland since 2006. The financial sector employs more than 246,000 people directly and generates a further 245,000 jobs indi- rectly. Combined, these 491,000 jobs account for 11.7% of all employees in Switzerland. At the same

10 “UBS promotes staff training”

time, banks are also looking to develop young talent, and are currently training around 3,800 commercial apprentices.

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UBS – an important employer. UBS employs more than a third of its roughly 60,000 employees in Switzerland and is the third-largest private employer in the country. With some 1,800 training positions, UBS offers attractive opportunities for those entering the workforce, along with a variety of further training possibilities. Each year, approximately 80% of apprentices stay with UBS after completion. Thanks to the bank’s wide range of business operations and international focus, its employment offering com- prises no less than 250 job profiles. UBS also fosters a culture of ongoing staff development, with emp loyees in Switzerland completing a total of more than 185,000 training units in 2014. The attractive development opportunities are one of the reasons why more than 45% of employees in Switzerland 18 have been working for UBS for more than 10 years.16 14 12 10 8 6 4 2 0 11

100

18 40

16 20 14 12 0 10 8 6 4 2 0 *CPFGN Livable Switzerland

Switzerland – high quality of life. Swiss cities -QPMWTTconsistentlyGP\HÀJKIG.ÀPFGT

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The financial sector – supporting culture, sport and sustainability. The financial sector makes substantial contributions in support of social, cultural and sporting initiatives. The annual support com mitted by financial companies for cultural events alone accounts for more than a quarter of total corporate funding for culture. In addition, financial companies are meeting their ecological targets: many have an active environmental management system in place and are committed to reducing greenhouse gas emissions. The Swiss financial center also offers a wide range of financial investments based on social, ethical and environmental criteria.

100

+RKH/HEHQVTXDOLWlWLQ6FKZHL]HU6WlGWHQ “UBS is committed to sustainability”

UBS – responsible and sustainable. UBS has a long tradition of social responsibility. Its independent foundations have been supporting charitable purposes for more than 50 years. It also supports voluntary work by its employees and matches employee donations to selected aid organizations on a one-to- one basis. UBS supports a host of initiatives in Schweiz: Exportweltmeister von Qualität USthe areasD pro Kilo Ex poofrt eart, (200 9)sport and culture. At the end of 2014, 21% of the assets managed by UBS were taking 12 sustainability criteria (environment, society and gov- ernance) into account. With the aid of targeted 9 measures, UBS has significantly increased the energy

6efficiency of its buildings, and has reduced CO2 emissions to more than 50% below 2004 levels. It is 3also assisting its corporate clients with the energy “check-up” and offering institutional investors unpar- 0alleled access to the market for assets in the area Schweiz DeutschlandItalien Gross- USAFrankreich of renewable energies and energybritannien efficiency, thanks to UBS Clean Energy Infrastructure Switzerland.

UBS is reducing its greenhouse gas emissions

CO2 emissions in tonnes (UBS, 2015)

400,000

– 51% 300,000

200,000

100,000

0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

500000.093750 437500.082031 375000.070312 312500.058594 250000.046875 187500.035156 125000.023438 62500.011719 0.000000 Treibhausgas (THG)-Fussabdruck von UBS

In t CO2 e Anteile erneuerbarer Energien (in %)

400 000 100

300 000 75

200 000 50

100 000 25

0 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Direkte THG-Emissionen (Erdöl, Erdgas, Treibstoffe) Indirekte THG-Emissionen (Elektrizität, Fernwärme) Andere indirekte THG-Emissionen (Geschäftsreisen inkl. Kompensation, Papier, Entsorgung) Anteile erneuerbarer Energien (in %) Switzerland as an export nation

Switzerland – internationally successful. Switzer- land owes its economic success in large part to its strong foreign trade relations and international network with around 30 free trade agreements to date. Over 30,000 internationally active SMEs are reliant on Swiss exports. Overall exports account for 50% of GDP. Although the currency situation represents a major challenge for the export industry, Swiss exports continue to enjoy strong demand abroad. Of these, almost 60% go to the EU, and in particular to our neighboring countries, which are Switzerland’s most important trading partners. Accounting for 10% of all exports, trade with Baden-Württemberg alone is as significant as with the USA or all BRIC (Brazil, Russia, India and China) countries together, while trade with Northern Italy (6% of all exports) is as extensive as with China.

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The financial sector – internationally connected. The Swiss economy can rely on a highly efficient financial center to support it in its international activities. According to the Global Financial Centres Index, used to

14 “UBS provides important services for the Swiss export industry”

measure competitiveness, the financial centers of Zurich and Geneva are ranked second and third in Europe after London and among the top 15 worldwide. The major Swiss banks are among the main providers of essential services for Swiss companies with an export focus. This includes processing payment transactions, hedging currency risks, financing international trading activities and ensuring payment with letters of credit or guarantees. Around 70% of the market share in foreign trade services is held by the two major Swiss banks.

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UBS – partner to export business. UBS provides import- and export-driven companies with integrated solutions that are individually tailored to their risk coverage and financing needs. Thanks to its presence in more than 50 countries and its network of some 3,000 correspondent banks worldwide, UBS offers a com prehensive range of services for export-driven companies. Smaller Swiss banks that are not in a position to offer all international services themselves also benefit from UBS’s global network.

10 20 30 40 50 60 70 80

0 Long-living Switzerland

Switzerland – high life expectancy. Life expectancy in Switzerland is among the highest in the world and was calculated at 82.8 years in 2012 – coming in third place behind Japan and Iceland. One of the reasons for this is the high quality of life. The “Economist” magazine chose Switzerland to be the best place in the world to be born in 2013. Nevertheless, the high life expectancy also creates challenges for society. The number of pension- ers is set to almost double by 2050, while the number of people who are gainfully employed will only rise slightly. This trend makes a reform of the pension system crucial.

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The finance sector – retirement planning advice and solutions. Planning for retirement is gaining in importance as a result of increasing life expectancy. The Swiss pensions system is based on three pillars: the state pension, occupational pension and private pension provision. Financial service providers deliver advice and planning services, which allow for the creation of optimally tailored solutions, taking people’s individual situations into account. They make an important contribution towards the second and third

18 16 14 12 10 8 6 4 2 0

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16 20 14 12 0 10 8 6 4 2 0 *CPFGN “UBS is a leading provider of retirement solutions”

pillars by, for example, providing pension funds with advice and support in their investment decisions. The capital invested in occupational pension plans has more than tripled over the last 22 years, correspond- ing to an annual growth rate of 6%. In addition to this, private pension provisions are becoming increasingly important too. Since 2009, the volume of assets invested in private pensions has risen by approximately 8% annually. These assets have to be actively managed. Banks and insurance companies play a vital role in this respect.

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UBS – a key partner in the area of retirement planning. As an experienced pensions advisor and the largest asset manager in Switzerland, UBS is also a leading provider of retirement solutions with an extensive product portfolio and a wealth of expertise. In the area of investment funds, UBS is the largest provider in Switzerland with a volume of CHF 227 billion and market share of approximately 26%. UBS investment foundations manage assets in excess of CHF 11 billion in over 1,000 pension funds, assum- ing the ranking of fourth-biggest player in assets under management in Switzerland.

.DSLWDOLQGHUEHUXIOLFKHQ9RUVRUJHVWDUNDQJHVWLHJHQ Financially strong Switzerland

Switzerland – robust public finances. With a public sector debt ratio of 46% of GDP in 2014 com- pared to the OECD average of 111%, Switzerland’s public finances are in great shape. Even in the last few years, which have seen the public finances of many developed countries come under pressure, Switzer- land has been able to keep its debt at a low level and in some years even reduce it. A key factor in this regard has been the “debt brake,” which is designed to keep debt at a constant level across the economic cycle. The corporate sector also contributes to the solid public finances through high tax revenues. Large companies are major taxpayers. Just under 3% of corporations liable to taxation pay almost 90% of the direct federal taxes levied on legal entities. Fac- toring in the implicit government debt arising from the benefits promised from the old age and survivors’ insurance (AHV), public debt in Switzerland arrives at a somewhat higher total level, however. The implicit government debt in the AHV alone totals over 170% of the country’s GDP.

A small number of companies pay almost 90% of direct federal tax (FTA, 2014)

12%

97% 88%

Corporations with net proﬁt in excess of CHF 1 million 3%

Corporations subject Direct federal tax revenues to taxation of legal entities

18 3% der Kapitalgesellschaften zahlen 88% der 3% der Kapitalgesellschaften zahlen 88% der direkten Bundesteuer juristischer Personen direkten Bundesteuer juristischer Personen

9% 9%

97% 91% 97% 91%

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Anteil dieser Unternehmen an direkter Bundessteuer

100

0 “The banking sector and its employees are major taxpayers”

Financial sector – a major taxpayer. The provision of banking services generates major tax revenues for the government. In 2013, the overall tax effects culminating from the financial sector and financial market totaled approximately CHF 18.3 billion, which corresponds to around 14% of total fiscal income at a federal, cantonal and municipal level. To put that into context, annual government spending on healthcare, sport and culture in Switzerland equates to around the same amount.

UBS – an important taxpayer. With the founding of UBS Switzerland AG, UBS once again pays hun- dreds of millions of francs in income tax. In addition to this, the bank and its employees paid an average of over CHF 1 billion per year in other taxes from 2010 to 2014 in Switzerland alone.

Tax revenues from banking sector activity In CHF billion; discrepancies are due to rounding differences (BAK Basel, 2014) 18.3 9.6 Through upstream 8.7 added value and 2.3 employee consumption 3.8 3.1 Taxation of proﬁts and income (incl. income 1.8 tax paid by employees) 4.2 3.1

Financial sectorFinancial market

Indirect tax effects VAT Direct taxes paid by insurers Stamp duty Direct taxes paid by banks Withholding tax

3% der Kapitalgesellschaften zahlen 91% der 3% der Kapitalgesellschaften zahlen 91% der direkten Bundesteuer juristischer Personen direkten Bundesteuer juristischer Personen

9% 9%

97% 91% 97% 91%

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0 Stable Switzerland

Switzerland – attractive conditions. Ever since coming into existence, modern-day Switzerland has set itself apart from other countries on the grounds of its stability and security. Switzerland’s appeal as a business location can for the most part be attributed to its liberal economic policy, which is geared toward promoting stability. In an international comparison carried out by the World Economic Forum (WEF), Switzerland ranks among the top countries in the world in terms of macroeconomic and struc- tural conditions. For example, with an average annual inflation of 0.5% over the last 10 years, Switzerland comes second only to Japan among the OECD countries. The continued high level of confidence placed in Switzerland was illustrated by the Swiss franc’s sharp appreciation in value in response to the Swiss National Bank’s decision to discontinue the mini- mum exchange rate with the euro in January 2015. Nonetheless, the conditions have to be constantly improved. This also includes open markets, a competitive taxation system and social partnership.

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20 “UBS is the world’s leading wealth manager”

Financial sector – a reliable partner for Switzer- land. The financial center benefits at international level from Switzerland’s stability and reputation. Six of the 25 largest wealth managers worldwide are Swiss banks. The over CHF 6,100 billion of assets being managed by banks in Switzerland make a significant con tribution toward the economy’s financing and make a key contribution to the high level of capital stock and low interest rates. Furthermore, the franc is a strong and secure currency, as well as being the most traded currency in the world after the US dollar, euro, yen, pound sterling and Australian dollar.

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world’s leading wealth manager. Thanks to its global trading activities, UBS helps ensure liquid trad-

ing in the Swiss franc with over 100 other currencies from around the world. As the leading foreign exchange trader in Switzerland and Europe, UBS offers its clients seamless order processing tailored to their specific needs.

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Switzerland – diversified.Over the last few decades, Switzerland has developed into a services society. Nevertheless, industry still contributes a significant share to the country’s total value-added. Its share has remained stable at 25% over the last 15 years, during which time industry has become less important in many developed countries. Overall, Switzerland’s industrial sector has a diversified and varied mix of trade and industry, which has a positive impact on competition and innovation. Switzerland supplies the global market with highly specialized products and services and is among 100 the market leaders in many sectors. In total, industry generates 22% of all jobs in Switzerland. 75 5YKV\GTNCPFJCUCUVTQPICPFDCNCPEGFKPFWUVTKCNUGEVQT 'ORNQ[OGPVUJCTGURGTUGEVQT 5YKUU(GFGTCN5VCVKUVKECN1HƂEG 5GEVQT 50 2TKOCT[RTQFWEVKQP ¬ 25 5GEVQT 5GEVQT /CVGTKCNIQQFU 5GTXKEGU RTQFWEVKQP 0 1VJGTKPFWUVTKGU /GEJCPKECNCPFCWVQOQVKXGGPIKPGGTKPI %QPUVTWEVKQP /GVCNRTQFWEVU %JGOKECNCPFRJCTOCKPFWUVT[ 9QQFRCRGTCPFRTKPVKPI &CVCRTQEGUUKPIGSWKROGPVCPFYCVEJGU (QQFUVWHHUCPFVQDCEEQ

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5GMVQT +PFWUVTKGUGMVQT &KGPUVNGKUVWPIUUGMVQT “Clients from all sectors place their trust in UBS services”

Financial sector – strong networks. The financial sector, including insurance, accounts for 10.5% of overall economic output and thus makes a key contribution to Switzerland’s prosperity. It also has strong networks with other sectors, as it provides them with important services. The financial sector plays a key role in the overall economy by, for example, granting loans, providing financing and transferring risks. Particularely multinationals from all sectors have special financing requirements and are closely linked with the Swiss financial sector.

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UBS – across all sectors. UBS is the largest universal bank in Switzerland, which is the only country in which UBS is active in all five business areas – Retail, Wealth Management, Corporate and Institutional Banking, Investment Bank and Asset Management – holding a leading position in each one. UBS has very strong ties to its home market. UBS services over 120,000 Swiss companies through its 4,500 client- facing employees. At 19%, the wholesale and retail sector accounts for the largest proportion of UBS business clients.

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16 20 14 12 0 10 8 6 4 2 0 *CPFGN Competitive Switzerland

Switzerland – a competitive business location. In the 2014 – 2015 edition of its Global Competitiveness Report, the WEF voted Switzerland the most competitive country in the world for the fifth time in succession. Switzerland’s economic success is due in large part to the attractive operating environment that the country offers. Above-average innovation and some of the best research facilities in the world set Switzerland apart from its peers. Around 3% of Swiss GDP is spent on research and development. This means that Switzerland is also one of the leading countries in terms of R&D in international com parisons, with Israel, Finland, Sweden, Japan and Ger- many the only other OECD countries spending more.

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Financial sector – promoting innovation. The financial sector facilitates access to innovation capital and is itself committed to innovation. In a comparison with other European countries, Switzerland is fifth in the area of risk capital and venture capital. Through the Swiss Finance Institute, which was founded jointly by the financial sector and Swiss universities in 2006, the financial sector makes a direct contribution to research and teaching and thus to Switzerland’s stand-

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ing as a center of innovation. UBS numbers among the well-known companies from the financial sector that are involved in the Swiss Innovation Park’s economic advisory council and are thus establishing a basis for future innovation.

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UBS – supporting innovation and education. UBS supports the Swiss education system by providing a large number of apprenticeships and a wide range of training opportunities. This contribution was given further support by the UBS Education Initiative that was launched to mark UBS’s 150th anniversary in 2012. The core element of the initiative is the UBS Interna- tional Center of Economics in Society at the Univer- sity of Zurich, which carries out research into the inter- play between the economy and society. UBS has also joined forces with the Swiss Economic Forum to launch a growth initiative for SMEs. UBS gives innovative, forward-looking SMEs and start-ups the opportunity to have their strategies reviewed by independent experts and gain access to growth capital. 18 16 14 12 10 8 6 25 4 2 0

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16 20 14 12 0 10 8 6 4 2 0 *CPFGN UBS in Switzerland

Our 300 branches: www.ubs.com/locations

UBS Mobile Banking App: www.ubs.com/mobilebanking

Other apps: UBS Locator, UBS KeyClub, Prices and Earnings, and UBS Paymit

Sources: Allianz GWR, 2014; BAK Basel, 2014; BCG, 2015; Swiss Federal Statistical Office, 2015; Swiss Federal Statistical Office, 2014; Swiss Federal Statistical Office, 2003; BIS, 2013; Bloomberg, 2015; FSIO, 2014; Economist EIU, 2013; FDFA, 2015; FTA, 2014; European Commission IUS, 2015; Swiss Federal Customs Administration, 2014; IMD, 2015; IMF, 2015; Long Finance, 2014; Mercer, 2015; OECD, 2015; OECD, 2014; OECD, 2013; Reuters Ecowin, 2015; SBA, 2014; Scorpio Partnership, 2014; SECO, 2015; SECO, 2014; SIF, 2015; SNB, 2015; SNB, 2014; SNB, 2013; Stiftung SIP, 2015; UBS, 2015; UBS, 2014; UBS CIO, 2015; UBS CIO, 2014; WEF GCI, 2007 – 2015; Yale EPI, 2014; data availability: June / July 2015

This document and the information contained herein are provided solely for information purposes, and are not to be construed as a solicitation of an offer to buy or sell any securities or other financial instruments in Switzerland, the United States or any other ju- risdiction. No investment decision relating to securities of or relating to UBS Group AG, UBS AG or their affiliates should be made on the basis of this document. Refer to UBS’s quarterly and annual reports, which are available at www.ubs.com/investors. UBS un- dertakes no obligation to update the information contained herein.

26 UBS’s commitment to Switzerland

Examples of our wide-ranging commitment in Switzerland

Switzerland Tourism Marketing partnership with the Switzerland Tourism marketing organization since 2010

UBS Kids Cup Series of track-and-field competitions for children aged 6 – 15, which are held every year for over 120,000 participants across 850 events; title sponsor since 2011

Weltklasse Zurich World-famous athletics meeting; main partner since 1981

Art Basel One of the world’s leading art fairs; main sponsor since 1994

Montreux Jazz Festival Renowned international music festival steeped in tradition; main sponsor since 1987

Locarno Film Festival Leading international film festival with a unique ambience; main sponsor since 1981

UBS Education Initiative Long-term commitment to the future of Switzerland as a business location through targeted investments in education

Voluntary work carried out by UBS employees Almost 25,000 hours of voluntary work carried out by more than 2,700 UBS employees in 2014

UBS employee donations Current and former UBS employees donated in excess of CHF 470,000 to selected aid projects in 2014

27 Switzerland

Growth & prosperity Gross domestic product (GDP): CHF 648 billion GDP per capita: CHF 79,000, fourth-highest income worldwide after Luxembourg, Norway and Qatar Net foreign assets per capita: CHF 96,000 Government debt: 46% of GDP (OECD average 111%), ranked 6th in the OECD behind Estonia, Chile, Luxembourg, Norway and South Korea Real GDP growth: 1.9% (average over last five years) Inflation rate: 0.5% (average over last ten years); within the OECD, only Japan had a lower inflation rate Some 558,000 businesses in Switzerland, including more than 556,600 SMEs (over 99%) 3% of corporations account for almost 90% of direct federal taxes paid by legal entities

Openness & international integration Trade surplus: just under CHF 30 billion Exports: CHF 313 billion, equivalent to 48% of GDP; almost 50% of jobs are dependent on exports

Education & employment Unemployment rate: 3.2% 440,000 jobs have been created in Switzerland since 2005 One-third of the workforce works at 1,250 large companies

Competition & innovation Three Swiss companies were ranked among the 100 most valuable in the world in 2014 (Nestlé, Novartis and Roche) Market capitalization of listed companies relative to GDP: ranked second behind Hong Kong Most competitive economy in the world No. 1 in patent applications per capita, ahead of Japan Expenditure on research and development: approximately 3% of GDP Financial sector

Growth & prosperity Added value: over CHF 66 billion (10.5% of GDP) Indirect added value: CHF 23 billion (just under 5% of GDP) While Swiss GDP grew by an annualized 1.7% in real terms from 1993 to 2013, the financial sector posted above-average real growth of 2.4% p.a. in the same period 50% of the population has a bank within 500 meters of where they live Direct and indirect taxes paid by the financial sector: around CHF 18 billion per year, enough to cover the entire amount spent by the Swiss government on healthcare, sport and culture 275 banking institutions in Switzerland with 2,463 branches

Openness & international integration With a market share of just under 28% or USD 2,400 billion, the Swiss financial center is the global market leader in cross-border wealth management The large banks have a share of around 70% of the export trade services market Banks and insurance companies invested over CHF 200 billion outside of Switzerland in 2013, which corresponds to 20.4% of total Swiss investments made abroad

Education & employment Employment: 246,000 (over 5% of all gainfully employed persons) Indirect employment impact: 245,000 (over 5% of all gainfully employed persons) Banks train around 3,800 apprentices

Competition & innovation Most competitive financial centers: Zurich and Geneva are second and third respectively (after London) in Europe; in seventh and thirteenth place in a global comparison Large banks grant around 38% of all unsecured corporate loans Almost 70% of SMEs and 99% of large international companies place their trust in the capital market transaction services provided by the large banks UBS in Switzerland

Growth & prosperity Largest bank in Switzerland One in three households, one in three wealthy individuals, over 120,000 Swiss companies, one in three pension funds and around 80% of banks domiciled in Switzerland are UBS clients 1 million payments are made per day for our clients 74 million cashier and ATM transactions took place in 2014 10,000 client contacts per day in the UBS Customer Service Center In 2014, UBS and its employees paid more than CHF 1 billion in taxes Purchases totaling more than CHF 2.5 billion from around 15,000 suppliers

Openness & international integration Network of approximately 3,000 correspondent banks UBS trades in around 100 currencies, making it the largest foreign-exchange trader in Switzerland and Europe

Education & employment More than one-third of employees work in Switzerland (over 21,000 out of a total workforce of some 60,000) Largest employer in the financial center and third-largest private employer (after Migros and Coop) Some 1,800 training positions, 80% of apprentices remain with UBS Employees from more than 80 different countries Over 45% of employees have been working for UBS for more than 10 years

Competition & innovation UBS finances one in five private mortgages, manages one in six Swiss francs saved, processes one in four Swiss francs spent on credit cards and one in five Swiss francs spent on debit cards Corporate lending in Switzerland as at the end of 2014: around CHF 44 billion (CHF 16 billion in working capital loans and CHF 28 billion in mortgages) An average of over 550,000 transactions on the SIX Swiss Exchange each month 300 branches and 1,250 ATMs 62 advisory locations with around 750 client advisors and 300 specialists for companies Facts & Figures Switzerland and UBS – strong partners or unregistered trademarks of UBS. All rights reserved. Printed in Switzerland on chlorine-free paper using petroleum-reduced paper using petroleum-reduced Printed in Switzerland on chlorine-free trademarks of UBS. All rights reserved. or unregistered UBS Switzerland AG / P.O. Box CH-8098 Zurich www.ubs.com © UBS 2015. The key symbol and UBS are registered and registered © UBS 2015. The key symbol and are printing inks. Paper produced from sustainably farmed trees grown in an environmentally friendly manner. Languages: English, French, German and Italian. SAP-No. 83421E. Languages: English, French, friendly manner. in an environmentally grown sustainably farmed trees from printing inks. Paper produced