RATING ACTION COMMENTARY Fitch Takes Action on 7 Swiss Banking Groups on Coronavirus Disruption

Tue 31 Mar, 2020 - 9:56 AM ET

Fitch Ratings - London - 31 Mar 2020: Fitch Ratings has taken rating actions on seven Swiss banking groups due to the disruption caused by the coronavirus pandemic in and globally. The main actions are as follows:

Long-Term Issuer Default Rating (IDR) affirmed with Negative Outlooks:

Credit Suisse Group AG (A-), UBS Group AG (A+), Corner Banca SA (BBB+)

Long-Term IDRs placed on Rating Watch Negative (RWN):

EFG International AG (A)

Long-Term IDRs affirmed with Stable Outlooks:

Banque Pictet & Cie SA (AA-), Compagnie Lombard Odier SCmA (AA-), Zuercher Kantonalbank (AAA)

A full list of rating actions can be found below. While the ultimate economic and financial market implications of the coronavirus outbreak are unclear, Fitch views the risks to banks' credit profile profiles to be clearly skewed to the downside and this is reflected in today's rating actions. Fitch expects global economic growth to slow sharply in 2020, with increasing downside risks to this scenario.

Switzerland has adopted support measures for the private sector and financial markets, which should have overall positive implications for banks. Government guaranteed to SMEs, provided by the banks and funded through a special facility set up by the (SNB), should support the viability of the businesses and hence asset quality. Compensation of a significant portion of lost income for employees and self-employed will support serviceability of consumer and mortgage debt. Exclusion of placements from the leverage ratio calculation, and the deactivation by regulators of the counter- cyclical buffer should free up some capital to facilitate lending. The increase of the threshold above which interest is charged on central bank placements will also somewhat ease the pressure on net interest income from low interest rates.

Nonetheless, we expect asset quality to weaken relative to previous expectations and for earnings to face challenges, primarily due to weaker business volumes and to rising impairment charges. Fitch-rated Swiss banks generate a high portion of their revenue from wealth and activities, and declines in assets under management (AuM) as a result of sharp falls in asset prices will negatively impact their revenue base. Measures adopted or announced by the authorities globally to cushion the impact of the pandemic are vast in volume but may not be sufficient to prevent further market sell-offs. Higher wholesale funding costs for debt-issuing banks represent an additional downside risk in the event monetary policy support packages fail to mitigate rising funding costs.

Fitch has withdrawn the 'A+'/'F1' senior unsecured debt programme ratings of UBS Group Funding (Switzerland) AG because the programme is closed since UBS now issues holding company debt directly out of UBS Group AG.

KEY RATING DRIVERS

CREDIT SUISSE GROUP AG AND SUBSIDIARIES Unless noted below, the key rating drivers for Credit Suisse Group AG (CSG) and its subsidiaries are those outlined in our Rating Action Commentary published in June 2019 (Fitch Affirms Credit Suisse Group at 'A-'; Outlook Positive).

The Outlook on CSG's Long-Term IDR has been revised to Negative from Positive. CSG has rating headroom to emerge from the coronavirus crisis with its ratings intact but the economic fallout from the pandemic represents a medium- term risk to its ratings.

The group enters the downturn after having completed its restructuring, which resulted in a lower risk profile and improved profitability, albeit still moderate for CSG's rating and reliant on markets businesses. Market volatility may benefit the group's sales and trading revenue as well as transaction-based income from clients. However, the likely decline of recurring management fees, primary capital-market revenues, as well as higher loan impairment charges mean that it will be extremely difficult for the group to make significant progress towards stated profitability targets in the near term, while earnings volatility could increase.

Weaker profitability and risk-weight inflation caused by credit-risk migration and higher risk-weighted assets (RWAs) related to market risk will increase pressure on the group's capitalisation, which is supporting CSG's 'a-' Viability Rating (VR), with a common equity Tier 1 (CET1) ratio of 12.7% at end-2019.

As a result, we believe the economic and financial market fallout from the pandemic creates downside risks to our assessment of the group's earnings, asset quality and capitalisation relative to when we last reviewed its ratings.

At the same time, we expect CSG's funding and liquidity to remain stable, supported by the group's conservative liquidity position, limited refinancing needs in 2020 and access to central banks' liquidity facilities.

Fitch has also taken rating actions on certain subsidiaries of Credit Suisse AG (CS AG), the group's main operating entity, which were placed Under Criteria Observation (UCO) (see "Fitch Places Ratings of 67 Developed Market European Banking Groups Under Criteria Observation" published on 4 March 2020) following the publication of Fitch's updated Bank Rating Criteria.

Fitch has upgraded the Long-Term IDR of Credit Suisse (Schweiz) AG (CS Schweiz) to 'A+' from 'A', one notch above its VR, because of significant buffers of junior and internal bail-inable debt that offer protection to senior creditors of CS Schweiz in case of its failure. CS Schweiz's Derivative Counterparty Rating (DCR) was upgraded by one notch, in line with the Long-Term IDR. The Negative Outlook on CS Schweiz's Long-Term IDR mirrors that on the parent because we expect their ratings to be highly correlated and since we believe that the fallout from the pandemic creates medium-term downside risks for the standalone profile of CS Schweiz, in particular to our assessment of its earnings, asset quality and capitalisation.

Fitch has upgraded support-driven Long-Term IDRs of Credit Suisse International (CSI), Credit Suisse (Deutschland) AG (CSD) and Credit Suisse Securities Sociedad de Valores S.A. (CSSSV) to 'A' from 'A-', reflecting the change in the anchor rating they are notched off, from CS AG's 'a-' VR to its 'A' Long-Term IDR. The change in the anchor rating to CS AG's Long-Term IDR, which benefits from an uplift above the VR due to buffers of junior and downstreamed holdco senior debt, reflects our expectation that senior creditors of CSI, CSD and CSSSV will benefit from the parent's junior debt buffers given their high degree of integration into the parent and the group's single point-of-entry resolution strategy. In the case of CSI, this expectation is further underpinned by the regulatory requirement to pre-place sufficient bail-inable debt and equity into the subsidiary. CSI's long-term senior debt, CSI's and CSSSV's DCRs and CSD's long-term deposit ratings have been upgraded in line with the institutions' Long- Term IDRs. The Negative Outlooks on the Long-Term IDRs of CSI, CSSSV and CSD mirror that on the parent.

The Outlooks on the Long-Term IDR of Credit Suisse, New York branch and on the support-driven Long-Term IDR of Credit Suisse (USA), Inc. were revised to Negative from Positive, in line with the Outlook revision on the parent's Long- Term IDR.

UBS GROUP AG AND SUBSIDIARIES

Unless noted below, the key rating drivers for UBS Group AG and its subsidiaries are those outlined in our Rating Action Commentary published in June 2019 (Fitch Affirms UBS Group at 'A+'; Outlook Stable).

Fitch has revised the Outlook of UBS Group to Negative from Stable. The rating actions reflect our view that the economic fallout from the global pandemic represents a medium-term risk to UBS Group's ratings. We believe that the group enters the economic downturn from a relative position of strength, underpinned by its leading global wealth management franchise, which should provide support to earnings, solid capitalisation, and by its sound funding and liquidity. At the same time, we believe the economic and financial market fallout from the coronavirus outbreak creates downside risks to our assessment of the group's earnings, asset quality and capitalisation relative to when we last reviewed its ratings.

We expect UBS Group's earnings to come under pressure in 2020, reflecting the likely reduction of recurring management fees as a result of lower assets under management (unless asset prices rebound) and lower client risk appetite, lower primary-market revenues and higher loan impairment charges. Sales and trading results and transaction-based fees may benefit from market volatility but we do not expect these to outweigh the loss of other revenue and larger credit losses. The group's capital ratios are sound and broadly commensurate with risk, with a CET1 ratio of 13.7% at end-2019, but are likely to come under pressure as a result of weaker profitability and increase in RWAs, driven by credit-risk migrations and higher-market risk RWAs.

We expect UBS Group's funding and liquidity to remain stable, supported by the group's conservative liquidity position, limited refinancing needs in 2020 and access to the central bank's liquidity facilities.

BANQUE PICTET & CIE SA AND COMPAGNIE LOMBARD ODIER SCMA

Unless noted below, the key rating drivers for Banque Pictet & Cie SA (Pictet) are those outlined in our Rating Action Commentary published in July 2019 (Fitch Affirms Banque Pictet at 'AA-'; Outlook Stable) and the key rating drivers for Compagnie Lombard Odier SCmA (Lombard Odier) are those outlined in our Rating Action Commentary published in July 2019 (Fitch Affirms Lombard Odier at 'AA-'; Outlook Stable).

Fitch has affirmed Pictet's and Lombard Odier's respective Long-Term IDRs and VRs. The Outlooks on the Long-Term IDRs are Stable. The rating actions on Pictet and Lombard Odier reflect our expectation that these banks' wealth management-focused business models will remain resilient to the economic and financial market downturn caused by the pandemic even in a severely stressed scenario. This expectation is primarily driven by the very low credit risk and high liquidity of these banks' liability-driven balance sheets, as well as strong profitability, which could withstand severe deterioration in revenues before putting pressure on the banks' sound capital ratios.

Highly liquid assets (central bank placements and highly rated securities) account for the majority of Pictet's and Lombard Odier's total assets. Net loans comprise around a quarter of the banks' balance sheets and in both cases consist exclusively of conservatively collateralised Lombard loans. While sharp market movements are likely to increase the frequency of margin calls on these loans, we view the risk of material credit losses on them as low.

We believe the economic and financial market fallout from the coronavirus outbreak creates some downside risks to our assessment of the banks' earnings relative to when we last reviewed their ratings. We expect recurring management fees to decrease as AuM shrink due to adverse market movements and as clients switch to lower-risk and less remunerative asset allocations. However, this is compensated by both banks' strong starting points, with 2019 pre-tax profits estimated by Fitch at around 5% of RWAs in both cases (in the case of Pictet, calculated at the level of ).

EFG INTERNATIONAL AND SUBSIDIARIES

Unless noted below, the key rating drivers for EFG International (EFG) and its subsidiaries are those outlined in our Rating Action Commentary published in July 2019 (Fitch Affirms EFG International at 'A'; Revises Outlook to Stable).

Fitch has placed the Long-Term IDR, VR and debt ratings of EFG on Rating Watch Negative (RWN) because in our view the economic fallout from the coronavirus crisis represents a near-term risk to EFG's ratings. We believe the economic and financial market fallout from the pandemic creates downside risks to our assessment of the bank's earnings, asset quality and capitalisation relative to when we last reviewed its ratings.

The bank enters the economic downturn having just completed the integration of a large acquisition. Its profitability is a rating weakness, resulting in only moderate rating headroom at its 'a' VR level. The bank's 2019 operating performance materially improved yoy, in line with Fitch's expectations factored into the ratings. However, we see a heightened risk that a continuation of this profitability trend into 2020 will now be hampered or delayed. We expect it will be difficult for EFG to attract sufficient net new money to execute its growth strategy, while recurring fee income derived from wealth and asset management activities comes under pressure from reduced AuM due to recent market sell- offs.

Similar to other private banks, EFG's ratings are supported by the high share of central bank placements and highly-rated securities on the bank's balance sheet. Its loan book is generally low-risk, and mostly consists of conservatively collateralised Lombard loans. It also contains mortgage loans to wealthy individuals and a small portion (less than 3% of net loans at end-2019) of secured general corporate loans it inherited when it acquired BSI in 2016. We believe that the latter could be a source of credit losses for the bank, which is likely to exacerbate profitability pressures, which is reflected in the RWN. A combination of pre-impairment profitability pressure and increased impairment charges could put pressure on EFG's capitalisation, which currently supports the VR.

At the same time, we expect EFG's sound liquidity to remain a rating strength. At end-2019, EFG had a consolidated liquidity coverage ratio of 182%, and its high- quality liquid assets were equal to about a third of total assets.

ZUERCHER KANTONALBANK

Unless noted below, the key rating drivers for Zuercher Kantonalbank (ZKB) are those outlined in our Rating Action Commentary published in June 2019 (Fitch Affirms Zuercher Kantonalbank at 'AAA'/Stable/'a+')

Fitch has affirmed ZKB's IDRs and Support Rating, which are based on institutional support from the Canton of Zurich (AAA/Stable), the bank's guarantor and sole owner, and are equalised with the canton's IDRs. The canton guarantees all of ZKB's non-subordinated liabilities according to a specific cantonal law, the ZKB Law.

Fitch has affirmed ZKB's VR because we believe that the bank could withstand moderate deterioration in the domestic economy at its current VR, given its strong starting position. ZKB's funding, liquidity and capitalisation are strong. Earnings are adequate and loan loss impairments have remained low. However, we believe that economic and financial market fallout from the pandemic creates downside risks to our assessment of the bank's earnings, asset quality and capitalisation relative to when we last reviewed its ratings. At the same time, we expect that ZKB's funding & liquidity will benefit from the guarantee of the bank's strong owners.

CORNER BANCA SA

Unless noted below, the key rating drivers for Corner Banca SA (CB) are those outlined in our Rating Action Commentary published in July 2019 (Fitch Rates Corner Banca 'BBB+'; Outlook Stable).

Fitch has revised CB's Outlook to Negative from Stable. The rating actions reflect our view that the economic fallout from the coronavirus crisis represents a medium-term risk to CB's ratings. We believe that the economic and financial market fallout from the pandemic creates downside risks to our assessment of the bank's asset quality and earnings relative to when we last reviewed its ratings.

CB is domiciled in Lugano and has a naturally significant exposure to the local economy of the Swiss Canton of Ticino, which borders Italy and is currently one of the regions most affected by the outbreak in Switzerland. The bank also has moderate exposures to shipping and trade finance, which in our view are likely to perform weakly in the current environment. As a result, we believe that CB's asset quality is likely to deteriorate, with related impairment charges putting pressure on the bank's moderate earnings.

However, CB's high capital ratios (CET1 ratio of 25.7% and leverage ratio of 12.6% at end-2018 and we expect them to have remained stable in 2019) provide a sufficiently large cushion against weaker asset quality and profitability, in our view.

RATING SENSITIVITIES

Except otherwise stated below, existing rating sensitivities as defined in the latest rating action commentaries on each issuer and its respective debt classes continue to apply and are available at www.fitchratings.com.

The most immediate downside rating sensitivity for banks' IDRs, VRs and associated debt ratings now relates to the economic and financial market fallout arising from the coronavirus outbreak as this represents a clear risk to our assessment of asset quality, earnings, capitalisation and funding. The extent to which the support packages by the government and central bank can mitigate rating pressure will depend on the amount and form such support takes.

CREDIT SUISSE GROUP AG AND SUBSIDIARIES

CSG has headroom to emerge with its IDRs, VR and debt ratings intact primarily due to the relative strength of its asset quality, capitalisation and funding and liquidity profile, which are all scored above its VR. But this outcome will depend on the ultimate depth and duration of the coronavirus shock to the international economy. The ratings would likely be downgraded if the economic and financial market disruption arising from the pandemic is likely to reach a level that places sustained pressure on earnings and capitalisation, for example if there is a heightened likelihood that the group's CET1 ratio could drop significantly below the stated guidance of 12% (assuming stable minimum requirements following the deactivation of the counter-cyclical buffer) without a credible plan to restore capitalisation to target levels in a short period of time.

The ratings could also be downgraded if the group's capital markets businesses post significant unexpected pre-tax losses, compromising the profitability of the group, which could be indicative of weaknesses in risk controls.

The Outlook would likely be revised to Stable if the coronavirus shock to the global economy proves to be short-lived, and if CSG emerges from it with relatively unscathed franchise, capitalisation and funding and liquidity profile. An upgrade could follow if the group is able to achieve significant progress in meeting its profitability ambitions without increasing its risk appetite.

The Long-Term IDR of CS Schweiz is sensitive to changes in the ratings of CSG and Credit Suisse AG. It is also sensitive to potential deterioration of the standalone profile of CS Schweiz, and would be downgraded if the economic and financial market disruption arising from the pandemic is likely to reach a level that places sustained pressure on earnings and capitalisation. The ratings of other subsidiaries are sensitive to changes in the Long-Term IDR of Credit Suisse AG, which is in turn sensitive to the same factors as the ratings of CSG.

UBS GROUP AG AND SUBSIDIARIES

UBS Group has headroom to emerge with its IDRs, VR and debt ratings intact primarily due to the relative strength of its asset quality, capitalisation and funding and liquidity profile, which are all scored in line with its VR. But this outcome will depend on the ultimate depth and duration of the coronavirus shock to the international economy. The ratings would likely be downgraded if the economic and financial market disruption arising from the pandemic is likely to reach a level that places sustained pressure on earnings and capitalisation, for example if there is a heightened probability that the group's CET1 ratio drops significantly below the stated guidance of around 13% (assuming stable minimum requirements following the deactivation of the counter-cyclical buffer) without a clear path for it to be swiftly restored to target levels.

Significant fines or litigation costs from outstanding or potential new legal cases, which would exacerbate pressure on capital, are also likely to lead to a downgrade.

While not expected given the size of UBS Group's capital markets businesses relative to the group, the ratings would come under pressure should they post significant unexpected pre-tax losses, compromising consolidated profitability, which could be indicative of weaknesses in risk controls.

The Outlook would be revised to Stable if the coronavirus shock to the global economy proves to be short-lived, and if UBS Group emerges from it with relatively unscathed franchise, capitalisation and funding and liquidity profile. Upside for the ratings is limited by the constraints of the group's business model.

BANQUE PICTET & CIE SA AND COMPAGNIE LOMBARD ODIER SCMA

Pictet's and Lombard Odier's ratings are primarily sensitive to structural deterioration in earnings, through cost pressures, loss of franchise or prolonged economic disruption as a result of the pandemic leading to persistently depressed asset prices and a reduced revenue base without offsetting cost- measures. An increase in risk appetite in the loan or securities portfolios, which we do not expect, would put pressure on the ratings. Large operational risk losses, particularly should they result in pressure on capital ratios, could also result in a downgrade.

An upgrade is unlikely given the banks' high ratings and the relatively concentrated, albeit profitable, business model.

EFG INTERNATIONAL AND SUBSIDIARIES

The RWN on EFG reflects the near-term risks to its ratings arising from the coronavirus outbreak and the heightened probability of a downgrade. The increased risk of a material decline in earnings means EFG has moderate rating headroom in the face of the economic disruption posed by the outbreak. We expect to resolve the RWN in the near term, when the impact of the pandemic on the bank's credit profile becomes more apparent.

Potential downgrade triggers are a sustained reversal in the recent trend of improving profitability, for example if we expect EFG's operating profit/RWAs to sustainably fall below 1%. Ratings could also be downgraded if we expect the group's capitalisation to come under significant pressure, for example if we expect the group's CET1 ratio to fall below the target level of above 14% without a credible plan to restore it in a short period of time.

The ratings could be taken off RWN, affirmed and assigned a Stable Outlook if the coronavirus shock to the global economy proves to be short-lived and if EFG's profitability proves resilient to the adverse environment. An upgrade is currently unlikely and would require a structural improvement in profitability. ZUERCHER KANTONALBANK

ZKB's IDRs and Support Rating are primarily sensitive to changes in the rating of Canton of Zurich, with which they are equalised.

ZKB has headroom to emerge with its VR intact, due to the relative strength of its capitalisation and its sound asset quality. But this outcome will depend on the ultimate depth and duration of the coronavirus shock to the domestic economy. The VR would likely be downgraded if the economic and financial market disruption arising from the pandemic is likely to reach a level that places sustained pressure on asset quality. This could be caused by a severe real-estate downturn, or if ZKB's operating profitability deteriorates materially, which would ultimately affect capitalisation.

We believe that an upgrade of the VR is unlikely given the concentration of ZKB's business model on the Canton of Zurich, resulting in a large exposure to the local property market.

CORNER BANCA SA

CB has headroom to emerge with its IDRs and VR intact primarily due to the relative strength of its capitalisation and funding and liquidity profile, which are all scored above its VR. But this outcome will depend on the ultimate depth and duration of the coronavirus shock to the domestic economy. The ratings would likely be downgraded if the economic and financial market disruption arising from the pandemic is likely to reach a level that places sustained pressure on earnings or results in outsized credit losses, which would in turn put acute pressure on capitalisation. A shock to the bank's funding base and significant deterioration in the bank's liquidity position, while not expected given the high share of liquid assets on CB's balance sheet, could also result in a downgrade.

The Outlook would be revised to Stable if the coronavirus shock to the local economy proves to be short-lived, and if CB emerges from it with relatively unscathed capitalisation and funding and liquidity profile. An upgrade would require sustainable growth of the bank's franchise resulting in a more balanced business mix, provided this is achieved without increasing the bank's risk appetite.

BEST/WORST CASE RATING SCENARIO Ratings of financial institutions issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings https://www.fitchratings.com/site/re/10111579.

REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING

The principal sources of information used in the analysis are described in the Applicable Criteria.

PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS

The ratings of Credit Suisse International, Credit Suisse (Deutschland) AG, and Credit Suisse Securities, Sociedad de Valores, S.A., Credit Suisse (USA), Inc. and Credit Suisse NY branch are directly linked to Credit Suisse AG; a change in Fitch's assessment of the ratings of Credit Suisse AG may result in a change in the ratings of the related entities. The ratings of Credit Suisse Group Funding (Guernsey) Limited are directly linked to Credit Suisse Group AG; a change in Fitch's assessment of the ratings of Credit Suisse Group AG may result in a change in the ratings of the entity.

The ratings of UBS SE and UBS Bank USA are directly linked to UBS Group; a change in Fitch's assessment of the ratings of UBS Group may result in a change in the ratings of the related entities.

The rating of the subordinated notes issued by EFG International (Guernsey) Limited is linked to the ratings of EFG Bank AG. A change in Fitch's assessment of the ratings of EFG Bank AG may result in a change in the rating of the subordinated notes.

The IDRs and Support Rating of Zuercher Kantonalbank are directly linked to the Canton of Zurich; a change in Fitch's assessment of the ratings of the Canton of Zurich may result in a change in the ratings of the entity. ESG CONSIDERATIONS

ESG issues are credit neutral or have only a minimal credit impact on the entity(ies), either due to their nature or the way in which they are being managed by the entity(ies). For more information on Fitch's ESG Relevance Scores, visit www.fitchratings.com/esg.

VIEW ADDITIONAL RATING DETAILS

FITCH RATINGS ANALYSTS

Konstantin Yakimovich Senior Director Primary Rating Analyst +44 20 3530 1789 Fitch Ratings Ltd 30 North Colonnade, Canary Wharf London E14 5GN

Ioana Sima Director Primary Rating Analyst +44 20 3530 1736 Fitch Ratings Ltd 30 North Colonnade, Canary Wharf London E14 5GN

Krista Davies Director Primary Rating Analyst +44 20 3530 1579 Fitch Ratings Ltd 30 North Colonnade, Canary Wharf London E14 5GN

Ioana Sima Director Secondary Rating Analyst +44 20 3530 1736

Konstantin Yakimovich Senior Director Secondary Rating Analyst +44 20 3530 1789

Marco Diamantini Senior Analyst Secondary Rating Analyst +49 69 768076 114

Michael Bojko Associate Director Secondary Rating Analyst +44 20 3530 2723

Christian Kuendig Senior Director Committee Chairperson +44 20 3530 1399

MEDIA CONTACTS

Louisa Williams London +44 20 3530 2452 louisa.williams@thefitchgroup.com

Additional information is available on www.fitchratings.com

APPLICABLE CRITERIA

Non-Bank Financial Institutions Rating Criteria (pub. 28 Feb 2020) (including rating assumption sensitivity) Bank Rating Criteria (pub. 28 Feb 2020) (including rating assumption sensitivity)

ADDITIONAL DISCLOSURES

Dodd-Frank Rating Information Disclosure Form Solicitation Status Endorsement Policy

ENDORSEMENT STATUS

Banque Pictet & Cie SA EU Issued Compagnie Lombard Odier SCmA EU Issued Corner Banca SA EU Issued Credit Suisse (Deutschland) AG EU Issued Credit Suisse (Schweiz) AG EU Issued Credit Suisse (USA), Inc. EU Issued Credit Suisse AG EU Issued Credit Suisse Group AG EU Issued Credit Suisse Group Funding (Guernsey) Limited EU Issued Credit Suisse International EU Issued Credit Suisse NY EU Issued Credit Suisse Securities, Sociedad de Valores, S.A. EU Issued EFG Bank AG EU Issued EFG International (Guernsey) Limited EU Issued EFG International AG EU Issued UBS AG EU Issued UBS Bank USA EU Issued UBS Europe SE EU Issued UBS Group AG EU Issued UBS Group Funding (Switzerland) AG EU Issued UBS Switzerland AG EU Issued Zuercher Kantonalbank EU Issued DISCLAIMER

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTPS://WWW.FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, THE FOLLOWING https://www.fitchratings.com/site/dam/jcr:6b03c4cd-611d-47ec-b8f1- 183c01b51b08/Rating%20Definitions%20- %203%20May%202019%20v3%206-11-19.pdf DETAILS FITCH'S RATING DEFINITIONS FOR EACH RATING SCALE AND RATING CATEGORIES, INCLUDING DEFINITIONS RELATING TO DEFAULT. PUBLISHED RATINGS, CRITERIA, AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE, AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE CODE OF CONDUCT SECTION OF THIS SITE. DIRECTORS AND SHAREHOLDERS RELEVANT INTERESTS ARE AVAILABLE AT HTTPS://WWW.FITCHRATINGS.COM/SITE/REGULATORY. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH WEBSITE.

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While certain of the NRSRO's credit rating subsidiaries are listed on Item 3 of Form NRSRO and as such are authorized to issue credit ratings on behalf of the NRSRO (see https://www.fitchratings.com/site/regulatory), other credit rating subsidiaries are not listed on Form NRSRO (the "non-NRSROs") and therefore credit ratings issued by those subsidiaries are not issued on behalf of the NRSRO. However, non-NRSRO personnel may participate in determining credit ratings issued by or on behalf of the NRSRO. READ LESS

SOLICITATION STATUS

The ratings above were solicited and assigned or maintained at the request of the rated entity/issuer or a related third party. Any exceptions follow below.

ENDORSEMENT POLICY

Fitch's approach to ratings endorsement so that ratings produced outside the EU may be used by regulated entities within the EU for regulatory purposes, pursuant to the terms of the EU Regulation with respect to credit rating agencies, can be found on the EU Regulatory Disclosures page. The endorsement status of all International ratings is provided within the entity summary page for each rated entity and in the transaction detail pages for all structured finance transactions on the Fitch website. These disclosures are updated on a daily basis.

Autos Structured Finance: Covered Bonds Structured Finance: ABS

Structured Finance: CMBS Insurance Structured Finance: Structured Credit

Non-Bank Financial Institutions Structured Finance Banks

Structured Finance: RMBS North America Europe Germany Guernsey

United States Switzerland Spain United Kingdom