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UBS Product Day - ZurichFixed IncomeSimon Bunce, Global Head of Fixed Income andRates
June 1, 2006
1
Fixed Income organization
Fixed Income
Notes:1. Including Switzerland2. Joint reporting line to Investment Banking
Valid as of May 10, 2006
UBS Investment Bank
FXCCTEquities Investment Banking
Asia-PacificAmericas Europe1
RatesMunicipalSecurities
Debt CapitalMarkets2
Credit FixedIncome
Commodities
Distribution Research &Transactional
Risk Mgmt
COO SecuritizedProduct Group
EmergingMarkets
2Source: Mercer Oliver Wyman
Fixed Income market revenue growth
Fixed Income markets have significantly outperformed totalInvestment Banking revenues over the past four years
Rates incl. Munis
Other
Securitization
Credit
2001 2002 2003 2004 2005
$65bn $63bn
$82bn
$91bn
$105bn
CAGR 12%
3Source: Mercer Oliver Wyman
Evolution of Fixed Income market
Revenues are increasingly being driven by investor segmentsand proprietary/principal activities
Traditional Investors
Hedge Funds and Other
Proprietary/Principal Finance
Banks and Insurance
Corporates
%re
ven
ues
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1993 2005
4
1 FI Revenue for external disclosure includes FXCCT and PFCA/CRESource: Quarterly reports, UBS IB Analysis, PSRNote: Total revenue includes institutional revenues only
Competitor results
FIRC revenues 2004 / 20051
USD
m
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
FY 2004 FY 2005
Citi DB GS JPM LEH MS ML CSFB BSCUBS
5
Fixed Income - a global franchiseFixed Income employs 2,411 people in 21 countries1
1) Excludes interns and trainees
101323
451
28
8 17
79
1
5 12417
2
1
5
4
54
797
582
Note: headcount as of May 2006
Americas
1355
EMEA
720
APAC
336
1
6
Fixed Income product overview
Average Market Position
Under Represented Market Position
Above Average Market Position
Structured Libor
GovernmentBonds
Asset BackedSecurities
Mortgages
Derivatives
Rates Commodities
Crude OilTrading
CommoditiesStructuring
Power & GasTrading
SecuritizedProducts
Group
CollateralizedDebt
Obligations
SecuritizedProprietary
Trading
CommercialMortgage
BackedSecurities
MunicipalSecurities
Group
InvestmentBanking &
Underwriting
Bond Trading
Short TermMarket Group
RegionalTrading
InstitutionalSales
Derivatives
Research
GlobalGovernments
EmergingMarkets
High Yield
Credit Strategy
Mortgages/ABS
InvestmentGrade
Foreign Exchange
Credit FixedIncome
Distressed Debt
Structured Credit
GlobalSyndicated
Finance
High Yield
Investment Grade
EmergingMarkets
7
Key Fixed Income themes
A determination to invest and grow Fixed Income
Clients
ProductDevelopment
BusinessExpansion
Cross-business
Co-operationPeople
New Markets
8
Fixed Income growth strategy summaryWe aim to achieve a dominant market position in our client-orientedbusinesses and a world-class structured products capability
•Expand our Global Structured Finance and High Yield Loan Capital Markets businessesHigh Yield
SecuritizedProducts
•Build out of new Securitized Products Group, including a Commercial Real Estate CapitalMarkets group and a proprietary trading desk
Commodities •Expand our Commodities business globally
Emerging Markets•Expand Fixed Income capability in Emerging Markets countries focusing on Brazil, Russia,
India, China, and Mexico
Structured Credit •Expand our Investment Grade Structured Credit and Trading businesses
Business Growth &Other
•Expand businesses and local markets presence in the APAC region•Expand Municipal Securitization, Derivatives, and Proprietary Trading Businesses
9
Client focusClients are at the center of our business and underpin our growthinitiatives…
…and we are focused on increasing the advisory aspect of our service to them
• Integration of Taxable Fixed Income business
• Creation of UBS Home Finance
WealthManagement
Hedge Funds• Appointment of Head of Hedge Funds
• Development of Prime Brokerage platform
FinancialSponsors
• Improvement of “client experience” with leveraged finance product
• Alignment of client relationship decisions with balance sheet riskmanagement decisions
• Access For Success – Pension Opportunity Initiative
• Creation of Asset Liability Management unitPensions
10
Fixed Income reengineering drivers
Mission
Recruitment Risk ProcessRisk
Framework
Infrastructure CultureClient
Reengagement
All our efforts are aligned around our mission…
…to deliver one firm to our clients
11
Questions…
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