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UniCredit_-_Monitoring_Germanys_ESG_leaders_-_the_UCRESGLG_Index

VIEWS: 62 PAGES: 256

									      Environmental,
            Social &
        Governance
           Research

                                  Quarterly

Economics & FI/FX Research                                   January 2009
Credit Research
Equity Research
Cross Asset Research




“        Monitoring Germany’s ESG leaders –


                                                      ”
the UCRESGLG Index




Exclusive partnership with


140 German companies analyzed

Environmental, social and governance criteria
used to derive responsible investment decisions



Bayerische Hypo- und Vereinsbank AG ■ UniCredit CAIB Group
20 January 2009
                                                                   20 January 2009                                 Global Equity Research

                                                                                                                          ESG Research



                                            Contents
                                        3   Executive Summary
                                        4   Responsible Investment indices overview
                                        7   Challenges for Responsible Investment (RI) indices
                                        7   RI indices performance
                                       10   RI indices diversification
                                       11   RI indices sustainability
                                       14   Introducing the UniCredit Environmental, Social and Governance Leaders Germany
                                            (UCRESGLG) Index Monitor
                                       14   1) In-depth ESG analysis
                                       15   2) ESG strategic focus list
                                       16   3) Sustainability ahead of marketability
                                       17   4) ESG rating performance monitor
                                       18   UniCredit ESG Leaders Germany (UCRESGLG) Index Monitor composition overview
                                            (16 January 2009)*
                                       19   Constructing the UniCredit ESG Leaders Germany (UCRESGLG) Index Monitor
                                       20   Coverage
                                       20   Investment status
                                       21   Pricing the UniCredit ESG Leaders Germany Equity (UCRESGLG) Index
                                       21   Index Market Capitalization
                                       22   Today’s Initial Security Weight
                                       22   Next Day Initial Security Weight
                                       22   Note on Dividends
                                       23   Maintaining the UniCredit ESG Leaders Germany (UCRESGLG) Index Monitor
                                       23   Quarterly Index Review
                                       25   Appendix 1 – Index constituents and non-constituents overview by sector
                                       26   Market Portfolio & Sector Profiles
                                       31   Aerospace & Defence, Infrastructure & Logistics
                                       38             EADS
                                       40             Fraport
                                       42             VTG
                                       44   Automobiles & Parts
                                       51             BMW Group
                                       53             Daimler
                                       55             ElringKlinger
                                       57             LEONI
                                       59             Volkswagen
                                       61   Banks
                                       68             Deutsche Bank
                                       70   Capital Goods
                                       77             Heidelberger Druckmaschinen
                                       79   Chemicals
                                       86             BASF
                                       88             Linde Group
                                       90   Construction & Materials
                                       97             HeidelbergCement
                                       99   Consumer Goods
                                      106             adidas
                                      108             Henkel
                                      110             Puma
                                      112   Financial Services
                                      119   Insurance
                                      126             Allianz Group
                                      128             Munich Re Group
                                      130   Media
                                      137   Pharmaceuticals & Biotech, Health Care
                                      144             Drägerwerk
                                      146             Merck
                                      148             Rhön-Klinikum
                                      150   Real Estate
                                      157   Software & IT Services, Semiconductors, Technology & Hardware
                                      164             SAP
                                      166             Vossloh
                                      168   Steel, Metals & Mining
                                      175             Norddeutsche Affinerie
                                      177   Telecommunications
                                      184             Deutsche Telekom
                                      186   Tourism, Leisure & Services
                                      193             Lufthansa Group




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                page 1                                   See last pages for disclaimer.
20 January 2009
                                                                    20 January 2009                                        Global Equity Research

                                                                                                                                   ESG Research


                                      195   Utilities, Renewables
                                      202               aleo solar
                                      204               CropEnergies
                                      206               Nordex
                                      208               Phoenix Solar
                                      210               Schmack Biogas
                                      212               SolarWorld
                                      214               Sunways
                                      216   Wholesale & Retail, Fashion & Luxury Goods
                                      223   Appendix 2 – Responsible Investment indices description overview
                                      225   Appendix 3 – Responsible Investment Indices performance overview
                                      226   Appendix 4 – ESG strategic focus list
                                      229   Appendix 5 – UniCredit ESG Leaders Germany Index constituents overview
                                      230   Appendix 6 – UniCredit ESG Research Methodology
                                      230   Step 1 – ESG rating
                                      230   Linking oekom’s corporate rating to an ESG framework
                                      236   Appendix 7: Price Source for Securities
                                      236   Exchange Rates
                                      236   Closing Prices Policy
                                      238   Appendix 8 - Ongoing Event-Related Changes
                                      238   Corporate Events Affecting Existing Index Constituents
                                      238   Changes in Number of Shares or Industry Classification for Existing Constituents
                                      239   Early Inclusions of Non-Index Constituents
                                      239   Early Deletions of Existing Constituents
                                      239   Corporate Events Affecting Non-Index Constituents
                                      239   Ongoing Event-Related Changes announcement policy




                                            Throughout this report we use share prices as of 16 January 2009 unless otherwise
                                            stated.



                                            Patrick Yves Berger, CFA (CAIB)                  Andreas Heine, Equity Analyst (HVB)
                                            +44 20 7826-7952                                 +49 89 378-16921
                                            patrickyves.berger@caib.unicreditgroup.eu        andreas.heine@unicreditgroup.de

                                            Gerhard Schwarz, CEFA (HVB)                      Georg Stürzer, CEFA (HVB)
                                            +49 89 378-12421                                 +49 89 378-18252
                                            gerhard.schwarz1@unicreditgroup.de               georg.stuerzer@unicreditgroup.de




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                    page 2                                      See last pages for disclaimer.
20 January 2009
                                                                      20 January 2009                                             Global Equity Research

                                                                                                                                        ESG Research



                                            Executive Summary
UNICREDIT ENVIRONMENTAL, SOCIAL & GOVERNANCE LEADERS GERMANY INDEX BUY RECOMMENDATIONS (EUR) (16 JAN 09)

Bloomber            Company name                           Sector Financial    ESG       Last   Target           α     P/E 09E       EPS        ROE Div. yield
g Ticker                                                             rating   rating    price    price sustainable          (x)   growth         09E      09E
                                                                                                               (%)                09E (%)        (%)       (%)
DTE GR            Deutsche Telekom           Telecommunications        Buy       B-      10.0     14.5          63.0      10.7       12.2       14.1            7.8
SAP GR                           SAP      Software & IT Services       Buy       C+      26.8      33           21.8      14.7       19.4       35.9            2.1
ALV GR                         Allianz                  Insurance      Buy       C+      65.4     118           77.8       7.1    -6866.3         0.0           6.9
MUV2 GR                    Munich Re                    Insurance      Buy       C+     111.7     130           11.8       7.5       80.0         0.0           4.9
DAI GY                        Daimler        Automobiles & Parts       Buy       B-      23.8      31           50.4      13.4      -34.9         6.4           2.1
BAS GR                      BASF SE                    Chemicals       Buy       B-      23.6      34           45.1       9.9      -34.9       21.7            8.2
MRK GR                   Merck KGaA Pharmaceuticals & Biotech          Buy       C+      63.4      83           26.8      10.1       -4.3       11.0            1.9
BMW GR                          BMW          Automobiles & Parts       Buy       B-      19.7      28           67.4       9.6      -13.0         7.5           3.6
DBK GR                Deutsche Bank                         Banks      Buy       C+      19.8      38           89.5       4.2     -160.8         0.0           2.5
LIN GR                          Linde                  Chemicals       Buy       B-      54.7      92           71.4      11.3       18.2       11.9            3.5
LHA GR                     Lufthansa     Infrastructure & Logistics    Buy       C+      10.7      14           29.5      13.3      -40.2         6.7           3.8
RHK GR                 Rhön-Klinikum                  Health Care      Buy        C      16.1      22           23.1      13.5        5.6       15.8            2.0
ZIL2 GY                 ElringKlinger        Automobiles & Parts       Buy       C+       6.5       8           28.6      11.7      -31.6       16.1            8.8
LEO GY                         LEONI         Automobiles & Parts       Buy       B-       9.9      19          126.9       4.8       18.3       15.4            8.1
CE2 GR                 CropEnergies                   Renewables       Buy       B-       2.8       4           46.2       7.5      381.9       13.1            0.0
VT9 GR                           VTG     Infrastructure & Logistics    Buy       C+       6.7      12           75.9       6.6      -28.4       10.1            6.0

                                                                                                         Source: oekom research, Bloomberg, UniCredit Research



                                            Responsible Investment (RI) indices have played a key role in the past decade to support
                                            the RI growth momentum but our analysis calls RI benchmarked portfolio strategies into
                                            question given significant shortcomings in their performance, diversification and sustainability.
                                            Due to increasing pressure on RI indices, we believe that their utility will shift from
                                            benchmarking to monitoring tools. It is with this latter vision that we introduce the UniCredit
                                            Environmental, Social and Governance (ESG) Leaders Germany Index Monitor (Bloomberg
                                            ticker: UCRESGLG Index) for which we see the benefits as fourfold relative to the majority of
                                            existing RI indices:

                                            ■   In-depth ESG analysis. Whereas most RI index providers simply list inclusions and
                                                exclusions of constituents, UniCredit in partnership with oekom research offers additional
                                                ESG analysis by providing thorough sector reviews and company profiles covering
                                                18 sectors and 140 German equities.

                                            ■   ESG strategic focus list. Building on UniCredit’s sustainable alpha concept (see our
                                                Sep 2008 report “Unlocking sustainable alpha”), we provide investors with a key stock
                                                recommendation list, which integrates ESG ratings with our financial and strategic views.
                                                Whereas most RI indices exclusively screen companies based on their ESG rating, we are
                                                moving closer to ESG integration.

                                            ■   Sustainability ahead of marketability. Our monitor does not set any index construction
                                                constraints allowing the inclusion of leading mid/small-cap ESG performers, which are not
                                                represented in major blue-chip RI indices.

Patrick Yves Berger, CFA,                   ■   ESG rating performance monitor. In order to capture ESG dynamics in the German
Equity Analyst (CAIB)                           equity universe, we provide investors with a monitor capturing the key changes in ESG
+44 20 7826-7952
patrickyves.berger@caib.unicredit               ratings in order to identify key movers and shakers.
group.eu




Bayerische Hypo- und Vereinsbank AG        UniCredit CAIB Group                        page 3                                          See last pages for disclaimer.
20 January 2009
                                                                    20 January 2009                                                                                                                                   Global Equity Research

                                                                                                                                                                                                                               ESG Research



                                      Responsible Investment (RI) indices overview
RI indices have provided key          Responsible Investment (RI) indices have played a key role in the past decade to support the
support for RI movement over
the past decade                       RI growth momentum, providing investors with benchmarks to develop passive and active RI
                                      strategies.


                                      NEW CREATION OF RI INDICES HAS SLOWED DOWN SINCE 2001

                                      Historic overview of RI indices and growth*

                                                  Cumulative number of key RI indices (rhs)                                            Y-o-Y growth (%)




                                                                                                                                                                                                                                              INSPESG
                                                                                                                                                                                                                                 DXGGERP,
                                        180                                                                                                                                                                                                             40




                                                                                                                                                                                                                                  SUSLDP
                                                                                                                                                                                                      AASGI, MAALA,




                                                                                                                                                                                                                                   GCXP,
                                                                                                     SUTP, SUTE, AESE, ECAPGP, 4GGL,




                                                                                                                                                            KEMSSRIE, ISRII, SRIM,
                                                                                                      4GEU, 4GUS, HMNIEEU, HMNIXGL,




                                                                                                                                                                                                        ISE, HVNI,
                                                                                                                                                                                     FOAVSRI, JSOCI
                                                                                                                                                              GALPETHP, CSSAI




                                                                                                                                                                                                          SAMAU
                                        160                                                                                                                                                                                                             35


                                        140
                                                                                                                                                                                                                                                        30




                                                                                                                                         ETHIEEU, ETHIEGL
                                                                                                                  ETCFX
                                        120
                                                                                                                                                                                                                                                        25

                                        100
                                                                               CALVIN, ECAPEP, JSI




                                                                                                                                                                                                                                                        20
                                         80

                                                                                                                                                                                                                                                        15
                                         60

                                                                                                                                                                                                                                                        10
                                         40
                                                                     W1SGI
                                                 KLDDSI



                                                             NX25




                                         20                                                                                                                                                                                                             5



                                           0                                                                                                                                                                                                            0
                                                1990      1997      1999     2000                        2001                           2002                  2003                   2004                 2005         2006       2007       2008



                                      * for a detailed description of RI indices please refer to Appendix 2
                                      Source: Dow Jones, ASPE, Calvert, E. Capital Partners, FTSE, Kempen, ZEW, Domini Social Investments, Calvert
                                      Investments, Hanover stock exchange, Ethibel, ING, Fondaco, Oko-Invest, Jantzi Research, MAALA, Standard & Poor’s,
                                      Morningstar, Brazilian stock exchange, Deutsche Boerse AG, Ethical Funds Company, SAM, Johannesburg stock
                                      exchange, Innovest, BNP Paribas, Goldman Sachs, oekom research, UniCredit Research


RI index construction                 Although construction methodologies vary across indices, the general construction process
methodologies can be based
on several approaches                 follows a simple alignment where an index partner teams up with a sustainability rating
                                      agency to narrow down the broad universe of an underlying market benchmark. We note that
                                      the use of Negative, Positive and Best-in-Class screening methodologies can each be applied
                                      independently or jointly subject to the construction methodology chosen by the specific
                                      index provider.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                                              page 4                                                                                                                See last pages for disclaimer.
20 January 2009
                                                                   20 January 2009                                                        Global Equity Research

                                                                                                                                                    ESG Research


                                      RESPONSIBLE INVESTMENT INDICES GENERALLY APPLY A RANGE OF SCREENING CRITERIA
                                      TO FILTER CONSTITUENTS

                                      Generalized RI index construction methodology



                                                                                         NON-RI INDEX UNIVERSE

                                                                           NEGATIVE SCREENING (Sustainability rating agency)

                                                       Initial screening approach excludes some constituents or sectors from the index universe based
                                                        on criteria relating to their policies, actions, products, or services. Constituents that do not meet
                                                                       the minimum standards of the screen are not included in the RI index


                                                                           POSITIVE SCREENING (Sustainability rating agency)
                                                               Secondary screening approach includes some constituents or sectors from the
                                                               index universe based on criteria relating to their policies, actions, products, or
                                                                 services. Constituents that meet the minimum standards of the screen are
                                                                                          included in the RI index

                                                                               BEST-IN-CLASS (Sustainability rating agency)
                                                                            Leading companies with regard to ESG criteria from each
                                                                              individual sector or industry group are identified and
                                                                                             included in the RI index

                                                                                      INDEX CRITERIA (Index Provider)
                                                                                   Remaining universe is amended to become
                                                                                    appropriate, measurable, unambiguous,
                                                                                     relevant, accountable and investable




                                                                                                   RI INDEX
                                                                                                  UNIVERSE




                                           Source: Environmental, Social, and Governance Factors at Listed Companies by CFA Institute; UniCredit Research


Strong presence of RI indices         Currently there is a large variety of RI benchmark indices available, mainly focusing on
in Europe, following positive
screening methodology                 developed markets with emerging markets increasingly gaining attention as highlighted
                                      through indices such as the “S&P ESG India” index. Despite an overall simplistic construction
                                      process, applications across the various RI indices can differ significantly, ranging from
                                      negative screening to thematic combinations.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                              page 5                                                    See last pages for disclaimer.
20 January 2009
                                                                       20 January 2009                                 Global Equity Research

                                                                                                                             ESG Research


RI INDICES MORE REPRESENTED IN EUROPE WITH POSITIVE SCREENING THE MOST POPULAR CONSTRUCTION METHODOLOGY

Geographic focus breakdown of key RI indices (number of indices)                Construction methodology breakdown of key RI indices (number of
                                                                                indices)*

                       Australia South Africa   Austria
          Canada
                        2.6%        2.6%         2.6%
           5.3%                                                                                             PS + BIC
                                                                                                             6.1%
          Germany                                            Global
                                                                                           NS + PS + BIC
           5.3%                                              26.3%
                                                                                              15.2%
           Brazil
           2.6%                                                                                                               PS
                                                                                                                             42.4%
        Japan
        2.6%
         India
         2.6%
                  Israel
                  2.6%
                                                      EU                                          NS + PS
                    Canada US                                                                      36.4%
                     5.3% 10.5%                      28.9%




* NS= negative screening, PS= positive screening, BIC= Best-in-Class                                                     Source: UniCredit Research


RI indices have represented an                   While increasing attention to ESG risk issues, another key benefit of RI indices for asset
effective way of “outsourcing”
RI expertise                                     managers has been the effective outsourcing of sustainability expertise in the asset
                                                 allocation process.




Bayerische Hypo- und Vereinsbank AG             UniCredit CAIB Group              page 6                                    See last pages for disclaimer.
                                                                       20 January 2009                                              Global Equity Research

                                                                                                                                             ESG Research



                                            Challenges for Responsible Investment (RI) indices
RI indices face significant                 Despite RI benchmarks’ significant contributions to the RI movement, criticism continues to
challenges
                                            arise in the areas of performance, diversification and sustainability.

                                            RI indices performance
Does RI pay off?                            With regard to performance, discussions questioning whether or not RI pays off find an
                                            audience on the sceptical end of the spectrum in the context of RI benchmarking strategies.


RI INDICES HAVE UNDERPERFORMED IN RELATIVE AND RISK-ADJUSTED TERMS ON AVERAGE *

Annualized performance differential since inception of RI index –                     Annualized Sharpe ratio differential since inception RI index –
underlying market benchmark per 31Dec08 (local currency, %)                           underlying market benchmark per 31Dec08 (local currency)

       1.5                                                                                0.06
       1.0                                                                                0.04
       0.5
                                                                                          0.02
       0.0
                                                                                          0.00
      -0.5
                                                                                         -0.02
      -1.0
                                                                                         -0.04
      -1.5
      -2.0                                                                               -0.06

      -2.5                                                                               -0.08
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* indices must have at least a 5Y history since actual inception, daily pricing and publicly disclosed market benchmark for analytical inclusion. Regional subsets of
global indices outside the EU have not been included in the analysis, since inception performance is based on first available date of time series. For a detailed
performance overview please refer to Appendix 3                                                                               Source: Bloomberg, UniCredit Research


On average, RI indices have                 Performance analysis since inception of key publicly available Global, European and US
underperformed since their
inception                                   indices offers a grim picture: Only 27% out of the 11 indices we analyzed are able to portray
                                            annualized outperformance relative to their underlying market benchmark with annualized
                                            underperformance of RI indices reaching –0.7% on average. From a risk-adjusted
                                            perspective, the picture only improves slightly with 36% (or 4) of RI indices portraying higher
                                            Sharpe ratios than their underlying market benchmark with the average RI index portraying a
                                            relative -0.02 points lower annualized Sharpe ratio.




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                         page 7                                             See last pages for disclaimer.
                                                                 20 January 2009                                                        Global Equity Research

                                                                                                                                                   ESG Research


IMPLICIT ACTIVE RISK OF RI INDICES DOES NOT SEEM TO PAY OFF

Annualized tracking error differential since inception of RI index –      Annualized information ratio differential since inception RI index –
underlying benchmark per 15Dec08 (local currency)                         underlying benchmark per 15Dec08 (local currency)

      10.00                                                                  0.60
       9.00
       8.00                                                                  0.40
       7.00                                                                  0.20
       6.00
       5.00                                                                  0.00
       4.00
       3.00                                                                 -0.20
       2.00                                                                 -0.40
       1.00
       0.00                                                                 -0.60
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                                                                                                                             Source: Bloomberg, UniCredit Research


High tracking errors of RI              Tracking errors in the range of 2.4 to 9.3 show significant deviations from the underlying
indices do not seem to pay off
                                        market, which does not necessarily pay off given that only 27% of information ratios remain in
                                        positive territory at relatively low values from 0.1 to 0.4.

Passive RI sector/country bets          Overall strong performance differentials can partially be explained by looking in detail at
offer some explanation
regarding performance                   passive sector and country bets that RI benchmarking portfolios take onboard relative to their
differentials                           underlying markets.

DJSI taken as analytical                We have taken the European series of the Dow Jones Sustainability Indices as an analytical
example
                                        example to highlight these bets, given the series popular growth in indexed/benchmarked
                                        related products.




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                page 8                                                                See last pages for disclaimer.
                                                             20 January 2009                                Global Equity Research

                                                                                                                    ESG Research


                                      DOW JONES SUSTAINABILITY INDICES TAKEN AS ANALYTICAL EXAMPLE

                                      Assets based on Dow Jones Sustainability Indices (USDbn)

                                        7.0



                                        6.0



                                        5.0



                                        4.0



                                        3.0



                                        2.0



                                        1.0



                                        0.0
                                                  Sep 02     Sep 03       Sep 04       Sep 05     Sep 06        Sep 07            Sep 08



                                                                                                     Source: Dow Jones, UniCredit Research


RI indices contain implicit           Based on comparisons between the DJSI STOXX and its underlying market benchmark, the
active risk relative to general
market benchmark                      Dow Jones STOXX 600, RI indices can deviate significantly from their underlying market
                                      benchmarks in terms of country/sector bets (+4.5% to -4.0%). The implicit active risk taken on
                                      board relative to the general market benchmark does not seem to pay off according to poor
                                      information ratios highlighted above.


RI INDICES IMPLICITLY TAKE SIGNIFICANT ACTIVE BETS TO UNDERLYING MARKET BENCHMARKS

Difference in country weights DJSI STOXX– Dow Jones STOXX 600           Difference in sector weights DJSI STOXX– Dow Jones STOXX 600
as per 02Dec08 in EUR (%)                                               as per 02Dec08 in EUR (%)

   5.0                                                                    5.0
   4.0                                                                    4.0
                                                                          3.0
   3.0
                                                                           2.0
   2.0                                                                     1.0
   1.0                                                                     0.0
                                                                          -1.0
   0.0
                                                                          -2.0
  -1.0                                                                    -3.0
  -2.0                                                                    -4.0
                                                                                           su ks




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                                                                                                Pa


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                                                                                               ra




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                                                                                            r.
                                                                                     Au




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                                                                                 Ho
                                                                                  du




  -5.0
                                                                               In


                                                                             r.&




         DE CH ES NL FI NO IE DK PT LU AT GR BE IT SE FR GB
                                                                           Pe




                                                                                                     Source: Dow Jones, UniCredit Research


RI funds seem more sheltered          Asset owners may not necessarily shift assets away from managers based purely on the
from redemptions…
                                      highlighted underperformance relative to benchmarks given that underlying market
                                      benchmarks may not be suited to the manager’s RI style and asset owners’ investment goals.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                 page 9                                  See last pages for disclaimer.
                                                                      20 January 2009                                              Global Equity Research

                                                                                                                                             ESG Research



                                      Redemption figures seem to indicate that RI funds have been more sheltered from the
                                      significant market sell-offs observed in 2008, with the largest European SRI funds showing
                                      net inflows on average.

…but performance                      In the long term however, RI benchmarking strategies are likely to continue an uphill battle
shortcomings likely to remain
LT problem                            against redemptions in a performance management context and could undermine the ESG
                                      mainstreaming movement itself due to their construction and ESG issues
                                      integration methodology.


                                      RI EQUITY FUNDS SEEM BETTER SHELTERED FROM REDEMPTIONS

                                      Monthly funds inflows/outflows as % of total assets under management (%)

                                                                       Top 20 largest EU SRI funds    All EU asset class funds     EU equity funds
                                          8.0


                                          6.0


                                          4.0


                                          2.0


                                          -


                                         -2.0


                                         -4.0


                                         -6.0


                                         -8.0


                                        -10.0
                                                 Jan-08      Feb-08     Mar-08    Apr-08    May-08   Jun-08    Jul-08     Aug-08   Sep-08       Oct-08     Nov-08



                                                                        Source: Lipper FERI, Emerging Portfolio Fund Research, Bloomberg, UniCredit Research



                                      RI indices diversification
RI indices’ derived country           Portfolio diversification remains a key topic for ESG investment methodologies in order to
portfolios contain high
unsystematic risk and can not         reach competitive performance levels as outlined in our report “Unlocking sustainable alpha”
fulfill some regulatory               published in September 2008. Although RI index providers try to provide a stratified sample of
requirements
                                      the underlying market benchmark, investors aiming to create country-specific RI portfolios
                                      could face a significant amount of unsystematic risk due to limited country-specific
                                      constituents. Regulatory requirements to limit issuer risk such as the EU’s commonly known
                                      “5/10/40 rule” further impose the need for a minimum amount of securities if country-specific
                                      constituents are to be derived from broader market benchmarks.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                            page 10                                               See last pages for disclaimer.
                                                                    20 January 2009                                            Global Equity Research

                                                                                                                                        ESG Research


HIGH DEGREE OF UNSYSTEMATIC RISK LIMITS PROLIFERATION OF COUNTRY-SPECIFIC RI PORTFOLIOS

Number of index constituents by country as per 02Dec08                            Unsystematic risk diversification theory diagram

                         DJ STOXX 600       DJSI STOXX      n=30                   Variance (rp)
  90 165

  80

  70
                                                                                                  Risk eliminated by
  60                                                                                              diversification
  50

  40
                                                                                          Total risk
  30                                                                                      of stock
  20
                                                                                                                           Undiversifiable
  10                                                                                                                       or market risk
   0
                                                                                                                                                  Number of
       GB FR DE CH SE ES IT           NL   FI DK BE NO AT GR IE PT LU
                                                                                                                          n=30                    securities

Source: Dow Jones; Investment Analysis and Portfolio Management by Frank K. Reilly, Keith C. Brown, Frank Reilly; UniCredit Research


Number of constituents                       In the case of the European Dow Jones Sustainability Indices, the average number of
reduced by up to 80% from
general to RI benchmark                      constituents by country is being reduced by 80% (average of 10 stocks left per country) for
                                             the DJSI STOXX and 81% (average of 7 stocks left per country) for the DJSI EUROSTOXX
                                             relative to their underlying market benchmarks.

Limited choice of country-                   For investors looking towards effective country diversification in order to eliminate country-
specific constituents remains
significant portfolio constraint             specific risk, a limited choice of constituents remains a significant portfolio
                                             construction constraint.

                                             RI indices sustainability
ESG mainstreaming could hold                 The United Nations Principles for Responsible Investing (UNPRI) is promoting the integration
some future negative surprises
for RI indices                               of ESG issues into traditional investment analysis and assessment. This implies that
                                             quantifiable ESG issues such as greenhouse gas emissions (GHG) and related costs are
                                             likely to become an integrated factor in future ESG-oriented asset allocation models. This
                                             represents a fundamental shift from qualitative (sustainability rating) to quantitative indicators
                                             (sustainable development key performance indicators), which could hold some negative
                                             surprises for some RI indices.




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                    page 11                                            See last pages for disclaimer.
                                                                         20 January 2009                                                Global Equity Research

                                                                                                                                                 ESG Research


RI INDICES COULD HAVE SIGNIFICANT RISK EXPOSURE TO ESG ISSUES THAT HAVE NOT YET BEEN FULLY CLARIFIED

Direct greenhouse gas emissions by index (tons of CO2 per year)                        Average cost of CO2 emissions per company by index (EURmn)

  1200                                                                                    1600

                                                                                          1400
  1000
                                                                                          1200
   800
                                                                                          1000

   600                                                                                     800

                                                                                           600
   400
                                                                                           400
   200
                                                                                           200

      0                                                                                      0
                  DJSI Stoxx Utilities          MSCI Europe Utilities Sector                                DJSI Stoxx                   MSCI Europe Utilities Sector


                                                                                                                       Source: Fortis Investments, UniCredit Research


GHG exposure of RI indices                  According to Fortis Investments, 10 companies retained in the DJSI Stoxx represent 50% of
raises sustainability questions
                                            the direct GHG emissions of the MSCI Europe Utilities with the average cost of CO2
                                            emissions higher in the DJSI compared to the MSCI Europe Utilities sector. These figures
                                            raise some questions regarding the underlying sustainability of RI indices in some key
                                            sustainable development areas.

Marketability of RI indices                 RI index construction methodologies can also limit the promotion of some of the most
possibly taking preference over
sustainability                              sustainable companies in the capital markets. Due to market capitalization and liquidity
                                            limitations, a significant amount of renewable energy small caps are not given access to RI
                                            indices and underlying investor base, which could improve their capital efficiency. Examples
                                            in the German market include wind turbine manufacturer Nordex (EUR 668mn MCAP as of
                                            31 Dec 08). With marketability possibly taking preference over sustainability, the active risk for
                                            investors wanting to support leading sustainable off-benchmark plays can prove too costly.


RI INDEX CONSTRUCTION METHODOLOGIES COULD PUT MARKETABILITY AHEAD OF SUSTAINABILITY

Oekom research’s German Prime investment status stocks                                 Weight of oekom research German Not Prime investment status
included/excluded from DJS indices as per 02Dec08 (number of                           stocks in DJSI Eurostoxx index as per 02Dec08 **
Prime stocks)*

                                                                                          5.00       4
                                                                                          4.50
                                                                                          4.00                   7
                                                                                          3.50
            oekom Prime                                                                   3.00
                                                                                                                            14
            rated, in DJS                                                                 2.50
                43.3%
                                                        oekom Prime                       2.00
                                                         rated, not in                    1.50
                                                             DJS                                                                        29
                                                            56.7%                         1.00
                                                                                          0.50                                                        54            71
                                                                                          0.00
                                                                                                   E.ON      Siemens       RWE      Deutsche       Fresenius     Hochtief
                                                                                                                                    Börse AG          SE


* total number of Prime stocks = 30 **data labels represent rank by weight of constituent in index, total number of constituents = 83        Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                         page 12                                                See last pages for disclaimer.
                                                             20 January 2009                                Global Equity Research

                                                                                                                  ESG Research


There can be significant              It is also worth highlighting that there can be significant disagreements between sustainability
disagreements between
sustainability rating providers       ratings. As an example, oekom Research’s “Not Prime” rating for Siemens does not imply a
                                      Best-in-Class status for a company that has seen major controversies regarding business
                                      ethics in recent years, e.g concerning corruption. Within the selection process of the
                                      European DJSI series, which is backed by sustainability rating agency SAM, Siemens
                                      remains one of the top 10 holdings in the DJS Eurostoxx.

Pressure on RI benchmarking           Although we acknowledge the importance and contribution of RI indices to the global SRI
strategies likely to increase
                                      movement, shortcomings in performance and portfolio diversification coupled with some
                                      questions regarding underlying sustainability are likely to increase the pressure and relevance
                                      of RI index benchmarked products in the future.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 13                                  See last pages for disclaimer.
                                                             20 January 2009                                  Global Equity Research

                                                                                                                      ESG Research



Introducing the UniCredit Environmental, Social and Governance
Leaders Germany (UCRESGLG) Index Monitor
UCRESGLG INDEX HAS OUTPERFORMED THE DAX INDEX SINCE INCEPTION

UCRESGLG Index general description Bloomberg page                       Comparative returns of UCRESGLG and DAX Index since inception
                                                                        (EUR)




                                                                                                       Source: Bloomberg, UniCredit Research


We believe that RI indices will       Given the increasing pressure on RI indices on several fronts, we believe that the utility of RI
move away from benchmarking
to monitoring tools                   indices will move away from offering market participants benchmarks and investment
                                      universes for active and passive RI portfolio management. We believe that RI indices will
                                      rather convert to monitoring tools building a platform for shareholder activism, corporate social
                                      responsibility assessment and peer comparisons of best practices.

UCRESGLG to monitor best              It is with this latter vision that we introduce the UniCredit ESG Leaders Germany Index
ESG performing stocks in
Germany                               monitor (Bloomberg ticker: UCRESGLG Index). The index is designed to reflect the stock
                                      performance of companies positively engaged in addressing ESG issues within their
                                      operating environment in the German equity universe.

We see several benefits of            We see the benefits of this monitor as fourfold relative to the majority of existing RI indices:
UCRESGLG relative to existing
RI indices


                                      1) In-depth ESG analysis
In-depth ESG analysis profiles        Whereas most RI index providers simply list inclusions and exclusions of constituents,
18 sectors and 140 companies
                                      UniCredit in partnership with oekom research offers additional ESG analysis by providing
                                      thorough sector reviews and company profiles covering 18 sectors and 140 stocks. For full
                                      index constituents and non-constituents reviews by sector, please refer to Appendix 1.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                page 14                                    See last pages for disclaimer.
                                                                        20 January 2009                                              Global Equity Research

                                                                                                                                             ESG Research


UNICREDIT ESG LEADERS GERMANY INDEX MONITOR CONSTITUENTS UPDATE (31 DECEMBER 2008)

Bloomberg Ticker            Company name        Country                           Sector         Financial       ESG       Social    Environmental          Reason for
                                                                                                    rating      rating     rating           rating          inclusion /
                                                                                                                                                             exclusion
New inclusions
PS4 GY                         Phoenix Solar         GE                    Renewables                HOLD          A-          B-                  A-    New coverage
SWV GY                            SolarWorld         GE                    Renewables                HOLD          A-          C+                   A    New coverage
VOS GR                                Vossloh        GE        Technology & Hardware                 HOLD          B-          C-                   B    New coverage
VT9 GR                                  VTG          GE       Infrastructure & Logistics               BUY         C+          C-                  B-    New coverage
New exclusions
None

                                                                                                                         Source: oekom research, UniCredit Research



                                            2) ESG strategic focus list
ESG mainstreaming asks for                  Although ESG issues are crucial for the long-term sustainability of earnings for a company,
integration, not exclusionary
priority of ESG issues                      we do not believe that they should dominate an effective ESG asset allocation process with
                                            ESG mainstreaming asking for integration, not exclusionary priority to ESG issues.

ESG focus list aligns financial,            Building on our ESG Research methodology outlined in our report “Unlocking sustainable
strategic and ESG views
                                            alpha” (Sep 08), we provide a mainstreaming approach by integrating ESG risk into our
                                            valuation models and target prices. Furthermore, we provide a strategic element to ESG-
                                            driven stock-picking by integrating our EUROSTOXX sector views into the UCRESGLG Index
                                            constituents and non-constituents universe. This approach, therefore, filters key stock
                                            recommendations that align our financial (Buy/Sell), strategic (Overweight/Underweight) and
                                            ESG (Prime/Not Prime) point of view and can be summarized in our ESG strategic focus list:


ESG STRATEGIC FOCUS LIST WITH KEY STOCK RECOMMENDATIONS (UPDATE)*

ESG sector                                                            EUROSTOXX sector               Sector                                          Preferred plays
                                                                      group                          recommendation
                                                                                                     current (prior)
Aerospace & Defence, Infrastructure & Logistics                       Industrial Gds. & S.           UW (UW)                           MTX GR, DPW GR, RHM GR
Automobiles & Parts                                                   Automobiles & Parts            N (UW)                                        RUK GY, LEO GY
Banks                                                                 Banks                          N (N)                             COM GR, DPB GR, DBK GR
Capital Goods                                                         Industrial Gds. & S.           UW (UW)                   SKB GR, KU2 GR, JEN GY, SNG GR
Chemicals                                                             Chemicals                      OW (N)                                         LIN GR, BAS GR
Construction & Materials                                              Construction & Mat.            OW (OW)                                                   HEI GY
Consumer Goods                                                        Pers. & Household Gds.         N (N)                            PUM GR, ADS GR, HEN3 GR
Financial Services                                                    Financial Services             UW (N)                             MLP GY, A8A GR, HXCI GR
Insurance                                                             Insurance                      OW (OW)                                     ALV GR, MUV2 GR
Media                                                                 Media                          N (N)                                        GFK GR, PSM GR
Pharmaceuticals & Biotech, Health Care                                Health Care                    UW (UW)                           BHS GR, CLS1 GR, FME GR
Real Estate                                                           Financial Services             N (N)                GFJ GR, DEQ GR, VIA GR, AOX GY, DAZ
                                                                                                                                                           GR
Software & IT Services, Semiconductors,Technology & Hardware          Technology                     N (N)               FTM GR, AIXA GR, WIN GY, ILH GR, VOS
                                                                                                                                           GR, ADV GR, IFX GY
Steel, Metals & Mining                                                Basic Resources                OW (OW)                                                  NDA GR
Telecommunications                                                    Telecommunications             N (OW)                                         TLI GR, FNT GR
Tourism, Leisure & Services                                           Travel & Leisure               N (N)                              AB1 GY, SIX2 GR, LHA GR
Utilities, Renewables                                                 Utilities                      OW (OW)                          CE2 GR, SWW GR, NDX1 GR
Wholesale & Retail, Fashion & Luxury Goods                            Retail                         UW (UW)                 ARO GR, DOU GR, PRA GR, MEO GR

* Bloomberg tickers in bold represent “Prime” Buys in an overweight sector; “Not Prime” Sells in an Underweight sector or “Prime”/”Not Prime” Holds in a neutral
sector. Tickers in italics represent top “Prime” sustainable alphas in an overweight sector; bottom “Not Prime” sustainable alphas in an underweight sector or highest
available sustainable alpha in a neutral sector. For further details regarding the ESG focus list, please refer to Appendix 4              Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                           page 15                                          See last pages for disclaimer.
                                                             20 January 2009                                 Global Equity Research

                                                                                                                     ESG Research



                                      3) Sustainability ahead of marketability
                                      OUR INDEX FOCUSES ON SUSTAINABILITY, NOT ON INDEX CONSTRUCTION CONSTRAINTS

                                      Number of constituents per index

                                        40
                                                                                                                unsystematic risk diversification
                                                                                                                threshold
                                        35



                                        30



                                        25



                                        20



                                        15



                                        10



                                         5



                                         0
                                                                   DJSI STOXX (German stocks)   UCRESGLG



                                                                                                      Source: Dow Jones, UniCredit Research


Flexible construction                 As highlighted, a challenge faced by several blue chip RI indices is the limited number of
methodology diminishes
unsystematic risk at country          country constituents to create country-specific portfolios. Furthermore, the exclusion of small
level, meets regulatory               to mid-caps that portray strong ESG performance was an additional limitation to promote
requirements and includes all
strong ESG performers
                                      sustainability. The UCRESGLG sets no limits on market capitalization or trading volumes,
                                      allowing the inclusion of 34 Best-in-Class stocks in UniCredit Research’s actively covered
                                      German equity universe, beating the unsystematic risk diversification threshold of n>30,
                                      overcoming regulatory requirements to create a country-specific portfolio while setting
                                      sustainability ahead of marketability.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                 page 16                                  See last pages for disclaimer.
                                                                  20 January 2009                            Global Equity Research

                                                                                                                      ESG Research




                                      4) ESG rating performance monitor
UCRESGLG provides a                   In order to capture ESG dynamics within and outside the UCRESGLG index, we provide
dynamic monitoring system of
ESG rating performance                investors with a monitor capturing key changes in Environmental, Social & Governance
                                      ratings in order to identify key movers and shakers. Portrayed scores are based on our ESG
                                      scoring matrix outlined in our September 2008 report “Unlocking sustainable alpha”.

Munich RE biggest mover on            In the last quarter, only seven stocks out of UniCredit’s active covered German equity
the positive side
                                      universe have seen a change in their ESG, Environmental or Social & Governance scores.
                                      Four out of the seven stocks are UCRESGLG Index constituents, which currently counts with
                                      34 constituents. Biggest mover on the positive side has been Munich RE (Buy, C+), which
                                      has been able to increase its social score by 2 points (from C to C+) resulting as well in an
                                      overall ESG score increase of 2 points (from C to C+).


                                      ESG RATING PERFORMANCE MONITOR

                                      Q-o-Q change in ESG, Social and Environmental scores of UCRESGLG Index constituents and non-
                                      constituents

                                                                                                                  Change in ESG score
                                                                                                                  Change in social score
                                         SWW GR (H,A-)*                                                           Change in environmental score



                                             IDS GR (S,D)



                                           DTE GR (B,B-)*



                                          GMM GY (S,C-)



                                           AFX GR (B,D+)



                                          ALV GR (B,C+)*



                                        MUV2 GR (B,C+)*


                                                             -5    -4    -3       -2    -1   0       1        2         3           4           5



                                      * UCRESGLG index constituent                                Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                    page 17                                See last pages for disclaimer.
                                                                                               20 January 2009                                             Global Equity Research

                                                                                                                                                                   ESG Research



UniCredit ESG Leaders Germany (UCRESGLG) Index Monitor
composition overview (16 January 2009)*
UCRESGLG sector breakdown by MCAP (%)                                                                   UCRESGLG ESG rating group breakdown by MCAP (%)

                                         TL&S     Utilities         Aero.&Infra.
                                         1.4%      0.8%                3.8%                                                                          A
                                 Telco                                                                                                             0.53%
                                 12.9%
                           Steel
                           0.3%
                           IT                                                Auto                                               C
                          9.8%                                              32.7%                                             41.0%

                   Pharma&H.
                     4.8%                                                                                                                                            B
                                                                                                                                                                   58.4%
                                                                             Banks
                           Insurance                                          3.6%
                             15.1%                                           Capital G.
                               Cons. G           C.&M.       Chemicals         0.1%
                                 4.6%            1.1%          9.1%



                                                                                                                                            Source: oekom research, UniCredit Research



Sector performance – 1M (EUR BASED, %)                                                                  ESG rating group performance – 1M (EUR BASED, %)

       Banks

        Steel
                                                                                                             B
         Auto

    Insurance

        Index

       C.&M.
                                                                                                          Index
   Chemicals

        Telco

     Cons. G

        TL&S
                                                                                                             C
      Utilities

            IT

  Aero.&Infra.

  Pharma&H.
                                                                                                             A
   Capital G.


             -30     -25         -20       -15         -10         -5          0          5      10
                                                                                                                  -16   -14    -12    -10     -8      -6    -4      -2      0       2       4


                                                                                                                               Source: Bloomberg, oekom research, UniCredit Research



Sector performance – 3M (EUR BASED, %)                                                                  ESG rating group performance – 3M (EUR BASED, %)

       C.&M.

   Capital G.
                                                                                                             B
       Banks

         Auto

      Utilities

        TL&S
                                                                                                             A
        Index

        Steel

     Cons. G

   Chemicals
                                                                                                          Index
        Telco

    Insurance

            IT

  Pharma&H.
                                                                                                             C
  Aero.&Infra.


             -60    -50       -40        -30     -20         -10        0          10     20     30
                                                                                                                  -25          -20           -15            -10             -5              0


*a full list of UCRESGLG Index monitor constituents can be found in Appendix 5                                                 Source: Bloomberg, oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                      UniCredit CAIB Group                             page 18                                                 See last pages for disclaimer.
                                                                           20 January 2009                                                  Global Equity Research

                                                                                                                                                    ESG Research



                                          Constructing the UniCredit ESG Leaders Germany
                                          (UCRESGLG) Index Monitor
UCRESGLG is a market                      The UniCredit ESG Leaders Germany Index is a market capitalization weighted index, based
capitalization weighted index
                                          on the last trade prices of shares of all eligible companies denominated in EUR. The market
                                          capitalization of each constituent is not adjusted for free float in order to evaluate the
                                          sustainability of full economic resources and capital allocated to constituents.

UCRESGLG Index construction               The underlying methodology for selecting the constituents of the UniCredit ESG Leaders
methodology can be defined as
a Best-in-Class approach                  Germany Index can be described as a Best-in-Class approach within the RI field. The Best-in-
                                          Class approach is the process of selecting within each sector, rather than excluding,
                                          securities that show leadership in ESG issues. To construct the UCRESGLG Index monitor,
                                          we undertake an index construction process, which involves the following three basic steps:


UCRESGLG INDEX MONITOR FOLLOWS A BEST-IN-CLASS CONSTRUCTION PROCESS (28)

UCRESGLG Index Monitor construction process steps description with sector breakdown composites by market cap as of 15/12/08 (EUR)

                                                        STEP 2              BEST-IN-CLASS SCREENING
                                                                                      Consumer D.NP
                                                                       Utilities NP                    Consumer D.P
                                                                                          2.4%
                                                           Telco P        13.6%                           18.1%
                                                            6.7%                                              Consumer S.NP
                                                                                                                   3.3%
                                                       Telco NP
                                                         0.2%                                                     Consumer S.P
                                                         Materials P                                                  1.3%
                                                           5.9%                                                       Energy P
                                                     Materials NP                                                      0.0%
                                                                                                                     Financials NP
                                                        4.0%
                                                                                                                         3.8%
                                                         IT P                                            Financials P
                                                        4.5%      IT NP
                                                                                                            10.5%
                                                                  1.1%
                                                                                                               Health C.NP
                                                           Industrials P   Industrials NP       Health C.P        7.7%
                                                              2.7%                                2.3%
                                                                               12.1%

                                           2
                                               Assigning ESG investment status grades for potential constituents
                                                according to oekom`s research investment status methodology


             STEP 1             INDEX UNIVERSE DEFINITION                                          STEP 3                  INDEX CONSTRUCTION

                           Utilities                                                                                                       Consumer D.P
                           13.6%            Consumer D.                                                                                       18.1%
                                               20.5%
                                                                                                        Telco P
                   Telco
                                                        Consumer S.                                      6.7%                                      Consumer S.P
                   6.9%
                                                           4.5%                                                                                        1.3%
                                                                                                 Materials P
              Materials                                 Energy                                     5.9%                                                   Energy P
               9.9%                                      0.0%                                                                                               0.0%

                                                     Financials
                     IT                                                                                   IT P
                                                       14.2%                                                                                      Financials P
                   5.5%                                                                                  4.5%
                                                                                                                                                     10.5%
                      Industrials                                                                          Industrials P
                                         Health C.
                                                                                                               2.7%
                        14.8%             10.0%                                                                                      Health C.P
                                                                                                                                       2.3%
         1                                                                                         3
               Defining the equity universe through UniCredit                                            Selecting securities for inclusion according to
             Research's active coverage of listed German equities                                           index construction rules and guidelines


                                                                                                                  Source: oekom research, Bloomberg, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                                page 19                                               See last pages for disclaimer.
                                                             20 January 2009                              Global Equity Research

                                                                                                                 ESG Research


Constituents need to meet              The constituents of the UCRESGLG Index monitor are required to meet the following two
coverage and investment
status criteria                        criteria where applicable:

                                       Coverage
                                       ■   The company must be currently          under   active   coverage   with    an     investment
                                           recommendation and target price.

                                       Investment status
                                       ■   The company must have obtained a Prime Investment status by oekom research, which
                                           signals a Best-in-Class status in terms of sustainability for the respective sector. We
                                           highlight that oekom research sets Best-in-Class thresholds based on a global peer
                                           comparison.

Controversial business                 Although some RI benchmarks exclude securities due to activities in controversial business
activities do not represent
exclusionary criteria                  areas such as alcohol, gambling, nuclear power or military, the UniCredit ESG Leaders Index
                                       does not consider potential constituents business activities as exclusionary criteria.

                                       The existing universe and future inclusions of stocks will be driven by data provided by
                                       oekom research, Bloomberg, Thomson, Factiva and UniCredit Research.

                                       For details of oekom research’s methodology please see Appendix 6.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 20                                 See last pages for disclaimer.
                                                             20 January 2009                                   Global Equity Research

                                                                                                                        ESG Research




                                      Pricing the UniCredit ESG Leaders Germany Equity
                                      (UCRESGLG) Index
Index pricing follows the             The index measures the daily markets’ price performance in EUR for a selection of securities
Laspeyres’s concept of
weighted arithmetic average           by using the Laspeyres’ concept of a weighted arithmetic average together with the concept of
                                      chain-linking.

                                      As a general principle, today’s index level is obtained by applying the change in the market
                                      performance to the previous period index level.

                                                                                                   IndexAdjustedMarketCapEUR
                                                  velEUR = Pr iceIndexLe
                                      Pr iceIndexLe     t              velEUR−1 *
                                                                             t
                                                                                                                             t

                                                                                                             alMarketCa
                                                                                                    IndexIniti         pEURt

                                      Where:


                                      ■ Pr iceIndexLevelEURt −1 is the Price Index level in EUR at time t-1

                                      ■ IndexAdjustedMarketCapEURt                  is the Adjusted Market Capitalization of the Index at
                                          time t


                                      ■ IndexInitialMarketCapEURt              is the Initial Market Capitalization of the Index at time t

                                      Index Market Capitalization
                                      IndexAdjustedMarketCapEURt =
                                             IndexNumberOfSharest −1 * Pr icePerSharet * InclusionFactort
                                       ∑
                                      s∈I ,t                          FXratet

                                      IndexInitialMarketCapEURt =
                                             IndexNumberOfSharest −1 * Pr icePerSharet −1 * InclusionFactort
                                       ∑
                                      s∈I ,t                          FXratet −1



                                      Where:


                                      ■ IndexNumberOfSharest −1 is the number of shares of security s at time t-1

                                      ■ Pr icePerSharet       is the price per share of the security s at time t


                                      ■ Pr icePerSharet −1      is the price per share of the security s at time t-1


                                      ■ InclusionFactort       is the inclusion factor of the security s at time t




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                page 21                                      See last pages for disclaimer.
                                                             20 January 2009                                   Global Equity Research

                                                                                                                      ESG Research



                                      ■ FXratet      is the FX rate of the price currency of security s vs. EUR at time t. It is the value
                                          of 1 EUR in foreign currency


                                      ■ FXratet −1     is the FX rate of the price currency of security s vs. EUR at time t-1. It is the
                                          value of 1 EUR in foreign currency

                                      Today’s Initial Security Weight
                                      InitialSecurityWeightt =
                                       SecurityInitialMarketCapEURt
                                                                    * 100
                                        IndexInitialMarketCapEURt

                                      Next Day Initial Security Weight
                                      InitialSecurityWeightt +1 =
                                       SecurityInitialMarketCapEURt +1
                                                                       * 100
                                        IndexInitialMarketCapEURt +1

                                      Note on Dividends
Dividends are not considered          The UniCredit ESG Leaders Germany Index is a price index-based benchmark. Dividends are
                                      not re-invested and are not considered.

                                      For further information on pricing sources, please refer to Appendix 7.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                 page 22                                   See last pages for disclaimer.
                                                             20 January 2009                                   Global Equity Research

                                                                                                                       ESG Research



                                      Maintaining the UniCredit ESG Leaders Germany
                                      (UCRESGLG) Index Monitor
Index maintenance covers              Maintaining the UCRESGLG Index involves many aspects, including additions to and
additions, deletions of
constituents and changes in           deletions from the index and changes in number of shares.
number of shares
                                      All potential additions are considered in the context of the UniCredit ESG Leaders Germany
                                      Index Methodology, including the index constituent eligibility rules and guidelines described
                                      in “Constructing the UniCredit ESG Leaders Germany (UCRESGLG) Index” section.

                                      Additional shareholder information may come from better disclosure by companies or more
                                      stringent disclosure requirements by a country’s authorities. It may also come from UniCredit
                                      Research’s ongoing examination of new information sources for the purpose of better
                                      understanding shareholder structures. When UniCredit Research identifies useful additional
                                      sources of information, it seeks to incorporate them into its analysis.

                                      Overall, index maintenance can be described by two broad categories of implementation of
                                      changes.

                                      ■   Quarterly index reviews, aimed at promptly reflecting significant market events.

                                      ■   Ongoing event-related changes, such as mergers and acquisitions, which are generally
                                          implemented in the indices promptly as they occur.

                                      Quarterly Index Review
Quarterly index review ensures        The Quarterly Index Review process is designed to ensure that the index continues to be an
accurate reflection of ESG
marketplace                           accurate reflection of the evolving ESG equity marketplace. Quarterly index reviews may
                                      result in additions, deletions, and changes in number of shares.

                                      Quarterly Index Review Changes in Constituents
                                      During a quarterly index review, securities may be added to or deleted from an index for a
                                      variety of reasons including the following:

                                      ■   Additions/deletions of companies due to changes in their research coverage status and/or
                                          investment status availability.

                                      ■   Replacement of companies that are no longer suitable ESG Leader representatives.

                                      ■   Replacement of securities (additions or deletions) resulting from the review of price source
                                           for constituents with both domestic and foreign board quotations.

                                      ■   Additions or deletions of securities as a result of other market events.

                                      Quarterly Index Review Changes in Number of Shares
                                      Updates in number of shares are generally small changes in a security’s shares outstanding
                                      and are deferred to the quarterly index review. They result from amongst other things:

                                      ■   Exercise of options or warrants and employee stock option plans.

                                      ■   Conversion of convertible bonds or other instruments, including periodic conversion of
                                           preferred stocks, and small debt-to-equity swaps.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group                 page 23                                    See last pages for disclaimer.
                                                             20 January 2009                              Global Equity Research

                                                                                                                ESG Research



                                      ■   Periodic share buybacks.

                                      ■   Increases of less than 5% in a security’s number of shares resulting from acquisition of
                                           non-listed companies.

                                      ■   Other changes in number of shares resulting from events that could not be implemented on
                                           or near the effective dates, and where no price adjustment factor (PAF) is necessary.

                                      ■   Share cancellations.

                                      Quarterly Index Review Frequency and Timing
                                      The quarterly index review is conducted on the first day of the quarter’s last month with the
                                      implementation of changes resulting from a quarterly index review taking immediate effect.

                                      Quarterly Index Review Announcement policy
                                      The results of the quarterly index reviews are announced in the usual quarterly series of
                                      UniCredit Research’s ESG report series.

                                      For ongoing event-related changes, please refer to Appendix 8.




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 24                                See last pages for disclaimer.
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research



Appendix 1 –
Index constituents and non-constituents overview by sector




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 25       See last pages for disclaimer.
                                                             20 January 2009              Global Equity Research

                                                                                               ESG Research




                                                                       Market Portfolio & Sector Profiles




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 26               See last pages for disclaimer.
                                                                                               20 January 2009                                              Global Equity Research

                                                                                                                                                                        ESG Research



ESG overview – Market Portfolio
TP upside vs. difference TPESG -TP (%)*                                                                       Sustainable alpha of ESG Leader rated sectors (%)* (RANK)

         25.0                                                                                                   23.0
                                                                         Telco
         20.0
                                                                                                                22.0
         15.0
                      Auto
         10.0                                                                                                   21.0
                                                       TLS
 TPESG-TP (%)




                                                                    Chemicals
                5.0                        Utilities                    Insurance
                0.0                                  Cons. G                                                    20.0
                             Aero. & Infra.                         IT            Banks
           -5.0                           Pharma &
                                                                                                                19.0
                               Retail      Health C.              Construction &
      -10.0
                                                Media                  M.
      -15.0                                                                                                     18.0
                                                           Capital G.
      -20.0
                                   Real E.             Steel                                                    17.0
      -25.0                                                                         Financial S.
      -30.0                                                                                                     16.0
          -40.0         -20.0        0.0         20.0     40.0             60.0       80.0         100.0                           Cons. G                                 Utilities
                                                 TP upside (%)                                                                                 Sustainable alpha (%)



* MCAP weighted                                                                                                                                Source: oekom research, UniCredit Research


ESG risk analysis
The overall market portfolio has slightly improved with an average ESG score of -1.9, with both the Social & Governance (-1.9)
and Environmental performance (-1.9) labeling the market as an ESG Laggard. Only 2 (11%) out of our 18 (100%) sectors
continue to break into ESG Leading territory, which includes the “Utilities, Renewables” and “Consumer Goods” sectors.
The average relative ESG risk adjustment to the cost of equity for the market portfolio is -17.1% with a 100% ESG confidence
level. Adjusting these findings to stock-specific ESG ratings yields an average ESG risk adjustment of 28.1bps for the market.
The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment of 3.0% for the
overall market portfolio. From an ESG style analysis point of view, top tier rated ESG stocks (A+B) contribute an average 27.1%
to the overall sector performance with risk-adjusted performance (Sharpe ratio) for Prime investment status stocks being
significantly higher relative to the market benchmark based on our ESG efficient frontier analysis.

Strategic outlook
We expect the phase of stabilization/recovery on the German equity market to continue. Monetary indicators such as the
M1 money supply point to a turnaround of ifo business expectations in coming months and a bottoming-out of industrial activity
around mid-year. In past cycles equity purchases around lower turning points of the ifo expectation component showed an
attractive risk/reward ratio in the next three to nine months. The decisive actions of governments and central banks contribute to
the recovery. Investors will be willing to look over near-term economic weakness and focus on the chances of a medium-term
economic improvement. In the run-up to the Bundestagswahl (federal election) on September 27 uncertainty about the election
outcome could temporarily become a burden for the equity market. Our mid-year target for the DAX is 5,300 points and our
year-end target is 5,500 points. The attractive dividend yield of many companies is giving support from the valuation side.
Temporary setbacks on the equity market should be viewed as investment chances.

TOP & BOTTOM SUSTAINABLE ALPHAS BY ESG SCORING STATUS

SECTOR        INVESTMENT HIGHLIGHTS                                                       SECTOR TRIGGERS                          KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (ESG Leader status)
Consumer      – strong brands should better withstand turmoil                             – earlier Reebok turnaround              – detailed guidelines covering human rights, social
Goods (N)                                                                                                                            responsibility, health and safety standards
Utilities,    – scarce capacity should help prices find floor                             – most of electricity output for 09/10   – high exposure to Renewable companies with
Renewables                                                                                  already sold at high levels              environmental friendly policies and operations
(OW)
Bottom sustainable alphas (ESG Laggard status)
Real Estate   – recovery unlikely unless portfolio valuation,                             – 9M/08 results showed no sign of        – shortcomings in efficient energy management of
(N)             refinancing issues are solved                                               pick-up in transactions                  property portfolios
W. & Retail,  – weak macroeconomic factors remain                                         – retail sales growth momentum           – lack of transparency regarding labor, health and safety
F& Lux. G.      headwind for consumer sentiment                                             deteriorated further in Q4/08            standards
(UW)
Steel, Metals – reduction in inventories to minimize working                              – slump in Q3/Q4 demand and prices       - lack of transparency regarding supplier standards and
& Mining        capital and losses                                                                                                    strategies to address climate change
(OW)

                                                                                                                                               Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                            UniCredit CAIB Group                             page 27                                                See last pages for disclaimer.
                                                                   20 January 2009                                                    Global Equity Research

                                                                                                                                               ESG Research



ESG rating overview – Market portfolio
ESG market portfolio scoring overview by category                                   ESG stock rating breakdown

                                                                                                                         A-     B+
  -1.0                                                                                                                                   B
                                                                                                                        3.0%   0.7%
                                                                                                                                       0.7%
                                                                                                                  D-                              B-
                                                                                                                15.7%                            8.2%




                                                                                                                                                    C+
  -2.0
                                                                                                                                                   14.9%
                                                                                                          D
                                                                                                        21.6%

                                                                                                                                                C
                                                                                                                                              10.4%

                                                                                                                  D+                    C-
  -3.0
                                                                                                                 12.7%                11.9%
         Social & Governance          ESG               Environmental



                                                                                                                        Source: oekom research, UniCredit Research

Environmental review
On environmental issues, only 16.7% of the sectors were able to break into the Environmental Leader category with the average
market score well into the Environmental Laggard territory. The best environmental performers include the “Utilities,
Renewables” sector with its high exposure to Renewable energy companies, the “Consumer Goods” sector, whose
composites show a strong focus on adopting environmental policies and the newly added “Aerospace & Defence,
Infrastructure & Logistics” sector through conscious implementation of environmental management systems. The worst
environmental scores continue to be attributed to the “Media” and “Real Estate” sectors. Key weaknesses within the Media
sector are composites lacking measures to reduce energy consumption while the Real Estate sector shows shortcomings in
efficient energy management of property portfolios.

Social & Governance review
The market’s Social & Governance performance continued to lag its Environmental performance with only the “Consumer
Goods” sector clearly breaking into Leader territory. Key strengths worth highlighting within the sector constituents are
comprehensive risk assessments of products, detailed guidelines covering areas such as human rights, social responsibility or
health and safety and a focus on clear measures to check key suppliers’ compliance with company-specific labor, health and
safety standards. The bottom Laggard remains the “Real Estate” sector showing weaknesses through lack of transparency
regarding standards of business ethics and supplier standards with regard to labor, health and safety issues.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                         Soc. & Gov. rating Key social & governance strength
Utilities, Renewables + high share of revenues originating from         Consumer Goods – implementation of group-wide policies regarding staff
                        renewable energy production                                          relations/labor standards
Consumer Goods        + presence of systems/policies to                 -                  -
                        monitor/measure resource consumption
                        or reduce environmental pollution
Aero.& Infra.         + commitment to reduce CO2 emissions,             -                       -
                        comprehensive environmental policies
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                         Soc. & Gov. rating Key social & governance weakness
Media                 – lack of measures to reduce energy               Real Estate        – lack of transparency regarding standards of business ethics or
                        consumption                                                          limited public information on social and ethical issues
Real Estate           – shortcomings in efficient energy                Telco              – lack of policies regarding equal opportunities, non-discrimination
                        management of property portfolios
Financial Services    – lack of transparency regarding                  Tourism, Leisure        – shortcomings regarding labor, human rights business ethics policy
                        environmental management systems                & Services                implementation

                                                                                                                        Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                          page 28                                                 See last pages for disclaimer.
                                                                           20 January 2009                                            Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview charts – Market portfolio
TP and TPESG upside (%)                                                             ESG score overview by ESG scoring status

            TP upside (%)                           TP ESG upside (%)
 100.0      Market upside to financial TP (%)       Market upside to TP ESG (%)        3.0

  80.0                                                                                 2.0
                                                                                       1.0
  60.0
                                                                                       0.0
  40.0                                                                                -1.0
  20.0                                                                                -2.0
                                                                                      -3.0
   0.0
                                                                                      -4.0
 -20.0                                                                                -5.0
 -40.0                                                                                -6.0
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Environmental score overview by category’s ESG scoring status                       Social & Governance score overview by category’s ESG scoring status

   4.0                                                                                    1
   3.0                                                                                 0.5
   2.0                                                                                    0
   1.0                                                                                -0.5
   0.0
                                                                                          -1
  -1.0
                                                                                      -1.5
  -2.0
  -3.0                                                                                    -2
  -4.0                                                                                -2.5
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kesg/ke differential by ESG scoring status (bps)                                    ERP & beta differential between Prime/Not Prime composites

 250                                                                                  7.00
                                                                                                                6.18
 200
                                                                                      6.00
 150                                                                                               5.35

 100                                                                                  5.00

  50                                                                                  4.00
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                                                                                                                       Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG             UniCredit CAIB Group                  page 29                                                  See last pages for disclaimer.
                                                                                                                                                                                                    20 January 2009                                                                                                                                                                                     Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                 ESG Research



ESG sector composites overview – Market Portfolio
COMPOSITE CONSTITUENTS BREAKDOWN BY ESG SCORING STATUS
                                                                                                               ESG               Implied ESG exposure –                                                                        ESG risk ESGRsector i                                             ESG confidence –ESGCsector i                                                             TP upside      TPESG upside             αsustainable
Sector                                                                                                        score                           ESGEi (%)                                                                                       (%)                                                                      (%)                                              ke*     kESG*          (%)*              (%)*                   (%)*
ESG Leader status
Utilities, Renewables                                                                                               2.3                                                                      29                                                                             -17.1                                                                              0.0      5.3       7.4            22.3               26.0                  18.6
Consumer Goods                                                                                                      1.3                                                                      14                                                                             -17.1                                                                              0.0      6.5       6.6            25.0               28.6                  22.0
ESG Laggards
Aerospace & Defence, Infrastructure & Logistics                                                                     -0.3                                                          -20-14                                                                                    -17.1                                                                            0.0        8.4       9.2             8.7                 8.0               -1.2
Automobiles & Parts                                                                                                 -0.4                                                          -20-14                                                                                    -49.7                                                                          100.0        3.9       7.6           -16.9                -5.8              -13.4
Insurance                                                                                                           -0.7                                                             -20                                                                                    -17.1                                                                            0.0        5.0       8.3            51.2                54.8               46.5
Chemicals                                                                                                           -0.7                                                             -20                                                                                    -17.1                                                                           27.9        8.3       8.0            43.5                48.5               40.5
Construction & Materials                                                                                            -1.5                                                             -40                                                                                    -38.4                                                                          100.0        8.0       8.7            41.6                31.8               23.1
Pharmaceuticals & Biotech, Health Care                                                                              -1.8                                                             -40                                                                                    -17.1                                                                            0.0       13.3       7.9            24.2                20.1               12.2
Banks                                                                                                               -2.0                                                             -40                                                                                    -17.1                                                                            7.2       13.9       8.7            63.0                63.7               55.0
Software & IT Services, Semiconductors,Technology & Hardware                                                        -2.4                                                             -40                                                                                    -31.0                                                                          100.0        8.7       8.6            42.6                38.6               30.0
Steel, Metals & Mining                                                                                              -2.4                                                             -40                                                                                    -46.9                                                                          100.0        9.4      11.8            20.3                -2.6              -14.4
Tourism, Leisure & Services                                                                                         -2.5                                                             -60                                                                                    -29.6                                                                          100.0        8.9       9.1            28.5                32.6               23.4
Capital Goods                                                                                                       -2.9                                                             -60                                                                                    -17.1                                                                            0.0        9.0       9.6            35.0                22.6               13.0
Wholesale & Retail, Fashion & Luxury Goods                                                                          -3.1                                                             -60                                                                                    -17.1                                                                            NA        10.3       8.7             1.1                -6.9              -15.6
Telecommunications                                                                                                  -3.4                                                             -60                                                                                    -41.3                                                                          100.0        8.7       7.7            47.8                67.9               60.2
Financial Services                                                                                                  -3.8                                                             -80                                                                                    -17.1                                                                            NA         8.6       8.8            80.7                59.8               50.9
Media                                                                                                               -4.0                                                             -80                                                                                    -17.1                                                                            NA         6.2       9.9            15.5                 0.1               -9.9
Real Estate                                                                                                         -4.9                                                            -100                                                                                    -17.1                                                                            NA         7.6       9.6             8.7               -10.1              -19.8
* MCAP weighted

ESG confidence analysis ( x )                                                                                                 ESG style analysis (%)                                                                                                                                                                              ESG efficient frontier analysis (%)
                                                                                                                                                                Composite A                         Composite B                           Composite C                           Composite D                                                                            Sharpe ratio Prime(0.38); Sharpe ratio Sector(0.07)
          ESGCsector i = 1.0 - 0.0                                                                                                                                                                                                                                                                                                                    12
                                                                                                                               100

                                                                                                                                                                                                                                                                                                                                                      10
                                                                                                                                80




                                                                                                                                                                                                                                                                                                                                   Portfolio return
                                                                                                                                                                                                                                                                                                                                                       8
                                                                                                                                60
                                                                                                                                                                                                                                                                                                                                                       6

                                                                                                                                40                                                                                                                                                                                                                     4

                                                                                                                                                                                                                                                                                                                                                       2
                                                                                                                                20
                                                                                                                                                                                                                                                                                                                                                       0
                                                                                                                                 0                                                                                                                                                                                                                         0             10               20             30                 40             50
                                                                                                                                              May-02




                                                                                                                                                                         May-03




                                                                                                                                                                                                    May-04




                                                                                                                                                                                                                               May-05




                                                                                                                                                                                                                                                          May-06




                                                                                                                                                                                                                                                                                     May-07




                                                                                                                                                                                                                                                                                                                May-08
                                                                                                                                     Jan-02


                                                                                                                                                       Sep-02
                                                                                                                                                                Jan-03


                                                                                                                                                                                  Sep-03
                                                                                                                                                                                           Jan-04


                                                                                                                                                                                                             Sep-04
                                                                                                                                                                                                                      Jan-05


                                                                                                                                                                                                                                        Sep-05
                                                                                                                                                                                                                                                 Jan-06


                                                                                                                                                                                                                                                                   Sep-06
                                                                                                                                                                                                                                                                            Jan-07


                                                                                                                                                                                                                                                                                              Sep-07
                                                                                                                                                                                                                                                                                                       Jan-08


                                                                                                                                                                                                                                                                                                                         Sep-08
                                                                                                                                                                                                                                                                                                                                                                                        Portfolio risk (STDEV)
  -2.63

           -2.52

                   -2.42

                           -2.31

                                   -2.20

                                           -2.09

                                                   -1.99

                                                           -1.88

                                                                    -1.77

                                                                            -1.67

                                                                                    -1.56

                                                                                            -1.45

                                                                                                    -1.35

                                                                                                            -1.24

                                                                                                                      -1.13




                                                                                                                                                                                                                                                                                                                                                                     FP Prime       FP Sector           CAL Prime            CAL Sector

                                                                                                                                                                                                                                                                                                                                                                                          Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                UniCredit CAIB Group                                                                                                                               page 30                                                                                                                                                                                    See last pages for disclaimer.
                                                              20 January 2009               Global Equity Research

                                                                                                 ESG Research




                                                             Aerospace & Defence, Infrastructure & Logistics




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group               page 31                See last pages for disclaimer.
                                                                                          20 January 2009                                     Global Equity Research

                                                                                                                                                     ESG Research



ESG overview – Aerospace & Defence, Infrastructure & Logistics
TP upside vs. difference TPESG-TP (%)*                                                             Sustainable alpha of UCRESGLG Index constituents (%)

                  4.0 FRA GR (H,C+)                                                                  80
                             EAD FP (H,C+)                                         VT9 GR (B,C+)
                  2.0                                                                                70

                             Sector                                                                  60
                  0.0
                                                                                                     50
 TPESG - TP (%)




                  -2.0
                         MTX GR (H,C)                                                                40
                  -4.0                                                                               30
                               DPW GR (H,C)
                  -6.0                                                                               20

                  -8.0                                                                               10
                                                                                                      0
             -10.0                         RHM GR (B,D+)
                                                                                                    -10
             -12.0




                                                                                                                                     EAD FP




                                                                                                                                                                FRA GR
                                                                                                               VT9 GR




                                                                                                                                     (H,C+)
                                                                                                                (B,C+)




                                                                                                                                                                 (H,C+)
                         0            20            40           60           80             100
                                                     TP upside (%)


* average is MCAP weighted                                                                                                     Source: oekom research, UniCredit Research


ESG risk analysis
Aerospace & Defence, Infrstructure & Logistics continues to score slightly below the ESG Leaders territory with an average ESG
sector score of -0.3. The Environmental performance (0.2) improved relative to the sector’s slightly worse Social & Governance score
(-0.3). Overall, 50% of stocks were able to obtain a Prime investment status, including EADS (Hold, C+), Fraport (Hold, C+)
and newly added VTG (Buy, C+). We stress that there remains no negative ESG/risk relationship within this sector. Using the
general portfolio ESG risk adjustment variables and taking into account stock-specific ESG ratings, the ESG risk adjustment for the
sector has been determined at 14.4bp. The overall impact of these ESG risk adjustments on our target prices translates into an
upside adjustment of -0.7% for the overall sector. From an ESG style analysis point of view, there are no top tier rated ESG
stocks (A+B) with contributions of C and D rated stocks at 95.9% and 4.1%, respectively. The risk-adjusted performance
(Sharpe ratio) for Prime stocks has been determined to be 6.6% higher relative to the sector benchmark based on our ESG
efficient frontier analysis.

Strategic outlook
Reflecting the caution over commercial aerospace cycle fundamentals, driven by slowing GDP growth, volatile fuel costs and
substantial aircraft capacity reductions, we see potential risk for further pressure on sentiment towards EADS. IATA forecasts
that global passenger air traffic will fall 3%-4% in 2009, a decline that is similar to the negative Gulf War effect in 1991 and after
September 11, 2001. The lower oil price also eliminates the pressure on airlines to buy aircraft for replacement or fuel efficiency.
Consequently, the two main drivers of new aircraft demand have largely fizzled. In addition, aircraft financing conditions have
deteriorated significantly in the past quarter, and we see signs of falling aircraft lease rates, which is normally a good leading
indicator of a future decline in aircraft deliveries. Airbus indicated it would have to increase its gross customer financing
exposure further in the coming years. As a consequence, there has been evidence that mainly European and Asian airlines are
starting to defer orders, a process we expect to accelerate in 2009. Therefore, we are now assuming that Airbus civil aircraft
deliveries will decline by 5% in 2009 and drop by 12% in 2010.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS
COMPANY            INVESTMENT HIGHLIGHTS                STOCK TRIGGERS                                                   KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
VTG (Buy,C+)       High visibility and stability in the Minor free float                                                 + mainly active in environmentally sound rail
                   rental business                                                                                         transport
EADS (Hold,C+)     Weakening outlook for global air     Peak of the commercial aerospace cycle in 2009                   + committed to reduce CO2, Nox and noise
                   traffic accelerates                                                                                     emissions of products
Fraport (Hold,C+) Lower freight and passenger           Retail & Properties biggest profit contributor                   + transparent social and environmental reporting
                   numbers in Frankfurt
Bottom sustainable alphas (UCRESGLG Index non-constituents)
MTU Aero           Still good volume growth at OEM      MTU’s high-margin spare parts business largely                   - lack of transparency regarding ecological life
Engines (Hold,C)   division                             stable                                                              cycle assessment of products
Deutsche Post      ca. 80% cost cut at US Express       Implementation of the US restructuring plan                      - lack of transparency regarding the percentage of
(Hold,C)                                                                                                                    diesel vehicles equipped with particulate filter
Rheinmetall        Growing Defence business             Bottom in the performance of Automotive shares                   - lack of transparency regarding product recycling
(Buy,D+)
                                                                                                                               Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                         UniCredit CAIB Group                     page 32                                        See last pages for disclaimer.
                                                                    20 January 2009                                                     Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview – Aerospace & Defence, Infrastructure & Logistics
ESG sector scoring overview by category                                              ESG stock rating breakdown

  1.0
                                                                                                                    D+
                                                                                                                   16.7%




  0.0                                                                                                                                             C+
                                                                                                                                                 50.0%


                                                                                                               C
                                                                                                             33.3%


  -1.0
         Social & Governance          ESG                Environmental



                                                                                                                           Source: oekom research, UniCredit Research

Environmental review
Apropos environmental issues, the majority (67%) of the Aerospace & Defence, Infrastructure & Logistics companies we
analyzed fall into the Environmental Leaders category. Taking average environmental scores into account, the group has moved
up into the Environmental Leaders category. The highest scoring Environmental Leaders are EADS (B-) and VTG (B-) with key
strengths a commitment to reduce CO2 emissions and activities in environmentally sound rail transport, respectively. At the
other end of the scale, the worst score remains with Rheinmetall (D+) given its lack of transparency in product recycling.

Social & Governance review
Regarding social issues, the percentage distribution between Soc. & Gov. Leaders and Soc. & Gov. Laggards deteriorated with
a 50:50 split. Based on average scores, the sector lies slightly below our Leaders categorization. The top company from a social
perspective remains Deutsche Post (B-) with key strength the group-wide implementation of safety management systems.
Rheinmetall (C-), MTU Aero Engines (C-) and VTG (C-) were meted out the worst social score with key weaknesses being the
lack of transparency regarding standards complying with labor safety and health issues vis-à-vis their suppliers for all three.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                          Soc. & Gov. rating Key social & governance strength
EADS (B-)            + committed to reduce CO2, Nox and noise            Deutsche Post (B-) + group-wide implementation of safety management systems
                        emissions of products
VTG (B-)             + mainly active in environmentally sound rail       EADS (C+)                + detailed policy on staff relations and labor standards
                        transport
MTU Aero Engines     + implementation of a certified environmental       Fraport (C+)             + detailed corporate guidelines covering important areas related to
(C+)                    management system at all major                                              social responsibility, human rights, and health and safety
                        installations with significant environmental
                        risks
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                          Soc. & Gov. rating Key social & governance weakness
Rheinmetall (D+)     - lack of transparency regarding product            MTU Aero Engines - lack of transparency regarding measures to check compliance of
                        recycling                                        (C-)                  key suppliers with labor/health and safety standards
Deutsche Post (C-)   - lack of transparency regarding the                Rheinmetall (C-)   - lack of transparency regarding supplier standards with regard to
                        percentage of diesel vehicles equipped with                            labor/health and safety issues
                        particulate filter
-                    -                                                   VTG (C-)                 - lack of transparency regarding supplier standards with regard to
                                                                                                     labor/health and safety issues

                                                                                                                           Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                           page 33                                                See last pages for disclaimer.
                                                                                        20 January 2009                                                           Global Equity Research

                                                                                                                                                                             ESG Research



ESG overview charts – Aerospace & Defence, Infrastructure & Logistics
TP and TPESG upside (%)*                                                                         ESG score overview by ESG scoring status

                    TP upside (%)                            TP ESG upside (%)                                               ESG Leader                  ESG Laggard          Sector average
                    TP upside sector (%)                     TP ESG upside sector (%)
                                                                                                    2
  90                                                                                                1
  80                                                                                                1
  70                                                                                                0
  60                                                                                               -1
  50
                                                                                                   -1
  40
                                                                                                   -2
  30
  20                                                                                               -2
  10                                                                                               -3
   0                                                                                               -3
 -10                                                                                               -4
                        RHM GR




                                                        FRA GR




                                                                                       MTX GR




                                                                                                                               FRA GR




                                                                                                                                                                  MTX GR




                                                                                                                                                                                                    RHM GR
                                      EAD FP




                                                                                                             EAD FP
          VT9 GR




                                                                                                                                                VT9 GR
                                                                       DPW GR




                                                                                                                                                                                   DPW GR
Environmental score overview by category’s ESG scoring status                                    Social & Governance score overview by category’s ESG scoring status

           Environmental Leader            Environmental Laggard                Sector average                        Soc. & Gov. Leader                 Soc. & Gov. Laggard                Sector average

  3                                                                                                 3
                                                                                                    2
  2
                                                                                                    2
  1                                                                                                 1
  0                                                                                                 1
                                                                                                    0
  -1                                                                                               -1
  -2                                                                                               -1
                                                                                                   -2
  -3
                                                                                                   -2
  -4                                                                                               -3
                                      MTX GR




                                                        FRA GR




                                                                                       RHM GR




                                                                                                                                                FRA GR




                                                                                                                                                                  MTX GR




                                                                                                                                                                                   RHM GR
          EAD FP




                                                                                                                               EAD FP
                        VT9 GR




                                                                                                                                                                                                    VT9 GR
                                                                       DPW GR




                                                                                                             DPW GR




kesg/ke differential by ESG scoring status (bps)*                                                ERP & beta differential between Prime/Not Prime composites

                     ESG Leader                 ESG Laggard         Sector average                                                             Prime        Not Prime

 100
                                                                                                                      6.99
  80
                                                                                                                                        6.04
  60

  40

  20

   0

 -20
                                                                                                                                                                           1.09             0.94
 -40
                                       FRA GR




                                                        MTX GR




                                                                                       RHM GR
           EAD FP




                         VT9 GR




                                                                       DPW GR




                                                                                                                             ERP                                                  Beta



* averages are MCAP weighted                                                                                                                   Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                  UniCredit CAIB Group                          page 34                                                                  See last pages for disclaimer.
                                                                                                                                                                                       20 January 2009                                                                                                                                                                                         Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                        ESG Research



UCRESGLG Index sector constituents overview – Aerospace & Defence, Infrastructure & Logistics
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg                                                          Current              ESG               ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                       Target                    TP upside        TPESG upside                 α sustainable
ticker                  Name                                       rec.                 rating               ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price          TPESG           (%)                 (%)                         (%)
UCRESGLG index constituent
EAD FP                  EADS                                       Hold                 C+                               14.3                                                 -17.1                                                          0.0                9.6                                9.3                    12.7                       14.0           14.4            10.1                 13.4                      4.1
FRA GR                  Fraport                                    Hold                 C+                               14.3                                                 -17.1                                                          0.0                8.0                                7.8                    28.8                       30.0           31.0             4.2                  7.5                     -0.3
VT9 GR                  VTG                                        Buy                  C+                               14.3                                                 -17.1                                                          0.0                8.6                                8.4                             6.7               12.0           12.4            78.8                 84.3                     75.9
UCRESGLG index non-constituent
MTX GR                  MTU Aero                                   Hold                 C                            -20.0                                                    -17.1                                                          0.0                9.0                                9.3                     19.5                      20.0           19.2             2.4                 -1.7                    -11.0
                        Engines
DPW GR                  Deutsche Post                              Hold                 C                            -20.0                                                    -17.1                                                          0.0                9.1                                9.4                             9.4               10.0             9.6            6.5                  2.3                     -7.1
RHM GR                  Rheinmetall                                Buy                  D+                              -60.0                                                 -17.1                                                          0.0                8.6                                9.5                    22.7                       30.0           26.7            32.0                 17.4                      7.9

                                                                                                                                                                                                                                                                                                                                                                                  Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                    ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                       Composite C                           Composite D                                                                                                                        Sharpe ratio Prime(0.25); Sharpe ratio Sector(0.23)
         ESGCsector i = 1.0 - 1.0
                                                                                                                  100                                                                                                                                                                                                                     10
                                                                                                                                                                                                                                                                                                                                           9
                                                                                                                                                                                                                                                                                                                                           8
                                                                                                                   80
                                                                                                                                                                                                                                                                                                                                           7




                                                                                                                                                                                                                                                                                                                       Portfolio return
                                                                                                                                                                                                                                                                                                                                           6
                                                                                                                   60
                                                                                                                                                                                                                                                                                                                                           5
                                                                                                                                                                                                                                                                                                                                           4
                                                                                                                   40
                                                                                                                                                                                                                                                                                                                                           3
                                                                                                                                                                                                                                                                                                                                           2
                                                                                                                   20
                                                                                                                                                                                                                                                                                                                                           1
                                                                                                                                                                                                                                                                                                                                           0
                                                                                                                    0                                                                                                                                                                                                                          0            5           10         15         20         25           30            35
                                                                                                                                 May-02



                                                                                                                                                            May-03



                                                                                                                                                                                       May-04



                                                                                                                                                                                                                  May-05



                                                                                                                                                                                                                                             May-06




                                                                                                                                                                                                                                                                        May-07



                                                                                                                                                                                                                                                                                                   May-08
                                                                                                                        Jan-02


                                                                                                                                          Sep-02
                                                                                                                                                   Jan-03


                                                                                                                                                                     Sep-03
                                                                                                                                                                              Jan-04


                                                                                                                                                                                                Sep-04
                                                                                                                                                                                                         Jan-05


                                                                                                                                                                                                                           Sep-05
                                                                                                                                                                                                                                    Jan-06


                                                                                                                                                                                                                                                      Sep-06
                                                                                                                                                                                                                                                               Jan-07


                                                                                                                                                                                                                                                                                 Sep-07
                                                                                                                                                                                                                                                                                          Jan-08


                                                                                                                                                                                                                                                                                                            Sep-08
                                                                                                                                                                                                                                                                                                                                                                               Portfolio risk (STDEV)
  0.85

          1.00

                 1.15

                        1.29

                               1.44

                                      1.59

                                             1.73

                                                    1.88

                                                            2.03

                                                                   2.17

                                                                          2.32

                                                                                 2.47

                                                                                            2.61

                                                                                                   2.76

                                                                                                          2.91




                                                                                                                                                                                                                                                                                                                                                        FP Prime             FP Sector         CAL Prime           CAL Sector


                                                                                                                                                                                                                                                                                                                                                                                  Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                        UniCredit CAIB Group                                                                                                                          page 35                                                                                                                                                                                        See last pages for disclaimer.
                                                                                                                                  20 January 2009                                                                                                             Global Equity Research

                                                                                                                                                                                                                                                                          ESG Research



Aerospace & Defence, Infrastructure & Logistics: Performance
                                                                                              52-week                52-week % chg.                        Market cap.                       Absolute performance (%)                 Relative performance (%) vs. Euro STOXX 50
Company                                                                Price              High              Low         High                    Low                     (mn)              1M            3M         12M       YTD                       1M          3M                    12M           YTD
EADS                                                  EUR              12.71                  19.3           9.7         52.0                -23.9                10,356                 10.5          31.4        -31.2       8.6            17.4               37.3                    13.2          15.4
MTU Aero Engines                                      EUR              19.54                  36.3          13.7         85.9                -30.1                   1,016               14.4          27.3        -39.2       2.0            21.3               33.2                     5.2           8.8
Rheinmetall                                           EUR              22.73                  53.9          16.9       136.9                 -25.7                      818               3.3          -16.4       -47.0      -0.1            10.2              -10.6                    -2.5           6.7
Germany average                                                                                                          91.6                -26.6                                        9.4          14.1        -39.1       3.5            16.3               20.0                     5.3          10.3
Deutsche Post                                         EUR               9.39                  22.9           7.5       143.9                 -20.3                11,387                 -13.7          -8.9       -56.0    -20.5               -6.8              -3.0             -11.5           -13.7
Fraport                                               EUR              28.80                  53.0          23.5         84.0                -18.3                   2,640                -0.2          -0.7       -44.1      -6.1                     6.7         5.2                    0.3           0.7
VTG                                                   EUR               6.71                  17.0           6.5       153.2                        -3.1                144               -1.6         -32.9       -51.4    -10.5                      5.3      -27.0                    -6.9          -3.7
Germany average                                                                                                        127.0                 -13.9                                        -5.2         -14.2       -50.5    -12.4                      1.7        -8.3                   -6.0          -5.6


1M absolute performance (%)                                                                          1M relative performance (%)                                                                          Absolute performance YTD (%)
                                                             DAX (%)             Euro STOXX (%)                                                                                                                                                                     DAX (%)              Euro STOXX (%)
 20                                                                                                   30                                                                                                   20
                       14.4                                                                                            21.3
                                                                                                             17.4                                                                                                  8.6
          10.5                                                                                        20                                                                                                   10
 10
                                                                                                                                     10.2                                                                                   2.0
                                      3.3                                                                                                                                      6.7               5.3
                                                                                                      10                                                                                                       0
   0
                                                                       -0.2            -1.6            0                                                                                                   -10
                                                                                                                                                                                                                                         -0.1                                  -6.1             -10.5
 -10
                                                                                                     -10                                                                                                   -20
                                                                                                                                                              -6.8                                                                                           -20.5
                                                      -13.7
 -20                                                                                                 -20                                                                                                   -30
           EADS




                                                      Deutsche




                                                                                                             EADS




                                                                                                                                                             Deutsche




                                                                                                                                                                                                                   EADS




                                                                                                                                                                                                                                                             Deutsche
                                      Rheinmetall




                                                                       Fraport




                                                                                                                                      Rheinmetall




                                                                                                                                                                               Fraport




                                                                                                                                                                                                                                         Rheinmetall




                                                                                                                                                                                                                                                                               Fraport
                      MTU Aero




                                                                                                                       MTU Aero




                                                                                                                                                                                                                           MTU Aero
                                                                                        VTG




                                                                                                                                                                                                 VTG




                                                                                                                                                                                                                                                                                                 VTG
                       Engines




                                                                                                                        Engines




                                                                                                                                                                                                                            Engines
                                                        Post




                                                                                                                                                               Post




                                                                                                                                                                                                                                                               Post
                                                                                                                                                                                                                                                                        Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                 UniCredit CAIB Group                                                                  page 36                                                                                                                         See last pages for disclaimer.
                                                                                                                                           20 January 2009                                                                                                     Global Equity Research

                                                                                                                                                                                                                                                                        ESG Research



Aerospace & Defence, Infrastructure & Logistics: Valuation Overview
                                                                              P/E (x)                                         P/CF (x)                                 EV/sales (x)                                   EV/EBITDA (x)                                    EV/EBIT (x)
Company                                                            2008e         2009e    2010e                     2008e        2009e      2010e            2008e           2009e         2010e          2008e             2009e              2010e          2008e          2009e            2010e
EADS                                                                   11.2         7.7     9.5                       2.8           3.2         3.5             0.23          0.18            0.18              2.5               1.9            2.3            4.8              3.4             4.6
MTU Aero Engines                                                        7.0         5.9     6.5                       4.1           3.3         3.5             0.71          0.59            0.54              4.4               4.0            3.9            6.4              5.8             5.9
Rheinmetall                                                            10.2         7.1     5.8                       4.5           2.7         2.5             0.55          0.39            0.37              5.2               4.1            3.6            8.7              7.4             6.2
Germany average                                                         9.1         6.8     6.9                       3.7           3.0         3.1             0.49          0.39            0.36              3.7               3.0            3.1            6.2              5.0             5.5
Deutsche Post                                                          17.9         9.5     8.6                       5.5           3.8         3.6             0.47          0.31            0.31              5.1               4.1            3.9           11.0              6.9             6.4
Fraport                                                                17.4        15.5    14.8                       8.3           6.9         5.4             2.25          2.06            2.18              8.0               7.2            7.5           13.1            12.6             13.4
VTG                                                                     9.0         6.6     5.8                       2.5           1.4         1.3             1.36          1.21            1.22              5.2               4.8            4.8           10.7            10.8             10.4
Germany average                                                        14.8        10.5     9.7                       5.5           4.1         3.4             1.36          1.19            1.24              6.1               5.4            5.4           11.6            10.1             10.1


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                       ROCE 2010e (%) vs. WACC 2010e (%)                                                                 EV/sales 2002-2010e (x)
                      2.5                                                                                            20                                                                                   1.4

                                                                                Fraport
                                                                                                                                                                                                          1.2
                      2.0                                                                                                                                                                                                                              1.05
                                                                                                                     15                                                                                                                                          1.03
                                                                                                                                                       MTU Aero                                                                                                           0.93
 EV/sales 2010e (x)




                                                                                                                                                                                                          1.0
                                                                                                   ROCE 2010e (%)


                                                                                                                                                         Engines Deutsche Post                                                                  0.85
                      1.5                                                                                                                                                                                                                                                              0.79   0.80
                                                                                                                                                 Rheinmetall
                                                                                                                                                                                                          0.8
                                                                   VTG                                               10                                                                                                             0.70




                                                                                                                                                                                                      X
                                                                                                                                                                                                                  0.64     0.57
                      1.0                                                                                                                                                              EADS               0.6
                                                         MTU Aero                                                                         VTG
                                                          Engines                                                     5
                      0.5                                                                                                                             Fraport                                             0.4
                                Deutsche Post       Rheinmetall
                                    EADS                                                                                                                                                                  0.2
                      0.0                                                                                             0
                            0                   5                 10               15         20                          0         2       4            6               8            10        12        0.0
                                                     EBIT margin 2010e (%)                                                                       WACC 2010e (%)                                                   2002      2003        2004    2005   2006      2007     2008e    2009e      2010e


                                                                                                                                                                                                                                                                      Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                UniCredit CAIB Group                                                           page 37                                                                                                               See last pages for disclaimer.
January 2009
                                                                          20 January 2009                                      Global Equity Research

                                                                                                                                         ESG Research



EADS                                                                                             Hold (prev. Hold)
Outlook for civil aerospace is now as bad as 2001                                                Price on 01/16/09                                    EUR 12.71
                                                                                                 Target price (prev. EUR 14.00)                       EUR 14.00
■   Investment story: Reflecting the caution over commercial aerospace                           Upside to TP                                                10.1%
    cycle fundamentals, driven by slowing GDP growth, volatile fuel costs                        Cost of equity                                               9.6%
    and substantial aircraft capacity reductions, we see potential risk for                      High/Low (12M)                                          19.32/9.67
    further pressure on sentiment towards EADS. IATA forecasts global
                                                                                                 INVESTMENT HIGHLIGHTS
    passenger air traffic will fall 3% in 2009, a decline that is similar to the                  Weakening outlook for global air traffic accelerates
    negative Gulf War effect in 1991 and after September 11, 2001. The                            Power8 Plus savings of EUR 1.0 bn beyond 2010
                                                                                                  Strong balance sheet, net liquidity above EUR 9.0 bn
    lower oil price also eliminates the pressure on airlines to buy aircraft for
    replacement or fuel efficiency. Consequently, the two main drivers of                        STOCK TRIGGERS
                                                                                                  Peak of the commercial aerospace cycle in 2009
    new aircraft demand have extensively fizzled. In addition, aircraft                           Further A400M provision risk; A380 production costs
    financing conditions have deteriorated significantly in the past quarter,                     Stabilization of USD/EUR rate helps performance
    and we see signs of falling aircraft lease rates, which is normally a good
                                                                                                 STOCK DATA
    leading indicator of a future decline in aircraft deliveries. Airbus indicated it
                                                                                                 Reuters/Bloomberg                              EAD.PA/EAD FP
    would have to increase its gross customer financing exposure further in
                                                                                                 Average daily volume (tds.)                                  384.0
    the coming years. As a consequence, there has been evidence that mainly
                                                                                                 Free float (%)                                                47.0
    European and Asian airlines are starting to defer orders, a process we
                                                                                                 Market capitalization (EUR bn)                                10.4
    expect to accelerate in 2009. Therefore, since the global economic                           No. of shares issued (mn)                            806.9
    outlook has deteriorated so rapidly, we are now assuming Airbus civil aircraft               Shareholders          SOGEADE 27.38%, Daimler 22.52%,
    deliveries will decline by -5% in 2009 and drop -12% in 2010e.                                                      SEPI 5.49%, treasury shares 0.55%,
                                                                                                                                              rest free float

■   Operating performance in 2009e and 2010e: According to our                                   UPCOMING EVENTS
    estimates, the EBIT of Airbus is the major driver of the improvement in                      Annual results 2008                                      10-Mar-09
    EADS’ operating profit to EUR 2.313 bn in 2009e (operating margin                            Q1 sales and earnings                                   12-May-09
    5.3%). Due to the expected reduction in aircraft deliveries and additional                   AGM                                                        May-09
    customer aircraft financing, we expect a drop in group EBIT to EUR
    1.768 bn in 2010. Key risks to our calculations are a fall in the                              50
                                                                                                   45
    USD/EUR rate, because EADS has a significant USD currency                                      40
                                                                                                   35
    headwind of an estimated EUR 1.5 bn in 2009/10, and the Power 8 cost-                          30
                                                                                                   25
    reduction plan was designed for a rate of USD 1.35/EUR. In addition,
                                                                                                   20
    production issues on the A380 have not been resolved, Airbus has
                                                                                                   15
    indicated 2009 will be another challenging year for this aircraft type, and the
    risks of further delays on the A400M military transport aircraft have                          10
    increased.

■   Valuation: Based on our 2009e earnings estimates, our preliminary fair                          5
                                                                                                            2006               2007                2008
    valuation calculation of EUR 14.00 is based on a sector-average P/E of                          EADS (FRA)
                                                                                                    DAX 30 PERFORMANCE - PRICE INDEX

    8.5x, an EV/EBITDA multiple of 3.5x and an EV/EBIT multiple of 4.5x.                                                      Source: Thomson Datastream



                                                                                                 RELATIVE PERFORMANCE (% CHG.)
                                        2006       2007          2008e        2009e     2010e
                                                                                                                                       1M          3M           6M
Sales (EUR mn)                         39434      39123          41255        43525     44208
                                                                                                 DAX                                  18.2        37.0         39.3
EBITDA (EUR mn)                       2033.0     1751.0         3755.0       4053.5    3536.2
                                                                                                 Euro STOXX 50                        17.4        37.3         38.4
EBIT (EUR mn)                          399.0        52.0        1981.0       2312.5    1767.9
                                                                                                 ES Ind. G/S                          16.6        34.8         46.8
Net income (EUR mn)                     99.0     -446.0         1034.5       1338.1    1081.6
EPS reported (EUR)                      0.12       -0.56          1.28         1.66      1.34
                                                                                                 Uwe Weinreich, CEFA (HVB)
DPS (EUR)                               0.12        0.12          0.37         0.48      0.50
                                                                                                 +49 89 378-12640
ROCE (%)                                 6.9         0.2            8.1        10.3        7.8   uwe.weinreich@unicreditgroup.de
P/E (x)                                213.0       -41.5           11.2          7.7       9.5
P/CF (x)                                 7.3      139.2             2.8          3.2      3.5
P/BV (x)                                 1.6         1.4            0.9          0.7      0.7
EV/sales (x)                            0.59        0.42          0.23         0.18      0.18
EV/EBIT (x)                             58.5      312.6             4.8          3.4      4.6
ROCE/WACC (x)                            0.6           0            0.9          1.2      0.9
Div. yield (%)                           0.5         0.5            2.6          3.8      3.9

                                                  Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                          page 38                                          See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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January 2009
                                                                       20 January 2009                                     Global Equity Research

                                                                                                                                     ESG Research



Fraport                                                                                      Hold (prev. Hold)
Cautious on 2009 passenger and freight traffic                                               Price on 01/16/09                                    EUR 28.80

■   Investment story: We are increasingly cautious about Fraport’s traffic                   Target price (prev. EUR 30.00)                       EUR 30.00
                                                                                             Upside to TP                                                 4.2%
    performance in 2009. Our current assumption for passenger traffic is a
                                                                                             Cost of equity                                               8.0%
    decline of 3.5% and a drop in cargo volume of 5%. As of January 2009, FRA
                                                                                             High/Low (12M)                                       53.00/23.53
    has raised its fees at Frankfurt airport by around 2.3%. The approval of the
    regulator for this step has been confirmed. The fee increase will partly                 INVESTMENT HIGHLIGHTS
    offset the shortfall in revenues associated with the recent downturn in                   Lower freight and passenger numbers in Frankfurt
                                                                                              FRA asks regulator for higher airport fees of +2.3%
    passenger and cargo traffic, therefore providing some stability for the                   Unchanged capex plan for 2009 and 2010
    aviation segment results (EBITDA) and assuring that the company is
                                                                                             STOCK TRIGGERS
    generating a sufficient return on its regulated assets. German court                      Retail & Properties biggest profit contributor
    cleared construction of new runway at Frankfurt airport as expected. All                  Other group segments don’t cover their WACC
                                                                                              Dividend continuity (EUR 1.15 per share)
    objections against runway expansion are rejected. Fraport starts
    construction of new runway in next weeks. After a projected                              STOCK DATA
    construction time of two years the new runway will be inaugurated in                     Reuters/Bloomberg                           FRAG.DE/FRA GR
    winter schedule 2011. Negatively, court indicated restrictive night flight               Average daily volume (tds.)                                 272.50
    ban in Frankfurt.                                                                        Free float (%)                                                24.1
                                                                                             Market capitalization (EUR bn)                                 2.6
■   Operating performance in 2009e and 2010e: Given our cautious view                        No. of shares issued (mn)                              91.6
    on FRA’s traffic performance, we expect underlying revenue growth in                     Shareholders            Hessen 31.57%, Frankfurt 20.16%,
    2009e of 2% and plus 4% in 2010e. This leads at best to a stable                                               Lufthansa 9.95%, Julius Bär 10.35%,
                                                                                                                                Artisan Partners 3.87%,
    EBITDA in 2009 and an improvement of 7% in 2010e. The drop in                                                          Arnhold/Bleichroeder 3.02%,
    group EBIT is due to expansion capex. Sales growth and profit drivers are                                                   Morgan Stanley 2.96%,
                                                                                                                                 Taube Hudson 3.01%,
    the Retail & Properties and External Activities segments. Aviation and                                          Capital Group 1.89%, rest free float
    Ground Handling will continue their negative earnings trend. Consequently,
    the FRA group will not create value in the next two years.                               UPCOMING EVENTS
                                                                                             Preliminary FY 2008 results                              05-Mar-09
■   The valuation seems to be favorable. Fraport is trading around its book                  Annual report 2008                                       26-Mar-09
    value, which reflects lower ROCE in the next two years despite a robust                  Q1/2009 sales and earnings                               12-May-09
    balance sheet and basically solid business prospects. The dividend
    yield of more than 4% gives some share price support. Our underlying                       75
                                                                                               70
    dividend estimate of EUR 1.15 is backed by recent management statements                    65
                                                                                               60
    that it intends to keep the payout at least stable. Our target price of EUR 30             55

    is based on the fair value of our DCF model and the multiples peer                         50
                                                                                               45
    group comparison. Based on our 2009e earnings estimates, Fraport is                        40
    fairly valued with an EV/EBITDA multiple of 7.5x and an EV/EBIT multiple                   35
    of 12.5x as well as a P/E of 16x. Therefore, we for now reiterate our
                                                                                               30
    Hold rating for the stock.
                                                                                               25

                                      2006        2007         2008e      2009e    2010e
                                                                                               20
Sales (EUR mn)                        2144        2329         2136        2115      2212               2006               2007                2008
                                                                                                FRAPORT
                                                                                                DAX 30 PERFORMANCE - PRICE INDEX
EBITDA (EUR mn)                       578.4      580.5         598.0       602.0    645.0                                 Source: Thomson Datastream


EBIT (EUR mn)                         330.4      335.4         365.0       345.0    360.0
                                                                                             RELATIVE PERFORMANCE (% CHG.)
Net income (EUR mn)                   229.3      208.7         216.0       170.0    178.0
                                                                                                                                  1M           3M           6M
EPS reported (EUR)                     2.51       2.28          2.36        1.86     1.94
                                                                                             DAX                                  7.5          4.9          6.9
DPS (EUR)                              1.15       1.15          1.15        1.15     1.15    Euro STOXX 50                        6.7          5.2          6.0
ROCE (%)                                9.5         8.1          7.0         5.6      5.1    ES Ncycl. G/S                        -0.9         -7.3        -8.3
P/E (x)                                22.4       23.5          17.4        15.5     14.8
P/CF (x)                               10.4         3.8          8.3         6.9      5.4    Uwe Weinreich, CEFA (HVB)
P/BV (x)                                2.3         2.1          1.5         1.0      1.0    +49 89 378-12640
                                                                                             uwe.weinreich@unicreditgroup.de
EV/EBITDA (x)                           9.3         9.4          8.0         7.2      7.5
EV/EBIT (x)                            16.2       16.3          13.1        12.6     13.4
ROCE/WACC (x)                           1.2         1.0          1.0         0.9      0.9
Div. yield (%)                          2.0         2.1          2.8         4.0      4.0

                                                 Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                       page 40                                          See last pages for disclaimer.
B    i h H         d V i b k AG         U iC dit CAIB G                                 40                                          S l t          f di l i
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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January 2009
                                                                       20 January 2009                                     Global Equity Research

                                                                                                                                     ESG Research



VTG                                                                                          Buy (prev. Buy)
Sideways                                                                                     Price on 01/16/09                                        EUR 6.71
                                                                                             Target price (prev. EUR 16.70)                       EUR 12.00
■   Investment story: VTG operates more than 49,000 rail freight cars.                       Upside to TP                                                78.8%
    With 93.9%, the utilization rate reached a record level. The business is                 Cost of equity                                                8.6%
    largely based on long-term contracts. There is little variation in the utilization       High/Low (12M)                                           16.99/6.50
    of the rail freight cars. VTG increases average prices slightly as the mix of
                                                                                             INVESTMENT HIGHLIGHTS
    the wagons improves. The market still provides opportunities to consolidate               High visibility and stability in the rental business
    smaller and medium-sized companies to fuel growth.                                        Rising demand in rail transport
                                                                                              First-time dividend for 2008

■   Operating performance in 2009e and 2010e: A deterioration in economic                    STOCK TRIGGERS
                                                                                              Minor free float
    activity normally affects VTG with a lag of 3-4 quarters. We expect additional            Cooperation in tank container logistics and rail
    volume, but a slowdown in the utilization rate for the wagon hire business.               Rising material and initial-purchase prices
    Concerning prices, we expect some support from the modernization of
                                                                                             STOCK DATA
    the fleet. There is no spot market, and it makes no senses for customers to
                                                                                             Reuters/Bloomberg                            VT9G.DE/VT9 GR
    give back any wagons for one or two quarters. The two small segments,
                                                                                             Average daily volume (tds.)                                   25.2
    rail logistics and tank container logistics, are more directly exposed to                Free float (%)                                                39.8
    the slowdown of industrial activities. We expect sales at both to decline                Market capitalization (EUR bn)                                  0.1
    in 2009 and recover in 2010. Given the severity of the economic downturn,                No. of shares issued (mn)                             21.4
    we now expect VTG’s top line to decline roughly 2% in 2009, despite                      Shareholders                          Compagnie Européenne
    some acquisitions during 2008. On the earnings side, we expect a 5%                                                                de Wagons 54.6%,
                                                                                                                                              ZAM 5.6%
    reduction in EBITDA and, due to higher depreciation and net interest
    payments, a 27% decline in net profit. For 2010 we are looking for top-line              UPCOMING EVENTS
    growth of 4.4% and a 6% increase in EBITDA.                                              Annual general meeting                                   04-Jun-09
                                                                                             Key data                                                    Feb-09
■   Valuation: We calculate our target price with a P/E of roughly 12x,                      BPC, AC                                                     Apr-09

    which is 10% above the average since the IPO in Q3 2007, based on
                                                                                               20
    our 2009 EPS estimates. We calculate with cost of equity of 8.6% due                       18
    to the sound refinancing structure of the business model. The low market                   16
    capitalization and free float are no support for the share in current times.               14

                                                                                               12


                                      2006        2007         2008e      2009e    2010e       10

Sales (EUR mn)                         519         541          597         586       612
EBITDA (EUR mn)                       112.9      137.0         154.5       146.8    155.7       8

EBIT (EUR mn)                          54.4       69.2          76.0        65.8     71.7
Net income (EUR mn)                     5.5       48.8          30.3        21.7     24.6       6
                                                                                                        2006               2007                2008
EPS reported (EUR)                     0.26       2.28          1.42        1.01     1.15       VTG
                                                                                                DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                          Source: Thomson Datastream
DPS (EUR)                                0            0         0.30        0.40     0.50
ROCE (%)                                5.1         5.1          7.6         6.3      6.6    RELATIVE PERFORMANCE (% CHG.)
P/E (x)                                  0          7.7          9.0         6.6      5.8                                          1M          3M            6M
P/CF (x)                                 0          3.4          2.5         1.4      1.3    DAX                                   6.1       -27.4         -22.7
P/BV (x)                                 0          1.4          0.9         0.5      0.4    Euro STOXX 50                         5.3       -27.0         -23.6
EV/EBITDA (x)                           5.0         6.4          5.2         5.7      5.6    ES Bank                              10.3         -2.1         -3.4
EV/EBIT (x)                            10.3       12.6          10.7        12.8     12.2
ROCE/WACC (x)                           1.7         0.9          1.2         1.1      1.1    Christian Obst, CEFA (HVB)
                                                                                             christian.obst@unicreditgroup.de
Div. yield (%)                           0            0          2.3         6.0      7.5
                                                                                             +49 89 378-15117
                                                 Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                       page 42                                          See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 43       See last pages for disclaimer.
January 2009
                                                             20 January 2009          Global Equity Research

                                                                                           ESG Research




                                                                                  Automobiles & Parts




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 44           See last pages for disclaimer.
January 2009
                                                                                        20 January 2009                                                 Global Equity Research

                                                                                                                                                             ESG Research



ESG overview – Automobiles & Parts
TP upside vs. difference TPESG-TP (%)*                                                               Sustainable alpha of UCRESGLG Index constituents (%)

                  30.0                                                                                140
                    VOW GR (S,B-)                       DAI GY (B,B-)             LEO GY (B,B-)
                                      Sector                                                          120
                  20.0
                                                                                                      100
                                                     ZIL2 GY (B,C+) BMW GR (B,B-)
                  10.0                                                                                 80
 TPESG - TP (%)




                                                                                                       60
                   0.0                                                                                 40
                                                                                                       20
             -10.0
                                     GMM GY (S,C-)                                                      0
             -20.0                                                                                     -20
                                                            BDT GR (B,D+)
                                                                                                       -40
             -30.0
                                      RUK GY (H,D)                                                     -60
                                                                            PAH3 GR (B,D)




                                                                                                                 LEO GY




                                                                                                                                              DAI GY




                                                                                                                                                             ZIL2 GY
                                                                                                                               BMW GR




                                                                                                                                                                             VOW GR
                                                                                                                                               (B,B-)




                                                                                                                                                              (B,C+)
             -40.0




                                                                                                                  (B,B-)




                                                                                                                                                                              (S,B-)
                                                                                                                                (B,B-)
                         -60   -40     -20      0        20       40      60       80       100
                                                    TP upside (%)


* average is MCAP weighted                                                                                                               Source: oekom research, UniCredit Research

ESG risk analysis
The Automobiles & Parts sector continues to score slightly below the ESG Leaders territory with an average ESG sector score
of -0.4. Social & Governance performance (-0.4) again dragged the sector score downwards relative to the sector’s slightly
better Environmental performance (-0.2). Nevertheless, a majority of stocks (55.6%) managed to obtain Prime investment
status, with LEONI (Buy, B-), Daimler (Buy, B-), BMW (Buy, B-), Volkswagen (Sell, B-) and ElringKlinger (Buy, C+) being
Best-in-Class. The average relative ESG risk adjustment to the cost of equity for the sector is high at -49.7% with a 100% ESG
confidence level. Adjusting these findings to stock-specific ESG ratings yields an average ESG risk adjustment of 55.0bps for this
sector. The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment of 11.1% for the
overall sector. From an ESG style analysis point of view, top tier rated ESG stocks (B) contribute an average 83.6% to the overall sector
performance with risk-adjusted performance (Sharpe ratio) for Prime stocks significantly higher relative to the sector benchmark
based on our ESG efficient frontier analysis.

Strategic outlook
Despite the bleak short-term outlook for the sector, the trough was probably passed in Q4/08. Production in the triad markets
was heavily cut to reduce inventories, and this will also continue in Q1/09 but to a lower extent. We expect WEU PC production
to decrease by 24% in Q1/09 vs. 28% in Q4/08, NAFTA production should be down 19% to 2.82 mn units vs. a 25% decrease to
2.74 mn in Q4/08. In contrast to HY1/08, when high gasoline prices were the main burden, a record low consumer confidence is
now the main problem. In 2009 we see an ongoing decrease of the main markets (US -6.7% to 12.4 mn units and WEU -9% to
12.5 mn) on a yearly basis, but we believe HY2/09 should show some signs of a recovery. For all WEU OEMs, we saw a clear
acceleration of the sales decrease in Q4/08, which is a risk for the 2008 earnings guidance of some companies. After an
ongoing revision trend at the end of 2008, most earnings estimates for the WEU sector now include even more difficult market
conditions in FY 2009. Company valuations (excl. VW) are pricing in a recession and provide strong upside in a recovery scenario.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS
COMPANY       INVESTMENT HIGHLIGHTS                                                STOCK TRIGGERS                          KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
LEONI         Supplier for wiring harnesses for Astra/Zafira                       Opel bankruptcy could burden the        + various measures taken to reduce/substitute the use of
(Buy,B-)      models                                                               stock                                     hazardous and toxic substances in products
BMW           Model momentum increases in 2010                                     Stabilization of market demand          + comprehensive measures to incorporate recycling
(Buy,B-)                                                                                                                     considerations in the development and construction of
                                                                                                                             new products
Daimler                        Production cuts of >80 units in 2008 at             BPC in February should provide 09       + detailed and comprehensive code covering important
(Buy,B-)                       Mercedes                                            guidance                                  aspects such as corruption, antitrust, conflicts of
                                                                                                                             interest, gifts, validity of information
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Grammer       Sharp decline in car & truck business in 2009 Guidance for FY 2009                                           - lack of transparency regarding environmental
(Sell,C-)                                                                                                                     performance indicators
Rücker        Continued outsourcing of vehicle development First projects for the Airbus A350xwb                           - very little information on social and environmental
(Hold,D)                                                                                                                      issues publicly available
Porsche SE Strong core business                             Final increase in VW stake would allow                         - lack of transparency regarding standards of business
(Buy,D)                                                     solid valuation                                                   ethics
                                                                                                                                         Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                        UniCredit CAIB Group                        page 45                                              See last pages for disclaimer.
January 2009
                                                                        20 January 2009                                                        Global Equity Research

                                                                                                                                                        ESG Research



ESG rating overview – Automobiles & Parts
ESG sector scoring overview by category                                                  ESG stock rating breakdown

  0.0

                                                                                                                        D
                                                                                                                      22.2%



                                                                                                                                                           B-
                                                                                                                                                         44.4%
                                                                                                                 D+
                                                                                                                11.1%



                                                                                                                        C-
  -1.0                                                                                                                11.1%
                                                                                                                                     C+
         Social & Governance             ESG                 Environmental                                                          11.1%



                                                                                                                                Source: oekom research, UniCredit Research

Environmental review
On environmental issues, in the Autombiles & Parts sector a slight majority (56%) of companies were able to break into the
Environmental Leader category, but on average lower Environmental Laggard scores dragged the overall environmental
performance into ESG Laggard territory. The best environmental performers continue to be Volkswagen (B) and LEONI (B).
Worth highlighting as their key environmental strengths are formalized research efforts on various technologies to power
vehicles by renewable/alternative fuels and various measures taken to reduce/substitute the use of hazardous and toxic
substances in products. The worst environmental rating can be attributed to Porsche (D) weakened by its insufficient strategy
and management structures to address climate change.

Social & Governance review
The sector’s social performance followed the environmental rating pattern with also 56% of covered companies scoring Leader
status. BMW Group (B-), Daimler (B-) and ElringKlinger (B-) lead the sector’s social rating, with BMW showing a downward
trend in accident rates. Daimler on the other hand offers a detailed and comprehensive code covering important aspects such
as corruption, antitrust, conflicts of interest, gifts and validity of information, with ElringKlinger offering a comprehensive and
group-wide policy on staff relations and labor standards. The worst social scores were assigned to Porsche (D) and Rücker (D)
with key weaknesses lack of transparency regarding standards of business ethics and limited public information availability on
social issues.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                              Soc. & Gov. rating Key social & governance strength
LEONI (B)            + various measures taken to                             ElringKlinger (B-) + comprehensive and group-wide policy on staff relations and labor
                       reduce/substitute the use of hazardous and                                 standards
                       toxic substances in products
Volkswagen (B)       + public recognition of the group's                     BMW (B-)                 + nearly group-wide implementation of safety management systems
                       responsibility to act on climate change                                          and downward trend of accident rate
Daimler (B-)         + almost group-wide environmental                       Daimler (B-)             + detailed and comprehensive code covering important aspects
                       management system implemented                                                    such as corruption, antitrust, conflicts of interest, gifts, validity of
                                                                                                        information
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                              Soc. & Gov. rating Key social & governance weakness
Porsche SE (D)       - insufficient strategy and management                  Rücker (D)         - very little information on social and environmental issues publicly
                        structures to address climate change                                      available
Bertrandt (D+)            - lack of transparency regarding efforts to        Porsche SE (D)           - lack of transparency regarding standards of business ethics
                             extend the useful life of end-products
                             (vehicles)
Rücker (D+)               - lack of transparency regarding efforts to        Bertrandt (D+)           - lack of transparency regarding the involvement in community
                             extend the useful life of end-products                                      projects related to, e.g. education, poverty, minorities, and the
                             (vehicles)                                                                  environment

                                                                                                                                Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                            page 46                                                    See last pages for disclaimer.
January 2009
                                                                                                                 20 January 2009                                                             Global Equity Research

                                                                                                                                                                                                         ESG Research



ESG overview charts – Automobiles & Parts
TP and TPESG upside (%)*                                                                                                    ESG score overview by ESG scoring status

                                  TP upside (%)                                   TP ESG upside (%)                                                     ESG Leader              ESG Laggard               Sector average
                                  TP upside sector (%)                            TP ESG upside sector (%)
                                                                                                                              3
 150                                                                                                                          2

 100                                                                                                                          1
                                                                                                                              0
   50
                                                                                                                             -1

       0                                                                                                                     -2
                                                                                                                             -3
  -50
                                                                                                                             -4
 -100                                                                                                                        -5
              LEO GY




                                          DAI GY




                                                                                             RUK GY




                                                                                                                                   LEO GY




                                                                                                                                                              DAI GY
                                                     ZIL2 GY




                                                                                                       GMM GY




                                                                                                                                                                                   ZIL2 GY



                                                                                                                                                                                              GMM GY




                                                                                                                                                                                                                         RUK GY
                                                                                  PAH3 GR




                                                                                                                                                                                                                                  PAH3 GR
                                                                   BDT GR




                                                                                                                                                                                                              BDT GR
                            BMW GR




                                                                                                                                               BMW GR
                                                                                                                  VOW GR




                                                                                                                                                                       VOW GR
Environmental score overview by category’s ESG scoring status                                                               Social & Governance score overview by category’s ESG scoring status

                    Environmental Leader                       Environmental Laggard                  Sector average                         Soc. & Gov. Leader                 Soc. & Gov. Laggard                    Sector average

  4                                                                                                                           3
  3                                                                                                                           2
  2                                                                                                                           1
  1
                                                                                                                              0
  0
                                                                                                                             -1
  -1
                                                                                                                             -2
  -2
  -3                                                                                                                         -3

  -4                                                                                                                         -4
  -5                                                                                                                         -5
           LEO GY




                                        DAI GY




                                                                                 GMM GY




                                                                                                      RUK GY




                                                                                                                                                              DAI GY
                                                   ZIL2 GY




                                                                                                                                                                       LEO GY
                                                                                                                                   ZIL2 GY




                                                                                                                                                                                              GMM GY




                                                                                                                                                                                                                         RUK GY
                                                                                                                  PAH3 GR




                                                                                                                                                                                                                                  PAH3 GR
                                                                                            BDT GR




                                                                                                                                                                                                              BDT GR
                                                                  BMW GR




                                                                                                                                               BMW GR
                         VOW GR




                                                                                                                                                                                   VOW GR




kesg/ke differential by ESG scoring status (bps)*                                                                           ERP & beta differential between Prime/Not Prime composites

                                     ESG Leader                 ESG Laggard                 Sector average                                                             Prime       Not Prime

 400                                                                                                                                                          8.99

 300

 200
                                                                                                                                             5.81
 100

       0

 -100
                                                                                                                                                                                                                       1.44
 -200
                                                                                                                                                                                                       0.62
                            DAI GY


                                          LEO GY




                                                                   ZIL2 GY


                                                                                  GMM GY




                                                                                                                  RUK GY
                                                                                                       PAH3 GR
                                                                                             BDT GR
                                                     BMW GR
              VOW GR




                                                                                                                                                        ERP                                                    Beta



* averages are MCAP weighted                                                                                                                                             Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                          UniCredit CAIB Group                            page 47                                                                    See last pages for disclaimer.
                                                                                                                                                                                                        20 January 2009                                                                                                                                                                                       Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                         ESG Research



UCRESGLG Index sector constituents overview – Automobiles & Parts
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg                                                                    Current                 ESG                  ESG exposure                                  ESG risk                                          ESG confidence                                                                                              Current                       Target                 TP upside          TPESG upside                α sustainable
ticker                  Name                                                 rec.                    rating                  ESGEi (%)                              ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price        TPESG          (%)                   (%)                        (%)
UCRESGLG index constituent
LEO GY                  LEONI                                                Buy                     B-                                  28.6                                                  -49.7                                                    100.0                    8.0                                6.8                             9.9               19.0         23.2             91.3                 133.7                 126.9
BMW GR                  BMW                                                  Buy                     B-                                  28.6                                                  -49.7                                                    100.0                    7.8                                6.7                    19.7                       28.0         34.2             42.4                     74.2                67.4
DAI GY                  Daimler                                              Buy                     B-                                   28.6                                                 -49.7                                                    100.0                    8.6                                7.4                    23.8                       31.0         37.6             30.1                     57.8                50.4
VOW GR                  Volkswagen                                           Sell                    B-                                  28.6                                                  -49.7                                                    100.0                    8.9                                7.6                 243.6                        120.0        145.3            -50.7                 -40.4                  -48.0
ZIL2 GY                 ElringKlinger                                        Buy                     C+                                  14.3                                                  -49.7                                                    100.0                    8.2                                7.6                   6.5                          8.0          8.8             24.0                  36.2                   28.6
UCRESGLG index non-constituent
GMM GY                  Grammer                                              Sell                    C-                               -40.0                                                    -49.7                                                    100.0                    8.9                            10.6                                6.8                6.0          4.9            -11.8                 -28.7                  -39.3
BDT GR                  Bertrandt                                            Buy                     D+                               -60.0                                                    -49.7                                                    100.0                    8.0                            10.3                       17.6                       25.0         18.3             42.0                      3.8                -6.5
RUK GY                  Rücker                                               Hold                    D                                -80.0                                                    -49.7                                                    100.0                    8.4                            11.7                                5.0                5.5          3.7             10.0                 -25.5                  -37.2
PAH3 GR                 Porsche SE                                           Buy                     D                                -80.0                                                    -49.7                                                    100.0                    7.0                                9.8                     47.1                      73.0         48.1             55.0                      2.2                -7.6

                                                                                                                                                                                                                                                                                                                                                                                                 Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                                     ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                      Composite B                          Composite C                           Composite D                                                                                                 Sharpe ratio Prime(0.63); Sharpe ratio Sector(0.27)
           ESGCsector i = 1.0 - 0.0                                                                                                                                                                                                                                                                                                                        35
                                                                                                                                   100
                                                                                                                                                                                                                                                                                                                                                           30
                                                                                                                                    80
                                                                                                                                                                                                                                                                                                                                                           25




                                                                                                                                                                                                                                                                                                                                        Portfolio return
                                                                                                                                    60                                                                                                                                                                                                                     20

                                                                                                                                                                                                                                                                                                                                                           15
                                                                                                                                    40
                                                                                                                                                                                                                                                                                                                                                           10

                                                                                                                                    20                                                                                                                                                                                                                      5

                                                                                                                                                                                                                                                                                                                                                            0
                                                                                                                                     0                                                                                                                                                                                                                          0            10           20            30              40          50             60
                                                                                                                                                  May-02



                                                                                                                                                                             May-03



                                                                                                                                                                                                        May-04



                                                                                                                                                                                                                                   May-05



                                                                                                                                                                                                                                                              May-06




                                                                                                                                                                                                                                                                                         May-07



                                                                                                                                                                                                                                                                                                                    May-08
                                                                                                                                         Jan-02


                                                                                                                                                           Sep-02
                                                                                                                                                                    Jan-03


                                                                                                                                                                                      Sep-03
                                                                                                                                                                                               Jan-04


                                                                                                                                                                                                                 Sep-04
                                                                                                                                                                                                                          Jan-05


                                                                                                                                                                                                                                            Sep-05
                                                                                                                                                                                                                                                     Jan-06


                                                                                                                                                                                                                                                                       Sep-06
                                                                                                                                                                                                                                                                                Jan-07


                                                                                                                                                                                                                                                                                                  Sep-07
                                                                                                                                                                                                                                                                                                           Jan-08


                                                                                                                                                                                                                                                                                                                             Sep-08
  -10.10

            -9.90

                    -9.70

                            -9.50

                                    -9.30

                                            -9.10

                                                    -8.90

                                                            -8.70

                                                                     -8.50

                                                                             -8.30

                                                                                     -8.10

                                                                                             -7.90

                                                                                                          -7.70

                                                                                                                  -7.50

                                                                                                                          -7.30




                                                                                                                                                                                                                                                                                                                                                                                               Portfolio risk (STDEV)
                                                                                                                                                                                                                                                                                                                                                                         FP Prime          FP Sector           CAL Prime            CAL Sector


                                                                                                                                                                                                                                                                                                                                                                                                 Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                 UniCredit CAIB Group                                                                                                                                  page 48                                                                                                                                                                                        See last pages for disclaimer.
                                                                                                                                                           20 January 2009                                                                                                                                                                Global Equity Research

                                                                                                                                                                                                                                                                                                                                                               ESG Research



Automobiles & Parts: Performance
                                                                                                           52-week                        52-week % chg.                                    Market cap.                                   Absolute performance (%)                                    Relative performance (%) vs. Euro STOXX 50
Company                                                                               Price              High           Low                 High                            Low                            (mn)                   1M                    3M            12M              YTD                            1M                         3M                          12M         YTD
BMW                                                               EUR                 19.67               38.8           17.4               97.2                           -11.5                 12,519                          -10.8                  -1.5         -49.3             -10.5                          -3.9                       4.4                         -4.9          -3.7
Daimler                                                           EUR                 23.82               57.3           20.1              140.6                           -15.6                 22,976                           -1.9                  -0.6         -56.2              -9.8                          5.0                        5.2                        -11.7          -3.0
Porsche SE                                                        EUR                 47.09              135.1           43.0              186.9                            -8.7                       9,065                      -5.0                 -17.8         -59.2             -15.6                          1.9                   -11.9                           -14.7          -8.8
Volkswagen                                                        EUR               243.60               919.5          147.3              277.5                           -39.5                 74,895                          -20.7                 -39.1          60.3              -2.6                         -13.8                  -33.3                           104.7            4.2
Germany average                                                                                                                            175.6                           -18.8                                                  -9.6                 -14.8         -26.1              -9.6                          -2.7                   -8.9                            18.4          -2.8
Bertrandt                                                         EUR                 17.60               28.4           13.0               61.4                           -26.1                                 179              2.3                  12.8          -26.4              2.9                           9.2                   18.7                             18.0            9.7
ElringKlinger                                                     EUR                     6.50            26.9            5.8              317.6                            -9.5                                 372              5.9                  -29.4         -71.0             -10.0                         12.8                   -23.6                           -26.5          -3.3
Grammer                                                           EUR                     6.80            18.9            6.5              178.5                            -4.4                                  71              2.2                  -28.5         -55.8              -4.1                          9.1                   -22.6                           -11.3            2.7
LEONI                                                             EUR                     9.93            36.0            7.7              262.5                           -22.9                                 295             -14.0                 -17.0         -62.6             -23.6                          -7.1                  -11.1                           -18.2       -16.8
Rücker                                                            EUR                     5.00              8.5           4.6               70.0                            -8.8                                  42              -1.0                 -22.5         -38.6              -1.0                          5.9                   -16.6                             5.8            5.8
Germany average                                                                                                                            178.0                           -14.3                                                  -0.9                 -16.9         -50.9              -7.2                          6.0                   -11.0                            -6.4          -0.4


1M absolute performance (%)                                                                                       1M relative performance (%)                                                                                                             Absolute performance YTD (%)
 20                                                               DAX (%)                     Euro STOXX (%)       20                                                                                                                                      10                                                                            DAX (%)                            Euro STOXX (%)
                                                                                                                                                                                                12.8
                                                                                                                                                                               9.2                                     9.1                                                                                                   2.9
 10                                                                                                                10
                                                                    5.9                                                         5.0                                                                                                           5.9              0
                                                      2.3                           2.2                                                       1.9
   0                                                                                                                0

                                                                                                                        -3.9                                                                                                                               -10
 -10                                                                                                                                                                                                                                                               -10.5     -9.8                      -2.6                                -10.0                 -4.1                   -1.0
                 -1.9      -5.0                                                                           -1.0    -10
       -10.8                                                                                                                                                                                                                      -7.1
                                                                                                 -14.0                                                       -13.8                                                                                                                      -15.6
 -20                                                                                                                                                                                                                                                       -20
                                                                                                                  -20
                                        -20.7
                                                                                                                                                                                                                                                                                                                                                                               -23.6
 -30
                                                                                                                  -30                                                                                                                                      -30
                                                                    ElringKlinger
                                         Volkswagen




                                                                                                         Rücker
                           Porsche SE




                                                                                                 LEONI
                                                      Bertrandt
                 Daimler




                                                                                    Grammer
         BMW




                                                                                                                                                                                                 ElringKlinger




                                                                                                                                                                                                                                                                                                                                             ElringKlinger
                                                                                                                                                              Volkswagen




                                                                                                                                                                                                                                                                                                        Volkswagen
                                                                                                                                                                                                                                              Rücker




                                                                                                                                                                                                                                                                                                                                                                                        Rücker
                                                                                                                                                                                Bertrandt




                                                                                                                                                                                                                                  LEONI




                                                                                                                                                                                                                                                                                                                             Bertrandt




                                                                                                                                                                                                                                                                                                                                                                                LEONI
                                                                                                                                              Porsche SE




                                                                                                                                                                                                                                                                                         Porsche SE
                                                                                                                                Daimler




                                                                                                                                                                                                                                                                             Daimler
                                                                                                                                                                                                                       Grammer




                                                                                                                                                                                                                                                                                                                                                                  Grammer
                                                                                                                         BMW




                                                                                                                                                                                                                                                                    BMW
                                                                                                                                                                                                                                                                                                                                                             Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                          UniCredit CAIB Group                                                                                          page 49                                                                                                                                                                             See last pages for disclaimer.
                                                                                                                                                     20 January 2009                                                                                                             Global Equity Research

                                                                                                                                                                                                                                                                                          ESG Research



Automobiles & Parts: Valuation Overview
                                                                           P/E (x)                                                   P/CF (x)                                      EV/sales (x)                                           EV/EBITDA (x)                                  EV/EBIT (x)
Company                                                       2008e            2009e            2010e                      2008e        2009e         2010e                2008e            2009e          2010e               2008e            2009e            2010e       2008e             2009e           2010e
BMW                                                                12.9              9.6           6.1                       3.3           1.5          1.2                 0.36             0.26               0.20                2.3           1.4              1.1            9.1               6.3            3.7
Daimler                                                            15.3          13.4              6.6                       5.1           3.5          2.5                 0.41             0.24               0.21                4.5           2.9              2.0            8.9               6.8            3.8
Porsche SE                                                          2.6              1.5           6.0                       2.4           1.3          3.8                 2.03             0.76               1.00                1.8           0.7              4.0            2.0               0.8            5.4
Volkswagen                                                         20.3          45.8             36.5                       6.6           8.1          7.5                 0.59             0.71               0.68                4.5           6.6              6.0           10.6              22.0          18.1
Germany average                                                     7.0              4.5           7.8                       3.7           2.1          2.5                 0.85             0.49               0.52                2.8           1.6              2.1            4.8               2.5            5.1
Bertrandt                                                           6.4              5.0           8.0                       5.1           3.9          5.4                 0.49             0.33               0.36                3.6           2.6              3.9            4.2               3.0            5.1
ElringKlinger                                                      18.4              8.1           7.0                       9.6           4.0          3.7                 1.88             0.96               0.92                8.5           4.2              3.8           14.1               7.6            6.6
Grammer                                                            12.6         -15.9              9.3                       4.0           3.3          2.0                 0.22             0.31               0.30                4.6          10.1              5.6            8.4          106.1             12.2
LEONI                                                              14.1              4.8           2.8                       3.3           1.4          1.2                 0.44             0.29               0.23                5.9           3.9              3.6           13.3               7.7            4.7
Rücker                                                              9.9          12.1             11.4                       3.9           3.3          3.2                 0.38             0.32               0.32                3.4           3.2              3.0            6.1               7.1            6.6
Germany average                                                    10.8              6.5           6.1                       4.5           2.7          2.4                 0.68             0.44               0.43                4.6           3.9              3.8            7.5               6.8            6.3


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                             ROCE 2010e (%) vs. WACC 2010e (%)                                                                                 EV/sales 2002-2010e (x)
                      1.2                                                                                                   25                                                                                                1.4
                                                                                            Porsche SE                                                                                              Bertrandt
                      1.0                                                                                                                                                                                                     1.2
                                                                     ElringKlinger                                          20
                                                                                                                                                                 Porsche SE                                                                                                         0.97
 EV/sales 2010e (x)




                                                                                                                                                                                                                              1.0
                                                                                                          ROCE 2010e (%)




                      0.8                                                                                                                                                                   Rücker
                                                                                                                            15                                                                                                                                                              0.76
                                         Volkswagen
                                                                                                                                                                                                                              0.8                                         0.70
                      0.6                                                                                                                                                                                                             0.70
                                                                                                                                                              BMW           ElringKlinger                                                                          0.65
                                                                                                                            10                                                                                                                  0.59      0.61
                                                                                                                                                     LEONI                            Daimler                                 0.6
                      0.4                                                                                                                                                                                                                                                                             0.46     0.47
                                        Rücker         Bertrandt
                            Grammer                                                                                                                                                          Volkswagen
                                      LEONI       Daimler                                                                    5                                                                                                0.4
                      0.2                                                                                                                Grammer
                                          BMW
                                                                                                                                                                                                                              0.2
                      0.0                                                                                                    0
                            0                 5                10                      15                                        5               6                     7                      8                        9      0.0
                                                    EBIT margin 2010e (%)                                                                                    WACC 2010e (%)                                                           2002      2003    2004      2005    2006    2007      2008e     2009e   2010e


                                                                                                                                                                                                                                                                                        Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                           UniCredit CAIB Group                                                                           page 50                                                                                                                      See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                       ESG Research



BMW                                                                                            Buy (prev. Buy)
New model momentum in 2010                                                                     Price on 01/16/09                                    EUR 19.67
                                                                                               Target price (prev. EUR 27.00)                       EUR 28.00
■   Investment story: BMW’s strategic plan shows a strong acceleration of                      Upside to TP                                                42.4%
    the cost cuts of EUR 6 bn in total from 2010 onwards, as the company                       Cost of equity                                               7.8%
    has concentrated a lot of effort on new models like the important                          High/Low (12M)                                       38.78/17.40
    5 series which will be on the market in 2010. Also the models which will
                                                                                               INVESTMENT HIGHLIGHTS
    be launched late in 2009 (PAS and X1) will bring additional momentum                        model momentum increases in 2010
    and an improved cost structure. In 2010, approximately 20% of the total                     Main cost cuts targeted at new models
                                                                                                Margin turnaround should start 2010 and last to 2012
    sales volume will be renewed, which will rise to >60% until 2012. 2010
    should bring a substantial step towards the 2012 target to achieve an                      STOCK TRIGGERS
                                                                                                Stabilization of market demand
    EBIT margin of 8-10% in the Automotive segment.                                             Lower risk premiums in FS
                                                                                                No more residual value charges in 09 possible
■   Operating performance in 2009e and 2010e: After a sales decrease
                                                                                               STOCK DATA
    of 7% to 1.34 mn units in 2009 and an EBIT of EUR 1.75 bn (margin
                                                                                               Reuters/Bloomberg                           BMWG.DE/BMW GR
    3.7%) in the Auto segment, we estimate that 2010 should bring a higher
                                                                                               Average daily volume (tds.)                                 4499.8
    momentum (+7% to 1.43 mn units) which should allow a sharp increase                        Free float (%)                                                53.4
    in the segment EBIT of 56% to EUR 2.72 bn (margin 5.0%). The result                        Market capitalization (EUR bn)                                12.5
    is not only supported by the combination of cost cuts and new model                        No. of shares issued (mn)                            654.2
    momentum but also by a small market recovery in WEU and the US.                            Shareholders                      Com.: J. Quandt 16.7%,
                                                                                                                       S. Quandt 17.4%, S. Klatten 12.5%

■   Valuation: The target price is based on the 2009 earnings estimates as                     UPCOMING EVENTS
    the market is currently not willing to price in a potential earnings                       Annual general meeting                                  14-May-09
    turnaround as long as there is no sign of stability for demand. If BWM                     Interim report                                          06-May-09
    would achieve our 2010 estimates, the upside is huge. As the ROCE                          Bal. sheet press conf.                                   18-Mar-09
    would be >9% again, BMW would return to value creation which would
    result in a potential upside to >EUR 40 based on the Economic profit                         60
                                                                                                 55
    approach. EV/sales would be 0.22x and EV/EBITDA at 1.1, both clearly                         50

    below the last trough multiples.                                                             45
                                                                                                 40

                                                                                                 35

                                                                                                 30
                                       2006        2007         2008e       2009e     2010e
Sales (EUR mn)                        48999      56018          54241       52370     61552      25

EBITDA (EUR mn)                       8944.0   10376.0          8768.7      9474.1   11427.7
                                                                                                 20
EBIT (EUR mn)                         4050.0     4212.0         2169.6      2132.3    3297.7
Net income (EUR mn)                   2874.0     3134.0         1544.3      1344.1    2118.9
                                                                                                 15
EPS reported (EUR)                      4.38       4.79           2.36        2.05      3.24      BMW
                                                                                                          2006               2007                2008
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
DPS (EUR)                               0.70       1.06           0.80        0.70      1.10                                Source: Thomson Datastream


ROCE (%)                                 9.9       10.0            5.0         5.0       5.0
                                                                                               RELATIVE PERFORMANCE (% CHG.)
P/E (x)                                  9.4         9.4          12.9         9.6       6.1
                                                                                                                                    1M           3M           6M
P/CF (x)                                 3.6         3.3           3.3         1.5       1.2
                                                                                               DAX                                  -3.1         4.1         -2.2
P/BV (x)                                 1.4         1.4           0.8         0.5       0.6
                                                                                               Euro STOXX 50                        -3.9         4.4         -3.1
EV/EBITDA (x)                            2.9         3.1           2.3         1.4       1.1
                                                                                               ES Auto                              0.2         22.1         -7.2
EV/EBIT (x)                              6.5         7.7           9.1         6.3       3.7
ROCE/WACC (x)                            1.7         1.7           1.0         1.1       1.2   Georg Stürzer, CEFA (HVB)
Div. yield (%)                           1.7         2.4           2.6         3.6       5.6   +49 89 378-18252
                                                                                               georg.stürzer@unicreditgroup.de
                                                  Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                        page 51                                          See last pages for disclaimer.
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 52       See last pages for disclaimer.
January 2009
                                                                          20 January 2009                                     Global Equity Research

                                                                                                                                       ESG Research



Daimler                                                                                         Buy (prev. Buy)
Waiting for an improvement                                                                      Price on 01/16/09                                   EUR 23.82
                                                                                                Target price (prev. EUR 35.00)                      EUR 31.00
■   Investment story: In contrast to other companies, Daimler has at                            Upside to TP                                               30.1%
    Mercedes-Benz Cars and at Daimler Trucks well-restructured and cost                         Cost of equity                                              8.6%
    efficient business units which suffer in 2009 from a weak market                            High/Low (12M)                                      57.32/20.10
    environment. Therefore, a stabilization of the global car markets and
                                                                                                INVESTMENT HIGHLIGHTS
    the beginning of a recovery of the NA truck market in the course of                          Production cuts of >80’ units in 2008 at Mercedes
    2009 will be key for a share price recovery. Support for the business of                     Still relatively good profitability in a downturn
                                                                                                 Financial strength should allow a dividend
    Mercedes-Benz will come from the launch of the new E class in spring
    2009, which will have a full effect in 2010.                                                STOCK TRIGGERS
                                                                                                 BPC in February should provide 09 guidance
                                                                                                 New E class in March supports HY2/09
■   Operating performance 2009e and 2010e: We expect for Mercedes a
    decrease in sales of 4.7% to 1.19 mn units and an EBIT of EUR 1.7 bn                        STOCK DATA

    (margin of 3.6%) in 2009 which is a further deterioration vs. 2008 of                       Reuters/Bloomberg                           DAIGn.DE/DAI GY

    44% on an adjusted basis. For 2010, we forecast an EBIT of EUR 3.08 bn                      Average daily volume (tds.)                                9621.1
                                                                                                Free float (%)                                               88.3
    (margin of 6.1%) as volume should recover by 8% to 1.29 mn units. On
                                                                                                Market capitalization (EUR bn)                               23.0
    a group level, we see for 2009 an EBIT of EUR 3.2 bn (3.5% margin)
                                                                                                No. of shares issued (mn)                             964.1
    and for 2010 EUR 5.5 bn (5.6%).
                                                                                                Shareholders                           Deutsche Bank 2.97%,
                                                                                                                                                Kuwait 7.6%
■   Valuation: We think that the current valuation discounts even lower
                                                                                                UPCOMING EVENTS
    earnings estimates and the stock price has now discounted such a
                                                                                                Annual general meeting                                  08-Apr-09
    hefty amount of negative assumptions that the valuation reflects more
                                                                                                Interim report                                          28-Apr-09
    than a recession. Due to the current high uncertainty, we have based
                                                                                                Preliminary figures                                     17-Feb-09
    our target on 2009 estimates. In a conservative SoP model which is
    based on earnings adjusted EV/Sales multiples, we can derive EUR 31                           80
    as a fair value. In our Economic profit model, we can derive EUR 25                           70
                                                                                                  60
    due to the fact that Daimler will not cover its WACC in 2009 as ROCE is                       50
    only 4.5%. If we would use our 2010 estimates the SoP target would be                         40
    EUR 37 and in the ECP at EUR 45.
                                                                                                  30



                                                                                                  20
                                        2006        2007         2008e       2009e     2010e
Sales (EUR mn)                        152809      99399          96322       92965     99460
EBITDA (EUR mn)                       20421.0   17011.0          8745.1      7744.5   10529.8
EBIT (EUR mn)                          5713.0     7885.0         4475.1      3244.5    5559.8     10
                                                                                                           2006               2007               2008
                                                                                                   DAIMLER
Net income (EUR mn)                    3744.0     4849.0         2630.9      1711.5    3496.1      DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                             Source: Thomson Datastream

EPS reported (EUR)                       3.64       3.83           2.73        1.78      3.63
DPS (EUR)                                1.50       2.00           0.50        0.50      1.50   RELATIVE PERFORMANCE (% CHG.)

ROCE (%)                                  5.6       13.8            7.3         7.3       7.3                                        1M          3M           6M

P/E (x)                                  11.8       16.4           15.3        13.4       6.6   DAX                                  5.8         4.9         -8.3
                                                                                                Euro STOXX 50                        5.0         5.2         -9.2
P/CF (x)                                  2.8         5.2           5.1         3.5       2.5
                                                                                                ES Auto                              9.1        22.9        -13.2
P/BV (x)                                  1.2         1.9           1.1         0.6       0.5
EV/EBITDA (x)                             2.5         3.4           4.5         2.9       2.0
                                                                                                Georg Stürzer, CEFA (HVB)
EV/EBIT (x)                               8.8         7.2           8.9         6.8       3.8   +49 89 378-18252
ROCE/WACC (x)                             1.0         1.9           1.1         1.3       1.3   georg.stuerzer@unicreditgroup.de
Div. yield (%)                            3.5         3.2           1.2         2.1       6.3

                                                   Source: Company data, UniCredit Research




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January 2009
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                                                                                       ESG Research




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                                                                                                                                     ESG Research



ElringKlinger                                                                                Buy (prev. Buy)
Above-average margin in the trough                                                           Price on 01/16/09                                        EUR 6.45
                                                                                             Target price (prev. EUR 10.00)                           EUR 8.00
■   Investment story: ElringKlinger (EK) is a beneficiary of the trend                       Upside to TP                                                24.0%
    towards lower emissions, as its products support OEMs in reducing                        Cost of equity                                                8.2%
    weight and fuel consumption. The profit warnings on Oct. 19, 2008 and                    High/Low (12M)                                           26.93/5.84
    Jan 19, 2009 cost ElringKlinger some trust in the company’s above-
                                                                                             INVESTMENT HIGHLIGHTS
    average profitability. In a worst-case scenario the company expects                       Beneficiary of the trend towards lower emissions
    sales in 2009 to be down by 13% and an operating margin of still 8%.                      Technology and cost leader
                                                                                              Above-average profitability even in the downturn
    We note that EK is tied to engine production and is thus indirectly
    exposed to the cuts in vehicle production. We forecast global light                      STOCK TRIGGERS
                                                                                              News on success of new products
    vehicle production will fall by 9% next year (double-digit declines in                    CO2-based taxation of cars across Europe
    Europe and NAFTA). However, we expect the company to maintain its                         Better-than-expected profitability in FY 2009
    above-average profitability even in the downturn. ElringKlinger is cost
                                                                                             STOCK DATA
    and technology leader in its market segments. New products (e.g. diesel
                                                                                             Reuters/Bloomberg                             ZILGn.F/ZIL2 GY
    particle filter, injection-moldable PTFE, fuel cell and battery components)
                                                                                             Average daily volume (tds.)                                  227.1
    should ensure further growth and the high level of profitability.                        Free float (%)                                                46.5
                                                                                             Market capitalization (EUR bn)                                  0.4
■   Operating performance in 2009e and 2010e: In view of the recent                          No. of shares issued (mn)                                   57.6
    production cuts, we set a 2009 “-9% in sales” scenario (in-line with the                 Shareholders                                 K. Lechler 28.2%,
    new guidance, despite EUR +20 mn consolidation effect and EUR +70                                                                    Wh. Lechler 25.3%,
                                                                                                                                            free float 46.5%
    mn in new orders). Despite EUR +16 mn relief from raw material hedges,
    we forecast the EBIT margin will fall to 9.4% next year due to lower                     UPCOMING EVENTS
    capacity utilization and possible burdens from personnel adjustments. For                Annual general meeting                                   26-May-09
    2010, we incorporate 2.5% growth in sales in our estimates due to an                     Q1                                                         May-09
    easing of the demand situation on most markets and the first full-year with              Bal. sheet press conf.                                   30-Mar-09

    diesel particle filter series production.
                                                                                               30


■
                                                                                               25
    Valuation:.Due to significantly lower volumes, ElringKlinger will not
                                                                                               20
    generate value in 2009. Our economic profit model generates a fair value
    of EUR 7 based on trough 2009 earnings. Including some of the growth                       15

    potential from new products, we arrive at a fair value of EUR 9 based on our
    2010 estimates. We set our price target halfway between the years (EUR 8)                  10
    and reiterate our Buy recommendation as the share should have found a
    bottom with the second profit warning on Jan. 19, 2009.

                                                                                                  5
                                                                                                         2006              2007                2008
                                                                                                  ELRINGKLINGER
                                      2006        2007         2008e      2009e    2010e          DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                            Source: Thomson Datastream
Sales (EUR mn)                         528         608          664         590       605
EBITDA (EUR mn)                       142.0      171.0         134.0       118.7    138.7    RELATIVE PERFORMANCE (% CHG.)
EBIT (EUR mn)                          93.4      121.0          76.0        56.7     73.7                                          1M          3M            6M
Net income (EUR mn)                    57.8       75.9          46.3        31.7     43.7    DAX                                  13.6       -23.9         -32.1
EPS reported (EUR)                     3.01       3.95          0.80        0.55     0.76    Euro STOXX 50                        12.8       -23.6         -33.0
DPS (EUR)                              1.25       1.40          0.47        0.57     0.69    ES Auto                              16.9         -5.9        -37.1
ROCE (%)                               22.8       24.2          10.2         8.0     10.5
P/E (x)                                 4.4         5.6         21.9        11.7      8.5
                                                                                             Christian Aust, Equity Analyst (HVB)
                                                                                             +49 89 378-11394
P/CF (x)                                2.6         4.0         10.4         4.7      4.1    christian.aust@unicreditgroup.de
P/BV (x)                                1.3         1.8          3.9         1.5      1.5
EV/EBITDA (x)                           5.9         8.0          4.3         4.7      3.9
EV/EBIT (x)                             9.0       11.3           7.6         9.8      7.3
ROCE/WACC (x)                           2.9         3.1          1.5         0.9      1.3
Div. yield (%)                          9.4         6.4          2.6         8.8     10.7

                                                 Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                       page 55                                          See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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January 2009
                                                                       20 January 2009                                     Global Equity Research

                                                                                                                                     ESG Research



LEONI                                                                                        Buy (prev. Buy)
The impact of new orders – incl. GM/Opel                                                     Price on 01/16/09                                        EUR 9.93
                                                                                             Target price (prev. EUR 19.00)                       EUR 19.00
■   Investment story: In normal times, LEONI should finally enter the new                    Upside to TP                                                91.3%
    growth phase in the Wiring Systems Division in 2009 which is based on                    Cost of equity                                               8.0%
    significant new orders form BMW (5/6/7 series), Mercedes-Benz (new                       High/Low (12M)                                          36.00/7.66
    E class) and GM/Opel for the new worldwide compact car platform.
                                                                                             INVESTMENT HIGHLIGHTS
    Consequently, LEONI should be able to compensate for the sharp                            Supplier for wiring harnesses for Astra/Zafira models
    decease in the current business to a certain extent and could show a                      New orders worth EUR 400 mn until 2010
                                                                                              70% OE exposure
    better performance than the supplier sector in 2009. But there is one
    risk which is the fate of GM/Opel. The potential impact of an Opel                       STOCK TRIGGERS
                                                                                              Opel bankruptcy could burden the stock
    bankruptcy could be in the range of EUR 40 mn or EUR 1.01 on the                          State guarantees could save Opel business
    EPS. This is based on the assumption that management would react                          Low valuation increases takeover risk
    within one quarter to the new situation to limit the impact on the
                                                                                             STOCK DATA
    receivables side. The cash-effective items could create a burden of
                                                                                             Reuters/Bloomberg                           LEOGn.DE/LEO GY
    EUR 35 mn, which would then impact the net debt position of EUR 540 mn,
                                                                                             Average daily volume (tds.)                                 394.6
    which we have so far in our 2009 estimates. The negative impact on                       Free float (%)                                              100.0
    our target price of EUR 19 would be EUR 6, resulting instead in a lower                  Market capitalization (EUR bn)                                 0.3
    target of EUR 13.                                                                        No. of shares issued (mn)                                   29.7
                                                                                             Shareholders                                    Free float 100%
■   Operating performance in 2009e and 2010e: New orders will result in
                                                                                             UPCOMING EVENTS
    organic growth of 10% in 2009 or additional revenues of EUR 300 mn,
                                                                                             Annual general meeting                                  14-May-09
    which implies that the current business will fall by 10% in 2009. In 2010,
                                                                                             Q4                                                         Feb-09
    we have assumed that the order from GM/Opel will still be there and
                                                                                             Shareholder letter                                         Feb-09
    impact the P&L.
                                                                                               50
■   Valuation: Excluding the PPA effect, LEONI should achieve a NOPAT
                                                                                               45
                                                                                               40
                                                                                               35
    of EUR 86.2 mn or an ROCE of 6.7% for FY 2009 based on a capital                           30
    employed estimate of EUR 1.296 bn. Using a WACC of 7.5%, this                              25

    would mean that LEONI would cover its WACC by a factor of 0.89x.                           20

    This results in a fair value of the capital employed of EUR 1.15 bn – or                   15

    a EUR 19 target price for 2009 and EUR 17 for 2008.
                                                                                               10




                                      2006        2007         2008e      2009e    2010e
                                                                                                  5
Sales (EUR mn)                        2108        2367         2914        2950      3331                2006              2007                2008
                                                                                                  LEONI
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
EBITDA (EUR mn)                       193.5      201.7         219.8       219.8    219.8                                   Source: Thomson Datastream

EBIT (EUR mn)                         130.4      130.2          97.1       112.1    166.2
                                                                                             RELATIVE PERFORMANCE (% CHG.)
Net income (EUR mn)                    78.5       85.2          51.6        61.1    105.6
                                                                                                                                  1M           3M           6M
EPS reported (EUR)                     2.64       2.87          1.74        2.06     3.56
                                                                                             DAX                                  -6.3       -11.4        -31.4
DPS (EUR)                              0.80       0.90          0.80        0.80     1.10
                                                                                             Euro STOXX 50                        -7.1       -11.1        -32.3
ROCE (%)                               11.6       10.8           7.4         7.4     11.1
                                                                                             ES Auto                              -3.0         6.6        -36.4
P/E (x)                                11.1       12.4          14.1         4.8      2.8
P/CF (x)                                5.7         7.0          3.3         1.4      1.2
                                                                                             Georg Stürzer, CEFA (HVB)
P/BV (x)                                1.9         2.1          1.6         0.6      0.5    +49 89 378-18252
EV/EBITDA (x)                           5.9         7.8          5.9         3.9      3.6    georg.stuerzer@unicreditgroup.de
EV/EBIT (x)                             8.7       12.1          13.3         7.7      4.7
ROCE/WACC (x)                           1.6         1.5          1.1         1.3      1.9
Div. yield (%)                          2.7         2.5          3.3         8.1     11.1

                                                 Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                       page 57                                          See last pages for disclaimer.
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                                                                                       ESG Research




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                                                                                                                                         ESG Research



Volkswagen                                                                                      Sell (prev. Sell)
Porsche control                                                                                 Price on 01/16/09                                   EUR 243.60
                                                                                                Target price (prev. EUR 138.00)                     EUR 120.00
■   Investment story: With the “Mach 18+” strategy, the group intends to                        Upside to TP                                                -50.7%
    become the world’s No. 1 automaker and produce >10 mn vehicles by 2018.                     Cost of equity                                                8.9%
    The geographical expansion, new models, and a product line                                  High/Low (12M)                                     919.50/147.29
    encompassing everything from small cars to heavy trucks should assure
                                                                                                INVESTMENT HIGHLIGHTS
    further growth long term. With the pending acquisition of shares by Porsche,                 “Real” free float already around 10%
    the Volkswagen common share has deviated considerably from                                   No value generation in 2009/10
                                                                                                 Valuation exaggerated
    fundamentally justifiable levels and is being driven solely by the further steps
    of Porsche (target: control agreement).                                                     STOCK TRIGGERS
                                                                                                 Porsche stake increase and control agreement
                                                                                                 Stronger-than-expected profitability in FY09
■   Operating performance in 2009e and 2010e: We expect the impressive                           New VW law – discussion ongoing
    margin improvement of recent years to halt in FY08 and reverse in
                                                                                                STOCK DATA
    FYs 2009/10. Although Volkswagen is benefiting from the launch of
                                                                                                Reuters/Bloomberg                            VOWG.DE/VOW GR
    several important models (e.g. Golf VI, Polo), we believe VW cannot
                                                                                                Average daily volume (tds.)                                  1856.8
    decouple from the sharp declines on most car markets in 2009. Factoring                     Free float (%)                                                 57.9
    in the positive effects on revenues from the full consolidation of Scania                   Market capitalization (EUR bn)                                 74.9
    (EUR +3.05 bn), the sale of VW Truck & Bus (EUR -1.84 bn) and a                             No. of shares issued (mn)                             394.3
    decline of 8.0% across the other brands, we estimate revenues will                          Shareholders                   State of Lower Saxony 14.8%
    decrease 6.5% in 2009, followed by a marginal 1.5% recovery in 2010.                                                                      (20.05% Ord.),
                                                                                                                               Porsche 25.9% (35.14% Ord.)
    Due to lower capacity utilization, expected negative net pricing and a
    significantly lower contribution from the FS business and the Chinese                       UPCOMING EVENTS
    JVs, we expect operating profit to almost halve to EUR 3.4 bn in 2009                       Annual general meeting                                    23-Apr-09
    (3.2% of revenues). A negative financial result (MAN; higher interest                       Q1                                                           Apr-09
    cost) should trigger a disproportionate decline in net profit.                              BPC, AC                                                   12-Mar-09


■   Valuation: Since visibility in the Porsche option structure and real free
                                                                                                 500
                                                                                                 450
                                                                                                 400
    float of the VW Comm. stock remains low, we recommend to stay away                           350
                                                                                                 300
    from the Comm. shares and set our price target at the estimated avg.                         250
                                                                                                 200
    book value of the 50.8% stake of Porsche of EUR 120. Based on our
                                                                                                 150
    economic profit (EP) model VW will not create value in 09/10. The fair
    value, according to our model, would be EUR 71, which corresponds to                         100

    EV/Sales 09 of 0.27x and EV/EBITDA of 2.6x, in line with historic
    trough valuation. As VW Prefs are trading at a significant discount to                        50
    FV, we think these are better suited to play the VW fundamentals.
                                                                                                  30
                                                                                                            2006              2007                 2008
                                                                                                     VOLKSWAGEN
                                                                                                     DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                               Source: Thomson Datastream
                                        2006        2007          2008e      2009e     2010e
Sales (EUR mn)                        104875     108897          113182     105825    107412    RELATIVE PERFORMANCE (% CHG.)
EBITDA (EUR mn)                       9771.0    13580.0      14681.6        11400.6   12178.0                                         1M           3M           6M
EBIT (EUR mn)                         2009.0      6151.0         6281.6      3400.6    4028.0   DAX                                  -13.0       -33.6         59.2
Net income (EUR mn)                   2750.0      4122.0         4396.6      2248.3    2783.3   Euro STOXX 50                        -13.8       -33.3         58.3
EPS reported (EUR)                      7.07       10.43          10.83        5.32      6.68   ES Auto                               -9.7       -15.6         54.2
DPS (EUR)                               1.25        1.80           2.00        2.10      2.10
ROCE (%)                                 5.0        10.0           10.6         5.7       5.7
                                                                                                Christian Aust, Equity Analyst (HVB)
                                                                                                +49 89 378-11394
P/E (x)                                  8.8        12.3           20.3        45.8      36.5   christian.aust@unicreditgroup.de
P/CF (x)                                 1.7          3.2           6.6         8.1       7.5
P/BV (x)                                 0.9          1.6           2.7         2.9       2.7
EV/EBITDA (x)                            1.5          2.3           4.5         6.5       5.9
EV/EBIT (x)                              7.2          5.1          10.6        21.7      17.9
ROCE/WACC (x)                            0.6          1.3           1.2         0.7       0.7
Div. yield (%)                           2.0          1.4           0.9         0.9       0.9

                                                   Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG       UniCredit CAIB Group                        page 59                                           See last pages for disclaimer.
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                                                                                       ESG Research




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                                                                                       ESG Research




                                                                                                     Banks




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 61       See last pages for disclaimer.
January 2009
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                                                                                                                                                              ESG Research



ESG overview – Banks
TP upside vs. difference TPESG-TP (%)*                                                                   Sustainable alpha of UCRESGLG Index constituents (%)

                                                                                    DBK GR (B,C+)
                  4.0                                                                                     100
                  2.0                                                                                      90
                                                                         Sector                            80
                  0.0
                  -2.0                                                                                     70
 TPESG - TP (%)




                                                                                                           60
                  -4.0
                                                                                                           50
                  -6.0     HRX GR (S,C-)
                                            CBK GR (S,C-)                                                  40
                  -8.0
                                                            DPB GR (H,C-)                                  30
             -10.0
                                           COM GR (H,D+)                                                   20
             -12.0
                                                                                                           10
                                                                       ARL GR (B,D)
             -14.0                                                                                          0
             -16.0




                                                                                                                                               DBK GR
                                                                                                                                                (B,C+)
                         -40      -20        0       20         40       60          80      100
                                                     TP upside (%)


* average is MCAP weighted                                                                                                              Source: oekom research, UniCredit Research


ESG risk analysis
The Banks sector scored below the ESG Leaders territory with an average ESG sector score of -2.0. The Environmental
performance (-2.8) seems to be dragging the score downwards relative to the sector’s better Social & Governance score (-0.3).
Overall, only 16.7% of stocks were able to obtain Prime investment status, which only includes Deutsche Bank (Buy, C+). We
highlight the change that there is no negative ESG/risk relationship within this sector. Using the general portfolio ESG risk
adjustment variables and taking into account stock-specific ESG ratings, the ESG risk adjustment for the sector has been determined at
56.0bps. The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment of 0.8% for
the overall sector. From an ESG style analysis point of view, there are no top tier rated ESG stocks (A+B) with contributions of C
and D rated stocks at 94.3% and 5.7%, respectively. The risk-adjusted performance (Sharpe ratio) of Prime stocks has been
determined to be significantly higher relative to the sector benchmark based on our ESG efficient frontier analysis.

Strategic outlook
The outlook for the Banks sector remains subdued: Although we believe burdens directly related to the area of structured credit
products will fade out during FY 2009, we see major earnings risks more related to the downturn of the real economy. Apart
from reduced revenue generation, this will lead to a significant increase in loan-loss provisions compared to the still relatively
low current levels for most European banks in our coverage. Additionally, we expect that a tendency toward higher capital
requirements for the Banks sector will be a further dampening factor for sustainable profitability levels. Despite apparently
favorable valuation levels from a fundamental point of view in several cases, we remain cautious towards the overall sector for
the time being. We currently prefer banks with a defensive risk profile, good capital ratios and a high retail earnings contribution
from countries that have not seen real estate booms in recent years.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY        INVESTMENT HIGHLIGHTS                                                  STOCK TRIGGERS                        KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Deutsche       Strong positioning in the capital market                               Higher weighting of the more stable   + brokerage of SRI products
Bank (Buy,C+) business                                                                segments
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Hypo Real      Expensive liquidity package             Size and conditions of the upcoming                                  - very little information on social and environmental
Estate Group                                           capital injection                                                      issues publicly available
(Sell,C-)
comdirect   Nearly no capital burdens from the financial crisis Decision on capital management                              - very little information on environmental issues publicly
bank AG                                                                                                                       available
(Hold,D+)
Commerzbank High exposure in Germany                            Success of Dresdner Bank integration                        - lack of transparency regarding the integration of
(Sell,C-)                                                                                                                      environmental aspects into financial services such as
                                                                                                                               lending or asset management

                                                                                                                                        Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                          UniCredit CAIB Group                          page 62                                           See last pages for disclaimer.
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                                                                                                                                                        ESG Research



ESG rating overview – Banks
ESG sector scoring overview by category                                                  ESG stock rating breakdown

    0.0
                                                                                                                          D                      C+
                                                                                                                        16.7%                   16.7%


    -1.0


                                                                                                                 D+
                                                                                                                16.7%
    -2.0




                                                                                                                                                  C-
    -3.0                                                                                                                                        50.0%
           Social & Governance            ESG                 Environmental



                                                                                                                                Source: oekom research, UniCredit Research

Environmental review
The vast majority (83%) of the Banks we analyzed fell into the Environmental Laggards category, in line with the average group
score. Deutsche Bank (C+) remains the best performer with a key strength being the company’s comprehensive and
transparent sustainability reporting. On the opposite side of the spectrum again are comdirect bank AG (D), Commerzbank
(D) and Aareal Bank (D). Key weaknesses include their lack of transparency regarding the integration of environmental aspects
into financial services such as lending or asset management.

Social & Governance review
The Banking group fared much better on a social level. With the group average slightly in Laggards territory, the split between
Soc. & Gov. Leaders and Laggards is equally divided. It seems that banks take social issues seriously, with Deutsche Bank
(B-) again coming out on top, having implemented a quality sustainability management system. The group’s average ended up
in Laggards territory mainly due to Aareal Bank (D+) and comdirect bank AG (C-), their key weaknesses being a lack of
transparency in measures to ensure employee awareness of and compliance with the code of business ethics and very little
information on social and ethical issues publicly available.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                               Soc. & Gov. rating       Key social & governance strength
Deutsche Bank (C+) + comprehensive and transparent                            Deutsche Bank            + sustainability management system implemented
                       sustainability reporting                               (B-)
-                    -                                                        Commerzbank              + comprehensive initiatives to foster work/life balance of staff
                                                                              (C+)
-                          -                                                  Hypo Real Estate         + reasonable policy on equal opportunities and non-discrimination
                                                                              Group (C+)
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                               Soc. & Gov. rating Key social & governance weakness
comdirect bank AG    - very little information on environmental               Aareal Bank (D+)   - lack of transparency regarding measures to ensure employee
(D)                    issues publicly available                                                    awareness of and compliance with the code of business ethics
Commerzbank (D)            - lack of transparency regarding the               comdirect bank           - very little information on social and ethical issues publicly available
                              integration of environmental aspects into       AG (C-)
                              financial services such as lending or asset
                              management
Aareal Bank (D)            - lack of transparency regarding the               Postbank (C)             - lack of information on customer and product responsibility issues
                              implementation of environmental
                              management systems

                                                                                                                                Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG          UniCredit CAIB Group                            page 63                                                  See last pages for disclaimer.
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                                                                                        20 January 2009                                                           Global Equity Research

                                                                                                                                                                             ESG Research



ESG overview charts – Banks
TP and TPESG upside (%)*                                                                         ESG score overview by ESG scoring status

                    TP upside (%)                            TP ESG upside (%)                                               ESG Leader                  ESG Laggard          Sector average
                    TP upside sector (%)                     TP ESG upside sector (%)
                                                                                                   2
 120
                                                                                                   1
 100
                                                                                                   0
  80
  60                                                                                               -1
  40                                                                                               -2
  20
                                                                                                   -3
   0
 -20                                                                                               -4

 -40                                                                                               -5
                                                                                       HRX GR




                                                                                                                                                                  HRX GR
           DBK GR




                        ARL GR




                                       DPB GR




                                                        CBK GR




                                                                                                             DBK GR




                                                                                                                               CBK GR




                                                                                                                                                DPB GR




                                                                                                                                                                                                    ARL GR
                                                                       COM GR




                                                                                                                                                                                   COM GR
Environmental score overview by category’s ESG scoring status                                    Social & Governance score overview by category’s ESG scoring status

           Environmental Leader            Environmental Laggard                Sector average                        Soc. & Gov. Leader                 Soc. & Gov. Laggard                Sector average

  2                                                                                                3

  1                                                                                                2

  0                                                                                                1

  -1                                                                                               0

  -2                                                                                               -1

  -3                                                                                               -2

  -4                                                                                               -3

  -5                                                                                               -4
                                      HRX GR




                                                                                                                                                HRX GR
          DBK GR




                       DPB GR




                                                                       CBK GR




                                                                                       ARL GR




                                                                                                             DBK GR




                                                                                                                               CBK GR




                                                                                                                                                                  DPB GR




                                                                                                                                                                                                    ARL GR
                                                        COM GR




                                                                                                                                                                                   COM GR
kesg/ke differential by ESG scoring status (bps)*                                                ERP & beta differential between Prime/Not Prime composites

                     ESG Leader                 ESG Laggard         Sector average                                                             Prime        Not Prime

 120
 100                                                                                                                  9.54
                                                                                                                                        9.00
  80
  60
  40
  20
   0
 -20
                                                                                                                                                                           1.58             1.51
 -40
                                                        HRX GR
           DBK GR




                        DPB GR




                                       CBK GR




                                                                                       ARL GR
                                                                       COM GR




                                                                                                                             ERP                                                  Beta



* averages are MCAP weighted                                                                                                                   Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                  UniCredit CAIB Group                          page 64                                                                  See last pages for disclaimer.
                                                                                                                                                                                            20 January 2009                                                                                                                                                                                     Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                         ESG Research



UCRESGLG Index sector constituents overview – Banks
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

 Bloomberg                                                             Current              ESG                ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                       Target                TP upside        TPESG upside               α sustainable
 ticker                  Name                                          rec.                 rating                ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price      TPESG           (%)                 (%)                       (%)
 UCRESGLG index constituent
 DBK GR                  Deutsche Bank                                 Buy                  C+                                14.3                                                 -17.1                                                          7.2                8.9                                8.6                    19.8                       38.0         39.2            92.3               98.2                   89.5
 UCRESGLG index non-constituent
 CBK GR                  Commerzbank                                   Sell                 C-                            -40.0                                                    -17.1                                                          7.2                8.9                                9.5                             3.2                3.0          2.8            -7.3              -14.3                  -23.8
 DPB GR                  Postbank                                      Hold                 C-                            -40.0                                                    -17.1                                                          7.2                7.1                                7.5                             8.6               11.0         10.1          27.3                 16.8                    9.2
 HRX GR                  Hypo Real                                     Sell                 C-                            -40.0                                                    -17.1                                                          7.2                8.9                                9.5                             2.1                1.7          1.6         -19.4                -25.6                  -35.0
                         Estate Group
 COM GR                  comdirect bank                                Hold                 D+                            -60.0                                                    -17.1                                                          7.2                8.4                                9.3                             6.2                5.6          5.0         -10.0                -20.0                  -29.3
                         AG
 ARL GR                  Aareal Bank                                   Buy                  D                             -80.0                                                    -17.1                                                          7.2                7.5                                8.5                             5.0                8.4          7.1            67.3               42.4                   33.9

                                                                                                                                                                                                                                                                                                                                                                                   Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                         ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)*

                                                                                                                                                                                            Composite C                           Composite D                                                                                                                    Sharpe ratio Prime(0.38); Sharpe ratio Sector(0.07)
          ESGCsector i = 1.0 - 1.0
                                                                                                                       100                                                                                                                                                                                                                     12

                                                                                                                                                                                                                                                                                                                                               10
                                                                                                                        80




                                                                                                                                                                                                                                                                                                                            Portfolio return
                                                                                                                                                                                                                                                                                                                                                8
                                                                                                                        60
                                                                                                                                                                                                                                                                                                                                                6

                                                                                                                        40                                                                                                                                                                                                                      4

                                                                                                                        20                                                                                                                                                                                                                      2

                                                                                                                                                                                                                                                                                                                                                0
                                                                                                                         0                                                                                                                                                                                                                          0             10              20             30               40               50
                                                                                                                                      May-02



                                                                                                                                                                 May-03



                                                                                                                                                                                            May-04



                                                                                                                                                                                                                       May-05



                                                                                                                                                                                                                                                  May-06




                                                                                                                                                                                                                                                                             May-07



                                                                                                                                                                                                                                                                                                        May-08
                                                                                                                             Jan-02


                                                                                                                                               Sep-02
                                                                                                                                                        Jan-03


                                                                                                                                                                          Sep-03
                                                                                                                                                                                   Jan-04


                                                                                                                                                                                                     Sep-04
                                                                                                                                                                                                              Jan-05


                                                                                                                                                                                                                                Sep-05
                                                                                                                                                                                                                                         Jan-06


                                                                                                                                                                                                                                                           Sep-06
                                                                                                                                                                                                                                                                    Jan-07


                                                                                                                                                                                                                                                                                      Sep-07
                                                                                                                                                                                                                                                                                               Jan-08


                                                                                                                                                                                                                                                                                                                 Sep-08
                                                                                                                                                                                                                                                                                                                                                                                Portfolio risk (STDEV)
  -1.20

           -0.84

                   -0.48

                           -0.12

                                   0.24

                                          0.60

                                                 0.96

                                                        1.32

                                                                1.68

                                                                       2.04

                                                                              2.41

                                                                                     2.77

                                                                                                 3.13

                                                                                                        3.49

                                                                                                               3.85




                                                                                                                                                                                                                                                                                                                                                             FP Prime         FP Sector         CAL Prime           CAL Sector


* Efficient frontier based on market portfolio due to negative returns for bank composites over performance period                                                                                                                                                                                                                                                   Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                            UniCredit CAIB Group                                                                                                                           page 65                                                                                                                                                                                    See last pages for disclaimer.
                                                                                                                                           20 January 2009                                                                                                                                Global Equity Research

                                                                                                                                                                                                                                                                                                      ESG Research



Banks: Performance
                                                                                                 52-week                      52-week % chg.                        Market cap.                            Absolute performance (%)                               Relative performance (%) vs. Euro STOXX 50
Company                                                              Price                 High               Low               High                     Low                     (mn)                   1M                  3M         12M               YTD                       1M           3M                12M                 YTD
Aareal Bank                                            EUR              5.02                     25.3           5.0            403.4                         -0.6                215                    -4.4               -35.6       -78.8           -13.9                       2.5      -29.8               -34.3                 -7.1
comdirect bank AG                                      EUR              6.22                      9.6           4.6              54.2                 -26.7                      876                   19.1                21.9        -14.4               0.5            26.0               27.8                 30.0                7.3
Commerzbank                                            EUR              3.24                     23.9           3.2            637.2                         0.0             2,337                     -51.1               -67.8       -85.3           -51.9          -44.2                 -61.9               -40.8             -45.1
Deutsche Bank                                          EUR           19.76                       80.0          18.5            304.9                         -6.4          11,280                      -29.6               -39.6       -74.5           -29.6          -22.7                 -33.7               -30.0             -22.8
Hypo Real Estate Group                                 EUR              2.11                     24.0           2.0           1,035.5                        -4.3                445                   -27.5               -65.1       -90.3           -29.7          -20.6                 -59.3               -45.8             -22.9
Postbank                                               EUR              8.64                     66.5           8.6            670.1                         0.0             1,890                     -34.6               -59.9       -84.9           -45.1          -27.7                 -54.0               -40.4             -38.4
Germany average                                                                                                                517.6                         -6.3                                      -21.3               -41.0       -71.4           -28.3          -14.5                 -35.1                -26.9            -21.5


1M absolute performance (%)                                                                             1M relative performance (%)                                                                                           Absolute performance YTD (%)
 40                                                     DAX (%)               Euro STOXX (%)             40                                                                                                                    20                                                        DAX (%)                  Euro STOXX (%)
                                                                                                                                26.0
                         19.1
 20                                                                                                      20                                                                                                                                             0.5
                                                                                                                                                                                                                                   0
                                                                                                                2.5
   0                                                                                                      0
                                                                                                                                                                                                                               -20
          -4.4                                                                                                                                                                                                                         -13.9
 -20                                                                                                    -20
                                                                                                                                                                      -22.7             -20.6                                                                                            -29.6            -29.7
                                                                     -27.5                                                                                                                                     -27.7           -40
 -40                                                                                                    -40
                                                        -29.6                         -34.6                                                                                                                                                                                                                               -45.1
                                                                                                                                              -44.2
                                      -51.1                                                                                                                                                                                                                          -51.9
 -60                                                                                                    -60                                                                                                                    -60
           Aareal Bank




                                                                                                                Aareal Bank




                                                                                                                                                                                                                                        Aareal Bank
                                                                                      Postbank




                                                                                                                                                                                                                Postbank




                                                                                                                                                                                                                                                                                                                           Postbank
                                                                     Estate Group




                                                                                                                                                                                        Estate Group




                                                                                                                                                                                                                                                                                                          Estate Group
                                       Commerzbank




                                                        Deutsche




                                                                                                                                               Commerzbank




                                                                                                                                                                      Deutsche




                                                                                                                                                                                                                                                                     Commerzbank




                                                                                                                                                                                                                                                                                         Deutsche
                         comdirect




                                                                                                                               comdirect




                                                                                                                                                                                                                                                      comdirect
                         bank AG




                                                                                                                               bank AG




                                                                                                                                                                                                                                                      bank AG
                                                                      Hypo Real




                                                                                                                                                                                         Hypo Real




                                                                                                                                                                                                                                                                                                           Hypo Real
                                                         Bank




                                                                                                                                                                       Bank




                                                                                                                                                                                                                                                                                          Bank
                                                                                                                                                                                                                                                                                                    Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                  UniCredit CAIB Group                                                                          page 66                                                                                                                                            See last pages for disclaimer.
                                                                                                                                                    20 January 2009                                                                                                   Global Equity Research

                                                                                                                                                                                                                                                                               ESG Research



Banks: Valuation Overview
                                                                       P/E (x)                                                  Adj. P/E (x)                         Price/book value (x)                                 Price/adj. book value (x)                   Net dividend yield (%)
Company                                                     2008e         2009e         2010e                       2008e            2009e           2010e         2008e      2009e         2010e                        2008e        2009e           2010e          2008e          2009e           2010e
Aareal Bank                                                    3.1           6.5             6.1                      3.1               6.5            6.1          0.17        0.16            0.17                      0.17          0.16           0.17            0.0              0.0             3.0
comdirect bank AG                                            14.1           13.1            10.7                     14.1              13.1           10.7          2.05        2.05            2.05                      2.05          2.05           2.05            7.1              7.6             9.3
Commerzbank                                                    2.9          -3.9             5.3                      2.9               -3.9           5.3          0.17        0.24            0.23                      0.17          0.24           0.23            0.0              0.0             0.0
Deutsche Bank                                                 -2.6           4.2             3.9                     -2.6               4.2            3.9          0.35        0.34            0.33                      0.35          0.34           0.33            2.5              2.5             2.5
Hypo Real Estate Group                                        -0.1          -0.6            -3.4                     -0.1               -0.6          -3.4          0.17        0.21            0.24                      0.17          0.21           0.24            0.0              0.0             0.0
Postbank                                                      -2.7           3.0             2.9                     -2.7               3.0            2.9          0.35        0.31            0.28                      0.35          0.31           0.28            0.0              5.8             5.8
Germany average                                                4.0           5.0             4.8                      4.0               5.0            4.8          0.25        0.28            0.28                      0.25          0.28           0.28            3.7              4.3             4.0


P/BV 2010e (x) vs. ROE 2010e (%)                                                                   P/E 2010e (x) vs. Price/NAV 2010e (x)                                                                P/E 2010e (x) vs. EPS growth 2009e/10e (%)
                                                                                                                     12                                                                                                  15
                  2.0
                                                                           comdirect bank                                                                                      comdirect bank
                                                                                AG                                                                                                                                                                       comdirect bank
                                                                                                                                                                                    AG
                                                                                                                                                                                                                                                              AG
                  1.5                                                                                                       Aareal Bank
                                                                                                                      6                                                                                                  10
 P/BV 2010e (x)




                                                                                                                                                                                                         P/E 2010e (x)
                                                                                                    P/E 2010e (x)
                                                                                                                                    Commerzbank
                                                                                                                                         Deutsche Bank
                  1.0                                                                                                                  Postbank
                                                                                                                                                                                                                                                              Aareal Bank
                                                                                                                                                                                                                                         Commerzbank
                                                                                                                      0                                                                                                   5
                  0.5                                                                                                                                                                                                                      Deutsche Bank
                                                    Deutsche Bank                                                                     Hypo Real
                              Hypo Real                                                                                                                                                                                                       Postbank
                                                                                                                                     Estate Group
                             Estate Group Commerzbank        Postbank
                                        Aareal Bank
                  0.0                                                                                                -6                                                                                                   0
                        -5          0            5             10           15              20                            0.0             0.5           1.0           1.5          2.0            2.5                         -80          -30                  20                 70                  120
                                                      ROE 2010e (%)                                                                                    Price/NAV 2010e (x)                                                                        EPS growth 2009e/10e (%)


                                                                                                                                                                                                                                                                             Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                         UniCredit CAIB Group                                                                         page 67                                                                                                               See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                        ESG Research



Deutsche Bank                                                                                  Buy (prev. Buy)
Robust capital situation despite huge Q4 loss                                                  Price on 01/16/09                                     EUR 19.76
                                                                                               Target price (prev. EUR 38.00)                        EUR 38.00
■   Investment story: The high Q4 loss of EUR 4.8 bn announced in mid-                         Upside to TP                                                 92.3%
    January clearly was shocking news. However, we regard it as a positive                     Cost of equity                                                8.9%
    that the Tier 1 ratio remained above the 10% level. We stick to our                        High/Low (12M)                                        80.00/18.49
    opinion that Deutsche Bank should come through the current crisis
                                                                                               INVESTMENT HIGHLIGHTS
    without the need for a capital increase in order to compensate for additional               Strong positioning in the capital market business
    losses. Concerning the Postbank deal announced in September, we                             Participation in global mega trends
                                                                                                Significant price upside from a valuation perspective
    regard the acquisition of a minority stake in this retail bank as
    strategically reasonable. Among others, a major advantage of the new                       STOCK TRIGGERS
                                                                                                Higher weighting of the more stable segments
    deal structure, which was also announced in mid-January, is the                             Dimmed market sentiment due to market crisis
    reduced consumption of Tier 1 capital. We keep our Buy                                      Continuation of relatively high resistance to the crisis
    recommendation unchanged in a mid-term perspective, despite the
                                                                                               STOCK DATA
    weaker short-term sentiment.
                                                                                               Reuters/Bloomberg                            DBKGn.DE/DBK GR
                                                                                               Average daily volume (tds.)                                 10340.1
■   Operating performance in 2009e and 2010e: For FY 2009, we                                  Free float (%)                                                100.0
    forecast a net profit of EUR 2.7 bn compared to the announced loss of                      Market capitalization (EUR bn)                                 11.3
    EUR 3.9 bn in FY 2008. The reason is a projected strong uptick of total                    No. of shares issued (mn)                                   570.9
    revenues simply due to the expectation of the disappearance of                             Shareholders                                     Free float 100%
    markdowns on toxic assets held at fair value. In contrast, we expect a
                                                                                               UPCOMING EVENTS
    further weakening of client activity, which might be partially
                                                                                               Annual general meeting                                    26-May-09
    compensated by market share gains (“flight to quality”). In particular, our
                                                                                               Interim report                                            28-Apr-09
    revenue forecast for the capital markets business is now even below the
                                                                                               Bal. sheet press conf.                                    05-Feb-09
    level of the years 2002-2004. Furthermore, earnings will most probably be
    burdened by significantly increasing loan-loss provisions related to the                    140
    sharp macroeconomic downturn. For FY 2010, we expect a limited                              120
                                                                                                100
    increase of net income to EUR 2.9 bn due to slight improvements in
                                                                                                 80
    revenues (y-o-y), despite loan-loss provisions estimated to remain at
    elevated levels.                                                                             60




■   Valuation: Our target price of EUR 38 per share is derived from a P/E-
                                                                                                 40


    based SOP valuation, applying our earnings forecasts for 2009 and
    taking account of the 22.9% stake in Postbank “at equity.” Even in an
                                                                                                 20
    extreme scenario by attributing zero value to CB&S, we would still
                                                                                                 16
    come to an SOP value of ca. EUR 27 per Deutsche Bank share.                                           2006
                                                                                                  DEUTSCHE BANK
                                                                                                                             2007                 2008
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                            Source: Thomson Datastream



                                                                                               RELATIVE PERFORMANCE (% CHG.)
                                       2006        2007         2008e       2009e    2010e
                                                                                                                                     1M           3M           6M
Net profit (EUR mn)                    6070        6474         -3882        2728      2930
                                                                                               DAX                                  -21.9       -34.0        -32.8
Total revenues (EUR mn)               28494      30745          14145       22951    23882
                                                                                               Euro STOXX 50                        -22.7       -33.7        -33.8
Total assets (EUR bn)                 1584.5     2020.3         1995.2      1712.5   1721.1
                                                                                               ES Bank                              -17.7         -8.8       -13.6
EPS (diluted, EUR)                     11.48      13.05          -7.64        4.65     5.02
Dividend (EUR)                          4.00       4.50           0.50        0.50     0.50    Dr. Andreas Weese, CEFA (HVB)
Book value per share (EUR)             69.57      77.52          56.35       57.56    60.69    +49 89 378-12561
NAV per share (EUR)                    54.13      62.38          36.32       39.19    42.22    andreas.weese@unicreditgroup.de
Pre tax margin (%)                      29.3       28.5          -31.8        17.9     18.5
Cost-income ratio (%)                   69.7       69.6          126.5        74.2     73.5
ROAE (%)                                20.5       18.0          -11.7         8.8      8.7
Tier 1 ratio (%)                         8.9         8.6          10.1        10.0     10.2
P/E diluted (x)                          8.0         7.6          -7.6         4.2      3.9
P/BV (x)                                 1.3         1.3           1.0         0.3      0.3
Div. yield (%)                           4.3         4.5           0.9         2.5      2.5

                                                  Source: Company data, UniCredit Research




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January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




                                                                                    Capital Goods




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 70       See last pages for disclaimer.
                                                                                         20 January 2009                                        Global Equity Research

                                                                                                                                                      ESG Research



ESG overview – Capital Goods
TP upside vs. difference TPESG-TP (%)*                                                               Sustainable alpha of UCRESGLG Index constituents (%)

                  5.0                                                                                  12
                                                HDD GR (H,C+)
                                                                                                       10
                  0.0
                                                   WSU GR (B,C)                                         8
 TPESG - TP (%)




                                                                    KRN GR (B,C)
                  -5.0
                                          MAN GR (B,C-)                                                 6
                                             Sector
             -10.0           KU2 GR (S,D+)
                                                   G1A GR (B,D+)                                        4
                SKB GR (S,D)
                                    SNG GR (H,D)      JUN3 GR (B,D)              GIL GR (B,D-)          2
             -15.0         JEN GY (H,D)
                                       RAA GY (B,D)D9C GR (B,D)
                                                                                                        0




                                                                                                                                      HDD GR
             -20.0




                                                                                                                                       (H,C+)
                         -40   -20    0       20    40      60     80     100      120     140
                                                   TP upside (%)


* average is MCAP weighted                                                                                                      Source: oekom research, UniCredit Research


ESG risk analysis
The Capital Goods sector continues to score below the ESG Leaders territory with an average ESG sector score of -2.9. The
Environmental score (-3.5) seems to be dragging the sector score downwards relative to the slightly better Social & Governance
performance (-2.6). Overall, only 8% of stocks were able to obtain Prime investment status, which only includes Heidelberger
Druck (Hold, C+). We highlight that there is no negative ESG/risk relationship within this sector. Using the general portfolio ESG
risk adjustment variables and taking into account stock-specific ESG ratings, the ESG risk adjustment for the sector has been
determined at 93.3bps. The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment
of -12.4% for the overall sector. From an ESG style analysis point of view, there are no top tier rated ESG stocks (A+B) with
contributions of C and D rated stocks at 60.6% and 39.4%, respectively. The risk-adjusted performance (Sharpe ratio) for Prime
stocks has been determined to be 36.2% higher relative to the sector benchmark based on our ESG efficient frontier analysis.

Strategic outlook
After five consecutive years of growth, the German engineering sector is on the brink of a massive downswing. In October 2008,
order intake slumped by 14% and the order trend was even weaker in November and December. In 2009, the industry will have to
contend with substantially weaker order intake and a fall-off in sales and earnings (despite the in many cases still good order
backlog), which was, until recently, still impossible to predict. For many companies, 2010 could be the more difficult year because
the order backlog will have disappeared by then. In terms of their business focus, the flexibility of their cost structures and the
solidity of their balance sheets, German engineering companies are, however, much better prepared for a downswing than in the
past. Even though consensus earnings estimates for 2009 are in many instances still too high, we believe the valuation of the
sector stocks is attractive at the current share price level. We continue to favor stocks that are exposed to the more stable food and
beverage industry (such as Krones or GEA Group) or benefit from their strong service business (Demag Cranes, Jungheinrich).

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY       INVESTMENT HIGHLIGHTS                    STOCK TRIGGERS                                                KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Heidelberger Poor sales and earnings performance in FY Loss in confidence after several profit                        + environmental data for various resource
Druck         2008/09                                  warnings                                                         consumptions and emissions
(Hold,C+)
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Koenig &      Slump in demand for printing presses     Newsflow will remain negative for                              - no information on measures to ensure safe handling
Bauer                                                  some time                                                        of products
(Sell,D)
Jenoptik      Attractive high-tech product portfolio   Potential takeover candidate                                   - lack of transparency with respect to implementation of
(Hold,D)                                                                                                                 a strategy for addressing climate change and related
                                                                                                                         sector-specific risks
Singulus                        Disappointing sales and earnings figures for      Very high forecast uncertainties    - lack of transparency with respect to implementation of
(Hold,D)                        2008                                                                                     a strategy for addressing climate change and related
                                                                                                                         sector-specific risks

                                                                                                                                Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                       UniCredit CAIB Group                         page 71                                       See last pages for disclaimer.
                                                                         20 January 2009                                                Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview – Capital Goods
ESG sector scoring overview by category                                                ESG stock rating breakdown

  0.0
                                                                                                                          D-          C+
                                                                                                                         7.7%        7.7%

  -1.0                                                                                                                                          C
                                                                                                                                              15.4%


  -2.0
                                                                                                                                                  C-
                                                                                                                                                 7.7%
                                                                                                              D
  -3.0                                                                                                      46.2%

                                                                                                                                             D+
                                                                                                                                            15.4%
  -4.0
         Social & Governance            ESG                 Environmental



                                                                                                                           Source: oekom research, UniCredit Research

Environmental review
Environmentally, the Capital Goods group kept its overall bad score: 92% of the companies fell into the Environmental Laggards
category with the group’s average well into Laggard territory. The top Environmental Leader remains Heidelberger Druck (B-),
with its key strength being monitoring and providing environmental data for various resource consumptions and emissions. The
companies at the bottom of the Laggards ladder are characterized b7y weaknesses such as providing limited information on
environmental issues especially product life cycles (Demag Cranes AG (D-) and Rational (D-)), or non-transparent approaches
to environmental measures and management such as in the case of GILDEMEISTER (D-), with Koenig & Bauer (D-) also
portraying some other weaknesses.

Social & Governance review
The social score of the group remains also very poor. Again, 92% of the Capital Goods companies we analyzed are in the Soc.
& Gov. Laggards category, yet the group average is slightly better (but still in Laggards territory) than its environmental scoring.
Only Leader remains WashTec (C+), showing a group-wide policy on ensuring freedom of association as a key strength. Again,
most of the companies at the bottom suffer in scoring due to weaknesses regarding transparency about labor/health/safety
issues and management (GILDEMEISTER (D), Jungheinrich (D) or Singulus (D)) or regarding measures how to improve the
health and safety aspects of their products (Demag Cranes AG (D)).


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                             Soc. & Gov. rating Key social & governance strength
Heidelberger Druck   + environmental data for various resource              WashTec (C+)       + group-wide policy on ensuring freedom of association
(B-)                   consumptions and emissions
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                             Soc. & Gov. rating Key social & governance weakness
Demag Cranes AG      - no information regarding life cycle                  Demag Cranes AG - lack of transparency regarding measures to improve health and
(D-)                   assessments of products                              (D)                 safety aspects of products
GILDEMEISTER (D-)         - lack of transparency regarding the              GILDEMEISTER           - lack of transparency regarding supplier standards with regard to
                             implementation of environmental                (D)                       labor/health, safety and environmental issues
                             management systems
Koenig & Bauer (D-)       - lack of transparency regarding measures to      Jungheinrich (D)       - lack of transparency regarding health and safety management and
                             reduce raw material use in production                                    data

                                                                                                                           Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                         page 72                                               See last pages for disclaimer.
                                                                                                                                    20 January 2009                                                                      Global Equity Research

                                                                                                                                                                                                                                            ESG Research



ESG overview charts – Capital Goods
TP and TPESG upside (%)*                                                                                                                      ESG score overview by ESG scoring status

                             TP upside (%)                                                 TP ESG upside (%)                                                              ESG Leader                     ESG Laggard                        Sector average
                             TP upside sector (%)                                          TP ESG upside sector (%)
                                                                                                                                                2
 140                                                                                                                                            1
 120
                                                                                                                                                0
 100
  80                                                                                                                                           -1
  60                                                                                                                                           -2
  40                                                                                                                                           -3
  20
                                                                                                                                               -4
   0
 -20                                                                                                                                           -5
 -40                                                                                                                                           -6
                                                                                  RAA GY




                                                                                                                           JEN GY




                                                                                                                                                                                                                JEN GY




                                                                                                                                                                                                                                                      RAA GY
        GIL GR

                   KRN GR




                                       JUN3 GR




                                                            D9C GR




                                                                                                                                     SKB GR




                                                                                                                                                             KRN GR
                                                                       HDD GR




                                                                                              MAN GR

                                                                                                        KU2 GR

                                                                                                                  SNG GR




                                                                                                                                                    HDD GR




                                                                                                                                                                                MAN GR




                                                                                                                                                                                                    KU2 GR




                                                                                                                                                                                                                         D9C GR

                                                                                                                                                                                                                                  JUN3 GR

                                                                                                                                                                                                                                             SKB GR
                                                                                                                                                                                         G1A GR




                                                                                                                                                                                                                                                               SNG GR

                                                                                                                                                                                                                                                                         GIL GR
                                                  G1A GR
                             WSU GR




                                                                                                                                                                       WSU GR
Environmental score overview by category’s ESG scoring status                                                                                 Social & Governance score overview by category’s ESG scoring status

                 Environmental Leader                          Environmental Laggard                                Sector average                             Soc. & Gov. Leader                            Soc. & Gov. Laggard                      Sector average

  3                                                                                                                                             2
  2                                                                                                                                             1
  1
                                                                                                                                                0
  0
  -1                                                                                                                                           -1
  -2                                                                                                                                           -2
  -3
                                                                                                                                               -3
  -4
  -5                                                                                                                                           -4

  -6                                                                                                                                           -5
                                                 JEN GY




                                                                                                                           RAA GY




                                                                                                                                                                                         JEN GY




                                                                                                                                                                                                                                  RAA GY
                  MAN GR

                            KRN GR




                                                                      JUN3 GR




                                                                                              D9C GR

                                                                                                        GIL GR

                                                                                                                  SKB GR




                                                                                                                                                             HDD GR

                                                                                                                                                                       KRN GR
       HDD GR




                                                                                  KU2 GR




                                                                                                                                     SNG GR




                                                                                                                                                                                MAN GR




                                                                                                                                                                                                                SKB GR

                                                                                                                                                                                                                         KU2 GR




                                                                                                                                                                                                                                             D9C GR

                                                                                                                                                                                                                                                      GIL GR

                                                                                                                                                                                                                                                               JUN3 GR
                                                           G1A GR




                                                                                                                                                                                                    G1A GR




                                                                                                                                                                                                                                                                         SNG GR
                                      WSU GR




                                                                                                                                                    WSU GR




kesg/ke differential by ESG scoring status (bps)*                                                                                             ERP & beta differential between Prime/Not Prime composites

                                ESG Leader                          ESG Laggard                        Sector average                                                                             Prime         Not Prime

 200
                                                                                                                                                                8.60

 150                                                                                                                                                                              7.68


 100

  50

   0

                                                                                                                                                                                                                                  1.35                1.31
 -50
                                                            RAA GY




                                                                                              JEN GY
                             KRN GR
        HDD GR




                                       MAN GR

                                                  KU2 GR




                                                                                  D9C GR




                                                                                                        JUN3 GR

                                                                                                                  SKB GR

                                                                                                                           SNG GR

                                                                                                                                     GIL GR
                                                                       G1A GR
                   WSU GR




                                                                                                                                                                         ERP                                                                 Beta



* averages are MCAP weighted                                                                                                                                                                      Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                             UniCredit CAIB Group                                           page 73                                                                                 See last pages for disclaimer.
                                                                                                                                                                                     20 January 2009                                                                                                                                                                                       Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                    ESG Research



UCRESGLG Index sector constituents overview – Capital Goods
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW
Bloomberg                                                          Current              ESG             ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                        Target                 TP upside        TPESG upside                  α sustainable
ticker                  Name                                       rec.                 rating             ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                         price        TPESG          (%)                 (%)                          (%)
UCRESGLG index constituent
HDD GR                  Heidelberger Druck                         Hold                 C+                             14.3                                                 -17.1                                                          0.0               10.2                            10.0                                4.3                 5.0          5.1           17.6                 21.1                      11.1
UCRESGLG index non-constituent
KRN GR                  Krones                                     Buy                  C                          -20.0                                                    -17.1                                                          0.0                8.4                             8.7                       25.7                        45.0         43.2           75.4                 68.3                      59.6
WSU GR                  WashTec                                    Buy                  C                          -20.0                                                    -17.1                                                          0.0                7.5                             7.8                        5.6                         8.5          8.1           51.0                 44.6                      36.8
MAN GR                  MAN                                        Buy                  C-                         -40.0                                                    -17.1                                                          0.0                8.4                             9.0                       33.5                        41.0         37.8           22.4                 12.9                       3.9
G1A GR                  GEA Group                                  Buy                  D+                         -60.0                                                    -17.1                                                          0.0               10.2                            11.2                        9.7                        14.5         13.0           50.3                 34.5                      23.3
KU2 GR                  KUKA                                       Sell                 D+                         -60.0                                                    -17.1                                                          0.0                9.3                            10.3                       10.5                        11.0          9.8            5.0                 -6.3                     -16.6
JEN GY                  Jenoptik                                   Hold                 D                          -80.0                                                    -17.1                                                          0.0                9.8                            11.1                        5.8                         5.9          5.1            2.1                -11.8                     -22.9
D9C GR                  Demag Cranes AG                            Buy                  D                          -80.0                                                    -17.1                                                          0.0                8.0                             9.0                       16.7                        25.0         21.4           49.5                 27.7                      18.7
JUN3 GR                 Jungheinrich                               Buy                  D                          -80.0                                                    -17.1                                                          0.0                9.8                            11.1                        9.4                        15.0         13.0           59.6                 37.8                      26.7
SKB GR                  Koenig & Bauer                             Sell                 D                          -80.0                                                    -17.1                                                          0.0                9.8                            11.1                        8.5                         7.0          6.0          -17.4                -28.6                     -39.7
RAA GY                  Rational                                   Buy                  D                          -80.0                                                    -17.1                                                          0.0                7.5                             8.5                       72.9                       100.0         85.1           37.1                 16.7                       8.2
SNG GR                  Singulus                                   Hold                 D                          -80.0                                                    -17.1                                                          0.0               10.2                            11.6                        2.8                         3.0          2.6            5.6                 -8.6                     -20.2
GIL GR                  GILDEMEISTER                               Buy                  D-                        -100.0                                                    -17.1                                                          0.0               10.3                            12.0                        6.0                        13.0         10.9          117.4                 82.2                      70.2

                                                                                                                                                                                                                                                                                                                                                                              Source: oekom research, UniCredit Research


ESG confidence analysis ( x )                                                                                  ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                     Composite C                           Composite D                                                                                                                      Sharpe ratio Prime(0.32); Sharpe ratio Sector(0.23)
         ESGCsector i = 1.0 - 1.0
                                                                                                                100                                                                                                                                                                                                                     40

                                                                                                                                                                                                                                                                                                                                        30
                                                                                                                 80




                                                                                                                                                                                                                                                                                                                     Portfolio return
                                                                                                                                                                                                                                                                                                                                        20
                                                                                                                 60
                                                                                                                                                                                                                                                                                                                                        10

                                                                                                                 40                                                                                                                                                                                                                      0

                                                                                                                 20                                                                                                                                                                                                                     -10

                                                                                                                                                                                                                                                                                                                                        -20
                                                                                                                  0                                                                                                                                                                                                                           0            20       40         60         80        100           120           140
                                                                                                                               May-02



                                                                                                                                                          May-03



                                                                                                                                                                                     May-04



                                                                                                                                                                                                                May-05



                                                                                                                                                                                                                                           May-06




                                                                                                                                                                                                                                                                      May-07



                                                                                                                                                                                                                                                                                                 May-08
                                                                                                                      Jan-02


                                                                                                                                        Sep-02
                                                                                                                                                 Jan-03


                                                                                                                                                                   Sep-03
                                                                                                                                                                            Jan-04


                                                                                                                                                                                              Sep-04
                                                                                                                                                                                                       Jan-05


                                                                                                                                                                                                                         Sep-05
                                                                                                                                                                                                                                  Jan-06


                                                                                                                                                                                                                                                    Sep-06
                                                                                                                                                                                                                                                             Jan-07


                                                                                                                                                                                                                                                                               Sep-07
                                                                                                                                                                                                                                                                                        Jan-08


                                                                                                                                                                                                                                                                                                          Sep-08
                                                                                                                                                                                                                                                                                                                                                                           Portfolio risk (STDEV)
  0.92

          1.02

                 1.12

                        1.22

                               1.33

                                      1.43

                                             1.53

                                                    1.63

                                                            1.73

                                                                   1.83

                                                                          1.93

                                                                                 2.03

                                                                                          2.13

                                                                                                 2.23

                                                                                                        2.33




                                                                                                                                                                                                                                                                                                                                                       FP Prime          FP Sector         CAL Prime           CAL Sector


                                                                                                                                                                                                                                                                                                                                                                              Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                        UniCredit CAIB Group                                                                                                                        page 74                                                                                                                                                                                      See last pages for disclaimer.
                                                                                                                                                                                                                                       20 January 2009                                                                                                                                                                                                             Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      ESG Research



Capital Goods: Performance
                                                                                                                                                             52-week                                           52-week % chg.                                                         Market cap.                         Absolute performance (%)                                                                       Relative performance (%) vs. Euro STOXX 50
Company                                                                                                                         Price                      High                  Low                                   High                                Low                                   (mn)                 1M                          3M                   12M                              YTD                                1M                               3M                 12M                     YTD
Demag Cranes AG                                                                                              EUR                16.72                       38.8                  12.1                                 131.8                            -27.6                                     354                 1.3                  -11.2                     -26.0                              -10.2                              8.2                              -5.3               18.5                     -3.4
GEA Group                                                                                                    EUR                 9.65                       26.9                     9.6                               178.2                                      -0.1                           1,774         -19.7                       -17.5                     -49.9                              -21.7                     -12.8                               -11.6                     -5.4                   -14.9
GILDEMEISTER                                                                                                 EUR                 5.98                       23.2                     4.9                               287.6                            -18.2                                     259              -0.8                    -33.3                     -45.4                              -24.4                              6.1                        -27.5                     -0.9                   -17.6
Heidelberger Druck                                                                                           EUR                 4.25                       19.8                     4.0                               366.8                                      -6.6                            332                 7.0                  -47.7                     -75.3                              -31.9                       13.9                              -41.9                    -30.8                   -25.1
Jenoptik                                                                                                     EUR                 5.78                         6.2                    3.4                                  7.4                           -41.0                                     301            46.3                            32.2                       9.9                         16.1                        53.2                                38.1                   54.3                    22.9
Jungheinrich                                                                                                 EUR                 9.40                       24.8                     8.2                               163.4                            -12.3                                     320                 4.0                        -6.9                -56.5                                 2.5                      10.9                                    -1.1               -12.1                      9.3
Koenig & Bauer                                                                                               EUR                 8.47                       22.1                     7.9                               161.2                                      -7.0                            137              -2.8                    -19.2                     -51.9                              -14.4                              4.1                        -13.3                     -7.4                    -7.7
Krones                                                                                                       EUR                25.66                       59.7                  25.2                                 132.7                                      -1.9                            811          -11.5                       -15.2                     -46.4                              -18.6                          -4.7                                 -9.3                -1.9                   -11.8
KUKA                                                                                                         EUR                10.48                       25.5                  10.1                                 143.1                                      -4.0                            279              -5.0                    -37.4                     -46.0                              -19.6                              1.9                        -31.5                     -1.6                   -12.8
MAN                                                                                                          EUR                33.50                      104.3                  28.0                                 211.2                            -16.4                                    4,983                2.0                  -13.4                     -61.8                              -14.7                              8.9                              -7.6               -17.4                    -7.9
Rational                                                                                                     EUR                72.92                      144.0                  69.6                                  97.5                                      -4.6                            829          -16.3                             -7.4                -36.5                              -15.0                          -9.4                                 -1.5                7.9                     -8.2
Singulus                                                                                                     EUR                 2.84                       11.3                     2.5                               297.9                            -12.0                                     105                 4.4                  -12.6                     -68.9                              -21.3                       11.3                                    -6.7               -24.5                   -14.5
Washtec                                                                                                      EUR                 5.60                       11.2                     5.2                                98.4                                      -8.2                             86              -7.7                          -6.9                -39.1                               -7.6                          -0.8                                 -1.1                5.4                     -0.8
Germany average                                                                                                                                                                                                        181.6                            -12.6                                                         0.7                  -15.8                     -46.2                              -14.4                              7.6                              -9.9                -1.8                    -7.7


1M absolute performance (%)                                                                                                                                           1M relative performance (%)                                                                                                                                                  Absolute performance YTD (%)
 60                                                                                                                   DAX (%)        Euro STOXX (%)                    60                                                                                                                                                                               40                                                                                                                  DAX (%)             Euro STOXX (%)
                                                                 46.3                                                                                                                                                                  53.2
                                                                                                                                                                                                                                                                                                                                                                                                                       16.1
 40                                                                                                                                                                                                                                                                                                                                                     20
                                                                                                                                                                       40
                                                                                                                                                                                                                                                                                                                                                                                                                                  2.5
 20                                                                                                                                                                                                                                                                                                                                                      0
                                                     7.0                     4.0                                                                                                                                         13.9
         1.3                                                                                                                  2.0               4.4                    20
                                                                                                                                                                                                                                                   10.9                                                                   11.3                               -10.2                                                                                                                                                     -7.6
  0                                                                                                                                                                           8.2                       6.1                                                                                              8.9                                        -20
                                                                                                                                                                                                                                                                     4.1                                                                                                                                                                         -14.4 -18.6 -19.6 -14.7 -15.0 -21.3
                                                                                                                                                                                                                                                                                                  1.9                                                                       -21.7 -24.4
                                   -0.8                                                     -2.8 -11.5 -5.0                                                 -7.7        0                                                                                                                                                                                                                                  -31.9
 -20                                                                                                                                                                                                                                                                                                                                   -0.8         -40
                      -19.7                                                                                                         -16.3                                                                                                                                               -4.7
                                                                                                                                                                                           -12.8                                                                                                               -9.4
 -40                                                                                                                                                                  -20                                                                                                                                                                           -60
                                                  Heidelberger




                                                                                            Koenig & Bauer




                                                                                                                                                Singulus




                                                                                                                                                                                                                        Heidelberger




                                                                                                                                                                                                                                                                     Koenig & Bauer




                                                                                                                                                                                                                                                                                                                            Singulus




                                                                                                                                                                                                                                                                                                                                                                                                        Heidelberger




                                                                                                                                                                                                                                                                                                                                                                                                                                                  Koenig & Bauer




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            Singulus
                                                                             Jungheinrich




                                                                                                                                                                                                                                                   Jungheinrich




                                                                                                                                                                                                                                                                                                                                                                                                                                  Jungheinrich
                                                                                                                              MAN

                                                                                                                                     Rational




                                                                                                                                                                                                                                                                                                         MAN

                                                                                                                                                                                                                                                                                                               Rational




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         MAN

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 Rational
                       GEA Group




                                                                  Jenoptik




                                                                                                             Krones




                                                                                                                                                                                            GEA Group




                                                                                                                                                                                                                                        Jenoptik




                                                                                                                                                                                                                                                                                        Krones




                                                                                                                                                                                                                                                                                                                                                                             GEA Group




                                                                                                                                                                                                                                                                                                                                                                                                                       Jenoptik




                                                                                                                                                                                                                                                                                                                                                                                                                                                                   Krones
       Demag Cranes




                                   GILDEMEISTER




                                                                                                                       KUKA




                                                                                                                                                                            Demag Cranes




                                                                                                                                                                                                        GILDEMEISTER




                                                                                                                                                                                                                                                                                                  KUKA




                                                                                                                                                                                                                                                                                                                                                             Demag Cranes




                                                                                                                                                                                                                                                                                                                                                                                         GILDEMEISTER




                                                                                                                                                                                                                                                                                                                                                                                                                                                                               KUKA
                                                                                                                                                            Washtec




                                                                                                                                                                                                                                                                                                                                       Washtec




                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        Washtec
                                                     Druck




                                                                                                                                                                                                                           Druck




                                                                                                                                                                                                                                                                                                                                                                                                           Druck
           AG




                                                                                                                                                                                AG




                                                                                                                                                                                                                                                                                                                                                                 AG
                                                                                                                                                                                                                                                                                                                                                                                                                                                                              Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                                                      UniCredit CAIB Group                                                                                                                        page 75                                                                                                                                                                                                                          See last pages for disclaimer.
                                                                                                                                                       20 January 2009                                                                                                      Global Equity Research

                                                                                                                                                                                                                                                                                      ESG Research



Capital Goods: Valuation Overview
                                                                             P/E (x)                                                    P/CF (x)                                     EV/sales (x)                                    EV/EBITDA (x)                                   EV/EBIT (x)
Company                                                      2008e              2009e          2010e                          2008e        2009e         2010e               2008e         2009e           2010e         2008e             2009e            2010e          2008e           2009e             2010e
Demag Cranes AG                                                    7.3             5.7            6.1                          13.6          10.8             11.7            0.57          0.40            0.38               4.3           3.6              3.5            5.2                4.5             4.5
GEA Group                                                     24.3                 6.6            7.6                           8.6           4.8              5.3            0.77          0.47            0.48               6.8           4.5              5.1            8.1                5.4             6.1
GILDEMEISTER                                                       7.2             4.2            6.1                           7.2           3.0              3.0            0.40          0.22            0.22               3.8           2.5              2.8            4.6                3.2             3.9
Heidelberger Druck                                             -5.0               -4.3          26.0                          -15.9           7.7              2.6            0.56          0.38            0.35          -28.1             11.1              4.9           -9.3            -65.7              10.2
Jenoptik                                                      19.3                23.0          16.9                            5.2           6.2              5.7            0.83          0.86            0.80               6.3           6.7              6.0           12.1             12.9              10.7
Jungheinrich                                                       7.7             5.4            5.2                           6.0           3.0              2.9            0.30          0.17            0.16               3.9           2.4              2.3            5.3                3.7             3.4
Koenig & Bauer                                                 -5.5              -89.9          45.1                          -33.4           3.5              3.1            0.24          0.19            0.19          -19.8              5.8              5.0           -6.2             81.2              26.7
Krones                                                        12.1                 7.9            7.5                           8.1           4.9              4.8            0.64          0.33            0.28               6.6           3.6              3.1            8.6                5.0             4.3
KUKA                                                          16.8                10.6          12.0                           10.4           5.4              5.6            0.48          0.32            0.32               8.0           5.1              5.3           12.2                8.1             8.6
MAN                                                                8.3             7.3            7.5                           5.0           3.1              2.8            0.67          0.43            0.40               3.7           3.0              2.5            5.5                5.5             5.2
Rational                                                      19.4                12.2          10.7                           21.2          13.4             11.8            3.61          2.11            1.98           13.0              7.9              7.0           13.8                8.4             7.4
Singulus                                                       -7.6               15.3            8.4                          10.4           3.8              3.2            1.13          0.44            0.40           10.4              2.8              2.4           -7.3                6.1             4.1
Washtec                                                            7.8             5.3            5.0                           5.6           3.6              3.5            0.64          0.41            0.34               5.1           3.7              3.0            6.4                4.8             3.8
Germany average                                               11.0                 7.7            9.0                           8.0           4.6              4.0            0.83          0.52            0.49               5.6           4.0              3.6            7.1                5.9             5.8


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                                 ROCE 2010e (%) vs. WACC 2010e (%)                                                                      EV/sales 2002-2010e (x)
                                                                                                                               20                                                                                        1.6

                      0.8                                                                                                                                        Demag Cranes
                                                                                                                                                                                                                         1.4
                                                                               Jenoptik                                                                              AG
                                                                                                                               15                                                                                                                                             1.11
                                                                                                                                                                                                                         1.2
 EV/sales 2010e (x)




                                                                                                                                                     Washtec                           GEA Group
                                                                                                             ROCE 2010e (%)




                      0.6                                                                                                                                                  Krones                                                                            1.06   1.10
                                                                                                                                                                                                                                 0.96
                                                                                         GEA Group                                                                                                                       1.0
                                                                                                                                                                     KUKA        GILDEMEISTER                                                        0.86                                0.83
                                                                                                                               10                                                                                                         0.75
                                                                                MAN           Singulus
                      0.4                                                                                                                                                MAN                                             0.8




                                                                                                                                                                                                                     X
                                    Heidelberger                                                                                                                                            Jungheinrich
                                                                   Demag Cranes                Washtec
                                       Druck          KUKA             AG                                                                                                                      Singulus
                                                              Krones                                                                                                  Jenoptik                                           0.6
                                                                                                                                                                                                                                                                                                      0.52   0.49
                                                   GILDEMEISTER                                                                 5
                      0.2
                                                                                                                                            Heidelberger Druck                                                           0.4
                            Koenig & Bauer
                                                    Jungheinrich
                                                                                                                                                                        Koenig & Bauer                                   0.2
                      0.0                                                                                                       0
                            0           2             4                  6                8             10                          5         6           7              8             9            10         11        0.0
                                                   EBIT margin 2010e (%)                                                                                         WACC 2010e (%)                                                  2002      2003    2004      2005   2006      2007      2008e     2009e      2010e


                                                                                                                                                                                                                                                                                   Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                          UniCredit CAIB Group                                                                                page 76                                                                                                              See last pages for disclaimer.
January 2009
                                                                          20 January 2009                                       Global Equity Research

                                                                                                                                       ESG Research



Heidelberger Druck                                                                               Hold (prev. Hold)
Little hope for short-term recovery in demand                                                    Price on 01/16/09                                       EUR 4.25
                                                                                                 Target price (prev. EUR 5.00)                           EUR 5.00
■   Investment story: Following the relatively successful drupa trade show                       Upside to TP                                               17.6%
    in June 2008, new orders for printing presses have broken away massively                     Cost of equity                                             10.2%
    in recent months. From today’s point of view, we expect that the current                     High/Low (12M)                                          19.84/3.97
    downswing will last much longer than the traditional 12-18 months; thus
                                                                                                 INVESTMENT HIGHLIGHTS
    no positive news from the printing press industry or from Heidelberger                        Poor sales and earnings performance in FY 2008/09
    Druck is in sight.                                                                            Order trend seems to be disastrous
                                                                                                  Loss likely for also for 2009/10

■   Operating performance in 2009e and 2010e: Following the very                                 STOCK TRIGGERS
                                                                                                  Loss in confidence after several profit warnings
    disappointing FY 2008/09 (3/31) in which Heidelberg is facing a plunge                        Poor mid-term prospects
    in order intake and sales, an operating loss and significant restructuring                    Share price close to all-time low and below book value
    expenses, FY 2009/10 will, in our view, be challenging as well. Sales
                                                                                                 STOCK DATA
    are likely to decline significantly again (UniCredit (E) -5.5%) and we are
                                                                                                 Reuters/Bloomberg                         HDDG.DE/HDD GR
    therefore expecting a slight operating loss and an appreciable net loss
                                                                                                 Average daily volume (tds.)                                1006.7
    (UniCredit (E) EBIT 2009/10 EUR -17 mn, EPS 2009/10e EUR -0.99)                              Free float (%)                                               77.4
    despite the positive impact from capacity adjustments and additional                         Market capitalization (EUR bn)                              0.332
    cost-cutting measures. For FY 2010/11, a recovery in demand is likely.                       No. of shares issued (mn)                                  77.6
    We forecast an increase in sales of 9% and EBIT of EUR 108 mn (3.3%                          Shareholders                                   Allianz 12.96%,
    EBIT margin). Due to the significantly negative financial result,                                                                                RWE 9.6%

    however, net profit (UniCredit (E) EUR 13 mn, EPS 10/11e EUR 0.16)                           UPCOMING EVENTS
    will be still meager, in our view. One of the major tasks for 2009, in our                   Annual general meeting                                   23-Jul-09
    view, will be to arrange a refinancing of the convertible bond (volume of                    Bal. sheet press conf.                                  09-Jun-09
    EUR 300 mn, which can be called by February 2010).                                           9M/Q3                                                   03-Feb-09


■   Valuation: The share price of Heidelberger Druck has declined by 85-90%                        55
                                                                                                   50
                                                                                                   45
    over the recent 18 months and is currently more than 50% below book                            40
                                                                                                   35
                                                                                                   30
    value. This share price level fully reflects the poor short to mid term                        25

    prospects for the company and the printing press sector. Nevertheless,                         20

    as soon as the world economy recovers, the printing press sector will                          15


    recover too, and Heidelberger Druck will then once again be well positioned                    10

    with leaner cost structures. Assuming that the company will be able
    to reach EBIT margins of 7% or more again, the stock is definitely                              5

    undervalued. However, the current net debt of more than EUR 600 mn
                                                                                                    3
    (EUR +126 mn pension provisions) is worrying, in our view, and thus                                    2006
                                                                                                    HEIDELB.DRUCKMASCHINEN
                                                                                                                             2007            2008
                                                                                                    DAX 30 PERFORMANCE - PRICE INDEX
    the refinancing of the convertible bond will be challenging.                                                              Source: Thomson Datastream



                                                                                                 RELATIVE PERFORMANCE (% CHG.)
                                      2006/07   2007/08     2008/09e       2009/10e   2010/11e
                                                                                                                                     1M             3M          6M
Sales (EUR mn)                          3803        3670          3100        2928       3191    DAX                                14.7       -42.2          -28.6
EBITDA (EUR mn)                         490.6      391.4          -62.0       101.0      223.0   Euro STOXX 50                      13.9       -41.9          -29.5
EBIT (EUR mn)                           361.8      267.8         -187.0       -17.0      108.0   ES Ind. G/S                        13.1       -44.3          -21.1
Net income (EUR mn)                     263.0      141.8         -199.4       -76.5       12.6
EPS reported (EUR)                       3.23       1.82          -2.58       -0.99       0.16   Peter Rothenaicher, Equity Analyst (HVB)
DPS (EUR)                                0.95       0.95             0           0          0    +49 89 378-18718
                                                                                                 peter.rothenaicher@unicreditgroup.de
ROCE (%)                                 14.9         9.4          -6.2        -0.6        3.7
P/E (x)                                  10.8       17.8           -5.0        -4.3       26.0
P/CF (x)                                  9.0       10.1          -15.9         7.7        2.6
P/BV (x)                                  2.5         2.3           1.1         0.4        0.4
EV/EBITDA (x)                             7.1         7.8         -28.1        11.1        4.9
EV/EBIT (x)                               9.6       11.4           -9.3       -65.7       10.2
ROCE/WACC (x)                             1.5         0.9          -0.8        -0.1        0.7
Div. yield (%)                            2.7         2.9            0           0          0

                                                   Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG       UniCredit CAIB Group                         page 77                                        See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




                                                                                           Chemicals




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                                                                                             20 January 2009                                              Global Equity Research

                                                                                                                                                                  ESG Research



ESG overview – Chemicals
TP upside vs. difference TPESG-TP (%)*                                                                       Sustainable alpha of UCRESGLG Index constituents (%)

                  10.0                                                                                        80
                                                                           LIN GR (B,B-)
                                                      BAS GR (B,B-)                                           70
                   5.0                                                 Sector
                                   SY1 GY (B,C+)                                                              60
                                                       BAY GR (B,C+)               WCH GY (B,C+)
                   0.0
 TPESG - TP (%)




                                                                                                              50
                                                       SDF GR (B,C)       LXS GR (H,C)
                                                                                                              40
                  -5.0
                               GKR GR (S,C-)
                                                   ALT GY (S,C-)                                              30
             -10.0
                                                                                                              20

             -15.0                                                                                            10
                                                     KWS GR (B,D)                                               0
                                                                                WAS GR (B,D-)
             -20.0




                                                                                                                                 LIN GR




                                                                                                                                                                     BAS GR
                                                                                                                                  (B,B-)




                                                                                                                                                                      (B,B-)
                         -40       -20         0       20         40        60         80       100
                                                       TP upside (%)


* average is MCAP weighted                                                                                                                   Source: oekom research, UniCredit Research


ESG risk analysis
The Chemicals sector scored slightly below the ESG Leaders territory with an average ESG sector score of -0.7. Social & Governance
scores (-1.7) seem to be dragging the average score downwards relative to the sector’s slightly better Environmental performance (-
0.5). Given the overall low scores, only 18% of stocks were able to obtain Prime investment status, including BASF SE (Buy, B-) and
Linde (Buy, B-). We highlight that there is no negative ESG/risk relationship within this sector. Adjusting these findings to stock-
specific ESG ratings yields an average ESG risk adjustment of 24.5bps for this sector. The overall impact of these ESG risk
adjustments on our target prices translates into an upside adjustment of 5.0% for the overall sector. From an ESG style analysis point
of view, top tier rated ESG stocks (B) contribute an average 51.1% to the overall sector performance with the risk-adjusted
performance (Sharpe ratio) for Prime stocks 16.8% lower relative to the sector benchmark based on our ESG efficient frontier analysis.

Strategic outlook
The global volume growth of this sector will be negative in 2009. We estimate the global chemical production to be down by 2%-3%.
Even Asia might be not able to show growth. The shrinkage is most pronounced in the US followed by Europe. The capacity utilization
of the chemical industry is low. A lot of plants have been shut down or are running at reduced capacity. This is not only caused by the
lower demand, but also by the inventory rundown. The inventory cycle should come to an end in Q2/09. The lower oil price is not of
great help. The lower raw material prices have to be transferred to the customers. This is especially the case for commodities. In
contrast, the specialties should now benefit from a better gross margin. In our view, Q4/08 and Q1/09 will be the worst quarters of
the cycle. Despite the sharp earnings revisions, we expect further earnings disappointments. As of Q2/09, stabilization in earnings
should support the sector performance. Investors should focus on companies that are known for their resistance to an economic
downturn (industrial gases, agro, hybrids). A big plus for the sector is its strong cash flow and high dividend yield.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY       INVESTMENT HIGHLIGHTS                                                     STOCK TRIGGERS                           KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Linde         World’s largest industrial gases company                                  Attractive valuation at current levels   + group-wide implementation of an integrated health,
(Buy,B-)                                                                                                                           safety and environment system
BASF SE                            Stable dividend and yield of >8%                     Stabilization of the industrial          + good measures regarding product safety information
(Buy,B-)                                                                                production                                 and training for customers
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Graphit       Well positioned in both segments         Business in both segments will suffer                                     - no human rights policy implemented
Kropfmühl                                              from the crisis
(Sell,C-)
ALTANA                             Impending acquisitions on hold due to peak           Tender offer from Skion                  - lack of transparency regarding guidelines and
(Sell,C-)                          multiples                                                                                        measures regarding the sustainable extraction of
                                                                                                                                    renewable raw materials
KWS SAAT                           Business model independent from the cycle            Positive acreage trend in Corn in 2009 - lack of transparency regarding measures to increase
AG (Buy,D)                                                                                                                        transport efficiency

                                                                                                                                             Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                            UniCredit CAIB Group                            page 80                                           See last pages for disclaimer.
                                                                     20 January 2009                                           Global Equity Research

                                                                                                                                         ESG Research



ESG rating overview – Chemicals
ESG sector scoring overview by category                                            ESG stock rating breakdown

  0.0
                                                                                                                 D-
                                                                                                                9.1%               B-
                                                                                                           D                     18.2%
                                                                                                         9.1%



  -1.0
                                                                                                       C-
                                                                                                     18.2%
                                                                                                                                          C+
                                                                                                                                         27.3%



  -2.0                                                                                                            C
         Social & Governance          ESG               Environmental                                           18.2%



                                                                                                                   Source: oekom research, UniCredit Research

Environmental review
Some 45% of companies in the Chemicals sector made it into the Environmental Leaders category. Mainly due to the low scores
of Environmental Laggards, the group average score ended up in Environmental Laggards territory. BASF SE (B) came out on top with
its key strength the strategic implementation for addressing climate change and sector-specific risks. With key weaknesses of
H&R WASAG (D-) being a lack of transparency regarding this system and of KWS SAAT AG (D) being a lack of transparency
regarding measures to increase transport efficiency, we consider them the worst scorers in this category.

Social & Governance review
On the Social & Governance front, our analyzed companies scored badly. The vast majority (91%) rank as Soc. & Gov.
Laggards, yet most still scored above the sector average. Linde (C+), showing as one of its key strengths good implementation
of measures to ensure transport and facility safety, is classified as top Social & Governance Leader. Due to H&R WASAG (D-)‘s
key weakness of not providing enough information about social and ethical issues, the company ended up at the very bottom of
the Laggards category. Second-worst is KWS SAAT AG (D), with a key weakness being its poor transparency with regard to its
health and safety management.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                         Soc. & Gov. rating Key social & governance strength
BASF SE (B)          + group-wide implementation of a strategy for      Linde (C+)         + good measures implemented to ensure transport and facility
                        addressing climate change and related                                safety
                        sector-specific risks
Bayer (B-)           + group-wide implementation of a strategy for      -                      -
                        addressing climate change and related
                        sector-specific risks
Linde (B-)           + group-wide implementation of an integrated       -                      -
                        health, safety and environment system
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                         Soc. & Gov. rating Key social & governance weakness
H&R WASAG (D-)       - lack of transparency regarding the               H&R WASAG (D-) - very limited information on social and ethical issues publicly
                        implementation of environmental                                     available
                        management systems
KWS SAAT AG (D)      - lack of transparency regarding measures to       KWS SAAT AG (D) - lack of transparency regarding health and safety management and
                        increase transport efficiency                                      data
Graphit Kropfmühl    - lack of transparency as regards                  Bayer (C-)      - major controversies regarding product responsibility in recent
(D+)                    implementation of a group-wide strategy                            years, e.g. concerning controversial marketing
                        and formal systems for addressing climate
                        change

                                                                                                                   Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                         page 81                                          See last pages for disclaimer.
                                                                                                                                   20 January 2009                                                              Global Equity Research

                                                                                                                                                                                                                            ESG Research



ESG overview charts – Chemicals
TP and TPESG upside (%)*                                                                                                                     ESG score overview by ESG scoring status

                                    TP upside (%)                                         TP ESG upside (%)                                                          ESG Leader                     ESG Laggard                Sector average
                                    TP upside sector (%)                                  TP ESG upside sector (%)
                                                                                                                                               3
 100                                                                                                                                           2
  80                                                                                                                                           1

  60                                                                                                                                           0
                                                                                                                                              -1
  40
                                                                                                                                              -2
  20
                                                                                                                                              -3
   0
                                                                                                                                              -4
 -20                                                                                                                                          -5
 -40                                                                                                                                          -6
                                                                                                SY1 GY




                                                                                                                                                                                 SY1 GY
                                                                          BAY GR




                                                                                                                                                                      BAY GR
                                       LXS GR




                                                                                                                                                                                                                LXS GR
                         LIN GR




                                                  BAS GR




                                                                                      SDF GR




                                                                                                                                    GKR GR




                                                                                                                                                   BAS GR


                                                                                                                                                            LIN GR




                                                                                                                                                                                                       SDF GR




                                                                                                                                                                                                                                       GKR GR
                                                                                                                          ALT GY




                                                                                                                                                                                                                           ALT GY
            WCH GY




                                                                                                                                                                                           WCH GY
                                                             WAS GR




                                                                                                             KWS GR




                                                                                                                                                                                                                                                   KWS GR


                                                                                                                                                                                                                                                            WAS GR
Environmental score overview by category’s ESG scoring status                                                                                Social & Governance score overview by category’s ESG scoring status

                     Environmental Leader                             Environmental Laggard                            Sector average                       Soc. & Gov. Leader                      Soc. & Gov. Laggard                     Sector average

  4                                                                                                                                            2
  3                                                                                                                                            1
  2
                                                                                                                                               0
  1
  0                                                                                                                                           -1
  -1                                                                                                                                          -2
  -2                                                                                                                                          -3
  -3
                                                                                                                                              -4
  -4
  -5                                                                                                                                          -5
  -6                                                                                                                                          -6
                                                            SY1 GY




                                                                                                                                                                                                       SY1 GY
                        BAY GR




                                                                                                                                                                                                                BAY GR
                                                                                      LXS GR




                                                                                                                                                                                           LXS GR
           BAS GR




                                      LIN GR




                                                                         SDF GR




                                                                                                             GKR GR




                                                                                                                                                   LIN GR




                                                                                                                                                                      BAS GR


                                                                                                                                                                                 SDF GR




                                                                                                                                                                                                                                       GKR GR
                                                                                                ALT GY




                                                                                                                                                            ALT GY
                                                 WCH GY




                                                                                                                                                                                                                           WCH GY
                                                                                                                          KWS GR


                                                                                                                                    WAS GR




                                                                                                                                                                                                                                                   KWS GR


                                                                                                                                                                                                                                                            WAS GR
kesg/ke differential by ESG scoring status (bps)*                                                                                            ERP & beta differential between Prime/Not Prime composites

                                     ESG Leader                        ESG Laggard                       Sector average                                                                   Prime        Not Prime

 200
                                                                                                                                                            5.99               5.92
 150

 100

   50

       0

  -50
                                                                                                                                                                                                                         0.99               0.98
 -100
                                                   SY1 GY


                                                              BAY GR




                                                                                       LXS GR
              BAS GR


                           LIN GR




                                                                          SDF GR




                                                                                                 GKR GR


                                                                                                              ALT GY
                                        WCH GY




                                                                                                                          KWS GR


                                                                                                                                    WAS GR




                                                                                                                                                                     ERP                                                            Beta



* averages are MCAP weighted                                                                                                                                                              Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                                                UniCredit CAIB Group                                       page 82                                                                     See last pages for disclaimer.
                                                                                                                                                                                             20 January 2009                                                                                                                                                                                     Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                          ESG Research



UCRESGLG Index sector constituents overview – Chemicals
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW
Bloomberg                                                               Current              ESG                ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                       Target                TP upside        TPESG upside               α sustainable
ticker                  Name                                            rec.                 rating                ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price      TPESG           (%)                 (%)                       (%)
UCRESGLG index constituent
BAS GR                  BASF SE                                         Buy                  B-                               28.6                                                  -17.1                                                          27.9               8.4                                8.0                    23.6                       34.0       36.2              43.8               53.1                   45.1
LIN GR                  Linde                                           Buy                  B-                               28.6                                                  -17.1                                                          27.9               8.2                                7.8                    54.7                       92.0       98.0              68.3               79.3                   71.4
UCRESGLG index non-constituent
BAY GR                  Bayer                                           Buy                  C+                             14.3                                                    -17.1                                                          27.9               8.0                                7.8                    42.8                       59.0       60.9              37.9               42.2                   34.5
SY1 GY                 Symrise                                          Buy                  C+                             14.3                                                    -17.1                                                          27.9               8.5                                8.3                     9.4                       10.0       10.3               6.4                9.7                    1.4
WCH GY                  Wacker Chemie                                   Buy                  C+                             14.3                                                    -17.1                                                          27.9               8.9                                8.6                    64.3                      119.0      122.6              85.2               90.9                   82.2
SDF GR                  K+S                                             Buy                  C                             -20.0                                                    -17.1                                                          27.9               8.4                                8.7                    38.8                       50.0       48.0              28.9               23.7                   15.0
LXS GR                  Lanxess                                         Hold                 C                             -20.0                                                    -17.1                                                          27.9               8.8                                9.1                    12.6                       21.0       20.2              66.5               59.9                   50.8
ALT GY                  ALTANA                                          Sell                 C-                            -40.0                                                    -17.1                                                          27.9               8.0                                8.5                    12.6                       13.0       12.0               3.6               -4.6                  -13.1
GKR GR                 Graphit                                          Sell                 C-                            -40.0                                                    -17.1                                                          27.9               7.5                                8.0                    17.2                       14.0       12.9             -18.6              -25.2                  -33.2
                       Kropfmühl
KWS GR                  KWS SAAT AG                                     Buy                  D                             -80.0                                                    -17.1                                                          27.9               7.1                             8.0                       99.6                      121.0      102.5              21.5                3.0                   -5.0
WAS GR                  H&R WASAG                                       Buy                  D-                           -100.0                                                    -17.1                                                          27.9               8.9                            10.4                        9.3                       16.0       13.3              72.8               43.5                   33.2

                                                                                                                                                                                                                                                                                                                                                                                      Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                          ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                           Composite B                          Composite C                           Composite D                                                                                                 Sharpe ratio Prime(0.51); Sharpe ratio Sector(0.43)
          ESGCsector i = 1.0 - 1.0
                                                                                                                        100                                                                                                                                                                                                                     20
                                                                                                                                                                                                                                                                                                                                                18
                                                                                                                                                                                                                                                                                                                                                16
                                                                                                                         80
                                                                                                                                                                                                                                                                                                                                                14




                                                                                                                                                                                                                                                                                                                             Portfolio return
                                                                                                                                                                                                                                                                                                                                                12
                                                                                                                         60
                                                                                                                                                                                                                                                                                                                                                10
                                                                                                                                                                                                                                                                                                                                                 8
                                                                                                                         40
                                                                                                                                                                                                                                                                                                                                                 6
                                                                                                                                                                                                                                                                                                                                                 4
                                                                                                                         20
                                                                                                                                                                                                                                                                                                                                                 2
                                                                                                                                                                                                                                                                                                                                                 0
                                                                                                                          0                                                                                                                                                                                                                          0        5        10        15        20       25        30         35         40
                                                                                                                                       May-02



                                                                                                                                                                  May-03



                                                                                                                                                                                             May-04



                                                                                                                                                                                                                        May-05



                                                                                                                                                                                                                                                   May-06




                                                                                                                                                                                                                                                                              May-07



                                                                                                                                                                                                                                                                                                         May-08
                                                                                                                              Jan-02


                                                                                                                                                Sep-02
                                                                                                                                                         Jan-03


                                                                                                                                                                           Sep-03
                                                                                                                                                                                    Jan-04


                                                                                                                                                                                                      Sep-04
                                                                                                                                                                                                               Jan-05


                                                                                                                                                                                                                                 Sep-05
                                                                                                                                                                                                                                          Jan-06


                                                                                                                                                                                                                                                            Sep-06
                                                                                                                                                                                                                                                                     Jan-07


                                                                                                                                                                                                                                                                                       Sep-07
                                                                                                                                                                                                                                                                                                Jan-08


                                                                                                                                                                                                                                                                                                                  Sep-08
                                                                                                                                                                                                                                                                                                                                                                                 Portfolio risk (STDEV)
  -0.26

           -0.20

                   -0.15

                           -0.10

                                   -0.04

                                           0.01

                                                  0.06

                                                         0.12

                                                                 0.17

                                                                        0.22

                                                                               0.28

                                                                                      0.33

                                                                                                  0.38

                                                                                                         0.44

                                                                                                                0.49




                                                                                                                                                                                                                                                                                                                                                              FP Prime         FP Sector         CAL Prime           CAL Sector


                                                                                                                                                                                                                                                                                                                                                                             Source: oekom research, UniCredit Global Researc




Bayerische Hypo- und Vereinsbank AG                             UniCredit CAIB Group                                                                                                                           page 83                                                                                                                                                                                    See last pages for disclaimer.
                                                                                                                                                        20 January 2009                                                                                                                                        Global Equity Research

                                                                                                                                                                                                                                                                                                                            ESG Research



Chemicals: Performance
                                                                                                         52-week                           52-week % chg.                       Market cap.                           Absolute performance (%)                                           Relative performance (%) vs. Euro STOXX 50
Company                                                                            Price               High            Low                    High                     Low               (mn)                    1M                    3M                 12M              YTD                   1M                 3M                12M                     YTD
ALTANA                                                        EUR                  12.55                15.8               8.0                 26.2                -36.3                1,762                    -3.3              49.4               -12.4                    -2.3              3.6              55.3                32.0                      4.5
BASF SE                                                       EUR                  23.64                48.3           20.3                  104.3                 -14.1              21,728                    -11.2                -4.0             -48.5               -14.2                 -4.3                1.9                -4.1                    -7.4
Bayer                                                         EUR                  42.80                60.2           36.9                    40.6                -13.9              32,714                     6.7                   9.8            -27.8                    3.4              13.6              15.6                16.7                    10.2
Graphit Kropfmühl                                             EUR                  17.20                24.5           11.8                    42.4                -31.4                      50                 0.0                 -1.7                 24.0                 -1.0              6.9                4.2               68.5                      5.8
H&R WASAG                                                     EUR                   9.26                18.7               9.2               101.4                     -0.5                  278                 -3.1             -24.1               -40.9               -16.2                  3.8             -18.2                      3.6                -9.4
K+S                                                           EUR                  38.80                94.5           27.9                  143.6                 -28.2                6,402                    2.0                   6.0                -3.2                 -3.9              8.9              11.9                41.2                      2.9
KWS SAAT AG                                                   EUR                  99.58               175.3           71.0                    76.0                -28.7                     657                 3.0               22.0               -25.8               -11.0                  9.9              27.9                18.7                     -4.2
Lanxess                                                       EUR                  12.61                32.7           11.0                  159.3                 -13.0                1,049                    3.2              -11.2               -51.0                    -6.7             10.1               -5.3                -6.5                    0.1
LINDE                                                         EUR                  54.65                96.5           49.3                    76.6                    -9.8             9,208                    -3.2                -9.7             -41.0                    -9.9              3.7               -3.9                     3.4                -3.1
Symrise                                                       EUR                   9.40                18.1               7.9                 92.8                -16.4                1,111                    -2.3             -10.5               -43.8                    -5.3             -2.3             -10.5               -43.8                     1.5
Wacker Chemie                                                 EUR                  64.25               169.6           64.3                  163.9                      0.0             3,351                   -11.1                -7.4             -53.0               -14.4                 -4.2               -1.5                -8.5                    -7.6
Germany average                                                                                                                                93.4                -17.5                                         -1.8                  1.7            -29.4                    -7.4              4.5                7.0               11.0                     -0.6


1M absolute performance (%)                                                                                     1M relative performance (%)                                                                                             Absolute performance YTD (%)
 20                                                                DAX (%)               Euro STOXX (%)          20                                                                                                                      20                                                                          DAX (%)                Euro STOXX (%)
                                                                                                                                           13.6
                                                                                                                                                                                   9.9        10.1
                                                                                                                                                                          8.9                                                            10
                            6.7                                                                                                                       6.9
                                                                         3.2                                          3.6                                        3.8                                    3.7                                                            3.4
                                                        2.0    3.0
                                     0.0
   0                                                                                                              0                                                                                                                          0
                                                                                                                                                                                                                   -2.3
                                                                                                                                 -4.3                                                                                         -4.2
        -3.3                                    -3.1                                -3.2     -2.3                                                                                                                                        -10
                                                                                                                                                                                                                                                 -2.3                             -1.0                 -3.9   -11.0       -6.7      -9.9          -5.3
                 -11.2                                                                                 -11.1
                                                                                                                                                                                                                                                            -14.2                                                                                           -14.4
                                                                                                                                                                                                                                                                                             -16.2
 -20                                                                                                            -20                                                                                                                      -20
                            Bayer




                                                                                                                                            Bayer




                                                                                                                                                                                                                                                                       Bayer
                                                                         Lanxess




                                                                                                                                                                                              Lanxess




                                                                                                                                                                                                                                                                                                                          Lanxess
                  BASF SE




                                                                                                                                 BASF SE




                                                                                                                                                                                                                                                             BASF SE
                                                        K+S




                                                                                     LINDE




                                                                                                                                                                          K+S




                                                                                                                                                                                                        LINDE




                                                                                                                                                                                                                                                                                                       K+S




                                                                                                                                                                                                                                                                                                                                    LINDE
        ALTANA




                                                                                             Symrise




                                                                                                                      ALTANA




                                                                                                                                                                                                                    Symrise




                                                                                                                                                                                                                                                 ALTANA




                                                                                                                                                                                                                                                                                                                                                  Symrise
                                                                                                       Chemie




                                                                                                                                                                                                                              Chemie




                                                                                                                                                                                                                                                                                                                                                            Chemie
                                    Kropfmühl




                                                                                                                                                    Kropfmühl




                                                                                                                                                                                                                                                                                 Kropfmühl
                                                WASAG




                                                                                                                                                                WASAG




                                                                                                                                                                                                                                                                                             WASAG
                                                              KWS SAAT




                                                                                                                                                                                  KWS SAAT




                                                                                                                                                                                                                                                                                                              KWS SAAT
                                                                                                       Wacker




                                                                                                                                                                                                                              Wacker




                                                                                                                                                                                                                                                                                                                                                            Wacker
                                     Graphit




                                                                                                                                                     Graphit




                                                                                                                                                                                                                                                                                  Graphit
                                                 H&R




                                                                                                                                                                 H&R




                                                                                                                                                                                                                                                                                              H&R
                                                                AG




                                                                                                                                                                                    AG




                                                                                                                                                                                                                                                                                                                AG
                                                                                                                                                                                                                                                                                                                         Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                       UniCredit CAIB Group                                                                                    page 84                                                                                                                                                   See last pages for disclaimer.
                                                                                                                                                20 January 2009                                                                                               Global Equity Research

                                                                                                                                                                                                                                                                        ESG Research



Chemicals: Valuation Overview
                                                                        P/E (x)                                                 P/CF (x)                                    EV/sales (x)                            EV/EBITDA (x)                                     EV/EBIT (x)
Company                                                      2008e          2009e    2010e                            2008e        2009e         2010e              2008e        2009e     2010e        2008e             2009e              2010e           2008e           2009e             2010e
ALTANA                                                         14.8          17.9        16.9                           8.9           9.9            9.6             1.36          1.46     1.43              7.3               7.9            7.6            10.3             11.8              11.2
BASF SE                                                           9.6         9.0         6.1                           5.4           3.9            3.3             0.74          0.59     0.51              4.8               3.7            3.2             6.6                5.6             4.6
Bayer                                                          13.1           9.0         8.8                          12.1           6.5            6.3             1.67          1.33     1.16              9.1               6.1            5.5            15.8                9.5             8.3
Graphit Kropfmühl                                              10.8          16.4        18.8                           6.7           7.5            8.3             0.83          0.85     0.85              6.9               8.2            8.6             9.2             12.7              13.9
H&R WASAG                                                      31.9           7.1         6.5                          13.4           4.4            4.1             0.52          0.51     0.55              9.2               4.5            4.6            13.5                6.0             6.1
K+S                                                               9.6         6.4         4.4                           8.4           5.6            4.0             1.90          1.24     0.91              7.4               3.9            2.4             8.3                4.3             2.5
KWS SAAT AG                                                    16.2          13.9        10.6                          12.0          10.0            8.0             1.32          0.92     0.80              9.1               6.8            5.2            11.3                8.4             6.2
Lanxess                                                        12.3           9.2         7.4                           4.1           2.4            2.2             0.45          0.34     0.35              5.0               4.2            4.1             9.0                9.4             8.6
LINDE                                                          20.0          11.3         8.7                           7.2           4.5            4.2             1.61          1.19     1.07              8.1               5.8            5.2            15.0             10.2               8.2
Symrise                                                        15.4          10.7         9.4                           8.9           6.4            5.8             1.81          1.39     1.30              9.0               6.9            6.1            12.2                9.4             8.2
Wacker Chemie                                                  11.7           6.0         5.0                           6.5           3.2            2.8             1.45          0.75     0.62              5.3               2.7            2.1             8.0                4.2             3.2
Germany average                                                13.4           9.4         7.7                           7.5           4.9            4.3             1.24          0.96     0.87              7.0               4.9            4.1            10.1                7.3             5.8


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                         ROCE 2010e (%) vs. WACC 2010e (%)                                                             EV/sales 2002-2010e (x)
                      2.0                                                                                              25                                                                               3.0

                                                                                                                                                                      Wacker Chemie
                                                                                                                                                                                                        2.5
                      1.5                    ALTANA                                                                    20
 EV/sales 2010e (x)




                                                                                                                                  Graphit
                                                                                                     ROCE 2010e (%)




                                                        Symrise                                                                                                                                         2.0
                                                                                                                                 Kropfmühl           KWS SAAT AG                                                         1.78                  1.56
                                                     Bayer
                                                                                                                                                                                                                                      1.66
                                            LINDE                                                                      15
                      1.0
                             Graphit                                                     K+S                                                                                                            1.5




                                                                                                                                                                                                    X
                                                                                                                                                                                                                                                      1.29       1.58      1.24
                            Kropfmühl               KWS SAAT AG                                                                        H&R WASAG
                                                                                                                                                                                                               0.93                                                                     0.96
                                                              Wacker Chemie                                                             Symrise Bayer                                                   1.0
                                                                                                                                                                                                                                                                                               0.87
                      0.5       H&R WASAG                                                                              10
                                             BASF SE                                                                                                         BASF SE
                                                                                                                                             LINDE
                                Lanxess                                                                                            Lanxess                                ALTANA                        0.5
                      0.0                                                                                               5
                            0       5       10       15      20       25      30    35          40                          5          6              7               8             9        10         0.0
                                                    EBIT margin 2010e (%)                                                                             WACC 2010e (%)                                            2002      2003        2004    2005     2006     2007      2008e     2009e      2010e


                                                                                                                                                                                                                                                                     Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                          UniCredit CAIB Group                                                                         page 85                                                                                                       See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                        ESG Research



BASF SE                                                                                        Buy (prev. Buy)
Living in a worst-case scenario                                                                Price on 01/16/09                                     EUR 23.64
                                                                                               Target price (prev. EUR 36.00)                        EUR 34.00
■   Investment story: The slowdown of global industrial production and a                       Upside to TP                                                 43.8%
    low oil price mean a worst-case scenario for BASF. With a solid                            Cost of equity                                                8.4%
    performance in this stress scenario in 2009, BASF has the chance to                        High/Low (12M)                                        48.30/20.31
    receive a rerating during the year. With a global reach and a broad and
                                                                                               INVESTMENT HIGHLIGHTS
    diversified product portfolio, BASF should weather the storm better than                    Stable dividend and yield of >8%
    the industry average. Despite lower earnings, we expect an increase of                      Earnings leverage in case of an oil price recovery
                                                                                                Rerating possible if earnings can be generated in 2009
    the free cash flow due to the lower NWC requirements. With an estimated
    free cash flow of EUR 4 bn and a strong balance sheet, BASF has the                        STOCK TRIGGERS
                                                                                                Stabilization of the industrial production
    chance to take advantage of the current downturn with favorable                             Update about the Ciba integration
    acquisitions. The acquisitions of Ciba and Revus as well as the ramp-                       Significant unlock of NWC due to lower prices
    up of the gas production in Russia underline that BASF is still on a
                                                                                               STOCK DATA
    growth path and will strengthen its position. The high and at least stable
                                                                                               Reuters/Bloomberg                             BASF.DE/BAS GR
    dividend supports the share price with a yield of more than 8%.
                                                                                               Average daily volume (tds.)                                   8998
                                                                                               Free float (%)                                                100.0
■   Operating performance in 2009e and 2010e: According to our                                 Market capitalization (EUR bn)                                 21.7
    estimates, the EBIT of the Industrial business should decline by 30% in                    No. of shares issued (mn)                                   931.9
    2009, which would only represent 45% of the group EBIT. Due to the                         Shareholders                                     Free float 100%
    strong performance of Wingas and the higher gas production, the net
                                                                                               UPCOMING EVENTS
    earnings of Oil & Gas should only decline slightly. Lower hedge losses
                                                                                               Annual general meeting                                    30-Apr-09
    and an improvement in Agricultural Products should limit the EPS deline.
                                                                                               Q4                                                        26-Feb-09
    For 2010, we expect a substantial improvement in the Oil & Gas business
                                                                                               Q1                                                        30-Apr-09
    and a bottoming out of the industrial divisions. The EPS should increase
    by almost 50% from the low level of 2009. (Estimates do not include the                      55
    Ciba acquisition at this stage.)                                                             50

                                                                                                 45

■   Valuation: Our SOP model produces a value of EUR 42 based on the                             40

    2009 estimates. Based on the DCF model, the value is EUR 62 per                              35
    share. If we double the equity risk premium and calculate with a WACC
    of 12%, the DCF value is still EUR 34, which is our target price. This                       30

    would be equal to a 2009e P/E of 14. The dividend yield would still be
                                                                                                 25
    above 5% and the free cash flow yield 14%.

                                                                                                 20
                                                                                                           2006              2007                 2008
                                                                                                    BASF
                                                                                                    DAX 30 PERFORMANCE - PRICE INDEX
                                       2006        2007         2008e       2009e    2010e                                    Source: Thomson Datastream

Sales (EUR mn)                        52610      57951          61320       46770    53344
                                                                                               RELATIVE PERFORMANCE (% CHG.)
EBITDA (EUR mn)                       9736.5   10263.3          9252.6      7494.1   8595.9
                                                                                                                                     1M           3M           6M
EBIT (EUR mn)                         6749.9     7316.0         6565.3      4716.2   5839.4
                                                                                               DAX                                   -3.5         1.5        -12.8
Net income (EUR mn)                   3215.2     4065.0         3409.3      2162.4   3007.4
                                                                                               Euro STOXX 50                         -4.3         1.9        -13.7
EPS reported (EUR)                      3.18       4.16           3.67        2.39     3.35
                                                                                               ES Chem.                             -10.3         -3.2        -8.8
DPS (EUR)                               1.50       1.95           1.95        1.95     2.10
ROCE (%)                                10.0       10.4            6.9         6.9      8.2
                                                                                               Andreas Heine, Equity Analyst (HVB)
P/E (x)                                 10.2       10.7           10.6         9.9      7.1    +49 89 378-16921
P/CF (x)                                 5.1         6.2           5.7         4.1      3.5    andeas.heine@unicreditgroup.de
P/BV (x)                                 2.0         2.5           2.1         1.3      1.3
EV/EBITDA (x)                            4.3         4.1           4.6         5.5      4.8
EV/EBIT (x)                              6.3         5.8           6.5         8.8      7.1
ROCE/WACC (x)                            1.4         1.4           0.9         1.0      1.2
Div. yield (%)                           4.6         4.4           5.0         8.2      8.9

                                                  Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                        page 86                                           See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 87       See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                      ESG Research



Linde                                                                                          Buy (prev. Buy)
Solid as a rock in a tough environment                                                         Price on 01/16/07                                   EUR 82.10
                                                                                               Target price (prev. EUR 92.00)                      EUR 92.00
■   Investment story: Its acquisition of BOC has turned Linde into world’s                     Upside to TP                                               12.1%
    largest industrial gases company. The company’s activities are well                        Cost of equity                                              9.0%
    balanced, both regionally and in terms of its business fields. The company                 High/Low (12M)                                      82.90/56.20
    should continue to report solid results even in a tough environment; the
                                                                                               INVESTMENT HIGHLIGHTS
    backdrop is the generally stable industrial gases business and the                          World’s largest industrial gases company
    ongoing expansion via new projects. On the one hand, demand from                            Resilient business even in tough times
                                                                                                Mid-term 2010 targets confirmed
    the key industries remains robust. On the other, mid to long-term contracts
    paired with pass-on clauses should shield Linde from economic and                          STOCK TRIGGERS
                                                                                                Attractive valuation at current levels
    energy cost swings. The engineering business also continues to perform                      Synergies and HPO may deliver more than assumed
    well on the back of high demand from the chemical, oil and gas industry.                    New projects and contracts increase confidence

                                                                                               STOCK DATA
■   Operating performance in 2009e and 2010e: We expect sales to
                                                                                               Reuters/Bloomberg                             LING.DE/LIN GR
    increase 3.4% in 2009e and 5.6% in 2010e after 5.3% in 2008e. During
                                                                                               Average daily volume (tds.)                                 899.1
    the presentation of its Q3/08 results, Linde reiterated its target of an                   Free float (%)                                               69.0
    operating profit (EBITDA) of more than EUR 3 bn and an ROCE of 13%                         Market capitalization (EUR bn)                               12.9
    by 2010. The HPO program should generate savings of EUR 650-800 mn                         No. of shares issued (mn)                               162.0
    and therefore help Linde achieve its mid-term financial targets. Based                     Shareholders                          Capital Research 10%,
    on our calculations, including the new program, EBITDA should reach                                                                Commerzbank 9.8%,
                                                                                                                              Alico Beteiligungsgesellschaft
    EUR 2,981 mn by 2010e. However, the bottom line will most probably                                                    (Allianz group) 6%, Fidelity 5.4%,
    be held back by higher financing costs.                                                                             Deutsche Bank 3.8%, rest free float

                                                                                               UPCOMING EVENTS
■   Valuation: Despite the resilient character of the industrial gases                         Annual general meeting                                  15-May-09
    business, Linde could not escape the overall negative sentiment on the                     Q4                                                      16-Mar-09
    stock market in the last year. Consequently, the valuation has become                      Q1                                                        May-09
    attractive in recent months. While the DCF model calculates a fair value
    of EUR 87, the SOP model arrives at EUR 97. Our target price of EUR 92 is                   100
                                                                                                 95
    the mean of the two values, and our rating is Buy.                                           90
                                                                                                 85
                                                                                                 80
                                                                                                 75
                                       2006        2007         2008e       2009e    2010e       70
Sales (EUR mn)                        12439      12306          12954       13395    14150       65

EBITDA (EUR mn)                       8077.0     3031.0         2584.3      2743.3   2940.5      60

EBIT (EUR mn)                         2798.0     1752.0         1389.3      1559.6   1844.8      55
Net income (EUR mn)                   1838.0      935.0          679.3       804.7   1051.0
                                                                                                 50
EPS reported (EUR)                     13.30       5.77           4.09        4.84     6.30
                                                                                                 45
DPS (EUR)                               1.50       1.70           1.80        1.90     1.90         LINDE
                                                                                                           2006              2007               2008
                                                                                                    DAX 30 PERFORMANCE - PRICE INDEX
ROCE (%)                                 8.2       10.2           11.1        11.9     11.9                                   Source: Thomson Datastream

P/E (x)                                 14.5       14.0           20.1        17.0     13.0
                                                                                               RELATIVE PERFORMANCE (% CHG.)
P/CF (x)                                 1.3         7.9           7.2         6.8      6.4
                                                                                                                                    1M          3M           6M
P/BV (x)                                 1.2         1.6           1.5         1.5      1.4
                                                                                               DAX                                  3.6         1.6          8.0
EV/EBITDA (x)                            2.5         8.3           7.8         7.1      6.4
                                                                                               Euro STOXX 50                        4.8         6.0         13.0
EV/EBIT (x)                              7.3       17.6           14.5        12.5     10.2
                                                                                               ES Ind. G/S                          1.8         -0.8         8.5
ROCE/WACC (x)                            1.3         1.4           1.5         1.6      1.6
Div. yield (%)                           2.2         2.1           2.2         2.3      2.3    Christian Weiz, Equity Analyst (HVB)
                                                                                               +49 89 378-15229
                                                  Source: Company data, UniCredit Research
                                                                                               christian.weiz@unicreditgroup.de




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                        page 88                                         See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 89       See last pages for disclaimer.
                                                             20 January 2009              Global Equity Research

                                                                                               ESG Research




                                                                                  Construction & Materials




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group              page 90               See last pages for disclaimer.
                                                                                           20 January 2009                                            Global Equity Research

                                                                                                                                                            ESG Research



ESG overview – Construction & Materials
TP upside vs. difference TPESG-TP (%)*                                                                   Sustainable alpha of UCRESGLG Index constituents (%)

                  10.0                                                                                         0
                                    HEI GY (H,C+)
                   5.0                                                                                     -2

                   0.0                                                                                     -4
                                                    Sector
 TPESG - TP (%)




                  -5.0
                                                                            HOT GR (B,C)                   -6
             -10.0
                               PFD4 GR (S,C-)                                                              -8
             -15.0
                                                                                                          -10
             -20.0
                                                                                                          -12
             -25.0
                                                             GBF GR (B,D)                                 -14
             -30.0




                                                                                                                                             HEI GY
                                                                                                                                             (H,C+)
                         -50         0              50           100            150          200
                                                     TP upside (%)


* average is MCAP weighted                                                                                                             Source: oekom research, UniCredit Research


ESG risk analysis
The Construction & Materials sector continues to score below the ESG Leaders territory with an average ESG sector score of
-1.5. The Environmental score (-1.5) is relatively lower than that of Social & Governance (-1.0), leaving 25% of stocks with a
Prime investment status, which includes HeidelbergCement (Hold, C+). The average relative ESG risk adjustment to the cost
of equity for the sector is high at -38.4% with a 100% ESG confidence level. Adjusting these findings to stock-specific ESG
ratings yields an average ESG risk adjustment of 103.3bps for this sector. The overall impact of these ESG risk adjustments on
our target prices translates into an upside adjustment of -9.8% for the overall sector. From an ESG style analysis point of view,
there are no top tier rated ESG stocks (A+B), with contributions of C and D rated stocks 86.4% and 13.6%, respectively. The
risk-adjusted performance (Sharpe ratio) for Prime stocks has been determined to be 30.1% lower relative to the sector
benchmark based on our ESG efficient frontier analysis.

Strategic outlook
Worldwide, governments are trying to battle recession with measures to stimulate the economy. Almost all member countries of
the EU and the US plan to raise public expenditure in infrastructure. The planned investments will come on top of the already
planned expenditures and will increase investments by public authorities by 25% in Germany. German construction companies
should all profit from the economic stimulus packages. We expect the high order backlog of Hochtief and Bilfinger Berger to
stabilize output at least in the first half of 2009 and the spending from the governments to be reflected in new orders in H2/09.
Hochtief has the greatest potential from the stimulus packages, in our view. Hochtief is active in Europe, America and Australia.
The company has gained experience in infrastructure projects for years via its Australian subsidiary Leighton. The US subsidiary
Flatiron is one of the top ten contractors for bridges and highways. Bilfinger Berger should also benefit from the announced
plans. The company gained experience in traffic projects as well as in schools and hospitals.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY       INVESTMENT HIGHLIGHTS                      STOCK TRIGGERS                        KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Heidelberg    Consolidation of Hanson                    Development of the US and UK markets + detailed and comprehensive code of conduct covering
Cement                                                                                            important aspects of business ethics
(Hold,C+)
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Pfleiderer    Global No. 3 in engineered wood production Still unsatisfying business in Poland - limited information on measures to improve the eco-
(Sell,C-)                                                and N. America                           efficiency of products
Bilfinger                       Services business: growth with high margins           Government infrastructure projects   - lack of transparency regarding design guidelines to
Berger                                                                                                                        maximize energy efficiency of buildings and structures
(Buy,D)
Hochtief                        Turnaround in German construction business            Leighton’s share price               - lack of transparency regarding measures to maximize
(Buy,C)                                                                                                                       health and safety of residents and users during the
                                                                                                                              operation of buildings and structures

                                                                                                                                       Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                           UniCredit CAIB Group                         page 91                                         See last pages for disclaimer.
                                                                       20 January 2009                                                Global Equity Research

                                                                                                                                              ESG Research



ESG rating overview – Construction & Materials
ESG sector scoring overview by category                                              ESG stock rating breakdown

  0.0


                                                                                                                D                           C+
                                                                                                              25.0%                        25.0%




  -1.0




                                                                                                                C-                           C
                                                                                                              25.0%                        25.0%
  -2.0
         Social & Governance          ESG                Environmental



                                                                                                                         Source: oekom research, UniCredit Research

Environmental review
Due to the worst-scoring companies dragging down the average score, 75% of the Construction and Materials companies we
analyzed are in the Environmental Laggards group. The best Environmental Leader in the sector continues to be
HeidelbergCement (C+), with one of its key strengths being a comprehensive policy of measures that are aimed to reduce the
impact on the environment from its quarrying activities. Bilfinger Berger (D-) scored the worst with its key weakness being its
poor transparency in respect of its design guidelines aimed to maximize energy efficiency of buildings and structures.

Social & Governance review
From a Social & Governance perspective, the sector is split evenly between Leaders and Laggards. The best social performers
are Hochtief (C+), its strength being that it has taken comprehensive measures to ensure employee awareness of and
compliance with the code of business ethics, and HeidelbergCement (C+) with its introduction of a detailed and comprehensive
code of conduct related to its business ethics being a key strength. The worst social performers remain Bilfinger Berger (D+)
and Pfleiderer (D+), with key weaknesses being the lack of transparency regarding standards related to labor health and safety
issues and poor information on customer and product responsibility issues.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                          Soc. & Gov. rating Key social & governance strength
HeidelbergCement     + comprehensive policy and measures                 Hochtief (C+)      + comprehensive group-wide measures to ensure employee
(C+)                   regarding the reduction of the                                         awareness of and compliance with the code of business ethics
                       environmental impact of quarrying activities
-                    -                                                   HeidelbergCement + detailed and comprehensive code of conduct covering important
                                                                         (C+)               aspects of business ethics
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                          Soc. & Gov. rating Key social & governance weakness
Bilfinger Berger (D-) - lack of transparency regarding design            Bilfinger Berger   - lack of transparency regarding supplier standards with regard to
                         guidelines to maximize energy efficiency of     (D+)                  labor/health and safety issues
                         buildings and structures
Hochtief (C)          - lack of transparency regarding the               Pfleiderer (D+)         - lack of information on customer and product responsibility issues
                         implementation of a policy on sustainable
                         sourcing
Pfleiderer (C)        - limited information on measures to improve       -                       -
                         the eco-efficiency of products

                                                                                                                         Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                          page 92                                               See last pages for disclaimer.
                                                                                                 20 January 2009                                              Global Equity Research

                                                                                                                                                                               ESG Research



ESG overview charts – Construction & Materials
TP and TPESG upside (%)*                                                                                  ESG score overview by ESG scoring status

                         TP upside (%)                        TP ESG upside (%)                                                ESG Leader            ESG Laggard                Sector average
                         TP upside sector (%)                 TP ESG upside sector (%)
                                                                                                            2
 160
                                                                                                            1
 140
 120                                                                                                        0
 100
  80                                                                                                        -1
  60                                                                                                        -2
  40
  20                                                                                                        -3
   0
                                                                                                            -4
 -20
 -40                                                                                                        -5
                                        GBF GR




                                                                 HEI GY




                                                                                                                      HEI GY




                                                                                                                                                                                                GBF GR
                                                                                       PFD4 GR




                                                                                                                                                                    PFD4 GR
              HOT GR




                                                                                                                                            HOT GR
Environmental score overview by category’s ESG scoring status                                             Social & Governance score overview by category’s ESG scoring status

           Environmental Leader                   Environmental Laggard           Sector average                      Soc. & Gov. Leader             Soc. & Gov. Laggard                 Sector average

  2                                                                                                          2
  1                                                                                                          1
                                                                                                             1
  0
                                                                                                             0
  -1                                                                                                        -1
  -2                                                                                                        -1
  -3                                                                                                        -2
                                                                                                            -2
  -4
                                                                                                            -3
  -5                                                                                                        -3
  -6                                                                                                        -4
             HEI GY




                                                                                      GBF GR




                                                                                                                                            HEI GY




                                                                                                                                                                    GBF GR
                                                               PFD4 GR




                                                                                                                                                                                                PFD4 GR
                                       HOT GR




                                                                                                                      HOT GR




kesg/ke differential by ESG scoring status (bps)*                                                         ERP & beta differential between Prime/Not Prime composites

                          ESG Leader               ESG Laggard             Sector average                                                     Prime     Not Prime

 300                                                                                                                                 9.02
 250
 200
                                                                                                                       6.52
 150
 100
   50
       0
  -50
                                                                                                                                                                                         1.49
 -100                                                                                                                                                                     0.99
                HEI GY




                                                                                       GBF GR
                                                                 PFD4 GR
                                         HOT GR




                                                                                                                               ERP                                                Beta



* averages are MCAP weighted                                                                                                                   Source: oekom research, UniCredit Research




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                                                                                                                                                                                                         20 January 2009                                                                                                                                                                                      Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                       ESG Research



UCRESGLG Index sector constituents overview – Construction & Materials
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg                                                                           Current ESG                            ESG exposure                                  ESG risk                                          ESG confidence                                                                                              Current                       Target                 TP upside        TPESG upside               α sustainable
ticker                  Name                                                        rec.    rating                            ESGEi (%)                              ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price       TPESG           (%)                 (%)                       (%)
UCRESGLG index constituent
HEI GY                  HeidelbergCement                                            Hold              C+                                   14.3                                                 -38.4                                                    100.0                    8.3                                7.9                    31.6                       28.0        30.1             -11.3               -4.8                  -12.6
UCRESGLG index non-constituent
HOT GR                  Hochtief                                                    Buy               C                                -20.0                                                    -38.4                                                    100.0                    8.4                                9.0                    27.1                       67.0        61.2            147.2               125.9                 116.9
PFD4 GR                 Pfleiderer                                                  Sell              C-                               -40.0                                                    -38.4                                                    100.0                    9.8                            11.2                        5.0                        5.0         4.2              -0.6              -15.6                  -26.8
GBF GR                  Bilfinger Berger                                            Buy               D                                -80.0                                                    -38.4                                                    100.0                    8.0                            10.4                       33.5                       57.0        41.3              70.1               23.3                   12.9

                                                                                                                                                                                                                                                                                                                                                                                                   Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                                      ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                                         Composite C                           Composite D                                                                                                                     Sharpe ratio Prime(0.25); Sharpe ratio Sector(0.36)
          ESGCsector i = 1.0 - 0.0                                                                                                                                                                                                                                                                                                                          25
                                                                                                                                    100

                                                                                                                                                                                                                                                                                                                                                            20
                                                                                                                                     80




                                                                                                                                                                                                                                                                                                                                         Portfolio return
                                                                                                                                                                                                                                                                                                                                                            15
                                                                                                                                     60

                                                                                                                                                                                                                                                                                                                                                            10
                                                                                                                                     40

                                                                                                                                                                                                                                                                                                                                                             5
                                                                                                                                     20

                                                                                                                                                                                                                                                                                                                                                             0
                                                                                                                                      0                                                                                                                                                                                                                          0        10        20        30        40       50        60         70         80
                                                                                                                                                   May-02



                                                                                                                                                                              May-03



                                                                                                                                                                                                         May-04



                                                                                                                                                                                                                                    May-05



                                                                                                                                                                                                                                                               May-06




                                                                                                                                                                                                                                                                                          May-07



                                                                                                                                                                                                                                                                                                                     May-08
                                                                                                                                          Jan-02


                                                                                                                                                            Sep-02
                                                                                                                                                                     Jan-03


                                                                                                                                                                                       Sep-03
                                                                                                                                                                                                Jan-04


                                                                                                                                                                                                                  Sep-04
                                                                                                                                                                                                                           Jan-05


                                                                                                                                                                                                                                             Sep-05
                                                                                                                                                                                                                                                      Jan-06


                                                                                                                                                                                                                                                                        Sep-06
                                                                                                                                                                                                                                                                                 Jan-07


                                                                                                                                                                                                                                                                                                   Sep-07
                                                                                                                                                                                                                                                                                                            Jan-08


                                                                                                                                                                                                                                                                                                                              Sep-08
                                                                                                                                                                                                                                                                                                                                                                                              Portfolio risk (STDEV)
  -7.62

           -7.51

                   -7.41

                           -7.30

                                   -7.20

                                           -7.09

                                                   -6.99

                                                           -6.88

                                                                    -6.77

                                                                            -6.67

                                                                                      -6.56

                                                                                              -6.46

                                                                                                           -6.35

                                                                                                                   -6.24

                                                                                                                           -6.14




                                                                                                                                                                                                                                                                                                                                                                          FP Prime          FP Sector         CAL Prime           CAL Sector


                                                                                                                                                                                                                                                                                                                                                                                                   Source: oekom research, UniCredit Research




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                                                                                                                                              20 January 2009                                                                                                                         Global Equity Research

                                                                                                                                                                                                                                                                                                   ESG Research



Construction & Materials: Performance
                                                                                             52-week                                 52-week % chg.                          Market cap.           Absolute performance (%)                               Relative performance (%) vs. Euro STOXX 50
Company                                                               Price                 High          Low                          High                         Low               (mn)      1M               3M         12M                   YTD                          1M       3M                 12M                  YTD
Bilfinger Berger                                      EUR             33.50                  63.8          25.2                        90.4                        -24.8           1,246        -1.3            32.9        -20.8                  -7.2                        5.6     38.8                23.7                  -0.4
HeidelbergCement                                      EUR             31.56                 113.0          27.0                       258.0                        -14.4           4,245        -2.6            -53.6       -66.9                  -1.0                        4.3    -47.7               -22.4                  5.8
Hochtief                                              EUR             27.10                  77.9          20.9                       187.3                        -23.0           1,897       -18.3            31.3        -60.4                 -24.1                       -11.4    37.2               -15.9                 -17.3
Pfleiderer                                            EUR              5.03                  16.9           5.0                       236.2                          0.0                 268   -14.2            -34.5       -63.0                 -23.0                        -7.3   -28.6               -18.5                 -16.2
Germany average                                                                                                                       193.0                        -15.5                        -9.1             -6.0       -52.8                 -13.8                        -2.2    -0.1                -8.3                  -7.0


1M absolute performance (%)                                                                         1M relative performance (%)                                                                                    Absolute performance YTD (%)
 10                                                       DAX (%)          Euro STOXX (%)            10                                                                                                             20                                                                 DAX (%)               Euro STOXX (%)
                                                                                                                  5.6                          4.3
   0
                                                                                                      0                                                                                                                 0

 -10
             -1.3                -2.6                                                                                                                                                                                          -7.2                       -1.0
                                                                                                    -10                                                                                                             -20
 -20                                                                                                                                                                                               -7.3
                                                                                                                                                                                  -11.4                                                                                                -24.1                      -23.0
                                                          -18.3                -14.2

 -30                                                                                                -20                                                                                                             -40
              Bilfinger Berger




                                                                                                                  Bilfinger Berger




                                                                                                                                                                                                                               Bilfinger Berger
                                 HeidelbergCement




                                                                                                                                                HeidelbergCement




                                                                                                                                                                                                                                                           HeidelbergCement
                                                                               Pfleiderer




                                                                                                                                                                                                   Pfleiderer




                                                                                                                                                                                                                                                                                                                   Pfleiderer
                                                           Hochtief




                                                                                                                                                                                   Hochtief




                                                                                                                                                                                                                                                                                        Hochtief
                                                                                                                                                                                                                                                                                              Source: UniCredit Research




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                                                                                                                                                  20 January 2009                                                                                                 Global Equity Research

                                                                                                                                                                                                                                                                            ESG Research



Construction & Materials: Valuation Overview
                                                                         P/E (x)                                                 P/CF (x)                                  EV/sales (x)                                   EV/EBITDA (x)                                    EV/EBIT (x)
Company                                                     2008e           2009e         2010e                         2008e       2009e          2010e           2008e          2009e           2010e       2008e             2009e            2010e           2008e           2009e           2010e
Bilfinger Berger                                                 9.5           6.8          6.5                           4.3           4.0          3.9            0.30           0.27            0.28             6.8           5.6               5.7           10.5              8.4              8.4
HeidelbergCement                                                 4.9           4.5          4.8                           3.5           2.3          2.4            1.72           1.28            1.28             8.9           6.4               6.4           12.4              9.1              9.2
Hochtief                                                        25.6           9.6         10.1                           7.7           3.3          3.4            0.26           0.21            0.25             6.6           4.2               4.9           12.4              7.2              8.3
Pfleiderer                                                      27.4          14.8          8.8                           4.0           2.0          1.8            0.90           0.77            0.72             6.7           6.1               5.4           13.5             12.5            10.2
Germany average                                                 10.4           7.4          7.0                           4.5           2.7          2.6            0.80           0.63            0.63             7.1           5.4               5.5           12.1              8.9              9.0


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                           ROCE 2010e (%) vs. WACC 2010e (%)                                                                  EV/sales 2002-2010e (x)
                      1.6                                                                                               25                                                                                    1.4
                                                                                                                                                                                   Hochtief
                      1.4
                                                                                                                                                                                                              1.2                                                   1.14
                                                                       HeidelbergCement                                 20
                      1.2
 EV/sales 2010e (x)




                                                                                                                                                                                                              1.0


                                                                                                       ROCE 2010e (%)
                      1.0                                                                                                                                                                                                                    0.84         0.87
                                                                                                                        15
                                                                                                                                                                                                              0.8                                                                0.80
                      0.8                                                                                                                                                                                                                                                                 0.63
                                              Pfleiderer                                                                                                                                                                                                                                         0.63
                                                                                                                        10                                                                                            0.51
                      0.6                                                                                                                                                                                     0.6                         0.55
                                                                                                                                                                                                                                0.43
                                                                                                                                                    HeidelbergCement Bilfinger Berger
                      0.4                                                                                                                                                                                     0.4
                                        Hochtief                                                                         5
                      0.2                                                                                                                                            Pfleiderer
                                Bilfinger Berger                                                                                                                                                              0.2
                      0.0                                                                                                0
                            0             4                 8                  12                 16                         0      1         2      3         4           5       6          7       8       0.0
                                                   EBIT margin 2010e (%)                                                                                 WACC 2010e (%)                                               2002      2003    2004      2005    2006      2007      2008e     2009e    2010e


                                                                                                                                                                                                                                                                         Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                         UniCredit CAIB Group                                                                         page 96                                                                                                            See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                      ESG Research



HeidelbergCement                                                                               Hold (prev. Hold)
Capital increase becoming more likely                                                          Price on 01/16/09                                   EUR 31.56
                                                                                               Target price (prev. EUR 28.00)                      EUR 28.00
■   Investment story: HeidelbergCement expects a noticeable improvement in                     Upside to TP                                              -11.3%
    group turnover in 2008 despite the significant decline in the US and UK                    Cost of equity                                              8.3%
    due to the consolidation of Hanson. Operating results will also benefit                    High/Low (12M)                                    113.00/27.01
    from the consolidation effect, but the strongly fluctuating exchange
                                                                                               INVESTMENT HIGHLIGHTS
    rates, volatile energy costs and the potential of further economic weakening                Consolidation of Hanson
    together with the financing costs will weigh on earnings. Financing has                     Financing of Hanson
                                                                                                Book gain for maxit
    become an even more problematic issue after the major shareholder,
    Mr. Merckle, who controls around 80% of the shares, faced his own                          STOCK TRIGGERS
                                                                                                Development of the US and UK markets
    financing problems after speculative losses.                                                Exchange rates impacts
                                                                                                Capital increase likely
■   Operating performance in 2009e and 2010e: We assume a 5%
                                                                                               STOCK DATA
    decrease in cement sales in Europe in 2009, which is in line with market
                                                                                               Reuters/Bloomberg                              HEIG.F/HEI GY
    expectations. Operating earnings will even be harder hit, down 9% on 2008,
                                                                                               Average daily volume (tds.)                                  284
    which will already see lower margins, in our view. For North-America                       Free float (%)                                               14.0
    we have factored in 7.5% lower sales and for earnings to fall by 8.5%.                     Market capitalization (EUR bn)                                4.2
    We have already calculated that margins will halve in North America in                     No. of shares issued (mn)                         125.0
    2008. The regions Asia-Australia-Africa should be able to report further                   Shareholders              Spohn Cement (Merckle) 53.6%,
    growth, as HeidelbergCement has made acquisitions and expanded                                                       Dr. Merckle 27%, Schwenk 6.9%

    capacity. As we expect infrastructure investments to support the                           UPCOMING EVENTS
    construction business and cost-cutting measures to kick in, the                            Annual general meeting                                 07-May-09
    company could be able to show nearly stable earnings in 2009 and 2010.                     Preliminary figures                                     28-Jan-09
                                                                                               BPC, AC                                                 19-Mar-09
■   Valuation: HeidelbergCement has partly financed the EUR 14 bn
    takeover of Hanson by the sale of subsidiaries, such as Vicat and                           130
                                                                                                120
                                                                                                110
    maxit, with proceeds of EUR 3.5 bn and two capital increases without                        100
                                                                                                 90
    subscription rights by the major shareholder Merckle in the amount of                        80
    around EUR 500 mn each. As of the end of September, net debt stood                           70

    at EUR 12.3 bn. The company has to refinance around EUR 6 bn in 2010.                        60

                                                                                                 50
    Rating agencies downgraded the stock twice in the last few weeks,
    making it more difficult to refinance debt. Therefore, a capital increase                    40

    is becoming more likely.                                                                     30



                                                                                                 20
                                                                                                            2006             2007               2008
                                       2006        2007         2008e       2009e    2010e        HEIDELBERGCEMENT
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                            Source: Thomson Datastream
Sales (EUR mn)                         7997      10862          14283       13768    13457
EBITDA (EUR mn)                       1789.8     2377.7         2767.3      2771.3   2698.3    RELATIVE PERFORMANCE (% CHG.)
Operating income (EUR mn)             1335.0     1805.0         1947.5      1930.3   1857.6                                         1M          3M           6M
Net income (EUR mn)                    950.7     2021.8         2122.7       870.2    815.4    DAX                                  5.1       -48.0        -28.5
EPS reported (EUR)                      8.22      17.11          16.98        6.96     6.52    Euro STOXX 50                        4.3       -47.7        -29.4
DPS (EUR)                               1.25       1.30           1.50        1.75     1.75    ES Constr.                           2.4       -58.6        -34.4
ROCE (%)                                10.3         8.6           6.2         6.0      5.8
P/E (x)                                 11.5         6.5           4.9         4.5      4.8    Karin Brinkmann, Equity Analyst (HVB)
P/CF (x)                                 8.0         5.1           3.5         2.3      2.4    +49 89 378-13946
                                                                                               karin.brinkmann@unicreditgroup.de
P/BV (x)                                 2.1         1.9           1.2         0.4      0.4
EV/EBITDA (x)                            8.7       12.3            8.9         6.4      6.4
EV/EBIT (x)                             11.5       11.0           12.4         9.1      9.2
ROCE/WACC (x)                            1.4         1.3           0.8         0.9      0.9
Div. yield (%)                           1.3         1.2           1.8         5.5      5.5

                                                  Source: Company data, UniCredit Research




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January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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                                                             20 January 2009       Global Equity Research

                                                                                        ESG Research




                                                                                  Consumer Goods




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                                                                                            20 January 2009                                                      Global Equity Research

                                                                                                                                                                      ESG Research



ESG overview – Consumer Goods
TP upside vs. difference TPESG-TP (%)*                                                                     Sustainable alpha of UCRESGLG Index constituents (%)

             12.0                                                                                           40
             10.0                                                                                           35
                             PUM GR (H,B-)                                       HEN3 GR (H,B)
                  8.0                                                                                       30
                  6.0                                                                                       25
 TPESG - TP (%)




                                                  ADS GR (H,C+)          Sector
                  4.0                                                                                       20
                  2.0                                                                                       15
                  0.0                                                                                       10
                  -2.0                                                                                       5
                                                                                     BEI GR (B,C)
                  -4.0                                                                                       0




                                                                                                                           HEN3 GR




                                                                                                                                                       ADS GR




                                                                                                                                                                                PUM GR
                                                                                                                                                        (H,C+)
                  -6.0




                                                                                                                                                                                 (H,B-)
                                                                                                                             (H,B)
                         0          5        10        15         20       25          30        35
                                                       TP upside (%)


* average is MCAP weighted                                                                                                                       Source: oekom research, UniCredit Research


ESG risk analysis
The Consumer Goods sector continued to score well in ESG Leader territory with an average ESG sector score of 1.3. Both
Environmental (1.5) and Social & Governance (1.0) scores contributed to this positive achievement. With leading scores, 75% of
companies were able to obtain Prime investment status, with Henkel (Hold, B) and PUMA (Hold, B-) leading the way. We
highlight that there is no negative ESG/risk relationship within this sector. Using the general portfolio ESG risk adjustment
variables and taking into account stock-specific ESG ratings, the ESG risk adjustment for the sector has been determined at -20.8bps.
The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment of 3.6% for the
overall sector. From an ESG style analysis point of view, top tier rated ESG stocks (B) contributed an average 46.5% to the
overall sector performance with the risk-adjusted performance (Sharpe ratio) for Prime stocks being 39.4% higher relative to the
sector benchmark based on our ESG efficient frontier analysis.

Strategic outlook
In 2009, weak consumer confidence, disappointing post-Christmas business in North America, global weakness – particularly in
apparel sales and high promotional activities in most of the important sporting goods markets – are weighing on sentiment
toward sporting goods companies. In a worsening global sporting goods retail environment, strong brands such as adidas, Nike
and PUMA should normally withstand the turmoil better than their peers due to their positioning in key performance categories.
Nevertheless, the brands are affected by lower consumer spending, trading down on core markets and expected margin
pressure in their own retail activities. The Reebok turnaround is being impeded in this environment. It will take at least an
additional two years to generate an adequate return, in our view. Given the clear deterioration in the expectations for revenues
in Western Europe, Japan and North America as well as the slowing growth dynamic in emerging markets (China, Russia and
Latin America), we expect that operating margins of almost all sporting goods companies will come under pressure in 2009.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY       INVESTMENT HIGHLIGHTS                                                     STOCK TRIGGERS                               KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Henkel        Major player in the HPC and adhesives                                     Decline in raw material prices may           + group-wide implementation of environment, health and
(Hold,B)      businesses                                                                offer surprise                                 safety standards and management systems
adidas                             Disappointing performance of Reebok                  Probably higher revenues and net             + reasonable measures to ensure that own and/or
(Hold,C+)                          continues                                            profit in 2009                                 subcontractor sites have implemented adequate
                                                                                                                                       wastewater treatment
PUMA                               Growth in apparel and accessories > than in          Growth in core markets in Europe and         + detailed corporate guidelines covering important areas
(Hold,B-)                          footwear                                             Asia is slowing                                related to social responsibility, human rights, and
                                                                                                                                       health and safety
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Beiersdorf    Leading cosmetics company with strong    Relatively strong performance despite                                         - no supplier standards with regard to labor/health and
(Buy,C)       brands                                   recession                                                                       safety issues

                                                                                                                                                 Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                           UniCredit CAIB Group                          page 100                                                 See last pages for disclaimer.
                                                                     20 January 2009                                                    Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview – Consumer Goods
ESG sector scoring overview by category                                                 ESG stock rating breakdown

  2.0


                                                                                                                  C                           B
                                                                                                                25.0%                       25.0%




  1.0




                                                                                                                 C+                           B-
                                                                                                                25.0%                       25.0%
  0.0
         Social & Governance           ESG                Environmental



                                                                                                                          Source: oekom research, UniCredit Research,

Environmental review
Even though most of the Consumer Goods companies we analyzed scored below the group average, they all made it into the
Environmental Leaders category, thanks to the high score of the best environmental performer – Henkel (B). The company’s
strength lies in its resource efficiency (in CO2 emissions, energy or water consumption), which has improved in recent years. The key
strengths of the rest of the group lie in the presence of systems and environmental policies to monitor and measure resource
consumption or reduce environmental pollution (e.g. wastewater systems).

Social & Governance review
With respect to social issues, the majority (75%) of the companies we analyzed are Social & Governance Leaders. The group
average is also in Leaders territory and all of the companies in that territory scored above average. Key strengths worth
highlighting are comprehensive risk assessments of products (Henkel (B-), detailed guidelines covering areas such as human
rights, social responsibility or health and safety (PUMA (B-)), and a focus on clear measures to check key suppliers’ compliance
with the company's labor/health and safety standards (adidas (B-)). Despite being categorized as a Social & Governance
Leader, Beiersdorf (C-) is the worst social performer due to one of its key weakness being a lack of standards regarding
responsible advertising and data protection.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                           Soc. & Gov. rating Key social & governance strength
Henkel (B)           + increase in resource efficiency in recent          Henkel (B-)        + comprehensive risk assessment of products and ingredients
                       years, e.g. regarding CO2 emissions or
                       energy and water consumption
Beiersdorf (C+)      + group-wide environmental policy                    adidas (B-)              + comprehensive measures to check compliance of key suppliers
                                                                                                     with the company's labor/health and safety standards
adidas (C+)               + reasonable measures to ensure that own        PUMA (B-)                + detailed corporate guidelines covering important areas related to
                            and/or subcontractor sites have                                          social responsibility, human rights, and health and safety
                            implemented adequate wastewater
                            treatment
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                           Soc. & Gov. rating Key social & governance weakness
No environmental laggards available                                       Beiersdorf (C-)    - no supplier standards with regard to labor/health and safety issues

                                                                                                                          Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG       UniCredit CAIB Group                          page 101                                               See last pages for disclaimer.
                                                                                              20 January 2009                                               Global Equity Research

                                                                                                                                                                            ESG Research



ESG overview charts – Consumer Goods
TP and TPESG upside (%)*                                                                               ESG score overview by ESG scoring status

                         TP upside (%)                      TP ESG upside (%)                                                ESG Leader            ESG Laggard               Sector average
                         TP upside sector (%)               TP ESG upside sector (%)
                                                                                                          4
 45                                                                                                       3
 40                                                                                                       3
 35                                                                                                       2
 30                                                                                                       2
 25                                                                                                       1
 20                                                                                                       1
 15                                                                                                       0
 10                                                                                                      -1
  5                                                                                                      -1
  0                                                                                                      -2
             HEN3 GR




                                       BEI GR




                                                               ADS GR




                                                                                     PUM GR




                                                                                                                   HEN3 GR




                                                                                                                                          PUM GR




                                                                                                                                                                  ADS GR




                                                                                                                                                                                             BEI GR
Environmental score overview by category’s ESG scoring status                                          Social & Governance score overview by category’s ESG scoring status

          Environmental Leader                   Environmental Laggard           Sector average                    Soc. & Gov. Leader              Soc. & Gov. Laggard                Sector average

  4                                                                                                       3
                                                                                                          2
  3
                                                                                                          2
  3                                                                                                       1
  2                                                                                                       1
                                                                                                          0
  2                                                                                                      -1
  1                                                                                                      -1
                                                                                                         -2
  1
                                                                                                         -2
  0                                                                                                      -3
             HEN3 GR




                                       BEI GR




                                                               ADS GR




                                                                                     PUM GR




                                                                                                                   HEN3 GR




                                                                                                                                          ADS GR




                                                                                                                                                                  PUM GR




                                                                                                                                                                                             BEI GR
kesg/ke differential by ESG scoring status (bps)*                                                      ERP & beta differential between Prime/Not Prime composites

                          ESG Leader             ESG Laggard             Sector average                                                     Prime     Not Prime

 30                                                                                                                 5.41
 20
 10
                                                                                                                                   4.00
  0
 -10
 -20
 -30
 -40
 -50
                                                                                                                                                                       0.89
 -60                                                                                                                                                                                  0.56
               HEN3 GR




                                        PUM GR




                                                                ADS GR




                                                                                     BEI GR




                                                                                                                             ERP                                               Beta



* averages are MCAP weighted                                                                                                                 Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                     UniCredit CAIB Group                            page 102                                                           See last pages for disclaimer.
                                                                                                                                                                                        20 January 2009                                                                                                                                                                                    Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                   ESG Research



UCRESGLG Index sector constituents overview – Consumer Goods
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg                                                          Current              ESG                ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                      Target                TP upside        TPESG upside              α sustainable
ticker                  Name                                       rec.                 rating                ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                       price        TPESG         (%)                 (%)                      (%)
UCRESGLG index constituent
HEN3 GR                 Henkel                                     Hold                 B                                 42.9                                                 -17.1                                                          0.0                7.2                                6.7                    21.0                      27.0         29.9           28.9               42.7                   36.1
PUM GR                  PUMA                                       Hold                 B-                                28.6                                                 -17.1                                                          0.0                7.1                                6.7                 144.2                       150.0        160.4            4.0               11.3                    4.6
ADS GR                  adidas                                     Hold                 C+                                14.3                                                 -17.1                                                          0.0                7.1                                6.9                    25.9                      30.0         31.0           15.7               19.6                     12
UCRESGLG index non-constituent
BEI GR                  Beiersdorf                                 Buy                  C                             -20.0                                                    -17.1                                                          0.0                6.2                                6.4                    39.5                      52.0         49.6           31.5               25.4                   19.1

                                                                                                                                                                                                                                                                                                                                                                              Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                     ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                        Composite B                           Composite C                                                                                                                   Sharpe ratio Prime(0.27); Sharpe ratio Sector(0.19)
         ESGCsector i = 1.0 - 1.0
                                                                                                                   100                                                                                                                                                                                                                     7

                                                                                                                                                                                                                                                                                                                                           6
                                                                                                                    80
                                                                                                                                                                                                                                                                                                                                           5




                                                                                                                                                                                                                                                                                                                        Portfolio return
                                                                                                                    60                                                                                                                                                                                                                     4

                                                                                                                                                                                                                                                                                                                                           3
                                                                                                                    40
                                                                                                                                                                                                                                                                                                                                           2

                                                                                                                    20                                                                                                                                                                                                                     1

                                                                                                                                                                                                                                                                                                                                           0
                                                                                                                     0                                                                                                                                                                                                                         0             5              10              15             20                25
                                                                                                                                  May-02



                                                                                                                                                             May-03



                                                                                                                                                                                        May-04



                                                                                                                                                                                                                   May-05



                                                                                                                                                                                                                                              May-06




                                                                                                                                                                                                                                                                         May-07



                                                                                                                                                                                                                                                                                                    May-08
                                                                                                                         Jan-02


                                                                                                                                           Sep-02
                                                                                                                                                    Jan-03


                                                                                                                                                                      Sep-03
                                                                                                                                                                               Jan-04


                                                                                                                                                                                                 Sep-04
                                                                                                                                                                                                          Jan-05


                                                                                                                                                                                                                            Sep-05
                                                                                                                                                                                                                                     Jan-06


                                                                                                                                                                                                                                                       Sep-06
                                                                                                                                                                                                                                                                Jan-07


                                                                                                                                                                                                                                                                                  Sep-07
                                                                                                                                                                                                                                                                                           Jan-08


                                                                                                                                                                                                                                                                                                             Sep-08
                                                                                                                                                                                                                                                                                                                                                                          Portfolio risk (STDEV)
  1.71

          1.82

                 1.93

                        2.03

                               2.14

                                      2.24

                                             2.35

                                                    2.46

                                                            2.56

                                                                   2.67

                                                                          2.78

                                                                                 2.88

                                                                                             2.99

                                                                                                    3.09

                                                                                                           3.20




                                                                                                                                                                                                                                                                                                                                                        FP Prime         FP Sector        CAL Prime          CAL Sector


                                                                                                                                                                                                                                                                                                                                                                              Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                        UniCredit CAIB Group                                                                                                                       page 103                                                                                                                                                                                     See last pages for disclaimer.
                                                                                                                           20 January 2009                                                                                      Global Equity Research

                                                                                                                                                                                                                                           ESG Research



Consumer Goods: Performance
                                                                                    52-week                       52-week % chg.                    Market cap.      Absolute performance (%)              Relative performance (%) vs. Euro STOXX 50
Company                                                         Price              High          Low                High                   Low             (mn)   1M         3M         12M         YTD                   1M      3M               12M            YTD
adidas                                          EUR             25.92               46.8          21.9              80.4                  -15.7           5,137   -4.3      -17.5       -35.8       -4.3                  2.6   -11.6               8.6             2.5
Beiersdorf                                      EUR             39.54               54.9          37.0              38.7                   -6.5           9,964   -3.5       5.8        -17.7       -6.1                  3.4    11.7              26.8             0.6
Henkel                                          EUR             20.95               33.3          19.6              58.9                   -6.6           8,341   -2.5       -6.7       -36.6       -8.8                  4.4    -0.8               7.9            -2.0
PUMA                                            EUR            144.20              254.5         112.6              76.5                  -21.9           2,311   5.5        8.4        -39.0       2.5                  12.4    14.3               5.5             9.3
Germany average                                                                                                     63.6                  -12.7                   -1.2       -2.5       -32.3       -4.2                  5.7     3.4              12.2             2.6


1M absolute performance (%)                                                                1M relative performance (%)                                                         Absolute performance YTD (%)
                                                        DAX (%)         Euro STOXX (%)     20                                                                                                                                    DAX (%)            Euro STOXX (%)

 10                                                                                                                                                                             20

                                                                            5.5
                                                                                                                                                                    12.4
                                                                                                                                                                                                                                                          2.5
                                                                                           10
   0                                                                                                                                                                                0

                                                    -2.5                                                                                                 4.4
                                 -3.5                                                                                       3.4
             -4.3                                                                                    2.6                                                                                  -4.3             -6.1                  -8.8


 -10                                                                                        0                                                                                   -20
                                                      Henkel




                                                                                                                                                         Henkel




                                                                                                                                                                                                                                  Henkel
              adidas




                                                                                                         adidas




                                                                                                                                                                                           adidas
                                                                            PUMA




                                                                                                                                                                     PUMA




                                                                                                                                                                                                                                                           PUMA
                                 Beiersdorf




                                                                                                                            Beiersdorf




                                                                                                                                                                                                            Beiersdorf
                                                                                                                                                                                                                                       Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG           UniCredit CAIB Group                                                                       page 104                                                                                          See last pages for disclaimer.
                                                                                                                                         20 January 2009                                                                                             Global Equity Research

                                                                                                                                                                                                                                                              ESG Research



Consumer Goods: Valuation Overview
                                                                  P/E (x)                                                   P/CF (x)                                  EV/sales (x)                            EV/EBITDA (x)                                  EV/EBIT (x)
Company                                              2008e           2009e         2010e                         2008e         2009e       2010e             2008e         2009e     2010e        2008e             2009e            2010e       2008e             2009e           2010e
adidas                                                 11.9             7.6          6.9                              8.9         5.7            5.3           1.00          0.74     0.68              8.4           6.1              5.5           10.1               7.3            6.6
Beiersdorf                                             18.9            16.5         14.2                          15.6           13.5          11.8            1.73          1.32     1.18         11.3               9.2              7.7           12.9            10.6              8.7
Henkel                                                  6.6             9.2          8.3                              5.2         7.0            6.4           1.03          0.75     0.68         11.5               6.3              5.2           19.0               7.8            6.3
PUMA                                                   12.2             8.9          8.2                          10.1            7.2            6.6           1.30          0.82     0.72              7.7           5.2              4.4            9.0               6.1            5.2
Germany average                                        10.8             9.7          8.7                              8.6         7.5            6.9           1.26          0.91     0.82              9.4           6.4              5.5           11.7               7.6            6.5


EV/sales 2010e (x) vs. EBIT margin 2010e (%)                                                    ROCE 2010e (%) vs. WACC 2010e (%)                                                            EV/sales 2002-2010e (x)
                      1.6                                                                                        60                                                                               2.0

                                                                                                                                           Beiersdorf                                             1.8
                                                                                                                 50                                                                                                                                   1.65
                                                                                                                                                                                                                                              1.54
                                                     Beiersdorf                                                                                                                                   1.6
                      1.2                                                                                                                                                                                                     1.38     1.37
 EV/sales 2010e (x)




                                                                                                                                                                                                  1.4


                                                                                                ROCE 2010e (%)
                                                                                                                 40                                                                                                                                              1.26
                                                                                                                                                                                                          1.14       1.13
                                                                                                                                                                                                  1.2
                      0.8                                                                                        30                                                                                                                                                       0.91
                                                              PUMA                                                                                                                                1.0




                                                                                                                                                                                              X
                                adidas   Henkel                                                                                                                                                                                                                                    0.82
                                                                                                                                                             PUMA
                                                                                                                                                                                                  0.8
                                                                                                                 20
                      0.4                                                                                                                                                                         0.6
                                                                                                                                        adidas
                                                                                                                                                        Henkel
                                                                                                                 10                                                                               0.4

                                                                                                                                                                                                  0.2
                      0.0                                                                                         0
                            8      10         12           14                 16           18                         4                    6                           8                10        0.0
                                           EBIT margin 2010e (%)                                                                                 WACC 2010e (%)                                           2002      2003      2004    2005    2006     2007     2008e     2009e    2010e


                                                                                                                                                                                                                                                            Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                  UniCredit CAIB Group                                                                         page 105                                                                                                    See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                      Global Equity Research

                                                                                                                                       ESG Research



adidas                                                                                          Hold (prev. Hold)
Lack of sufficient visibility on group’s performance                                            Price on 01/16/09                                   EUR 25.92
                                                                                                Target price (prev. EUR 30.00)                      EUR 30.00
■   Investment story: In a worsening global sporting goods retail environment,                  Upside to TP                                               15.7%
    strong brands like adidas and TaylorMade-adidas Golf should withstand                       Cost of equity                                              7.1%
    the turmoil better than their peers, given their proven resilience in bear                  High/Low (12M)                                      46.76/21.86
    markets as a result of their global presence and very strong brands. We
                                                                                                INVESTMENT HIGHLIGHTS
    believe the strong position of both brands will allow the group to benefit                   Disappointing performance of Reebok continues
    from increasing momentum in performance categories and defend shelf                          adidas and TMaG still generate stable results
                                                                                                 adidas group retracted its 2009 financial guidance
    space as result-oriented retailers turn to “safe haven” brands. While a
    Reebok turnaround is currently being impeded in this retail environment                     STOCK TRIGGERS
                                                                                                 Probably higher revenues and net profit in 2009
    – especially in the USA, UK and Japan (together 60% of Reebok’s                              adidas brand effected by less consumer spending
    revenues) – we believe that management is currently taking the right                         Growth in emerging markets is losing momentum
    steps to reinvigorate the Reebok brand in 2009. Nevertheless, it will
                                                                                                STOCK DATA
    take at least an additional two years (up to 2011) for Reebok to be
                                                                                                Reuters/Bloomberg                          ADSG.DE/ADS GR
    earnings-accretive on a group EPS basis, in our view.
                                                                                                Average daily volume (tds.)                                1951.5

■   Operating performance in 2009e and 2010e: Given the clear deterioration                     Free float (%)                                               92.0
                                                                                                Market capitalization (EUR bn)                                5.1
    in the expectations for revenues in Western Europe, Japan and North
                                                                                                No. of shares issued (mn)                           193.4
    America as well as the slowing growth dynamic in emerging markets
                                                                                                Shareholders                                Capital 5.0%,
    (China, Russia and Latin America), we expect stable underlying sales                                                    INVESCO 3.6%, Fidelity 3.1%,
    growth in 2009. Based on this, we calculate an operating profit of EUR                                           Bank of New York 3.1%, rest free float

    1.090 bn (operating margin: 10.1%). We assume that, as one of the                           UPCOMING EVENTS
    brands in demand by retailers, adidas will – similar to the situation in                    FY 2008 sales and earnings                              04-Mar-09
    other recession phases – be in a position to stabilize group earnings                       Q1/2009 sales and earnings                              05-May-09
    even on an expected “trading down” in prices. The decline of 0.8 pp in                      AGM                                                     07-May-09
    the gross margin to 48.0% can be offset by flexible cost management in
    the marketing working budget and some other SG&A expenses.                                    65
                                                                                                  60
                                                                                                  55
■   Valuation: Our target price of EUR 30.00 is based on peer group and                           50
    multiples as well as SOP analysis. The forecast horizon is 2009e-2010e,                       45

    assuming an achievable EBIT margin of 10.1% and 10.4%, respectively.                          40

    ROCE of above 10% covers WACC over the forecast horizon. Net debt                             35

    will be reduced by EUR 550 mn to EUR 1.56 bn by the end of 2010.                              30
    adidas currently trades at a 2009 P/E ratio of 8.2x, a significant discount
    to its historical average 1-year forward P/E of 13x since 1999. In fact, it                   25


    trades below the lowest historical multiple, which was 8.5x in 2001.
                                                                                                  20
    adidas is valued with a high discount of 30% to Nike (on P/E).                                 ADIDAS
                                                                                                           2006               2007               2008
                                                                                                   DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                             Source: Thomson Datastream

                                       2006        2007         2008e       2009e     2010e
                                                                                                RELATIVE PERFORMANCE (% CHG.)
Sales (EUR mn)                        10084      10299          10760       10802     11230
                                                                                                                                     1M          3M           6M
EBITDA (EUR mn)                       1074.0     1160.0         1276.0      1308.0    1390.0
                                                                                                DAX                                  3.4       -11.9         -0.2
EBIT (EUR mn)                          881.0      949.0         1060.0      1090.0    1168.0
                                                                                                Euro STOXX 50                        2.6       -11.6         -1.1
Net income (EUR mn)                    483.0      551.0          635.0       660.0     728.0
                                                                                                ES Pers. & H/H.                      4.7         -7.5        -2.3
EPS reported (EUR)                      2.37       2.71           3.20        3.41      3.76
DPS (EUR)                               0.42       0.50           0.60        0.60      0.65    Uwe Weinreich, CEFA (HVB)
ROCE (%)                                 8.8         9.8          10.2        10.1      10.5    +49 89 378-12640
P/E (x)                                 16.4       15.9           11.9         7.6       6.9    uwe.weinreich@unicreditgroup.de
P/CF (x)                                12.0       11.7            8.9         5.7       5.3
P/BV (x)                                 2.9         3.0           2.4         1.4       1.2
EV/EBITDA (x)                           10.3         9.9           8.4         6.1       5.5
EV/EBIT (x)                             12.6       12.1           10.1         7.3       6.6
ROCE/WACC (x)                            1.5         1.6           1.8         1.8       1.9
Div. yield (%)                           1.1         1.2           1.6         2.3       2.5

                                                  Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                        page 106                                         See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group             page 107       See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                      Global Equity Research

                                                                                                                                       ESG Research



Henkel                                                                                          Hold (prev. Hold)
Clearing the decks for margin growth                                                            Price on 01/16/09                                   EUR 20.95
                                                                                                Target price (prev. EUR 27.00)                      EUR 27.00
■   Investment story: Henkel holds strong positions in its core markets; in                     Upside to TP                                               28.9%
    the home and personal care area it plays a major role in several categories                 Cost of equity                                              7.2%
    (e.g. heavy duty detergents), and in the adhesives segment Henkel is                        High/Low (12M)                                      33.29/19.56
    the dominant market leader. In order to achieve an operating margin of
                                                                                                INVESTMENT HIGHLIGHTS
    14% by 2012, the company has lined up several cost cutting, innovation                       Major player in the HPC and adhesives businesses
    and stimulation programs. Even though the easing of the raw material                         New cost cutting and stimulation programs promising
                                                                                                 Recently installed new CEO
    situation should play into Henkel’s hands, we think the 14% margin
    target is very ambitious – but not impossible. The integration of ICI                       STOCK TRIGGERS
                                                                                                 Decline in raw material prices may offer surprise
    A&EM is well on track, delivering savings ahead of schedule. Moreover,                       Savings could come sooner than anticipated…
    the acquired business is the major driver behind the absolute EBIT growth in                 …and possibly exceed targets
    both 2008 and 2009. However, despite a very adverse environment, the
                                                                                                STOCK DATA
    company must deliver at least satisfactory results in the coming                                                                       HNKG_p.DE/HEN3
                                                                                                Reuters/Bloomberg
    quarters to underscore and validate its 2012 margin target. After                                                                                  GR
                                                                                                Average daily volume (tds.)                         1488.6
    missing the previous goal of a 12% EBIT margin by 2008, expectations are                    Free float (%)                                              100.0
    running high. The recently installed CEO Casper Rorsted faces a tough                       Market capitalization (EUR bn)                                8.3
    challenge – Henkel’s credibility could be in jeopardy if targets are                        No. of shares issued (mn)                           432.7
    missed.                                                                                     Shareholders                Pref. shares: 100% free float;
                                                                                                                    common shares: Henkel family ca. 73%,
                                                                                                                                      remainder free float
■   Operating performance in 2009e and 2010e: While we expect a flat
    performance from the HPC activities in 2009 in absolute terms, Adhesives                    UPCOMING EVENTS
    Technologies should improve its EBIT on the back of the acquisition of                      Annual general meeting                                  20-Apr-09
    ICI A&EM. However, 2010 should already see some improvement due                             9M/Q3                                                   06-Nov-08
    to a slight economic recovery coupled with significant cost cutting and                     Q4                                                      25-Feb-09

    restructuring efforts.
                                                                                                  45


■   Valuation: Henkel’s stock fell quite dramatically at the beginning of
                                                                                                  40

                                                                                                  35
    2008 but remained relatively stable in the final quarter. We believe the
    risk is limited at current levels. DCF and SOP valuation models produce                       30

    an average fair value of EUR 30, from which we subtract a 10% premium,
                                                                                                  25
    leading to a target price of EUR 27. Given the uncertainties related to
    the looming global recession, we reiterate our Hold rating for the time being.
                                                                                                  20




                                       2006        2007         2008e       2009e     2010e       15
                                                                                                            2006              2007               2008
                                                                                                     HENKEL PREF.
Sales (EUR mn)                        12740      13074          14175       14676     15235          DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                               Source: Thomson Datastream
EBITDA (EUR mn)                       1648.0     1681.0         1268.1      1762.2    2007.8
EBIT (EUR mn)                         1298.0     1344.0          765.9      1423.2    1652.8    RELATIVE PERFORMANCE (% CHG.)
Net income (EUR mn)                    855.0      921.0         1762.1       981.0    1095.3                                         1M          3M           6M
EPS reported (EUR)                      1.98       2.14           4.07        2.28      2.54    DAX                                  5.2         -1.2        18.5
DPS (EUR)                               0.48       0.51           0.52        0.55      0.60    Euro STOXX 50                        4.4         -0.8        17.6
ROCE (%)                                10.9       11.7           14.8        11.7      11.6    ES Pers. & H/H.                      6.5         3.2         16.3
P/E (x)                                 16.3       17.5            6.6         9.2       8.3
P/CF (x)                                15.6       14.9            5.2         7.0       6.4    Christian Weiz, Equity Analyst (HVB)
                                                                                                +49 89 378-15229
P/BV (x)                                 2.6         3.0           1.7         1.2       1.1    christian.weiz@unicreditgroup.de
EV/EBITDA (x)                            9.1         9.7          11.5         7.2       5.9
EV/EBIT (x)                             11.6       12.2           19.0         8.9       7.2
ROCE/WACC (x)                            1.6         1.6           2.3         2.0       1.9
Div. yield (%)                           1.5         1.4           1.9         2.6       2.9

                                                  Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG      UniCredit CAIB Group                        page 108                                         See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




Bayerische Hypo- und Vereinsbank AG   UniCredit CAIB Group             page 109       See last pages for disclaimer.
January 2009
                                                                        20 January 2009                                      Global Equity Research

                                                                                                                                       ESG Research



PUMA                                                                                           Hold (prev. Hold)
Slowdown in core EMEA and Asian markets                                                        Price on 01/16/09                                  EUR 144.20
                                                                                               Target price (prev. EUR 150.00)                    EUR 150.00
■   Investment story: Puma is considerably more lifestyle-forward than                         Upside to TP                                                 4.0%
    most other brands in our research coverage universe. In a period when                      Cost of equity                                               7.1%
    consumer spending is slowing and consumers around the globe are                            High/Low (12M)                                    254.50/112.60
    focusing more on performance-oriented athletic products, lifestyle
                                                                                               INVESTMENT HIGHLIGHTS
    brands face a very uncertain time. PUMA’s order backlog already suggests                    Growth in apparel and accessories > than in footwear
    a significant slowdown in 2009 revenue growth. At the end of September,                     Continuing share buyback program
                                                                                                Marketing, retail spending 2009 still 18-19% of sales
    total currency-neutral orders were up by 4.7%, driven by the still high
    growth dynamic in the Americas region, despite a slowdown in EMEA and                      STOCK TRIGGERS
                                                                                                Growth in core markets in Europe and Asia is slowing
    Asian markets. The underlying sales growth in own retail will be flat at best.              Results for the Americas region are encouraging
                                                                                                Decrease in gross and operating margin in 2009
■   Operating performance in 2009e and 2010e: Given the expected
    challenging market conditions in most of PUMA’s sporting goods markets,                    STOCK DATA
    we calculate underlying revenue growth of 2.5%, driven by higher sales                     Reuters/Bloomberg                           PUMG.DE/PUM GR
    in apparel and accessories. Due to a less favorable USD hedge, higher                      Average daily volume (tds.)                                  46.90
    sourcing costs, product and regional mix as well as slower growth in                       Free float (%)                                                69.9
    own retail, we estimate a decrease in gross margin by 1.0 pp to 52.0%.                     Market capitalization (EUR bn)                                 2.3

    PUMA plans to continue its numerous marketing initiatives as an investment                 No. of shares issued (mn)                              15.4
                                                                                               Shareholders            PPR 68.0%, treasury shares 6.0%,
    in the brand’s long term appeal. Therefore, SG&A costs including expenses                                                      Morgan Stanley 5.1%,
    related to marketing and own retail expansion as a percent of sales will                                             Bear Stearns 3.2%, rest free float
    continue to be at a high level of above 38% in 2009. In our view, flexibility
                                                                                               UPCOMING EVENTS
    of operating expenses is crucial in a looming downturn, preserving
                                                                                               Financial results 2008                                   18-Feb-09
    margins and securing cash flows. Against this background, we expect
                                                                                               Q1/2009 sales and earnings                              08-May-09
    that PUMA’s operating result will presumably decrease to EUR 350 mn                        AGM                                                     13-May-09
    (-3.5%). Consequently, the EBIT margin is expected to drop from
    14.5% to 13.5% in 2009e.                                                                    400

                                                                                                350
■   Valuation: Puma remains one of the few stocks in the sporting goods
                                                                                                300
    sector that seems undervalued (P/E 09e 8.7x, EV/EBIT 09e 6.0x), but it
                                                                                                250
    appears that the market still has some concerns regarding revenues and
    earnings revision risks. PUMA continues to buy back its own shares,                         200
    thereby further reducing its free float. Currently PUMA has bought back
    an estimated 5.5% of its share capital. Nevertheless, the expected lack                     150

    of positive catalysts to release potential value for the stock leads us to keep
    our current Hold rating unchanged. Therefore, based on our earnings
    expectations for 2009, we keep our target price of EUR 150 unchanged. A                     100
                                                                                                          2006               2007                2008
                                                                                                  PUMA RUDOLF DASSLER SOT.
    P/E of at most 9.5x and an EV/EBIT multiple of 6.0x (2009e) are currently                     DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                            Source: Thomson Datastream

    appropriate. We assume that PPR will not add to its stake short term.
                                                                                               RELATIVE PERFORMANCE (% CHG.)
                                       2006       2007         2008e       2009e     2010e                                           1M          3M           6M
Sales (EUR mn)                         2369       2373          2502        2595      2725     DAX                                  13.2        14.0          7.7
EBITDA (EUR mn)                       404.5      418.0         420.0       412.0     446.0     Euro STOXX 50                        12.4        14.3          6.8
EBIT (EUR mn)                         366.2      372.0         362.5       350.0     380.0     ES Cycl. G/S                         14.5        18.4          5.5
Net income (EUR mn)                   263.2      268.9         258.5       250.0     270.0
EPS reported (EUR)                    16.39      16.80         16.75       16.19     17.49
                                                                                               Uwe Weinreich, CEFA (HVB)
DPS (EUR)                              2.50       2.75          2.80        2.80      2.90     +49 89 378-12640
ROCE (%)                               25.4       25.4          21.9        20.1      20.5     uwe.weinreich@unicreditgroup.de
P/E (x)                                17.5       17.8           12.2         8.9      8.2
P/CF (x)                               15.3       15.4           10.1         7.2      6.6
P/BV (x)                                4.6        4.3            2.7        1.6       1.4
EV/EBITDA (x)                          11.9       11.4            7.7         5.2      4.4
EV/EBIT (x)                            13.2       12.9            9.0         6.1      5.2
ROCE/WACC (x)                           2.9        2.9            2.5        2.3       2.3
Div. yield (%)                          0.9        0.9            1.4        1.9       2.0

                                                 Source: Company data, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                        page 110                                          See last pages for disclaimer.
January 2009
                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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                                                             20 January 2009       Global Equity Research

                                                                                        ESG Research




                                                                                  Financial Services




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                                                                                     20 January 2009                                              Global Equity Research

                                                                                                                                                           ESG Research



ESG overview – Financial Services
TP upside vs. difference TPESG-TP (%)*                                                              Sustainable alpha of UCRESGLG Index constituents (%)

                                                                                                             No UCRESGLG Index constituents available
                  0.0

                  -2.0

                  -4.0
 TPESG - TP (%)




                  -6.0

                  -8.0

             -10.0                                                            DB1 GR (B,D+)
                                                                     Sector
             -12.0
                             MLP GY (S,D)               A8A GR (H,D)     HXCI GR (H,D)
             -14.0

             -16.0
                         0       20            40           60            80             100
                                                TP upside (%)


* average is MCAP weighted                                                                                                          Source: oekom research, UniCredit Research


ESG risk analysis
The Financial Services sector fell deeply into ESG Laggard territory with an average ESG sector score of -4.0. The
Environmental performance was close to the lowest score possible (-4.8) with the Social & Governance performance slightly better
(-2.6). Given the overall low ESG score, none of the companies were able to obtain Prime investment status, but Deutsche
Boerse (Buy, D+) showed the highest ESG score in the sector. The average relative ESG risk adjustment to the cost of equity
for the sector could not be determined due to a lack of Prime stocks. Using the general portfolio ESG risk adjustment variables
and taking into account stock-specific ESG ratings, the ESG risk adjustment for the sector has been determined at 108.0bps.
The overall impact of these ESG risk adjustments on our target prices translates into an upside adjustment of -20.9% for the
overall sector. From an ESG style analysis point of view, there are no top tier rated ESG stocks, with D rated stocks contributing
to the whole sector performance. Given the lack of Prime stocks, no ESG efficient frontier analysis could be conducted.

Strategic outlook
In the Exchange arena, two threats are weighing on stocks: upcoming competition in cash markets and the fear that the cyclical
downturn will not only lead to lower trading volumes on cash markets, but also on derivative exchanges. We believe Deutsche Börse
with its comparably small exposure to the most cyclical – and potentially highly competitive – cash market is in a better position
than its peers.

In the Financial Distribution area, MLP and Aragon had high hopes for a year-end bonanza in investment fund sales, as German
retail investors had an incentive to invest their savings before year-end since any gains from then on will remain tax-free. That
did not materialize, as the financial market turmoil made retail investors cautious about longer-term investments. This pain is
also being felt by the closed-end fund issuers MPC and HCI, which face a sharp decline in demand for their products.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY       INVESTMENT HIGHLIGHTS                    STOCK TRIGGERS                                                   KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
No Prime Investment status companies available
Bottom sustainable alphas (UCRESGLG Index non-constituents)
MLP (Sell,D) Swiss Life bought a 27% stake             Decision of Mr. Lautenschläger on his                            - lack of transparency regarding the integration of
                                                       stake                                                               environmental and social aspects into financial
                                                                                                                           services such as lending or asset management
Aragon                       Moderate growth due to liability umbrella           Trend in (tied) consultant headcount   - very limited information on social, ethical and
(Hold,D)                                                                                                                  environmental issues publicly available
HCI Capital                  Weak demand for closed-end funds                    Trend in demand for long-term          - no supplier standards with regard to labor/health and
(Hold,D)                                                                         investments                              safety issues

                                                                                                                                    Source: oekom research, UniCredit Research




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                                                                      20 January 2009                                                   Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview – Financial Services
ESG sector scoring overview by category                                                ESG stock rating breakdown

  0.0

                                                                                                                    D-                      D+
  -1.0                                                                                                            20.0%                    20.0%

  -2.0


  -3.0


  -4.0


  -5.0


  -6.0                                                                                                                          D
         Social & Governance            ESG                Environmental                                                      60.0%



                                                                                                                           Source: oekom research, UniCredit Research

Environmental review
All of the analyzed companies from the Financial Services sector fell into the Environmental Laggards category. As most
received a very low score, the group average is also close to the bottom of the Laggards ladder. Only 25% of the companies
can be regarded as the best of the worst, including only Deutsche Börse AG (D), due to the integration of environmental
considerations into its index products. The worst companies are HCI Capital (D-), MLP (D-) and Aragon (D-) with key
weaknesses to highlight lack of transparency regarding environmental management systems and environmental performance
indicators.

Social & Governance review
On a social level, the whole sector again fell in the Soc. & Gov. Laggards territory with most of the companies scoring above
average, though. The highest score in the Laggards territory belong to Deutsche Börse AG (C-), HCI Capital (C-) and
Aragon (C-), showing as key social strength a reasonable community involvement policy and management in place. MLP (D+)
can be found at the bottom in this category, its social weakness being a lack of transparency regarding supplier standards with
regard to labour/health and safety issues.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                            Soc. & Gov. rating Key social & governance strength
No environmental leaders available                                         No social & governance leaders available
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                            Soc. & Gov. rating Key social & governance weakness
HCI Capital (D-)     - lack of transparency on formal systems and          MLP (D+)           - lack of transparency regarding supplier standards with regard to
                        strategies to address climate change                                     labor/health and safety issues
MLP (D-)             - lack of transparency regarding the                  Deutsche Börse     - lack of transparency regarding supplier standards with regard to
                        implementation of environmental                    AG (C-)               labor/health and safety issues
                        management systems
Aragon (D-)               - lack of transparency regarding                 HCI Capital (C-)        - no supplier standards with regard to labor/health and safety issues
                             environmental performance indicators

                                                                                                                           Source: oekom research, UniCredit Research




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                                                                                             20 January 2009                                                  Global Equity Research

                                                                                                                                                                             ESG Research



ESG overview charts – Financial Services
TP and TPESG upside (%)*                                                                              ESG score overview by ESG scoring status

                       TP upside (%)                        TP ESG upside (%)                                              ESG Leader                ESG Laggard              Sector average
                       TP upside sector (%)                 TP ESG upside sector (%)
                                                                                                        0
 100                                                                                                    -1
  90                                                                                                    -1
  80
                                                                                                        -2
  70
  60                                                                                                    -2
  50                                                                                                    -3
  40                                                                                                    -3
  30
                                                                                                        -4
  20
  10                                                                                                    -4
   0                                                                                                    -5
                                      HXCI GR




                                                                                                                                          HXCI GR
              DB1 GR




                                                                                   MLP GY




                                                                                                                  DB1 GR




                                                                                                                                                                   MLP GY
                                                              A8A GR




                                                                                                                                                                                                 A8A GR
Environmental score overview by category’s ESG scoring status                                         Social & Governance score overview by category’s ESG scoring status

          Environmental Leader                  Environmental Laggard          Sector average                     Soc. & Gov. Leader                 Soc. & Gov. Laggard              Sector average

  0                                                                                                     0

  -1                                                                                                    -1

                                                                                                        -1
  -2
                                                                                                        -2
  -3
                                                                                                        -2
  -4
                                                                                                        -3
  -5                                                                                                    -3

  -6                                                                                                    -4
                                     HXCI GR




                                                                                                                                          HXCI GR
             DB1 GR




                                                              MLP GY




                                                                                                                  DB1 GR




                                                                                                                                                                                                 MLP GY
                                                                                   A8A GR




                                                                                                                                                                   A8A GR




kesg/ke differential by ESG scoring status (bps)*                                                     ERP & beta differential between Prime/Not Prime composites**

                        ESG Leader              ESG Laggard            Sector average
                                                                                                        7.00
 140                                                                                                                                    6.18
                                                                                                        6.00
 120                                                                                                                       5.35
                                                                                                        5.00
 100

  80                                                                                                    4.00

  60                                                                                                    3.00
  40
                                                                                                        2.00
  20                                                                                                                                                                                      1.06
                                                                                                                                                                            0.84
                                                                                                        1.00
   0
                                                                                   HXCI GR
              DB1 GR




                                      MLP GY




                                                              A8A GR




                                                                                                        0.00
                                                                                                                                  ERP                                              Beta
                                                                                                                                                    Prime   Not Prime


* averages are MCAP weighted; **Market Portfolio figures due to lack of Prime sector composite availability                                    Source: oekom research, UniCredit Research




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                                                                                                                                                                                                         20 January 2009                                                                                                                                                                                     Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                      ESG Research



UCRESGLG Index sector constituents overview – Financial Services
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg t                                                                         Current ESG                            ESG exposure                                  ESG risk                                          ESG confidence                                                                                              Current                       Target                TP upside        TPESG upside               α sustainable
icker                   Name                                                        rec.    rating                            ESGEi (%)                              ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price      TPESG           (%)                 (%)                       (%)
UCRESGLG index constituent
N/A
UCRESGLG index non-constituent
DB1 GR                  Deutsche Börse AG                                           Buy               D+                               -60.0                                                    -17.1                                                          NA                 8.0                                8.8                    44.0                       82.0         72.7            86.4               65.2                   56.4
HXCI GR                 HCI Capital                                                 Hold              D                                -80.0                                                    -17.1                                                          NA                 8.9                            10.1                                1.6                2.8          2.4            76.1               51.3                   41.3
MLP GY                  MLP                                                         Sell              D                                -80.0                                                    -17.1                                                          NA                 8.4                             9.5                                7.4                9.0          7.7            21.1                3.8                   -5.7
A8A GR                  Aragon                                                      Hold              D                                -80.0                                                    -17.1                                                          NA                 8.4                                9.5                             9.3               15.0         12.9            61.3               38.2                   28.7

                                                                                                                                                                                                                                                                                                                                                                                                Source: oekom research, UniCredit Research



ESG confidence analysis ( x )*                                                                                                     ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)*

                                                                                                                                                                                                                             Composite D                                                                                                                                      Sharpe ratio Prime(0.38); Sharpe ratio Sector(0.07)
          ESGCsector i = 1.0 - 0.0                                                                                                                                                                                                                                                                                                                          12

                                                                                                                                    100                                                                                                                                                                                                                     10




                                                                                                                                                                                                                                                                                                                                         Portfolio return
                                                                                                                                                                                                                                                                                                                                                             8
                                                                                                                                     80
                                                                                                                                                                                                                                                                                                                                                             6
                                                                                                                                     60
                                                                                                                                                                                                                                                                                                                                                             4
                                                                                                                                     40
                                                                                                                                                                                                                                                                                                                                                             2
                                                                                                                                     20
                                                                                                                                                                                                                                                                                                                                                             0
                                                                                                                                      0                                                                                                                                                                                                                          0             10              20             30               40               50
                                                                                                                                                   May-02



                                                                                                                                                                              May-03



                                                                                                                                                                                                         May-04



                                                                                                                                                                                                                                    May-05



                                                                                                                                                                                                                                                               May-06




                                                                                                                                                                                                                                                                                          May-07



                                                                                                                                                                                                                                                                                                                     May-08
                                                                                                                                          Jan-02


                                                                                                                                                            Sep-02
                                                                                                                                                                     Jan-03


                                                                                                                                                                                       Sep-03
                                                                                                                                                                                                Jan-04


                                                                                                                                                                                                                  Sep-04
                                                                                                                                                                                                                           Jan-05


                                                                                                                                                                                                                                             Sep-05
                                                                                                                                                                                                                                                      Jan-06


                                                                                                                                                                                                                                                                        Sep-06
                                                                                                                                                                                                                                                                                 Jan-07


                                                                                                                                                                                                                                                                                                   Sep-07
                                                                                                                                                                                                                                                                                                            Jan-08


                                                                                                                                                                                                                                                                                                                              Sep-08
                                                                                                                                                                                                                                                                                                                                                                                             Portfolio risk (STDEV)
  -2.63

           -2.52

                   -2.42

                           -2.31

                                   -2.20

                                           -2.09

                                                   -1.99

                                                           -1.88

                                                                    -1.77

                                                                            -1.67

                                                                                      -1.56

                                                                                              -1.45

                                                                                                           -1.35

                                                                                                                   -1.24

                                                                                                                           -1.13




                                                                                                                                                                                                                                                                                                                                                                          FP Prime         FP Sector         CAL Prime           CAL Sector


* Market portfolio data due to lack of Prime/Not Prime composites                                                                                                                                                                                                                                                                                                                              Source: oekom research, UniCredit Research




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                                                                                                                                                                                                                                                              ESG Research



Financial Services: Performance
                                                                                     52-week                52-week % chg.                      Market cap.               Absolute performance (%)                          Relative performance (%) vs. Euro STOXX 50
Company                                                         Price           High            Low          High             Low                     (mn)           1M                3M          12M        YTD                1M                     3M            12M                YTD
Aragon                                              EUR           9.30            28.0           9.3         201.2             0.0                      58          -11.4             -38.7        -57.5      -14.7              -4.5                 -32.8           -13.1              -7.9
Deutsche Börse AG                                   EUR         44.00          121.2            44.0         175.5             0.0                    8,580         -20.2             -16.1        -60.5      -13.4             -13.3                 -10.2           -16.0              -6.6
HCI Capital                                         EUR           1.59            15.8           1.4         895.6           -13.8                      38           -7.6             -58.1        -87.9      -21.7              -0.7                 -52.2           -43.4          -14.9
MLP                                                 EUR           7.43            14.0           7.3          88.4            -2.3                     801          -20.4             -35.4        -21.0      -24.5             -13.5                 -29.5           23.4           -17.7
MPC Capital                                         EUR           6.82            52.6           3.9         671.3           -42.4                      83          41.2              -19.3        -86.1      -23.4             48.1                  -13.4           -41.6          -16.6
Germany average                                                                                              406.4           -11.7                                   -3.7             -33.5        -62.6      -19.5              3.2                  -27.6           -18.1          -12.7


1M absolute performance (%)                                                              1M relative performance (%)                                                                     Absolute performance YTD (%)
 60                                                   DAX (%)        Euro STOXX (%)       60                                                                                                  20                                                       DAX (%)         Euro STOXX (%)
                                                                                                                                                                            48.1
                                                                           41.2
 40
                                                                                          40
                                                                                                                                                                                               0
 20
                                                                                          20
   0                                                                                                                                                                                                -14.7       -13.4
                                                                                                                                                                                          -20
                                                                                           0                                                                                                                                            -21.7
 -20                                                                                                                                                                                                                                                          -24.5            -23.4
                                                                                                                                 -0.7
           -11.4          -20.2       -7.6                 -20.4                                  -4.5
                                                                                                                -13.3                                     -13.5
 -40                                                                                      -20                                                                                             -40
            Aragon




                                                                                                   Aragon




                                                                                                                                                                                                     Aragon
                                      HCI Capital




                                                                           Capital




                                                                                                                                  HCI Capital




                                                                                                                                                                            Capital




                                                                                                                                                                                                                                        HCI Capital




                                                                                                                                                                                                                                                                               Capital
                          Dt. Börse




                                                                                                                Dt. Börse




                                                                                                                                                                                                                Dt. Börse
                                                            MLP




                                                                                                                                                              MLP




                                                                                                                                                                                                                                                               MLP
                                                                            MPC




                                                                                                                                                                             MPC




                                                                                                                                                                                                                                                                                MPC
                             AG




                                                                                                                   AG




                                                                                                                                                                                                                   AG
                                                                                                                                                                                                                                                          Source: UniCredit Research




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                                                                                                                                                                                                                                                                                         ESG Research



Financial Services: Valuation Overview
                                                                  P/E (x)                                                    EV/EBIT (x)                                  Price/book value (x)                                             EPS growth (x)                       Net dividend yield (%)
Company                                                2008e          2009e          2010e                         2008e           2009e              2010e          2008e           2009e         2010e                       2008e             2009e         2010e           2008e          2009e           2010e
Aragon                                                    6.1          11.0            8.3                           6.7                2.5              1.5              1.2          1.0           0.9                         72.1             -44.4          33.3           73.7            84.2            95.3
Deutsche Börse AG                                         8.1           7.9            6.8                          10.3                5.7              5.1              3.7          2.9           4.3                         15.6               2.9          15.3           23.1            27.2            35.1
HCI Capital                                              -3.4           2.9            2.4                         -12.3             -5.6              -5.0               0.3          0.4           0.4                                                         21.2          885.0          881.9            753.3
MLP                                                      15.2          11.5           11.3                          10.7                5.2              5.1              2.4          2.2           2.2                        -21.8              32.6           2.1           39.1            41.1            44.6
MPC Capital                                              -1.1          37.4           16.8                          27.6            18.2                 7.3              1.1          1.7           1.5                                                        123.0          106.9            92.9            60.4
Germany average                                           8.5           7.4            6.0                          10.7                4.9              3.4              0.9          1.0           1.0                         25.7               5.4           8.0           53.8            58.9            63.0


P/BV 2010e (x) vs. ROE 2010e (%)                                                                  P/E 2010e (x) vs. EPS growth 2008e/ 09e (x)                                                              EV/EBIT 2008e (x) vs. CAGR EBIT 2007-2010e (%)
                  3
                                                                                                                   20                                                                                                          20
                                                                                                                                                                                                                                               MPC Capital
                                                                      Dt. Börse AG                                                                                                   MPC Capital                               15
                                                        MLP
                  2                                                                                                15




                                                                                                                                                                                                           EV/EBIT 2009e (x)
 P/BV 2010e (x)




                                                                                                   P/E 2010e (x)                                                                                                               10
                          MPC Capital                                                                                       MLP                                                                                                                                                                   Dt. Börse AG
                                                                                                                   10                                                                                                           5                                                              MLP
                                                                                                                                                Aragon                                                                                                                                          Aragon
                  1                                                                                                                                                                                                             0
                                        Aragon
                                                                                                                            Dt. Börse AG
                                                                                                                    5
                                                                                                                                                                                                                                                                 HCI Capital
                                    HCI Capital                                                                                                                                                                                 -5
                                                                                                                                        HCI Capital

                  0                                                                                                 0                                                                                                          -10
                      0                 10                       20                          30                         0     10   20      30    40     50     60    70    80   90    100 110 120 130                                -50          -40         -30        -20        -10                0          10
                                                 ROE 2010e (%)                                                                                   EPS growth 2009e/2010e (%)                                                                                  CAGR EBIT (2007-2010e) (%)


                                                                                                                                                                                                                                                                                       Source: UniCredit Research




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                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




                                                                                            Insurance




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                                                                                                                                                            ESG Research



ESG overview – Insurance
TP upside vs. difference TPESG-TP (%)*                                                              Sustainable alpha of UCRESGLG Index constituents (%)

                  4.0                                               ALV GR (B,C+)
                                                                                                      90
                                  MUV2 GR
                                                        Sector
                  2.0              (B,C+)                                                             80
                  0.0                                                                                 70
                  -2.0                                                                                60
 TPESG - TP (%)




                  -4.0                                                                                50
                  -6.0                                                                                40
                  -8.0                                                                                30
             -10.0                                                                                    20
             -12.0                                                                                    10
                                   HNR1 GR (B,D)
             -14.0                                                                                     0




                                                                                                                           ALV GR




                                                                                                                                                               MUV2 GR
                                                                                                                            (B,C+)
             -16.0




                                                                                                                                                                (B,C+)
                         0       20           40           60              80           100
                                               TP upside (%)


* average is MCAP weighted                                                                                                             Source: oekom research, UniCredit Research


ESG risk analysis
The Insurance sector dropped into ESG Laggard territory with an average ESG sector score of -0.7. Social & Governance
performance (0.0) has significantly improved but Environmental scores (-1.0) continue to drag the overall sector score
downwards. Despite an average Laggard score, a majority of companies (67%) were able to reach Prime investment status,
including Allianz (Buy, C+) and Munich Re (Buy, C+). We highlight that there is no negative ESG/risk relationship within this
sector. Using the general portfolio ESG risk adjustment variables and taking into account stock-specific ESG ratings, the ESG
risk adjustment for the sector has been determined at 26.6bps.The overall impact of these ESG risk adjustments on our target
prices translates into an upside adjustment of 3.6% for the overall sector. From an ESG style analysis point of view, there are no
top tier rated ESG stocks (A+B) with contributions of C and D rated stocks 90.1% and 9.9%, respectively. The risk-adjusted
performance (Sharpe ratio) for Prime stocks has been determined to be significantly higher relative to the sector benchmark
based on our ESG efficient frontier analysis.

Strategic outlook
We still expect a further deterioration of the environment for Insurance companies in the short- to medium-term, with weaker
equity markets and lower interest rates being burdening factors for the investment result. Particularly the life insurance business
faces challenges, due to 1. weaker product demand against the backdrop of the current economic downturn; and 2. low yield
levels, which make it hard to meet the guarantees given on traditional life policies. In the property & casualty business, the
softening of the cycle may not yet be over. The reinsurance sector is already heading towards a harder cycle, helped by the
relatively weak capital position of some primary insurers – which is why we are somewhat more optimistic for the reinsurance
sector. Generally, we take a cautious stance towards the overall insurance sector, despite attractive valuation levels from a
fundamental point of view. In the long term, we believe the prospects are positive, in particular for the life insurance business
due to increasing retirement provisioning needs in light of insufficient public pension schemes for an aging population.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

 COMPANY               INVESTMENT HIGHLIGHTS                                             STOCK TRIGGERS                              KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
Allianz       High upside potential from a valuation point of                   Trends in the capital market environment   + sound integration of environmental aspects into
(Buy,C+)      view                                                                                                           insurance and asset management business
Munich Re                    Positive signals from the renewals expected        Renewals in January                        + reasonable integration of environmental aspects into
(Buy,C+)                                                                                                                     the primary insurance business
Bottom sustainable alphas (UCRESGLG Index non-constituents)
Hannover Re Weak 2008 results                          Renewals                                                            - lack of information on the integration of social and
(Buy,D)                                                                                                                      environmental aspects into the reinsurance business

                                                                                                                                       Source: oekom research, UniCredit Research




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                                                                                                                                         ESG Research



ESG rating overview – Insurance
ESG sector scoring overview by category                                            ESG stock rating breakdown

  0.0




                                                                                                           D
                                                                                                         33.3%

  -1.0




                                                                                                                                         C+
                                                                                                                                        66.7%


  -2.0
         Social & Governance          ESG               Environmental



                                                                                                                     Source: oekom research, UniCredit Research

Environmental review
Regarding environmental issues, 67% of the Insurance companies we analyzed fell in the Environmental Leaders category. Due
to the low score in the Laggards group, the group’s overall score belongs to the Laggards category. The top performers are
Allianz (C+), with one of its key strength being the sound integration of green standards into its insurance and asset
management business, and Munich Re (C+), also thanks to its good integration of environmental aspects into its primary
insurance business. The worst performer is Hannover Re (D-), with a key weakness being its lack of transparency in formal
systems and strategies to address climate change.

Social & Governance review
As for Social & Governance issues, the split between Leaders and Laggards follows the same pattern as the Environmental
review. Even though the majority of the companies exceeded the average, the overall sector average ended up between the
Leaders and Laggards territories. Top scorers in the Leaders category are again Allianz (B-) and Munich Re (C+), the main
social strengths for both being a detailed and comprehensive code of conduct covering important aspects of business ethics.
The worst performer remains Hannover Re (D+), with one of its key weaknesses being lack of transparency regarding the
standards of its business ethics.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                         Soc. & Gov. rating Key social & governance strength
Allianz (C+)         + sound integration of environmental aspects       Allianz (B-)       + detailed and comprehensive code of conduct covering important
                        into insurance and asset management                                  aspects of business ethics
                        business
Munich Re (C+)       + reasonable integration of environmental          Munich Re (C+)         + detailed and comprehensive code of conduct covering important
                        aspects into the primary insurance business                              aspects of business ethics
Bottom ESG Laggards scores by category
Environmental rating Key environmental weakness                         Soc. & Gov. rating Key social & governance weakness
Hannover Re (D-)     - lack of transparency on formal systems and       Hannover Re (D+) - lack of transparency regarding standards of business ethics
                        strategies to address climate change

                                                                                                                     Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG     UniCredit CAIB Group                        page 121                                            See last pages for disclaimer.
                                                                                             20 January 2009                                                Global Equity Research

                                                                                                                                                                 ESG Research



ESG overview charts – Insurance
TP and TPESG upside (%)*                                                                              ESG score overview by ESG scoring status

                         TP upside (%)                          TP ESG upside (%)                                            ESG Leader       ESG Laggard         Sector average
                         TP upside sector (%)                   TP ESG upside sector (%)
                                                                                                        2
 100
                                                                                                        1
  90
  80                                                                                                    0
  70
                                                                                                        -1
  60
  50                                                                                                    -2
  40
  30                                                                                                    -3
  20                                                                                                    -4
  10
   0                                                                                                    -5




                                                                                                                    ALV GR




                                                                                                                                                  MUV2 GR




                                                                                                                                                                               HNR1 GR
                 ALV GR




                                                                                   HNR1 GR
                                                MUV2
                                                 GR




Environmental score overview by category’s ESG scoring status                                         Social & Governance score overview by category’s ESG scoring status

          Environmental Leader              Environmental Laggard                 Sector average                  Soc. & Gov. Leader          Soc. & Gov. Laggard            Sector average

  2                                                                                                     3
  1                                                                                                     2
  0
                                                                                                        1
  -1
                                                                                                        0
  -2
                                                                                                        -1
  -3
                                                                                                        -2
  -4
  -5                                                                                                    -3

  -6                                                                                                    -4
                ALV GR




                                                MUV2 GR




                                                                                  HNR1 GR




                                                                                                                    ALV GR




                                                                                                                                                  MUV2 GR




                                                                                                                                                                               HNR1 GR
kesg/ke differential by ESG scoring status (bps)*                                                     ERP & beta differential between Prime/Not Prime composites

                          ESG Leader        ESG Laggard                Sector average                                                     Prime   Not Prime

 140
                                                                                                                  6.77
 120
 100
  80                                                                                                                               5.17
  60
  40
  20
   0
 -20
 -40                                                                                                                                                           1.09
                                                                                                                                                                             0.78
                 ALV GR




                                                 MUV2 GR




                                                                                   HNR1 GR




                                                                                                                             ERP                                      Beta



* averages are MCAP weighted                                                                                                              Source: oekom research, UniCredit Research




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                                                                                                                                                                                       20 January 2009                                                                                                                                                                                    Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                  ESG Research



UCRESGLG Index sector constituents overview – Insurance
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg               Name                                       Current              ESG               ESG exposure                                 ESG risk                                          ESG confidence                                                                                              Current                      Target                TP upside        TPESG upside              α sustainable
ticker                                                             rec.                 rating               ESGEi (%)                             ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                       price      TPESG           (%)                 (%)                      (%)
UCRESGLG index constituent
ALV GR                  Allianz                                    Buy                  C+                               14.3                                                 -17.1                                                          0.0                8.4                                8.2                    65.4                     118.0        121.7           80.4               86.0                   77.8
MUV2 GR                 Munich Re                                  Buy                  C+                               14.3                                                 -17.1                                                          0.0                8.4                                8.2                 111.7                       130.0        134.0           16.4               20.0                   11.8
UCRESGLG index non-constituent
HNR1 GR                 Hannover Re                                Buy                  D                            -80.0                                                    -17.1                                                          0.0                8.9                            10.1                        23.6                     31.0         26.6           31.6               13.1                    3.1

                                                                                                                                                                                                                                                                                                                                                                             Source: oekom research, UniCredit Research



ESG confidence analysis ( x )                                                                                    ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)

                                                                                                                                                                                       Composite C                           Composite D                                                                                                                   Sharpe ratio Prime(0.17); Sharpe ratio Sector(0.07)
         ESGCsector i = 1.0 - 1.0
                                                                                                                  100                                                                                                                                                                                                                     9
                                                                                                                                                                                                                                                                                                                                          8
                                                                                                                   80                                                                                                                                                                                                                     7




                                                                                                                                                                                                                                                                                                                       Portfolio return
                                                                                                                                                                                                                                                                                                                                          6
                                                                                                                   60                                                                                                                                                                                                                     5
                                                                                                                                                                                                                                                                                                                                          4
                                                                                                                   40                                                                                                                                                                                                                     3
                                                                                                                                                                                                                                                                                                                                          2
                                                                                                                   20                                                                                                                                                                                                                     1
                                                                                                                                                                                                                                                                                                                                          0
                                                                                                                    0                                                                                                                                                                                                                         0            10              20              30             40                50
                                                                                                                                 May-02



                                                                                                                                                            May-03



                                                                                                                                                                                       May-04



                                                                                                                                                                                                                  May-05



                                                                                                                                                                                                                                             May-06




                                                                                                                                                                                                                                                                        May-07



                                                                                                                                                                                                                                                                                                   May-08
                                                                                                                        Jan-02


                                                                                                                                          Sep-02
                                                                                                                                                   Jan-03


                                                                                                                                                                     Sep-03
                                                                                                                                                                              Jan-04


                                                                                                                                                                                                Sep-04
                                                                                                                                                                                                         Jan-05


                                                                                                                                                                                                                           Sep-05
                                                                                                                                                                                                                                    Jan-06


                                                                                                                                                                                                                                                      Sep-06
                                                                                                                                                                                                                                                               Jan-07


                                                                                                                                                                                                                                                                                 Sep-07
                                                                                                                                                                                                                                                                                          Jan-08


                                                                                                                                                                                                                                                                                                            Sep-08
                                                                                                                                                                                                                                                                                                                                                                         Portfolio risk (STDEV)
  2.71

          2.80

                 2.90

                        2.99

                               3.09

                                      3.18

                                             3.28

                                                    3.37

                                                            3.47

                                                                   3.57

                                                                          3.66

                                                                                 3.76

                                                                                            3.85

                                                                                                   3.95

                                                                                                          4.04




                                                                                                                                                                                                                                                                                                                                                       FP Prime         FP Sector        CAL Prime          CAL Sector


                                                                                                                                                                                                                                                                                                                                                                             Source: oekom research, UniCredit Research




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                                                                                                                                                                                                                                               ESG Research



Insurance: Performance
                                                                                  52-week                         52-week % chg.            Marketcap.                 Absolute performance (%)                     Relative performance (%) vs. Euro STOXX 50
Company                                                      Price               High          Low                  High           Low            (mn)     1M                  3M        12M                YTD           1M             3M            12M             YTD
Allianz                                          EUR         65.41               139.8          46.1               113.7           -29.6         29,634   -12.1               -9.5       -51.9              -12.7        -5.2           -3.6           -7.4            -5.9
Hannover Re                                      EUR         23.55                35.9          15.8                52.4           -32.9          2,840   12.1                 8.0       -14.5               3.0        19.0            13.9           30.0             9.8
Munich Re                                        EUR      111.70                 130.5          83.0                16.8           -25.7         23,220    -3.7               20.1        -8.2               2.0          3.2           26.0           36.3             8.8
Germany average                                                                                                     61.0           -29.4                   -1.2                6.2       -24.9               -2.6         5.7           12.1           19.6             4.2


1M absolute performance (%)                                                              1M relative performance (%)                                                            Absolute performance YTD (%)
 20                                                DAX (%)        Euro STOXX (%)          30                                                                                      20                                                    DAX (%)         Euro STOXX (%)

                                       12.1
                                                                                                                                     19.0
 10                                                                                       20

                                                                                                                                                                                                                                3.0                        2.0
   0                                                                                      10                                                                                         0
                                                                                                                                                           3.2

 -10                                                                                       0
                                                                     -3.7
               -12.1                                                                                                                                                                             -12.7
                                                                                                       -5.2
 -20                                                                                     -10                                                                                     -20
                                      Hannover




                                                                                                                                      Hannover




                                                                                                                                                                                                                            Hannover
                 Allianz




                                                                                                        Allianz




                                                                                                                                                                                                  Allianz
                                                                     Munich Re




                                                                                                                                                           Munich Re




                                                                                                                                                                                                                                                           Munich Re
                                        Re




                                                                                                                                        Re




                                                                                                                                                                                                                              Re
                                                                                                                                                                                                                                           Source: UniCredit Research




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                                                                                                                                                                                                                                                                             ESG Research



Insurance: Valuation Overview
                                                                   P/E (x)                                                     Adj. P/E (x)                            Price/book value (x)                              Price/adj. book value (x)                  Net dividend yield (%)
Company                                                2008e            2009e        2010e                         2008e            2009e            2010e         2008e        2009e         2010e                     2008e        2009e           2010e         2008e          2009e           2010e
Allianz                                                -482.5             7.1          6.0                         -626.3              7.1             6.0            0.84        0.74         0.74                      1.17          1.11            1.03          5.4               6.9               8.4
Hannover Re                                             -25.4             5.5          5.3                          -25.4              5.5             5.3         -25.38         5.50         5.33                      1.18          0.87            0.76          0.0               7.4               7.4
Munich Re                                                   13.5          7.5          7.1                          13.2               7.3             7.0            1.03        0.93         0.86                      1.16          1.03            0.94          4.9               4.9               4.9
Germany average                                             13.5          6.6          6.0                          13.2               6.5             6.0            0.93        1.15         1.11                      1.17          0.99            0.90          5.1               6.2               6.6


P/BV 2010e (x) vs. ROE 2010e (%)                                                                  P/E 2010e (x) vs. Price/NAV 2010e (x)                                                                P/E 2010e (x) vs. EPS growth 2009e/10e (%)
                  7.0                                                                                               10                                                                                                  10

                  6.0
                                                       Hannover Re                                                   8                                                                                                   8
                  5.0                                                                                                                               Munich Re                                                                                     Munich Re
                                                                                                                                                                                                                                                                                               Allianz
 P/BV 2010e (x)




                                                                                                                                                                   Allianz




                                                                                                                                                                                                        P/E 2010e (x)
                                                                                                   P/E 2010e (x)
                                                                                                                     6                                                                                                   6
                  4.0
                                                                                                                                       Hannover Re                                                                                     Hannover Re
                  3.0                                                                                                                                                                                                    4
                                                                                                                     4

                  2.0

                                             Allianz                                                                 2                                                                                                   2
                  1.0
                            Munich Re
                  0.0                                                                                                0                                                                                                   0
                        8   10          12             14          16           18           20                          0.0                  0.5               1.0              1.5             2.0                         0                5               10                  15                     20
                                               ROE 2010e (%)                                                                                           Price/NAV 2010e (x)                                                                          EPS growth 2009e/10e (%)


                                                                                                                                                                                                                                                                           Source: UniCredit Research




Bayerische Hypo- und Vereinsbank AG                    UniCredit CAIB Group                                                                             page 125                                                                                                             See last pages for disclaimer.
January 2009
                                                                         20 January 2009                                     Global Equity Research

                                                                                                                                       ESG Research



Allianz                                                                                        Buy (prev. Buy)
Solid financial stock despite weaker business                                                  Price on 01/16/09                                    EUR 65.41
                                                                                               Target price (prev. EUR 128.00)                    EUR 118.00
■   Investment story: In our view, Allianz shows a quite solid risk profile                    Upside to TP                                                80.4%
    under liquidity and capital aspects, meaning that there should be no                       Cost of equity                                               8.4%
    need for any capital measures for strengthening the solvency ratio. In                     High/Low (12M)                                     139.80/46.07
    our view, attractive dividend payments are quite probable even during
                                                                                               INVESTMENT HIGHLIGHTS
    the expected recession period. For these reasons and the favorable                          High upside potential from a valuation point of view
    valuation from a fundamental perspective, we keep our Buy rating                            Mid-term beneficial effects from Solvency II
                                                                                                Sale of Dresdner Bank
    unchanged in the mid-to-long-term, despite the persisting deterioration
    of market conditions, which will most probably continue to weigh on                        STOCK TRIGGERS
                                                                                                Trends in the capital market environment
    operating trends in the quarters to come. Furthermore, with the sale of                     Degree of target achievement
    Dresdner Bank to Commerzbank, Allianz finally resolved its banking                          Accounting effects related to the Commerzbank stake
    problem (although leading to high burdens in FY 2008), which weighed
                                                                                               STOCK DATA
    on the sentiment towards the stock in the past.
                                                                                               Reuters/Bloomberg                            ALVG.DE/ALV GR
                                                                                               Average daily volume (tds.)                                  4956
■   Operating performance in 2009e and 2010e: With this publication, we                        Free float (%)                                               100.0
    have also revised downwards our forecasts for FY 2008 and the current                      Market capitalization (EUR bn)                                29.6
    year. For FY 2009, we expect a jump in net income to EUR 4.1 bn                            No. of shares issued (mn)                               450.2
    (FY 2008e: EUR -0.1 bn) since the previous year was heavily burdened                       Shareholders                                   Munich Re < 3%
    by losses from discontinued operations related to Dresdner Bank.
                                                                                               UPCOMING EVENTS
    Furthermore, we expect reduced levels of impairments on investments
                                                                                               Annual general meeting                                   29-Apr-09
    compared to the high level in FY 2008. For operating profit, in contrast,
                                                                                               Interim report                                           13-May-09
    we expect a decrease by almost 4% (y-o-y) to EUR 7.5 bn before taxes,
                                                                                               Bal. sheet press conf.                                   26-Feb-09
    with the strongest deterioration expected for the L/H insurance segment.
    For 2010, we forecast an increase of net income by 19% (y-o-y) to                           200
    EUR 4.9 bn, based on our assumptions of further reduced impairment                          180
                                                                                                160
    needs combined with an improvement at the operating level (operating                        140
    pretax profit projected to be up by 6% y-o-y at EUR 7.9 bn).                                120

                                                                                                100
■   Valuation: Our new target price of EUR 118 per share is derived from
                                                                                                 80
    our SOP valuation model. In our view, relatively reliable and attractive
    dividend payments should give the stock a certain protection on the                          60
    downside.

                                                                                                 40
                                                                                                          2006               2007                2008
                                                                                                  ALLIANZ
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
                                       2006        2007         2008e       2009e    2010e                                  Source: Thomson Datastream

Gross premiums (EUR mn)               65288      65736          66298       65722    65122
                                                                                               RELATIVE PERFORMANCE (% CHG.)
Net premiums (EUR mn)                 58524      59362          59821       59035    58535
                                                                                                                                    1M           3M           6M
Net income (EUR mn)                    7021        7966           -61        4127      4928
                                                                                               DAX                                  -4.5         -3.9        -6.7
EPS reported (EUR)                    17.09       18.00          -0.14       9.17     10.95
                                                                                               Euro STOXX 50                        -5.2         -3.6        -7.7
EV earnings (EUR mn)                    985        1941          -958        -431       517
                                                                                               ES Insurance                         -3.8         0.1         -5.2
Embedded value p. s. (EUR)            113.4       104.2          74.9        77.3      82.6
Dividend (EUR)                         3.80        5.50          3.50        4.50      5.50
                                                                                               Dr. Andreas Weese, CEFA (HVB)
RoEV (%)                               17.5        16.5           -0.2       12.1      13.7    +49 89 378-12561
P/E (x)                                 7.8          8.7        -778.8        7.1       6.0    andreas.weese@unicreditgroup.de
P/BV (x)                               1.09        1.46          1.35        0.79      0.74
Price/Embedded value                   1.18        1.51          1.41        0.85      0.79
MC/Net Premiums                        0.51        0.50          0.50        0.50      0.51
Dividend yield (%)                      2.4          3.9           5.4        6.9       8.4
Combined ratio (%)                     92.9        93.6          95.7        95.7      95.3

                                                  Source: Company data, UniCredit Research




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                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




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January 2009
                                                                        20 January 2009                                       Global Equity Research

                                                                                                                                    ESG Research



Munich Re                                                                                      Buy (prev. Buy)
Solid is beautiful                                                                             Price on 01/16/09                                 EUR 111.70
                                                                                               Target price (prev. EUR 130.00)                   EUR 130.00
■   Investment story: Munich Re is one of the two leading reinsurers in                        Upside to TP                                              16.4%
    the world. Since Dr. von Bomhard took over the CEO role, Munich Re                         Cost of equity                                             8.4%
    has put its full emphasis on risk-adequate profitability, rather than on                   High/Low (12M)                                    130.50/82.98
    premium income. This is reflected in the company’s RoRAC which, in our
                                                                                               INVESTMENT HIGHLIGHTS
    opinion, will stabilize above the hurdle rate of 15% in the following years. In             Positive signals from the renewals expected
    order to achieve above average and sustainable RoRAC levels, Munich Re                      Prudent underwriting and asset allocation
                                                                                                Stable dividend
    is also relying on strengthening the primary insurance operations
    incorporated in its ERGO subsidiary. ERGO is among the leading                             STOCK TRIGGERS
                                                                                                Renewals in January
    primary insurance companies in Germany in all business areas, but still                     Capital market environment
    lacks sufficient scale and scope in its international presence. With its                    Cat events
    prudent underwriting and asset allocation, Munich Re is set to weather
                                                                                               STOCK DATA
    even stormy times well.                                                                                                              MUVGn.DE/MUV2
                                                                                               Reuters/Bloomberg
                                                                                                                                                    GR
                                                                                               Average daily volume (tds.)                       2087.9
■   Operating performance in 2009e and 2010e: We think that Munich                             Free float (%)                                             100.0
    Re should be able to be able to benefit from a trend to higher prices                      Market capitalization (EUR bn)                              23.2
    and better conditions in the reinsurance markets. This, together with an                   No. of shares issued (mn)                                  206.4
    improvement of the investment result, should lead to higher EPS.                           Shareholders                                      Allianz 1.91%

                                                                                               UPCOMING EVENTS
■   Valuation: Based on our RoRAC-based SOP model, Munich Re shares are
                                                                                               Annual general meeting                                 22-Apr-09
    fairly valued at EUR 130 per share. Munich Re promised to pay an attractive
                                                                                               Bal. sheet press conf.                                 03-Mar-09
    dividend of EUR 5.50 for 2008, resulting in an attractive dividend yield.
                                                                                               Q1                                                     06-May-09

                                                                                                170
                                       2006        2007         2008e      2009e     2010e      160
                                                                                                150
Gross premiums (EUR mn)               37436      37262          37543      38266     38312
                                                                                                140
Net premiums (EUR mn)                 35714      35675          35690      36665     36681
                                                                                                130
Net income (EUR mn)                    3519        3937          1709       3046       3213
                                                                                                120
EPS reported (EUR)                    15.05       17.90          8.29       14.93     15.74
                                                                                                110
EV earnings (EUR mn)                   1338       -1771         -5381        677        516
                                                                                                100
Embedded value p. s. (EUR)            114.6       118.4         105.1       115.0     123.1
Dividend (EUR)                         4.50        5.50          5.50        5.50      5.50      90

RoEV (%)                               13.1        15.1           7.9        13.0      12.8      80
                                                                                                         2006              2007           2008
P/E (x)                                 7.7          7.2         13.6         7.5       7.1       MUENCHENER RUCK.
                                                                                                  DAX 30 PERFORMANCE - PRICE INDEX
                                                                                                                            Source: Thomson Datastream
P/BV (x)                                1.0          1.1          1.0         0.9       0.9
Price/Embedded value                    1.0          1.1          1.1         1.0       0.9    RELATIVE PERFORMANCE (% CHG.)
MC/Net Premiums                         0.7          0.8          0.7         0.6       0.6                                       1M             3M         6M
Dividend yield (%)                      3.9          4.3          4.9         4.9       4.9    DAX                                4.0        25.6          33.2
Combined ratio (%)                     92.9        96.5         100.5        99.5      98.0    Euro STOXX 50                      3.2        26.0          32.2
                                                                                               ES Insurance                       4.6        29.7          34.7
                                                  Source: Company data, UniCredit Research

                                                                                               Bernd Müller-Gerberding, CFA (HVB)
                                                                                               +49 89 378-18706
                                                                                               bernd.mueller-gerberding@unicreditgroup.de




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                                                                                       ESG Research




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                                                             20 January 2009      Global Equity Research

                                                                                       ESG Research




                                                                                                     Media




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                                                                                  20 January 2009                                     Global Equity Research

                                                                                                                                              ESG Research



ESG overview – Media
TP upside vs. difference TPESG-TP (%)*                                                       Sustainable alpha of UCRESGLG Index constituents (%)

                                                                                                 No Prime Investment status companies available
                  0.0
                  -2.0
                  -4.0
                  -6.0
 TPESG - TP (%)




                  -8.0
                             GFK GR (H,D+)
             -10.0
             -12.0                           Sector

             -14.0
                                                                        PSM GR (S,D-)
             -16.0
             -18.0
             -20.0
                         0    5       10     15         20         25        30         35
                                             TP upside (%)


* average is MCAP weighted                                                                                               Source: oekom research, UniCredit Research


ESG risk analysis
The Media sector again fell deeply into ESG Laggard territory with an average ESG sector score of -4.0. Its Environmental
performance is at the lowest score possible (-5.0), with its Social & Governance performance slightly better (-3.0). Given the
overall low ESG score, none of the companies were able to obtain Prime investment status, with GfK (Hold, D+) still portraying
the highest ESG score in the sector. The average relative ESG risk adjustment to the cost of equity for the sector could not be
determined due to a lack of Prime stocks. Using the general portfolio ESG risk adjustment variables and taking into account
stock-specific ESG ratings, the ESG risk adjustment for the sector has been determined at 115.5bps. The overall impact of
these ESG risk adjustments on our target prices translates into an upside adjustment of -15.4% for the overall sector. From an
ESG style analysis point of view, there are no top tier rated ESG stocks with D rated stocks being the sole contributors to the
overall sector performance. Given the lack of Prime stocks, no ESG efficient frontier analysis could be conducted.

Strategic outlook
The outlook for the German Media sector is at best challenging, if not gloomy. This is especially true for the print and free TV
segment, as both segments are facing increasing competition from online business. But web media will also face problems for
the first time, in our view, as the growth rate will drop further and advertising money will increasingly concentrate on a few
leading companies. The European-wide economic downturn will definitely have a negative impact on the P&L of the companies.
Print and free TV will suffer from the lower advertising spend (increasing price discounts); the print segment will additionally be
hit by the expected negative trend in private consumption. The situation for pay TV is different. This business is still growing in
Germany and most of the other European countries, and has (therefore) not shown any significant correlation to previous
economic downturns.

TOP & BOTTOM SUSTAINABLE ALPHAS BY UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS

COMPANY        INVESTMENT HIGHLIGHTS                   STOCK TRIGGERS                                        KEY ESG STRENGTH/WEAKNESS
Top sustainable alphas (UCRESGLG Index constituents)
No Prime Investment status companies available
Bottom sustainable alphas (UCRESGLG Index non-constituents)
GfK            No. 4 worldwide in market information   Expectation for an excellent Q4/08                    - lack of transparency regarding a corporate policy on
(Hold,D+)                                                                                                       staff relations and labor standards
ProSiebenSa No. 2 in European free TV                  Hope for an acceptance of the sales                   - lack of transparancy regarding measures to reduce
t.1 Media                                              model in 2009                                            energy consumption in the production of media content
(Sell,D-)

                                                                                                                         Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG                   UniCredit CAIB Group                   page 131                                        See last pages for disclaimer.
                                                                         20 January 2009                                                Global Equity Research

                                                                                                                                                ESG Research



ESG rating overview – Media
ESG sector scoring overview by category                                                ESG stock rating breakdown

  0.0


  -1.0


  -2.0


  -3.0                                                                                                       D-                                   D+
                                                                                                           50.0%                                 50.0%
  -4.0


  -5.0


  -6.0
         Social & Governance            ESG                 Environmental



                                                                                                                          Source: oekom research, UniCredit Research

Environmental review
All the Media companies we analyzed had a very low score with respect to environmental issues. Consequently, all ended up as
Environmental Laggards, with the worst scores possible for ProSiebenSat.1 Media (D-) and GfK (D-). Respective key
weaknesses include a lack of transparency regarding measures to reduce energy consumption in the production of media
content and limited information on measures to increase energy and resource efficiency of its IT infrastructure.

Social & Governance review
From a Social and Governance point of view as well, all the companies we analyzed again are branded Laggards, with a slight
improvement on the average score compared to their environmental scoring. The best of the worst is GfK (C-), with one of its
key strengths being the implementation of some measures to ensure data privacy and security. On the flipside, the worst is
ProSiebenSat.1 Media (D) with one of its key weaknesses being major controversies regarding business ethics in recent years,
eg, abuse of a dominant position in the sale of advertising space.


TOP/BOTTOM ESG SCORES BY CATEGORY’S ESG SCORING STATUS

Top ESG Leader scores by category
Environmental rating Key environmental strength                             Soc. & Gov. rating Key social & governance strength
No environmental leaders available                                          No social & governance leaders available

                                                                                                  Key social & governance weakness
ProSiebenSat.1            - lack of transparancy regarding measures to      ProSiebenSat.1        - no comprehensive policy regarding responsible marketing
Media (D-)                   reduce energy consumption in the               Media (D)
                             production of media content
GfK (D-)                  - only limited information on measures to         GfK (C-)              - lack of transparency regarding a corporate policy on staff relations
                            increase energy and resource efficiency of                               and labor standards
                            IT infrastructure

                                                                                                                          Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG         UniCredit CAIB Group                       page 132                                                See last pages for disclaimer.
                                                                              20 January 2009                                               Global Equity Research

                                                                                                                                                      ESG Research



ESG overview charts – Media
TP and TPESG upside (%)*                                                                ESG score overview by ESG scoring status

                   TP upside (%)                    TP ESG upside (%)                                    ESG Leader               ESG Laggard          Sector average
                   TP upside sector (%)             TP ESG upside sector (%)
                                                                                          0
 35
 30                                                                                      -1
 25
                                                                                         -2
 20
 15                                                                                      -3
 10
                                                                                         -4
   5
   0
                                                                                         -5
  -5
 -10                                                                                     -6
                       PSM GR




                                                              GFK GR




                                                                                                               GFK GR




                                                                                                                                                            PSM GR
Environmental score overview by category’s ESG scoring status                           Social & Governance score overview by category’s ESG scoring status

          Environmental Leader        Environmental Laggard            Sector average              Soc. & Gov. Leader              Soc. & Gov. Laggard               Sector average

  0                                                                                       0
                                                                                         -1
  -1
                                                                                         -1
  -2                                                                                     -2
                                                                                         -2
  -3
                                                                                         -3
  -4                                                                                     -3
                                                                                         -4
  -5
                                                                                         -4
  -6                                                                                     -5
                       PSM GR




                                                              GFK GR




                                                                                                               GFK GR




                                                                                                                                                            PSM GR
kesg/ke differential by ESG scoring status (bps)*                                       ERP & beta differential between Prime/Not Prime composites**

                    ESG Leader            ESG Laggard      Sector average
                                                                                          7.00
 160                                                                                                                    6.18
                                                                                          6.00
 140                                                                                                    5.35
 120                                                                                      5.00
 100
                                                                                          4.00
  80
                                                                                          3.00
  60
  40                                                                                      2.00
  20                                                                                                                                                                  1.06
                                                                                                                                                     0.84
                                                                                          1.00
   0
                        GFK GR




                                                              PSM GR




                                                                                          0.00
                                                                                                                  ERP                                       Beta
                                                                                                                                 Prime   Not Prime


* averages are MCAP weighted; ** Market Portfolio figures due to lack of Prime sector composite availability                   Source: oekom research, UniCredit Research




Bayerische Hypo- und Vereinsbank AG            UniCredit CAIB Group                     page 133                                                     See last pages for disclaimer.
                                                                                                                                                                                                       20 January 2009                                                                                                                                                                                    Global Equity Research

                                                                                                                                                                                                                                                                                                                                                                                                                   ESG Research



UCRESGLG Index sector constituents overview – Media
UCRESGLG INDEX CONSTITUENTS/NON-CONSTITUENTS OVERVIEW

Bloomberg                                                                   Current                 ESG                  ESG exposure                                  ESG risk                                          ESG confidence                                                                                              Current                       Target                TP upside        TPESG upside              α sustainable
ticker                                         Name                         rec.                    rating                  ESGEi (%)                              ESGRsector i (%)                                       ESGCsector i (%)                                         ke                          kESG                    price                        price      TPESG           (%)                 (%)                      (%)
UCRESGLG index constituent
N/A
UCRESGLG index non-constituent
GFK GR                  GfK                                                 Hold                    D+                               -60.0                                                    -17.1                                                          NA                 9.3                            10.3                       18.6                       20.0         17.8             7.8               -3.8                 -14.1
PSM GR                  ProSiebenSat.1                                      Sell                    D-                              -100.0                                                    -17.1                                                          NA                 8.0                                9.3                             1.5                2.0          1.6            30.7                7.8                  -1.5
                        Media

                                                                                                                                                                                                                                                                                                                                                                                             Source: oekom research, UniCredit Research



ESG confidence analysis ( x )*                                                                                                   ESG style analysis (%)                                                                                                                                                                               ESG efficient frontier analysis (%)*

                                                                                                                                                                                                                           Composite D                                                                                                                                      Sharpe ratio Prime(0.38); Sharpe ratio Sector(0.07)
          ESGCsector i = 1.0 - 0.0
                                                                                                                                                                                                                                                                                                                                                          12

                                                                                                                                  100                                                                                                                                                                                                                     10

                                                                                                                                                                                                                                                                                                                                                          8




                                                                                                                                                                                                                                                                                                                                       Portfolio return
                                                                                                                                   80
                                                                                                                                                                                                                                                                                                                                                          6
                                                                                                                                   60
                                                                                                                                                                                                                                                                                                                                                          4
                                                                                                                                   40
                                                                                                                                                                                                                                                                                                                                                          2
                                                                                                                                   20
                                                                                                                                                                                                                                                                                                                                                          0
                                                                                                                                    0                                                                                                                                                                                                                          0             10              20             30              40               50
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