1. 1818 Society Annual Meeting Pension Plan Performance October 24, 2007

2. Highlights 2006 Funded status Plan performance Real Estate update Hedge Fund update July/August 07 market stress Concluding Remarks Road Map

3. Staff Retirement Plan (SRP)  Assets increased by $1.6 billion to $14.0 billion  Closed Group Liabilities increased by $0.8 billion to $14.3 billion  Return of 14.3% outperforming benchmark by 3.1%  Funded ratio improved from 92% to 97%  Bank contribution rate of 12.23% for FY08 (18.35% in FY07) Retiree Staff Benefits Plan (RSBP)  Assets increased by $0.24 billion to $1.45 billion  Closed Group Liabilities increased by $0.11 billion to $1.85 billion  Return of 15.2% outperforming benchmark by 3.6%  Funded ratio improved from 69% to 78%  Bank contribution rate of 6.54% for FY08 (7.82% in FY07) Highlights 2006

4. SRP - Funded Status Funded ratio is (MV of Assets)/(Liabilities)

5. Total Bank Contribution Rates for FY03 - FY08

6. Hedge Funds 11% Global Fixed Income 40% Private Equity 9% Real Estate 5% US Equities 19% Non-US Equities 16% SRP - Asset Allocation as of December 31, 2006 Strategic Asset Allocation is currently under review

7. Plan Performance (2006)  Second largest excess return on record for the plan  Alternative investments played a key role

8. *Plan Performance (Jan ‘07 – Sept ‘07)  Continued strong performance during 2007  Alternatives contribution likely to be revised upward at year-end  Plan weathered well the July/August market turmoil * Numbers are preliminary

9. Real Estate Portfolio qPlan does not invest in residential homes/mortgages qCommercial RE has much better fundamentals than residential and is a great long-term diversifier qThe industry is cyclical but subspaces/geographies follow different cycles qStrategy has a 33 year track record and takes advantage of differences in cycles across subspaces qRE portfolio is well diversified by geography, property type and investment strategy.

10. Commercial RE Vacancy Rates by Sector

11. IIIIIIIVVVI BottomingRecoveryExpansionBalancedSlowingCorrection U.S. Office – CBD Industrial Northeast Pacific (ex So. Cal) Office – Suburban Sunbelt Hotels Office – Midtown Manhattan & So. Cal Apartments Pacific – So. Cal Retail – Malls Retail – Strip Ctrs Self Storage Midwest Europe Germany Netherlands Italy Belgium Austria Sweden Finland Norway Denmark London City & West End Office France Office Spain Office UK Retail Continental European Retail Switzerland Asia East/Central Australia Residential Australia Office Indonesia Thailand Japan Office Tokyo Residential Hong Kong China Office Singapore Malaysia China Residential Australia Retail Australia Industrial West Australia Residential Source: Morgan Stanley Global Cycle Chart, mid 2007

12. Source: Morgan Stanley Real Estate Portfolio by Property Type

13. Hedge Funds Portfolio qThere are many different types of HF portfolios with dramatically different risk/return profiles qWB’s HF portfolio is constructed to have low volatility and to seek positive returns across market environments by limiting downside risk qPortfolio rebuilt during 2000-2003--is now very diversified across strategies, geographies and number of managers qEquipped to deal with high profile losses but has avoided them so far qHedge funds techniques permeate all asset classes nowadays--useful source of intelligence

14. Source: Morgan Stanley Hedge Fund Diversification  Very diversified portfolio: more than 40 managers across all strategies and geographies

15. * Numbers are preliminary Hedge Fund Risk Adjusted Returns  HF provide substantially higher risk-adjusted returns compared with other public asset classes. Performance and Risk of HF Portfolio Jan 2003-2007 (Sept*)

16. Source: Morgan Stanley Returns of SRP HF Portfolio, 2000-2007 (Sept *) Hedge Fund Performance: Consistency  HF portfolio produced consistent and positive absolute returns  Staff choices of managers added significant value  Return stream is excellent diversifier for plan * Numbers are preliminary

17. Stress Test: The July/August 07 Episode  Market turmoil was triggered by failure of two funds that invested in CDOs  It resulted in a repricing of risk across markets  The HF portfolio showed great resilience Performance of WB Portfolio July / August 07 (Sept *) * Numbers are preliminary

18. Concluding Remarks qFunded status of the plan continued to improve during 2006 and is currently well funded qIn 2006: Large value added component from pension team qReal Estate and Hedge Funds: high risk-adjusted returns; great diversifiers qPlan weathered the July/August market stress well qImplications for Plan: n diversify n take advantage of changes in asset management n focus on long term trends