Directors and Officers

Investment Advisor

Hottinger Capital Corp.

1270 Avenue of the Americas, Suite 400

New York, NY 10020

(212) 332-7930

Administrator

Citi Fund Services Ohio, Inc.

Custodian

Citibank, N.A.

Transfer Agent

American Stock Transfer & Trust Company

59 Maiden Lane

Plaza Level

New York, NY 10038

Legal Counsel

Stroock & Stroock & Lavan LLP

Independent Registered Public Accounting Firm

Deloitte & Touche LLP

The Investment Advisor

The Swiss Helvetia Fund, Inc. (the “Fund”) is managed by Hottinger Capital Corp., which belongs to Groupe Banque Hottinger & Cie SA.

Groupe Banque Hottinger & Cie SA dates back to Banque Hottinguer, which was formed in Paris in 1786 and is one of Europe’s oldest private banking firms. Groupe Banque Hottinger & Cie SA has remained under the control of the Hottinger family through seven generations. Its headquarters are in Zurich with offices in Geneva, Sion, Basel, Brig and New York.

Executive Offices

The Swiss Helvetia Fund, Inc.

1270 Avenue of the Americas, Suite 400

New York, NY 10020

1-888-SWISS-00 (1-888-794-7700)

(212) 332-2760

For inquiries and reports:

1-888-SWISS-00 (1-888-794-7700)

Fax: (212) 332-7931

email: swz@swz.com

Website Address

www.swz.com

The Fund

The Fund is a non-diversified, closed-end investment company whose objective is to seek long-term capital appreciation through investment in equity and equity-linked securities of Swiss companies. The Fund also may acquire and hold equity and equity-linked securities of non-Swiss companies in limited instances.

The Fund is listed on the New York Stock Exchange under the symbol “SWZ”.

Net Asset Value is calculated daily by 6:15 P.M. (Eastern Time). The most recent calculation is available by calling 1-888-SWISS-00 or by accessing our Website. Net Asset Value is also published weekly in Barron’s, the Monday edition of The Wall Street Journal and the Sunday edition of The New York Times.

Overall Investment Strategy and Process

The goal of the Fund is to provide shareholders with broad exposure to the Swiss equity market and to returns based on long term capital appreciation through investments in Swiss companies that have the potential to provide sustainable returns. Management looks to achieve these goals by investing in companies whose growth profile is underestimated by the market or whose recovery potential is overlooked by other investors. These investment opportunities exist across various market capitalizations. The Fund invests in Swiss companies ranging from some of the largest global businesses to mid- and smaller-size companies that are less represented in the major Swiss indices, including private equity investments in early stage companies.

As part of its investment process, Management seeks to identify and value the factors driving business developments. Management also uses financial modeling tools, such as discounted cash flow analysis, to assess market implied expectations about the growth or recovery of specific companies and compares them to its own expectations. As a result, unlike index funds, the screening and the weighting process of the Fund’s portfolio represents the broader Swiss market.

Management believes that its stock selection process based on fundamental analysis of specific companies’ business developments will add value to the Fund’s portfolio. This is a long term investment approach, especially when investing in mid-

and smaller-size companies where it usually takes more time for a company’s success to attract the attention of investors.

Investment Results

Portfolio Composition

(All percentages are as of September 30, 2013)

In order to paint a comprehensive picture of the Fund’s exposures, risks and volatility, it is useful to break down its portfolio, according to Management’s two primary investment strategies. The undervalued growth strategy comprises the largest share of the Fund’s portfolio, with fifteen companies representing 56% of Fund assets. This amount consists of 43% in large capitalization companies, such as Nestle and Novartis, and 13% in mid- and small-capitalization companies, such as Lindt and Burckhardt Compression. The recovery strategy is comprised of fourteen companies, representing 34% of the Fund’s assets. This amount consists of 13% in large capitalization companies, such as ABB and UBS, and 22% in mid- and small-capitalization companies, such as Panalpina and Nobel Biocare.

Management’s commitment to investing the Fund’s assets in Swiss companies based on the merit of the investment cases rather than solely on market capitalization criteria is illustrated by the Fund’s 15% weight in small companies, including private equity, and 8% weight in mid-sized companies. The Fund’s exposure to large companies is 73% of its assets, approximately 20% below the average weighting of the major Swiss indexes.

Except as noted above, these percentages do not include the Fund’s private equity and other illiquid investments, which account for approximately 6% of the portfolio.

Performance Analysis

(Total returns are year-to-date as of September 30, 2013 in Swiss francs except where otherwise noted)

Management’s recovery strategy has produced strong results for the Fund, particularly in the mid- and smaller-size companies within the strategy. Companies like Swiss Life, with a 47.30% total return, Nobel Biocare and Panalpina are a few examples of the Fund’s investments that have rewarded investors with higher valuations. In most cases, the positive catalyst was the arrival of new management with a better strategy or more comprehensive analysis and solutions to specific issues facing the companies. At Noble Biocare, the new management’s ability to stop market share losses was a decisive influence. This was facilitated by a resilient premium brand, at least in the company’s core markets, and by the stable industry structure.

Panalpina has seen some operating margin improvement with potential for some gross margin progression and sales growth as management executes a transition to a more favorable business mix. Logistics is growing faster than the rest of the company’s business and freight forwarding is serving more of the healthcare sector, which has less volatility than other segments of the economy.

During the first nine months of the year, the Fund was most heavily invested in the healthcare, industrials, financials and consumer staples sectors, which together comprised about 75% of the Fund’s assets, excluding private equity and illiquid securities. The cumulative contribution to Fund’s performance of these sectors was 19% of the 22% total net asset value performance year-to-date (in US dollars). Important contributors in the healthcare sector include Roche, on the back of a total return of 33%, as well as Actelion, which has seen a 50% total return year-to-date. Although the Fund’s exposure to Actelion is only a third of its average exposure to Novartis, the biotech company has contributed more strongly to the Fund’s portfolio as the Fund invested in Actelion at an opportune time and has been able to capture 90% of the company’s year-to-date return. The healthcare sector continues to represent the largest allocation of the Fund’s portfolio, and many of the individual holdings fit nicely into its undervalued growth strategy.

The food & beverage industry, part of the consumer staples sector, has lagged other

sectors this year and returned only 8%. Therefore, as shown in the table below, it was a relatively modest contributor to Fund performance despite being the Fund’s fourth largest sector exposure. This is mainly due to the underperformance of Nestle, as the company suffered from slower growth in the emerging markets at the beginning of the year, and its sales development was penalized by weaker pricing.

In the financial sector, where the Fund’s investments primarily consist of companies that fit into the recovery strategy, results also were strong with investments returning over 25% in aggregate. Looking closer at the performance of the banking industry within the sector, UBS and Credit Suisse returned 33% and 28%, respectively, as they have been able to consolidate their strong performance of the first two quarters, while also seeing positive results in terms of improving capital ratios, although these results have been

partially offset by continuous high litigation fees and settlement related expenses. The published results for the third quarter showed the volatility of the investment banking business as a result of the U.S. Federal Reserve’s “taper” talks. Lower transaction volume and changes in business mix towards on-shore wealth management had a negative effect on the gross margins of the business. This was to be expected, and is reflected in the current valuation of UBS and Credit Suisse. Progress towards resumption of dividend payments for the two Swiss banks, however, might be delayed further.

In looking at market index returns, the industrial sector underperformed the healthcare, consumer discretionary and financial sectors. Due to the Fund’s stock selection and recovery strategy, however, the Fund saw stronger results in its investments in companies in the industrial sector.

Private Equity

Zurmont Madison Private Equity Limited Partnership, one of the Fund’s two investments in private equity funds and its largest overall allocation to private equity, follows an industrial buy-out and build strategy. This holding has developed positively during the period, with the vast majority of its underlying investments registering positive performance, although delays in investment realizations due to low deal activity has not yet allowed for a complete offset of operating expenses at the partnership level.

In contrast to the Fund’s investments in private equity funds, there has been a lot of capital raising activity by the rest of the Fund’s illiquid investments, although certain of those companies have seen a reduction in their valuations as a side effect of such capital raising efforts.

Macro-Economic Insights

Global growth indicators have improved in the past three months despite concerns about balance of payments problems in emerging markets and the associated financial market volatility driven by the hawkish Federal Reserve Board’s communication last May. Policymakers and central bank actions have continued to be the main drivers of market volatility in recent months, causing unintended reactions. The potential normalization of U.S. monetary policy prompted large withdrawals of capital from emerging markets. Subsequently, the dramatic strengthening of the U.S. dollar against

emerging markets currencies has fueled inflation in some developing markets through increased prices of imported goods, negatively affecting the finances of their governments that issue a portion of their debt in U.S. dollars. This should serve as a reminder to investors of the precarious situation of the global economy, created over the years by excess liquidity and credit build-up, and the dependence of certain emerging markets countries on low interest rates in the United States. The potential negative impact on the portfolio companies of the Fund is mainly lower reported sales in Swiss francs for the companies reporting in local currencies from these regions while margins are less affected usually due to a good match of local cost and sales.

China, however, has not been affected by a withdrawal of U.S. dollar liquidity, as expected, but its economy has been impacted by domestic factors. Policymakers in China are embarking upon financial sector reform, primarily the liberalization of interest rates. In addition, heightened concerns about China’s leverage have caused the Chinese authorities to mandate that banks significantly increase loan loss reserves. China’s government also has been quietly easing monetary conditions.

The United States continued to benefit from an ongoing economic recovery despite some increases in longer-term interest rates. The job market continued to gradually improve, while the housing market showed continued traction. Higher mortgage rates,

however, may start to weigh negatively on the sector. For example, mortgage applications have declined by 60% since last May. Going forward, leading U.S. indicators continue to point to robust growth in the private sector. Strong manufacturing numbers as well as bounces in industrial production and retail sales bode well for continued steady economic growth.

The economic recovery in the Eurozone has gained momentum recently, with manufacturing and service sectors showing the strongest pace of expansion over two years, based on the Eurozone PMI Composite Index surprising positively at 52.2 in September. Rising PMI data is likely to support Eurozone gross domestic product (GDP) growth in the second half of 2013. This positive development has been on the back of relaxed budgetary constraints, with the Eurozone backing away from fiscal austerity in exchange for accelerated structural reforms. Germany is experiencing an upturn, where growth has accelerated driven by rising exports and domestic demand. Industrial production growth has gradually improved from a year ago, and is now into positive territory. The European Central Bank’s (ECB) revised projections continue to show inflation well below 2% in 2014. The mutualization of debt, the Banking Union, and expansion of the ECB’s balance sheet are likely to progress in the coming months as policy makers are expected to gradually shift towards a more growth-orientated policy with deflationary pressures still visible in the Southern European countries, as small and

medium-sized businesses in those countries face far steeper borrowing rates, paying interest rates on bank loans up to three times higher than their German counterparts.

From a Swiss economic standpoint, GDP growth surprised positively, expanding by 0.6% in the first quarter of 2013 and by 0.5% in the second quarter of 2013, driven mainly by private consumption (+0.7% quarter-over-quarter), which accelerated at a near record pace during the second quarter. Favorable labor market conditions, an increase in active population and elevated savings rates continued to support robust domestic consumer confidence. Exports also contributed positively to the Swiss economy, helped by strong demand for pharmaceutical and chemical products, watches and jewelry, while services benefitted from improved growth momentum. While investments in construction remained extremely strong in the first quarter of 2013, it was the only GDP component to add negatively in the second quarter of 2013. Investments in machinery and equipment benefited from a meaningful increase for the first time in a year. Against this economic backdrop, the Swiss government raised its GDP forecasts from 1.4% to 1.8% for 2013, accelerating to 2.3% for 2014, while the Swiss National Bank (SNB) revised up its 2013 GDP forecast from 1.0-1.5% to 1.5-2.0%.

On the monetary front, SNB reserves have remained well controlled, at slightly more than 430 billion Swiss francs, and money supply is surging, with M3 growing

10.4% year-over-year in August. SNB President Jordan and Vice President Danthine repeated the importance of the EUR/CHF exchange rate floor with a moderate inflation outlook. Deflationary pressures appear to be coming to an end, but signs of inflation risks remained well contained in Switzerland. In that context, the SNB is likely to keep the policy rate low over the coming years, because it will be harder to defend the exchange rate floor otherwise. If the euro risk premium were to decline substantially, however, the SNB might consider abandoning the exchange rate floor before tightening its interest rate policy.

Market and Sector Outlook

Management continues to be concerned about the amount of credit risk and liquidity risk market participants are taking as they reach for income in a low yield environment, a strategy that, most of the time, involves a hefty amount of leverage. A revision of the current U.S. Federal Reserve policy to keep interest rates low could start an unpleasant unwinding of these strategies and also would compress valuation of the stock market. A mitigating factor for the buildup of risk in the financial system is the reasonable valuation of equities, historically speaking. Investing in the developed markets may be more attractive compared with emerging markets, where the cost of corporate debt is increasing in an environment of slower growth and has put pressure on cash flow margins and is contributing to deflation.

Confronted with ongoing macro-economic volatility, Management continues to concentrate on stock selection, trying to identify investment cases with enough margin of safety brought by more modest investor expectations or by undemanding valuations. Improvements in debt capital availability along with better prospects for the European economy may create a better environment for exits from certain of the Fund’s private equity positions in 2014.

Management believes the overall outlook of the important Swiss healthcare sector is positive. On the valuation front, there might be some froth in the biotechnology space as the U.S. market continued to rally as shown by the return of the Nasdaq Biotechnology Index, which was 56% up for this year in U.S. dollars. Valuation multiples, such as enterprise value to sales, have nearly doubled in the past three years while during the same period, sales growth also has accelerated and now should exceed 20% on average. In the Swiss market, Actelion is a good example of a company that has seen substantial progress in developing its product pipeline for high value added and difficult to meet medical needs.

In the pharmaceutical industry, Roche is seen as the leader in the development of innovative treatments, in particular in the oncology area. With a large share of its revenues dominated by biologic drugs, the company is well positioned to meet multiple challenges in the industry, such as increased competition from generics companies, life

cycle management of blockbuster products and pricing pressure on drugs. Governments are exerting downward pricing pressure through different mechanisms, including generic substitution, differentiated prices depending on patent status and the introduction of rebates from the industry to a country’s health system.

Rumors on a potential merger between Roche and Novartis have been reported recently in the press. Novartis’ thirty percent voting stake in Roche has proven to be a rewarding investment for Novartis over the last 10 years. A merger scenario is highly speculative at this stage, and Novartis has clearly stated a different agenda in terms of its capital allocation including dividend distributions, debt reduction, share buybacks and accretive acquisitions in the mid-sized range.

Why Invest? Global diversification.

Why should investors include Swiss equities in a well-balanced global portfolio? The simple answer is to improve diversification, both in terms of the types of companies available for investment and currency exposure. With the exception of the large multinational companies in the pharmaceutical industry, which are just as global as their peers in other countries, Swiss corporations tend to be more heavily exposed to international economic developments, especially due to their strong presence in the emerging markets. This is historically due to the need of Swiss companies to expand organically or by acquisition outside the narrow domestic

market. This explains why a country of only

eight million people is home to some of the most respected companies in the world. The market cap of listed Swiss equities is about twice that of GDP, whereas the equivalent US ratio is about one. Moreover, Swiss companies have, over the years, moved production centers abroad, setting up decentralized international operations with significant decision power at the local level. This helps Swiss companies to adapt and respond to challenges faster and compete better with local rivals.

Management believes these attributes have been a factor in the strong performance of the Swiss Performance Index over the past ten years. For example, a U.S. investor would have benefited from 4.28% per year excess returns compared to the S&P 500 Index, and 3.35% versus the MSCI EAFE. The appreciation of the Swiss franc against the U.S. dollar and other world currencies was an important positive component of those returns, which speaks for currency diversification, especially as the performance of the Swiss market in local currency has not suffered too much from lower sales reporting in Swiss francs. A strong currency has kept Swiss companies very competitive as they have had to continuously lower costs to preserve margins that would have been otherwise affected by the necessary price reduction in Swiss francs to avoid market share loss in international markets. In addition, the high cost base of Swiss operations has been compensated in part by the development and production of higher value added goods and services with more stable market shares.

Of course, the positive patterns of recent years are unlikely to persist forever as economies and currencies relationships ebb and flow. However, the potential benefits of global diversification are something U.S. investors should keep in mind when assessing the diversification and returns of their portfolios.

Sincerely,

Alexandre de Takacsy

President

Rudolf Millisits

Chief Executive Officer

Source: Citi