UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number: 811-08294

AB EXCHANGE RESERVES

(Exact name of registrant as specified in charter)

1345 Avenue of the Americas, New York, New York 10105

(Address of principal executive offices) (Zip code)

Joseph J. Mantineo

AllianceBernstein L.P.

1345 Avenue of the Americas

New York, New York 10105

(Name and address of agent for service)

Registrant’s telephone number, including area code: (800) 221-5672

Date of fiscal year end: April 30, 2015

Date of reporting period: April 30, 2015

ITEM 1. REPORTS TO STOCKHOLDERS.

APR    ^04.30.15

ANNUAL REPORT

AB EXCHANGE RESERVES

Investment Products Offered

• Are Not FDIC Insured

• May Lose Value

• Are Not Bank Guaranteed

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

This shareholder report must be preceded or accompanied by the Fund’s prospectus for individuals who are not current shareholders of the Fund.

You may obtain a description of the Fund’s proxy voting policies and procedures, and information regarding how the Fund voted proxies relating to portfolio securities during the most recent 12-month period ended June 30, without charge. Simply visit AB’s website at www.abglobal.com, or go to the Securities and Exchange Commission’s (the “Commission”) website at www.sec.gov, or call AB at (800) 227-4618.

The Fund files its complete schedule of portfolio holdings with the Commission for the first and third quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the Commission’s website at www.sec.gov. The Fund’s Forms N-Q may also be reviewed and copied at the Commission’s Public Reference Room in Washington, DC; information on the operation of the Public Reference Room may be obtained by calling (800) SEC-0330. AB publishes full portfolio holdings for the Fund monthly at www.abglobal.com.

AllianceBernstein Investments, Inc. (ABI) is the distributor of the AB family of mutual funds. ABI is a member of FINRA and is an affiliate of AllianceBernstein L.P., the Adviser of the funds.

The [A/B] logo is service mark of AllianceBernstein and AllianceBernstein^® is a registered trademark used by permission of the owner, AllianceBernstein L.P.

EXPENSE EXAMPLE

(unaudited)

As a shareholder of the Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments, contingent deferred sales charges on redemptions and (2) ongoing costs, including management fees; distribution (12b-1) fees; and other Fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period as indicated below.

Actual Expenses

The table below provides information about actual account values and actual expenses. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.

Hypothetical Example for Comparison Purposes

The table below also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed annual rate of return of 5% before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in the Fund and other funds by comparing this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of other funds.

Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), or contingent deferred sales charges on redemptions. Therefore, the hypothetical example is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.

	Beginning Account Value November 1,  2014		Ending Account Value April 30, 2015		Expenses Paid During Period*		Annualized Expense Ratio*
Class A
Actual	$	1,000	$	1,000.20	$	0.64		0.13	%
Hypothetical**	$	1,000	$	1,024.15	$	0.65		0.13	%
Class B
Actual	$	1,000	$	1,000.10	$	0.79		0.16	%
Hypothetical**	$	1,000	$	1,024.00	$	0.80		0.16	%
Class C
Actual	$	1,000	$	1,000.20	$	0.69		0.14	%
Hypothetical**	$	1,000	$	1,024.10	$	0.70		0.14	%
Advisor Class
Actual	$	1,000	$	1,000.20	$	0.64		0.13	%
Hypothetical**	$	1,000	$	1,024.15	$	0.65		0.13	%
Class R
Actual	$	1,000	$	1,000.10	$	0.79		0.16	%
Hypothetical**	$	1,000	$	1,024.00	$	0.80		0.16	%
Class K
Actual	$	1,000	$	1,000.10	$	0.74		0.15	%
Hypothetical**	$	1,000	$	1,024.05	$	0.75		0.15	%
Class I
Actual	$	1,000	$	1,000.40	$	0.45		0.09	%
Hypothetical**	$	1,000	$	1,024.35	$	0.45		0.09	%

* Expenses are equal to the classes’ annualized expense ratios multiplied by the average account value over the period, multiplied by 181/365 (to reflect the one-half year period).

** Assumes 5% annual return before expenses.

AB EXCHANGE RESERVES  • 1

Expense Example

PORTFOLIO OF INVESTMENTS

April 30, 2015

	Yield*	Principal Amount (000)		U.S. $ Value
SHORT-TERM INVESTMENTS – 100.0%
Certificates of Deposit – 36.3%
Bank of Tokyo-Mitsubishi UFJ Ltd./NY 6/10/15	0.240%	$	50,000	$	50,000,000
Branch Banking & Trust Co. 5/01/15	0.110%		30,000		30,000,000
HSBC Bank USA, NA/NY 8/03/15(a)	0.258%		50,000		50,000,000
JPMorgan Chase Bank, NA 10/23/15(a)	0.322%		25,000		25,000,000
Korea Development Bank/NY 5/06/15	0.120%		50,000		50,000,000
Nordea Bank Finland PLC/NY 8/17/15	0.260%		50,000		49,999,251
Norinchukin Bank/NY 5/15/15	0.230%		50,000		50,000,000
Oversea-Chinese Bank Corp. Ltd./NY 8/06/15	0.000%		50,000		50,000,000
Rabobank Nederland/NY 10/13/15(a)	0.240%		50,000		50,000,000
Royal Bank of Canada/NY 5/06/15(a)	0.218%		22,200		22,200,000
6/10/15(a)	0.251%		25,000		25,000,447
Sumitomo Mitsui Banking Corp. 5/04/15	0.010%		50,000		50,000,000
Sumitomo Mitsui Trust Bank Ltd. 5/11/15	0.150%		20,000		20,000,000
5/07/15	0.270%		11,000		11,000,183
Svenska Handelsbanken/NY 5/18/15	0.215%		36,000		36,000,085
9/25/15	0.295%		25,000		25,000,510
U.S. Bank, NA/MN 9/22/15(a)	0.220%		25,000		25,000,000
7/27/15(a)	0.241%		25,000		25,000,000
Wells Fargo Bank, NA 11/20/15(a)	0.282%		50,000		50,000,000
Westpac Banking Corp./NY 8/05/15(a)	0.258%		25,000		25,000,753
9/02/15(a)	0.266%		25,000		25,000,000
					744,201,229
Commercial Paper – 33.3%
ANZ New Zealand Int’l Ltd./London 4/08/16(a)(b)	0.301%		50,000		50,000,000
Apple, Inc. 5/04/15(b)	0.060%		6,517		6,516,967
Bank of New York Mellon Corp. (The) 5/01/15(b)	0.080%		50,000		50,000,000
Banque et Caisse d’Epargne de l’Etat 5/13/15	0.205%		40,000		39,997,267
7/08/15	0.250%		25,000		24,988,194

2 •  AB EXCHANGE RESERVES

Portfolio of Investments

	Yield*	Principal Amount (000)		U.S. $ Value
Coca-Cola Co. (The) 11/10/15(b)	0.250%	$	50,000	$	49,932,986
Commonwealth Bank of Australia 7/02/15(a)(b)	0.260%		25,000		25,000,000
3/24/16(a)(b)	0.292%		25,000		25,000,000
DBS Bank Ltd. 6/23/15(b)	0.200%		50,000		49,985,278
Exxon Mobil Corp. 6/22/15	0.180%		50,000		49,987,000
National Australia Bank Ltd. 11/05/15(a)(b)	0.268%		50,000		50,000,000
Nestle Capital Corp. 8/10/15	0.170%		33,400		33,384,070
Nestle Finance International 5/05/15	0.070%		3,000		2,999,977
Novartis Finance Corp. 10/02/15(b)	0.220%		50,000		49,952,944
NRW Bank 5/07/15(b)	0.145%		50,000		49,998,792
Toyota Motor Credit Corp. 5/20/15(a)	0.240%		50,000		50,000,000
United Overseas Bank Ltd. 8/18/15(b)	0.250%		50,000		49,962,153
Westpac Banking Corp. 8/03/15(a)(b)	0.258%		25,000		25,000,000
					682,705,628
U.S. Government & Government Sponsored Agency Obligations – 23.4%
Federal Home Loan Bank Discount Notes
5/01/15	0.062%		10,000		10,000,000
5/27/15	0.069%		8,000		7,999,601
6/19/15	0.070%		101,100		101,090,367
6/26/15	0.070%		50,000		49,994,556
6/26/15	0.075%		13,000		12,998,484
5/27/15	0.080%		2,900		2,899,832
Federal Home Loan Mortgage Corp.
9/25/15	0.500%		5,500		5,506,459
9/10/15	1.750%		832		836,789
U.S. Treasury Bill 8/27/15	0.072%		50,000		49,988,200
U.S. Treasury Notes
1/31/16(a)	0.070%		60,000		59,994,675
4/30/16(a)	0.094%		30,000		30,004,408
5/15/15	0.250%		25,000		25,001,631
8/15/15	0.250%		15,000		15,006,812
9/15/15	0.250%		80,000		80,041,928
8/31/15	1.250%		15,000		15,056,853
7/31/15	1.750%		15,000		15,062,842
					481,483,437

AB EXCHANGE RESERVES  • 3

Portfolio of Investments

	Yield*	Principal Amount (000)		U.S. $ Value
Corporates - Investment Grade – 3.8%
Apple, Inc. 5/03/16(a)	0.303%	$	5,876	$	5,880,765
International Business Machines Corp. 7/29/15(a)	0.309%		19,200		19,204,716
JPMorgan Chase Bank, NA 7/30/15(a)	0.528%		2,900		2,901,483
Toronto-Dominion Bank (The) 5/01/15(a)	0.436%		50,000		50,000,000
					77,986,964
Time Deposits – 1.6%
Bank of Montreal/Toronto 5/01/15	0.050%		10,000		10,000,000
Canadian Imperial Bank/Cayman 5/01/15	0.050%		12,400		12,400,000
U.S. Bank, NA/Cayman 5/01/15	0.120%		10,000		10,000,000
Total Time Deposits (cost $32,400,000)					32,400,000
Repurchase Agreements – 1.0%
Mizuho Securities USA 0.15% dated 4/30/15 due 5/01/15 in the amount of $20,000,083 (collateralized by $20,031,600 U.S. Treasury Bills and U.S. Treasury Notes, Zero Coupon to 4.50% due 10/29/15 to 2/15/16, value $20,400,027)			20,000		20,000,000
Governments - Sovereign Agencies – 0.6%
Nederlandse Waterschapsbank NV 5/23/15(a)(b) (cost $12,602,268)	0.542%		12,600		12,602,268
Total Investments – 100.0% (cost $2,051,379,526)					2,051,379,526
Other assets less liabilities – 0.0%					797,436
Net Assets – 100.0%				$	2,052,176,962

* Represents annualized yield from date of purchase for discount securities, and stated interest rate for interest-bearing securities.

(a) Floating Rate Security. Stated interest rate was in effect at April 30, 2015.

(b) Security is exempt from registration under Rule 144A of the Securities Act of 1933. These securities are considered liquid and may be resold in transactions exempt from registration, normally to qualified institutional buyers. At April 30, 2015, the aggregate market value of these securities amounted to $493,951,388 or 24.1% of net assets.

See notes to financial statements.

4 •  AB EXCHANGE RESERVES

Portfolio of Investments

STATEMENT OF ASSETS & LIABILITIES

April 30, 2015

Assets
Investments in securities, at value (cost $2,051,379,526)	$	2,051,379,526
Cash		175,373
Receivable for shares of beneficial interest sold		1,108,906
Interest receivable		462,061
Total assets		2,053,125,866
Liabilities
Payable for shares of beneficial interest redeemed		645,709
Advisory fee payable		60,486
Transfer Agent fee payable		41,237
Distribution fee payable		50,282
Administrative fee payable		20,672
Accrued expenses		130,518
Total liabilities		948,904
Net Assets	$	2,052,176,962
Composition of Net Assets
Shares of beneficial interest, at par	$	2,052,189
Additional paid-in capital		2,050,123,233
Undistributed net investment income		540
Accumulated net realized gain on investment transactions		1,000
	$	2,052,176,962

Net Asset Value Per Share—unlimited shares authorized, $.001 par value

Class	Net Assets		Shares Outstanding		Net Asset Value
A	$	136,850,606		136,843,923	$	1.00
B	$	4,741,511		4,738,701	$	1.00
C	$	14,489,101		14,487,703	$	1.00
Advisor	$	88,860,232		88,863,754	$	1.00
R	$	5,109,519		5,109,499	$	1.00
K	$	25,653,030		25,652,764	$	1.00
I	$	1,776,472,963		1,776,493,044	$	1.00

See notes to financial statements.

AB EXCHANGE RESERVES  • 5

Statement of Assets & Liabilities

STATEMENT OF OPERATIONS

	October 1, 2014 to April 30, 2015(a)			Year Ended September 30, 2014
Investment Income
Interest	$	1,971,307		$	2,731,426
Expenses
Advisory fee (see Note B)		2,781,868			4,008,984
Distribution fee—Class A		316,634			551,914
Distribution fee—Class B		33,269			85,939
Distribution fee—Class C		73,580			163,354
Distribution fee—Class R		17,902			39,026
Distribution fee—Class K		39,105			65,494
Transfer agency—Class A		34,237			38,973
Transfer agency—Class B		1,944			3,558
Transfer agency—Class C		4,560			7,030
Transfer agency—Advisor Class		106,779			196,959
Transfer agency—Class R		2,148			4,683
Transfer agency—Class K		7,821			13,099
Transfer agency—Class I		6,390			11,415
Custodian		143,391			233,661
Registration fees		107,042			127,724
Administrative		36,129			76,189
Trustees’ fees		21,944			58,788
Audit and tax		31,000			41,374
Printing		31,669			39,449
Legal		21,377			37,589
Miscellaneous		26,408			47,146
Total expenses		3,845,197			5,852,348
Less: expenses waived and reimbursed by the Adviser (see Note B)		(2,113,973	)		(3,077,514	)
Less: expenses waived and reimbursed by the Distributor (see Note C)		(480,490	)		(905,727	)
Net expenses		1,250,734			1,869,107
Net investment income		720,573			862,319
Realized and Unrealized Gain on Investment Transactions
Net realized gain on investment transactions		1,000			25,419
Contributions from Affiliates (see Note B)		—			98
Net Increase in Net Assets from Operations	$	721,573		$	887,836

(a) The Fund changed its fiscal year end from September 30 to April 30.

See notes to financial statements.

6 •  AB EXCHANGE RESERVES

Statement of Operations

STATEMENT OF CHANGES IN NET ASSETS

	October 1, 2014 to April 30, 2015(a)			Year Ended September 30, 2014			Year Ended September 30, 2013
Increase in Net Assets from Operations
Net investment income	$	720,573		$	862,319		$	1,703,640
Net realized gain on investment transactions		1,000			25,419			33,730
Contributions from Affiliates (see Note B)		– 0	–		98			– 0	–
Net increase in net assets from operations		721,573			887,836			1,737,370
Dividends and Distributions to Shareholders from
Net investment income
Class A		(45,155	)		(90,033	)		(161,569	)
Class B		(589	)		(2,311	)		(11,307	)
Class C		(2,922	)		(8,137	)		(18,478	)
Advisor Class		(169,026	)		(458,230	)		(740,190	)
Class R		(566	)		(785	)		(5,541	)
Class K		(4,203	)		(5,273	)		(31,345	)
Class I		(498,112	)		(297,550	)		(735,210	)
Net realized gain on investment transactions
Class A		(1,949	)		(4,906	)		– 0	–
Class B		(56	)		(258	)		– 0	–
Class C		(156	)		(648	)		– 0	–
Advisor Class		(8,326	)		(22,760	)		– 0	–
Class R		(61	)		(191	)		– 0	–
Class K		(229	)		(728	)		– 0	–
Class I		(8,084	)		(10,355	)		– 0	–
Transactions in Shares of Beneficial Interest
Net increase (decrease)		237,395,812			330,884,146			(496,943,729	)
Total increase (decrease)		237,377,951			330,869,817			(496,909,999	)
Net Assets
Beginning of period		1,814,799,011			1,483,929,194			1,980,839,193
End of Period (including undistributed net investment income of $540, $0 and $0, respectively)	$	2,052,176,962		$	1,814,799,011		$	1,483,929,194

(a) The Fund changed its fiscal year end from September 30 to April 30.

See notes to financial statements.

AB EXCHANGE RESERVES  • 7

Statement of Changes in Net Assets

NOTES TO FINANCIAL STATEMENTS

April 30, 2015

NOTE A

Significant Accounting Policies

AB Exchange Reserves (the “Fund”) is registered under the Investment Company Act of 1940 as a diversified, open-end investment company. Prior to January 20, 2015, the Fund was known as AllianceBernstein Exchange Reserves. The Fund’s investment objective is to provide maximum current income to the extent consistent with safety of principal and liquidity. The Fund offers, as described in the prospectus, Class A, Class B, Class C, Advisor Class, Class R, Class K and Class I shares. All seven classes of shares have identical voting, dividend, liquidation and other rights, except that the classes bear different distribution and transfer agency expenses. Each class has exclusive voting rights with respect to its distribution plan.

Class A shares are sold for cash without an initial sales charge at the time of purchase. On cash purchases of $1,000,000 or more, however, a contingent deferred sales charge (“CDSC”) equal to 1% of the lesser of net asset value at the time of redemption or original cost if redeemed within one year may be charged. Class A shares may be exchanged for Class A shares of other AB Mutual Funds, subject, in the case of Class A shares of the Fund that were purchased for cash, to any applicable initial sales charge at the time of exchange. Class A shares of the Fund also are offered in exchange for Class A shares of other AB Mutual Funds without any sales charge at the time of purchase, but on Class A shares of the Fund that were received in exchange for another AB Mutual Fund Class A shares that were not subject to an initial sales charge when originally purchased for cash because the purchase was of $1,000,000 or more, a 1% CDSC may be assessed if shares of the Fund are redeemed within one year of the AB Mutual Fund Class A shares originally purchased for cash.

Class B shares are sold for cash, to the extent described in the prospectus, without an initial sales charge. However, a CDSC is charged if shares are redeemed within four years after purchase. The CDSC charge declines from 4% to zero depending on the period of time the shares are held. Effective January 31, 2009, sales of Class B shares of the Fund to new investors were suspended. Class B shares will only be issued (i) upon the exchange of Class B shares from another AB Mutual Fund, (ii) for purposes of dividend reinvestment, (iii) through the Fund’s Automatic Investment Program (the “Program”) for accounts that established the Program prior to January 31, 2009, and (iv) for purchases of additional shares by Class B shareholders as of January 31, 2009. The ability to establish a new Program for accounts containing Class B shares was suspended as of January 31, 2009. Class B shares purchased for cash will automatically convert to Class A shares after eight years. Class B shares may be exchanged, to the extent described in the prospectus, for Class B shares of other AB Mutual Funds. Class B shares also are offered in exchange, to the extent described in the prospectus, for Class B shares of other AB Mutual Funds without an initial sales charge. However, a CDSC may be

8 •  AB EXCHANGE RESERVES

Notes to Financial Statements

charged if shares are redeemed within a certain number of years of the original purchase of AB Mutual Fund Class B shares. When redemption occurs, the applicable CDSC schedule is that which applied to the AB Mutual Fund Class B shares originally purchased for cash at the time of their purchase.

Class C shares are sold for cash or in exchange for Class C shares of another AB Mutual Fund without an initial sales charge at the time of purchase. Class C shares are subject to a CDSC of 1% on redemptions made within the first year after purchase. Class C shares do not convert to any other class of shares of the Fund. Class C shares may be exchanged for Class C shares of other AB Mutual Funds.

Advisor Class shares are sold for cash or in exchange for Advisor Class shares of another AB Mutual Fund without an initial sales charge or CDSC and are not subject to ongoing distribution expenses.

Class R, Class K, and Class I shares are sold for cash or in exchange of the same class of shares of another AB Mutual Fund without an initial sales charge or CDSC. Class I shares are not subject to ongoing distribution expenses. Class I shares are also available for the investment of cash collateral related to the AB Funds’ securities lending programs.

The financial statements have been prepared in conformity with U.S. generally accepted accounting principles (“U.S. GAAP”) which require management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities in the financial statements and amounts of income and expenses during the reporting period. The Fund is an investment company under U.S. GAAP and follows the accounting and reporting guidance applicable to investment companies. Actual results could differ from those estimates. The following is a summary of significant accounting policies followed by the Fund.

1. Security Valuation

Securities in which the Fund invests are traded primarily in the over-the-counter market and are valued at amortized cost, which approximates market value. Under such method a portfolio instrument is valued at cost and any premium or discount is amortized or accreted, respectively, on a constant basis to maturity.

2. Fair Value Measurements

In accordance with U.S. GAAP regarding fair value measurements, fair value is defined as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. U.S. GAAP establishes a framework for measuring fair value, and a three-level hierarchy for fair value measurements based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assump-

AB EXCHANGE RESERVES  • 9

Notes to Financial Statements

tions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Fund. Unobservable inputs reflect the Fund’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available in the circumstances. Each investment is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-tier hierarchy of inputs is summarized below.

• Level 1—quoted prices in active markets for identical investments

• Level 2—other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

• Level 3—significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments)

The fair value of debt instruments, such as bonds, and over-the-counter derivatives is generally based on market price quotations, recently executed market transactions (where observable) or industry recognized modeling techniques and are generally classified as Level 2. Pricing vendor inputs to Level 2 valuations may include quoted prices for similar investments in active markets, interest rate curves, coupon rates, currency rates, yield curves, option adjusted spreads, default rates, credit spreads and other unique security features in order to estimate the relevant cash flows which are then discounted to calculate fair values. If these inputs are unobservable and significant to the fair value, these investments will be classified as Level 3. In addition, non-agency rated investments are classified as Level 3.

Other fixed income investments, including non-U.S. government and corporate debt, are generally valued using quoted market prices, if available, which are typically impacted by current interest rates, maturity dates and any perceived credit risk of the issuer. Additionally, in the absence of quoted market prices, these inputs are used by pricing vendors to derive a valuation based upon industry or proprietary models which incorporate issuer specific data with relevant yield/spread comparisons with more widely quoted bonds with similar key characteristics. Those investments for which there are observable inputs are classified as Level 2. Where the inputs are not observable, the investments are classified as Level 3.

The following table summarizes the valuation of the Fund’s investments by the above fair value hierarchy levels as of April 30, 2015:

Investments in Securities:	Level 1			Level 2		Level 3			Total
Assets:
Short-Term Investments
Certificates of Deposit	$	– 0	–	$	744,201,229	$	– 0	–	$	744,201,229
Commercial Paper		– 0	–		682,705,628		– 0	–		682,705,628

10 •  AB EXCHANGE RESERVES

Notes to Financial Statements

Investments in Securities:

Level 1

Level 2

Level 3

Total

U.S. Government & Government Sponsored Agency Obligations

$

– 0

–

$

481,483,437

$

– 0

–

$

481,483,437

Corporates – Investment Grades

– 0

–

87,687,750

– 0

–

87,687,750

Time Deposits

– 0

–

32,400,000

– 0

–

32,400,000

Repurchase Agreements

20,000,000

– 0

–

– 0

–

20,000,000

Bank Note

– 0

–

2,901,482

– 0

–

2,901,482

Total Investments in Securities

20,000,000

2,031,379,526

– 0

–

2,051,379,526

Other Financial Instruments

– 0

–

– 0

–

– 0

–

– 0

–

Total^

$

20,000,000

$

2,031,379,526

$

– 0

–

$

2,051,379,526

^ There were no transfers between any levels during the reporting period.

The Fund recognizes all transfers between levels of the fair value hierarchy assuming the financial instruments were transferred at the beginning of the reporting period.

The AllianceBernstein L.P. (the “Adviser”) established a Valuation Committee (the “Committee”) to oversee the pricing and valuation of all securities held in the Fund. The Committee operates under pricing and valuation policies and procedures established by the Adviser and approved by the Board, including pricing policies which set forth the mechanisms and processes to be employed on a daily basis to implement these policies and procedures. In particular, the pricing policies describe how to determine market quotations for securities and other instruments. The Committee’s responsibilities include: 1) fair value and liquidity determinations (and oversight of any third parties to whom any responsibility for fair value and liquidity determinations is delegated), and 2) regular monitoring of the Adviser’s pricing and valuation policies and procedures and modification or enhancement of these policies and procedures (or recommendation of the modification of these policies and procedures) as the Committee believes appropriate.

The Committee is also responsible for monitoring the implementation of the pricing policies by the Adviser’s Pricing Group (the “Pricing Group”) and a third party which performs certain pricing functions in accordance with the pricing policies. The Pricing Group is responsible for the oversight of the third party on a day-to-day basis. The Committee and the Pricing Group perform a series of activities to provide reasonable assurance of the accuracy of prices including: 1) periodic vendor due diligence meetings, review of methodologies, new developments and processes at vendors, 2) daily comparison of security valuation versus prior day for all securities that exceeded established thresholds, and 3) daily review of unpriced, stale, and variance reports with exceptions reviewed by senior management and the Committee.

In addition, several processes outside of the pricing process are used to monitor valuation issues including: 1) performance and performance attribution reports are monitored for anomalous impacts based upon benchmark performance, and 2) portfolio managers review all portfolios for performance and analytics (which are generated using the Adviser’s prices).

AB EXCHANGE RESERVES  • 11

Notes to Financial Statements

3. Taxes

It is the Fund’s policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its investment company taxable income and net realized gains, if any, to shareholders. Therefore, no provisions for federal income or excise taxes are required.

In accordance with U.S. GAAP requirements regarding accounting for uncertainties in income taxes, management has analyzed the Fund’s tax positions taken or expected to be taken on federal and state income tax returns for all open tax years (the current and the prior three tax years) and has concluded that no provision for income tax is required in the Fund’s financial statements.

4. Dividends

The Fund declares dividends daily and automatically reinvests such dividends in additional shares at net asset value. Net realized capital gains on investments, if any, are expected to be distributed annually.

5. Class Allocations

All income earned and expenses incurred by the Fund are borne on a pro-rata basis by each outstanding class of shares, based on the proportionate interest in the Fund represented by the net assets of such class, except for class specific expenses which are allocated to the respective class. Realized and unrealized gains and losses are allocated among the various share classes based on respective net assets.

6. Investment Income and Investment Transactions

Interest income is accrued daily and includes amortization of premiums and accretions of discounts as adjustments to interest income. Investment transactions are accounted for on the date the securities are purchased or sold.

7. Repurchase Agreements

It is the Fund’s policy that its custodian or designated subcustodian take control of securities as collateral under repurchase agreements and to determine on a daily basis that the value of such securities are sufficient to cover the value of the repurchase agreements. If the seller defaults and the value of the collateral declines or if bankruptcy proceedings are commenced with respect to the seller of the security, realization of collateral by the Fund may be delayed or limited.

8. Change of Fiscal Year End

The Fund changed its fiscal year end from September 30 to April 30. Accordingly, the statements of operations, the statement of changes in net assets and financial highlights reflect the period from October 1, 2014 to April 30, 2015.

12 •  AB EXCHANGE RESERVES

Notes to Financial Statements

NOTE B

Advisory Fee and Other Transactions with Affiliates

The Fund pays the Adviser an advisory fee at the annual rate of .25% on the first $1.25 billion of average daily net assets; .24% on the next $.25 billion; .23% on the next $.25 billion; .22% on the next $.25 billion; .21% on the next $1 billion; and .20% in excess of $3 billion. For the period ended April 30, 2015 and the year ended September 30, 2014, the Adviser has voluntarily agreed to waive a portion of such fees in the amount of $1,636,721 and $2,385,513, respectively. To prevent the Fund’s expenses from exceeding its total income on a daily basis, the Adviser voluntarily reimbursed the Fund an additional amount of $477,252 and $692,001 for the period ended April 30, 2015 and the year ended September 30, 2014, respectively.

Pursuant to the investment advisory agreement, the Fund may reimburse the Adviser for certain legal and accounting services provided to the Fund by the Adviser. For the period ended April 30, 2015 and the year ended September 30, 2014, the reimbursement for such services amounted to $36,129 and $76,189, respectively.

The Fund compensates AllianceBernstein Investor Services, Inc. (“ABIS”), a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Fund. ABIS may make payments to intermediaries that provide omnibus account services, sub-accounting services and/or networking services. Such compensation retained by ABIS amounted to $155,613 and $217,406 for the period ended April 30, 2015 and the year ended September 30, 2014, respectively.

AllianceBernstein Investments, Inc. (the “Distributor”), a wholly-owned subsidiary of the Adviser, serves as the distributor of the Fund’s shares. The Distributor has advised the Fund that it has received contingent deferred sales charges imposed upon redemptions by shareholders of Class A, Class B and Class C shares for the period ended April 30, 2015 and the year ended September 30, 2014 were as follows:

Class	2015		2014
A	$	237	$	24,799
B		1,939		4,045
C		4,562		6,056

During the year ended September 30, 2014, the Adviser reimbursed the Fund $98 for trading losses incurred due to a trade entry error.

NOTE C

Distribution Services Agreement

The Fund has adopted a Distribution Services Agreement (the “Agreement”) pursuant to Rule 12b-1 under the Investment Company Act of 1940 for Class A, Class B, Class C, Class R and Class K. Under the Agreement, the Fund

AB EXCHANGE RESERVES  • 13

Notes to Financial Statements

pays distribution and servicing fees to the Distributor at an annual rate of .30% of the Fund’s average daily net assets attributable to Class A shares, 1% of the Fund’s average daily net assets attributable to Class B shares, .75% of the Fund’s average daily net assets attributable to Class C shares, .50% of the Fund’s average daily net assets attributable to Class R shares and .25% of the Fund’s average daily net assets attributable to Class K shares. There are no distribution and servicing fees on the Advisor Class and Class I shares. The fees are accrued daily and paid monthly. The Agreement provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. For the period ended April 30, 2015 and the year ended September 30, 2014, the Distributor voluntarily agreed to waive all of the distribution fees limiting the effective annual rate to 0% for the Class A, Class B, Class C, Class R and Class K shares as follows:

Class	2015		2014
A	$	316,634	$	551,914
B	$	33,269	$	85,939
C	$	73,580	$	163,354
R	$	17,902	$	39,026
K	$	39,105	$	65,494

NOTE D

Investment Transactions, Income Taxes and Distributions to Shareholders

At April 30, 2015, the cost of investments for federal income tax purposes was the same as the cost for financial reporting purposes.

The tax character of distributions paid during the fiscal period ended April 30, 2015 and years ended September 30, 2014 and September 30, 2013, were as follows:

	2015			2014		2013
Distributions paid from:
Ordinary income	$	739,434		$	896,314	$	1,703,640
Long-term capital gain		– 0	–		5,851		– 0	–
Total distributions paid	$	739,434		$	902,165	$	1,703,640

As of April 30, 2015, the components of accumulated earnings/(deficit) on a tax basis were as follows:

Undistributed ordinary income	$	1,483
Undistributed capital gains		57
Total accumulated earnings/(deficit)	$	1,540

For tax purposes, net capital losses may be carried over to offset future capital gains, if any. Funds are permitted to carry forward capital losses incurred in taxable years beginning after December 22, 2010 for an indefinite period, and such

14 •  AB EXCHANGE RESERVES

Notes to Financial Statements

losses will retain their character as either short-term or long-term capital losses. As of April 30, 2015, the Fund did not have any capital loss carryforwards.

During the current fiscal year permanent differences primarily due to the redesignation of dividends resulted in a net increase in undistributed net investment income and a net decrease in accumulated net realized gain on investment transactions. This reclassification had no effect on net assets.

NOTE E

Transactions in Shares of Beneficial Interest

Transactions, all at $1.00 per share, were as follows:

	Shares
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30, 2014			Year Ended September 30, 2013
Class A
Shares sold		39,134,544			167,168,654			202,748,046
Shares issued in reinvestment of dividends and distributions		47,070			94,663			161,236
Shares converted from Class B		1,590,241			2,403,125			2,319,735
Shares redeemed		(121,013,048	)		(144,961,789	)		(186,170,051	)
Net increase (decrease)		(80,241,193	)		24,704,653			19,058,966
Class B
Shares sold		928,744			1,635,484			2,976,191
Shares issued in reinvestment of dividends and distributions		642			2,553			11,285
Shares converted to Class A		(1,590,241	)		(2,403,125	)		(2,319,735	)
Shares redeemed		(1,289,949	)		(3,030,946	)		(5,336,148	)
Net decrease		(1,950,804	)		(3,796,034	)		(4,668,407	)
Class C
Shares sold		5,953,845			11,055,384			23,310,245
Shares issued in reinvestment of dividends and distributions		3,068			8,734			18,410
Shares redeemed		(10,023,522	)		(19,266,591	)		(18,113,288	)
Net increase (decrease)		(4,066,609	)		(8,202,473	)		5,215,367
Advisor Class
Shares sold		159,997,014			299,166,464			405,185,355
Shares issued in reinvestment of dividends and distributions		177,350			480,982			740,034
Shares redeemed		(994,551,354	)		(316,450,301	)		(215,697,860	)
Net increase (decrease)		(834,376,990	)		(16,802,855	)		190,227,529
Class R
Shares sold		5,415,711			21,618,074			7,809,950
Shares issued in reinvestment of dividends and distributions		627			976			5,541
Shares redeemed		(8,106,274	)		(20,971,211	)		(7,075,815	)
Net increase (decrease)		(2,689,936	)		647,839			739,676

AB EXCHANGE RESERVES  • 15

Notes to Financial Statements

	Shares
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30, 2014			Year Ended September 30, 2013
Class K
Shares sold		40,078,800			45,858,700			63,259,258
Shares issued in reinvestment of dividends and distributions		4,432			6,001			31,345
Shares redeemed		(40,659,273	)		(50,239,707	)		(67,908,020	)
Net decrease		(576,041	)		(4,375,006	)		(4,617,417	)
Class I
Shares sold		6,239,263,035			6,642,079,448			8,146,467,224
Shares issued in reinvestment of dividends and distributions		498,621			298,907			723,141
Shares redeemed		(5,078,464,271	)		(6,303,670,333	)		(8,850,089,808	)
Net increase (decrease)		1,161,297,385			338,708,022			(702,899,443	)

^(a)  The Fund changed its fiscal year end from September 30 to April 30.

NOTE F

Risks Involved in Investing in the Fund

Money Market Fund Risk—Money market funds are sometimes unable to maintain a net asset value (“NAV”) at $1.00 per share and, as it is generally referred to, “break the buck.” In that event, an investor in a money market fund would, upon redemption, receive less than $1.00 per share. The Fund’s shareholders should not rely on or expect an affiliate of the Fund to purchase distressed assets from the Fund, make capital infusions, enter into credit support agreements or take other actions to prevent the Fund from breaking the buck. In addition, significant redemptions by large investors in the Fund could have a material adverse effect on the Fund’s other shareholders. The Fund’s NAV could be affected by forced selling during periods of high redemption pressures and/or illiquid markets. Money market funds are also subject to regulatory risk. The Securities and Exchange Commission recently adopted amendments to Rule 2a-7 governing money market funds. The amendments have different implications for prime and tax-exempt institutional money market funds, and U.S. government and retail money market funds. The amendments will require prime money market funds that have institutional investors, to sell and redeem their shares at a floating net asset value (“NAV”) based on the current market value of securities in their underlying portfolios while government money market funds and retail money market funds will continue to be permitted to maintain a stable NAV. The amended rule will permit the Fund, at the discretion of the Fund’s Board to, under certain circumstances, impose liquidity fees of up to 2% on, or suspend, redemptions for limited periods of time. The Fund also may be required to impose a liquidity fee of 1% on redemptions at times of severely reduced liquidity of Fund assets, unless the Board determines that no fee or an adjusted fee (up to 2%) is in the Fund’s best interests. There are a number of other changes under

16 •  AB EXCHANGE RESERVES

Notes to Financial Statements

the amendments that relate to diversification, disclosure, reporting and stress testing requirements for money market funds. The effective date for the principal changes is October 14, 2016, but certain other changes will become effective prior to that date.

Interest Rate Risk and Credit Risk—The Fund’s primary risks are interest rate risk and credit risk. Because the Fund invests in short-term securities, a decline in interest rates will affect the Fund’s yield as the securities mature or are sold and the Fund purchases new short-term securities with a lower yield. Generally, an increase in interest rates causes the value of a debt instrument to decrease. The change in value for shorter-term securities is usually smaller than for securities with longer maturities. In addition, if interest rates remain low for an extended period of time, the Fund may have difficulties in maintaining a positive yield, paying expenses out of the Fund’s assets, or maintaining a stable $1.00 NAV.

Credit risk is the possibility that a security’s credit rating will be downgraded or that the issuer of the security will default (fail to make scheduled interest and principal payments). Credit quality can change rapidly in certain market environments and the default of a single holding could have the potential to cause significant NAV deterioration.

Foreign (Non-U.S.) Risk—Investment in securities of non-U.S. issuers may involve more risk than those of U.S. issuers. These securities may fluctuate more widely in price and may be less liquid due to adverse market, economic, political, regulatory or other factors.

Liquidity Risk—Liquidity risk exists when particular investments are difficult to purchase or sell, which may prevent the Fund from selling out of these securities at an advantageous time or price.

Indemnification Risk—In the ordinary course of business, the Fund enters into contracts that contain a variety of indemnifications. The Fund’s maximum exposure under these arrangements is unknown. However, the Fund has not had prior claims or losses pursuant to these indemnification provisions and expects the risk of loss thereunder to be remote. Therefore, the Fund has not accrued any liability in connection with these indemnification provisions.

NOTE G

Subsequent Events

Management has evaluated subsequent events for possible recognition or disclosure in the financial statements through the date the financial statements are issued. Management has determined that there are no material events that would require disclosure in the Fund’s financial statements through this date.

AB EXCHANGE RESERVES  • 17

Notes to Financial Statements

FINANCIAL HIGHLIGHTS

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class A
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0002			.0005			.0009			.0018			.0001			.0001
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0002			.0005			.0009			.0018			.0001			.0001
Less: Dividends and Distributions
Dividends from net investment income		(.0002	)		(.0005	)		(.0009	)		(.0018	)		(.0001	)		(.0001	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0002	)		(.0005	)		(.0009	)		(.0018	)		(.0001	)		(.0001	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.03	%		.05	%		.09	%		.18	%		.01	%		.01	%
Ratios/Supplemental Data
Net assets, end of period (in millions)		$137			$217			$192			$173			$221			$225
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.13	%^		.12	%		.14	%		.14	%		.23	%		.28	%+
Expenses, before waivers/reimbursements		.61	%^		.61	%		.62	%		.61	%		.86	%		.84	%+
Net investment income(b)		.04	%^		.05	%		.08	%		.17	%		.01	%		.01	%+

See footnote summary on page 24.

18 •  AB EXCHANGE RESERVES

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class B
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0001			.0003			.0008			.0017			.0001			.0001
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0001			.0003			.0008			.0017			.0001			.0001
Less: Dividends and Distributions
Dividends from net investment income		(.0001	)		(.0003	)		(.0008	)		(.0017	)		(.0001	)		(.0001	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0001	)		(.0003	)		(.0008	)		(.0017	)		(.0001	)		(.0001	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.01	%		.03	%		.08	%		.17	%		.01	%		.01	%
Ratios/Supplemental Data
Net assets, end of period (in millions)		$4			$7			$10			$15			$26			$36
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.15	%^		.14	%		.14	%		.14	%		.23	%		.29	%+
Expenses, before waivers/reimbursements		1.34	%^		1.33	%		1.33	%		1.36	%		1.61	%		1.59	%(e)+
Net investment income(b)		.02	%^		.03	%		.09	%		.17	%		.01	%		.01	%+

See footnote summary on page 24.

AB EXCHANGE RESERVES  • 19

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class C
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0002			.0004			.0009			.0018			.0001			.0001
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0002			.0004			.0009			.0018			.0001			.0001
Less: Dividends and Distributions
Dividends from net investment income		(.0002	)		(.0004	)		(.0009	)		(.0018	)		(.0001	)		(.0001	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0002	)		(.0004	)		(.0009	)		(.0018	)		(.0001	)		(.0001	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.02	%		.04	%		.09	%		.18	%		.01	%		.01	%
Ratios/Supplemental Data
Net assets, end of period (in millions)		$14			$19			$27			$22			$31			$27
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.14	%^		.13	%		.14	%		.14	%		.23	%		.29	%+
Expenses, before waivers/reimbursements		1.08	%^		1.07	%		1.08	%		1.08	%		1.32	%		1.31	%(e)+
Net investment income(b)		.03	%^		.04	%		.08	%		.17	%		.01	%		.01	%+

See footnote summary on page 24.

20 •  AB EXCHANGE RESERVES

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Advisor Class
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0002			.0005			.0009			.0018			.0001			.0004
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0002			.0005			.0009			.0018			.0001			.0004
Less: Dividends and Distributions
Dividends from net investment income		(.0002	)		(.0005	)		(.0009	)		(.0018	)		(.0001	)		(.0004	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0002	)		(.0005	)		(.0009	)		(.0018	)		(.0001	)		(.0004	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.03	%		.05	%		.09	%		.18	%		.01	%		.04	%
Ratios/Supplemental Data
Net assets, end of period (in millions)		$89			$923			$940			$750			$700			$149
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.13	%^		.12	%		.14	%		.14	%		.22	%		.25	%+
Expenses, before waivers/reimbursements		.31	%^		.31	%		.32	%		.31	%		.54	%		.54	%+
Net investment income(b)		.04	%^		.05	%		.09	%		.18	%		.02	%		.04	%+

See footnote summary on page 24.

AB EXCHANGE RESERVES  • 21

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class R
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0001			.0001			.0008			.0018			.0001			.0001
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0001			.0001			.0008			.0018			.0001			.0001
Less: Dividends and Distributions
Dividends from net investment income		(.0001	)		(.0001	)		(.0008	)		(.0018	)		(.0001	)		(.0001	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0001	)		(.0001	)		(.0008	)		(.0018	)		(.0001	)		(.0001	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.01	%		.01	%		.08	%		.18	%		.01	%		.01	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$5,110			$7,800			$7,152			$6,412			$6,271			$6,313
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.16	%^		.16	%		.15	%		.13	%		.22	%		.28	%+
Expenses, before waivers/reimbursements		.84	%^		.85	%		.84	%		.85	%		.97	%		1.08	%+
Net investment income(b)		.02	%^		.01	%		.08	%		.18	%		.01	%		.01	%+

See footnote summary on page 24.

22 •  AB EXCHANGE RESERVES

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class K
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0002			.0002			.0008			.0017			.0001			.0002
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0002			.0002			.0008			.0017			.0001			.0002
Less: Dividends and Distributions
Dividends from net investment income		(.0002	)		(.0002	)		(.0008	)		(.0017	)		(.0001	)		(.0002	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0002	)		(.0002	)		(.0008	)		(.0017	)		(.0001	)		(.0002	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.02	%		.02	%		.08	%		.17	%		.01	%		.02	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$25,653			$26,229			$30,605			$35,221			$43,108			$40,762
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.15	%^		.15	%		.14	%		.15	%		.23	%		.27	%+
Expenses, before waivers/reimbursements		.58	%^		.59	%		.60	%		.69	%		.82	%		.83	%+
Net investment income(b)		.03	%^		.02	%		.09	%		.17	%		.01	%		.02	%+

See footnote summary on page 24.

AB EXCHANGE RESERVES  • 23

Financial Highlights

Selected Data For A Share Of Beneficial Interest Outstanding Throughout Each Period

	Class I
	October 1, 2014 to April 30, 2015(a)			Year Ended September 30,
				2014			2013			2012			2011			2010
Net asset value, beginning of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Income From Investment Operations
Net investment income(b)		.0004			.0007			.0010			.0018			.0011			.0015
Net realized gain on investment transactions		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00	(c)		.00
Contributions from Affiliates		.00			.00	(c)		.00			.00			.00			.00
Net increase in net asset value from operations		.0004			.0007			.0010			.0018			.0011			.0015
Less: Dividends and Distributions
Dividends from net investment income		(.0004	)		(.0007	)		(.0010	)		(.0018	)		(.0011	)		(.0015	)
Distributions from net realized gain on investment transactions		(.00	)(c)		(.00	)(c)		.00			.00			.00			.00
Total dividends and distributions		(.0004	)		(.0007	)		(.0010	)		(.0018	)		(.0011	)		(.0015	)
Net asset value, end of period		$  1.00			$  1.00			$  1.00			$  1.00			$  1.00			$  1.00
Total Return
Total investment return based on net asset value(d)		.04	%		.07	%		.10	%		.18	%		.11	%		.15	%
Ratios/Supplemental Data
Net assets, end of period (in thousands)		$1,776,473			$615,207			$276,480			$979,369			$1,906			$2,365
Ratio to average net assets of:
Expenses, net of waivers/reimbursements		.09	%^		.10	%		.13	%		.14	%		.13	%		.15	%+
Expenses, before waivers/reimbursements		.28	%^		.29	%		.28	%		.32	%		.40	%		.41	%+
Net investment income(b)		.08	%^		.07	%		.10	%		.19	%		.12	%		.15	%+

(a) The Fund changed its fiscal year end from September 30 to April 30.

(b) Net of fees waived and expenses reimbursed.

(c) Amount is less than $0.00005.

(d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total return does not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. Total investment return calculated for a period of less than one year is not annualized.

(e) Ratios restated from 1.34% and 1.06% for Class B and Class C, respectively.

^ Annualized.

+ The ratio includes expenses attributable to costs of proxy solicitation.

See notes to financial statements.

24 •  AB EXCHANGE RESERVES

Financial Highlights

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Board of Trustees and Shareholders of

AB Exchange Reserves

We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of AB Exchange Reserves (formerly known as AllianceBernstein Exchange Reserves) (the “Fund”) as of April 30, 2015, and the related statements of operations for the period October 1, 2014 to April 30, 2015 and the year ended September 30, 2014, the statements of changes in net assets for the period October 1, 2014 to April 30, 2015 and each of the two years in the period ended September 30, 2014, and the financial highlights for the period October 1, 2014 to April 30, 2015 and each of the five years in the period ended September 30, 2014. These financial statements and financial highlights are the responsibility of the Fund’s management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. We were not engaged to perform an audit of the Fund’s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Fund’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our procedures included confirmation of securities owned as of April 30, 2015 by correspondence with the custodian and others or by other appropriate auditing procedures where replies from others were not received. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of AB Exchange Reserves at April 30, 2015, and the results of its operations for the period October 1, 2014 to April 30, 2015 and the year ended September 30, 2014, the changes in its net assets for the period October 1, 2014 to April 30, 2015 and each of the two years in the period ended September 30, 2014, and the financial highlights for the period October 1, 2014 to April 30, 2015 and each of the five years in the period ended September 30, 2014, in conformity with U.S. generally accepted accounting principles.

New York, New York

June 12, 2015

AB EXCHANGE RESERVES  • 25

Report Of Independent Registered Public Accounting Firm

2015 FEDERAL TAX INFORMATION

(unaudited)

For Federal income tax purposes, the following information is furnished with respect to the distributions paid by the Fund during the taxable year ended April 30, 2015.

For foreign shareholders, 53.54% of ordinary income dividends paid may be considered to be qualifying to be taxed as interest-related dividends.

Shareholders should not use the above information to prepare their income tax returns. The information necessary to complete your income tax returns will be included with your Form 1099-DIV which will be sent to you separately in January 2016.

26 •  AB EXCHANGE RESERVES

TRUSTEES

Marshall C. Turner, Jr.(1) , Chairman	Nancy P. Jacklin(1) Robert M. Keith, President and Chief Executive Officer Garry L. Moody(1) Earl D. Weiner(1)
John H. Dobkin(1) Michael J. Downey(1) William H. Foulk, Jr.(1) D. James Guzy(1)

OFFICERS

Philip L. Kirstein,
Senior Vice President and Independent Compliance Officer Raymond J. Papera, Senior Vice President Maria R. Cona, Vice President Edward J. Dombrowski, Vice President Lucas Krupa, Vice President Emilie D. Wrapp, Secretary Joseph J. Mantineo, Treasurer and Chief Financial Officer Stephen M. Woetzel, Controller Vincent S. Noto, Chief Compliance Officer

Custodian and Accounting Agent	Transfer Agent
State Street Bank and Trust Company State Street Corporation CCB/5 1 Iron Street Boston, MA 02210	AllianceBernstein Investor Services, Inc. P.O. Box 786003 San Antonio, TX 78278-6003 Toll-Free (800) 221-5672

Legal Counsel	Principal Underwriter
Seward & Kissel LLP One Battery Park Plaza New York, NY 10004	AllianceBernstein Investments, Inc. 1345 Avenue of the Americas New York, NY 10105
Independent Registered Public Accounting Firm Ernst & Young LLP 5 Times Square New York, NY 10036

(1) Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee. Mr. Foulk and Ms. Jacklin are members of the Pricing Committee.

AB EXCHANGE RESERVES  • 27

Trustees

MANAGEMENT OF THE FUND

Board of Trustees Information

The business and affairs of the Fund are managed under the direction of the Board of Trustees. Certain information concerning the Fund’s Trustees is set forth below.

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
INTERESTED DIRECTOR
Robert M. Keith, + 1345 Avenue of the Americas New York, NY 10105 55 (2010)	Senior Vice President of AllianceBernstein L.P. (the “Adviser”) and the head of AllianceBernstein Investments, Inc. (“ABI”) since July 2008; Director of ABI and President of the AB Mutual Funds. Previously, he served as Executive Managing Director of ABI from December 2006 to June 2008. Prior to joining ABI in 2006, Executive Managing Director of Bernstein Global Wealth Management, and prior thereto, Senior Managing Director and Global Head of Client Service and Sales of the Adviser’s institutional investment management business since 2004. Prior thereto, he was Managing Director and Head of North American Client Service and Sales in the Adviser’s institutional investment management business, with which he had been associated since prior to 2004.		120	None

28 •  AB EXCHANGE RESERVES

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS
Marshall C. Turner, Jr., # Chairman of the Board 73 (2005)	Private Investor since prior to 2010. Former CEO of Dupont Photomasks, Inc. (components of semi-conductor manufacturing), 2003-2006, and interim CEO 1999-2000. He has extensive operating and early-stage investment experience, including prior service as general partner of institutional venture capital partnerships, and serves on the boards of three education and science-related non-profit organizations. He has served as a director of one AB fund since 1992, and director or trustee of multiple AB funds since 2005. He has been Chairman of the AB Funds since January 2014, and the Chairman of the Independent Directors Committees of such Funds since February 2014.		120	Xilinx, Inc. (programmable logic semi-conductors) since 2007
John H. Dobkin, # 73 (1994)	Independent Consultant since prior to 2010. Formerly, President of Save Venice, Inc. (preservation organization) from 2001-2002; Senior Advisor from June 1999-June 2000 and President of Historic Hudson Valley (historic preservation) from December 1989-May 1999. Previously, Director of the National Academy of Design. He has served as a director or trustee of various AB Funds since 1992, and as Chairman of the Audit Committees of a number of such Funds from 2001-2008.		120	None

AB EXCHANGE RESERVES  • 29

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Michael J. Downey, # 71 (2005)	Private Investor since prior to 2010. Formerly, managing partner of Lexington Capital, LLC (investment advisory firm) from December 1997 until December 2003. He served as a Director of Prospect Acquision Corp. (financial services) from 2007 until 2009. From 1987 until 1993, Chairman and CEO of Prudential Mutual Fund Management, director of the Prudential mutual funds, and member of the Executive Committee of Prudential Securities Inc. He has served as a director or trustee of the AB Funds since 2005 and is a director and Chairman of one other registered investment company.		120	Asia Pacific Fund, Inc. (registered investment company) since prior to 2010
William H. Foulk, Jr., #, ##, 82 (1994)	Investment Adviser and an Independent Consultant since prior to 2010. Previously, he was Senior Manager of Barrett Associates, Inc., a registered investment adviser. He was formerly Deputy Comptroller and Chief Investment Officer of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings. He has served as a director or trustee of various AB Funds since 1983, and was Chairman of the Independent Directors Committees of the AB Funds from 2003 until early February 2014. He served as Chairman of such Funds from 2003 through December 2013. He is also active in a number of mutual fund related organizations and committees.		120	None

30 •  AB EXCHANGE RESERVES

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
D. James Guzy, # 79 (2005)	Chairman of the Board of SRC Computers, Inc. (semi-conductors), with which he has been associated since prior to 2010. He served as Chairman of the Board of PLX Technology (semi-conductors) since prior to 2010 until November 2013. He was a director of Intel Corporation (semi-conductors) from 1969 until 2008, and served as Chairman of the Finance Committee of such company for several years until May 2008. He has served as a director or trustee of one or more of the AB Funds since 1982.		120	None
Nancy P. Jacklin, #, ## 67 (2006)	Professorial Lecturer at the Johns Hopkins School of Advanced International Studies (2008-2015). U.S. Executive Director of the International Monetary Fund (which is responsible for ensuring the stability of the international monetary system), (December 2002-May 2006); Partner, Clifford Chance (1992-2002); Sector Counsel, International Banking and Finance, and Associate General Counsel, Citicorp (1985-1992); Assistant General Counsel (International), Federal Reserve Board of Governors (1982-1985); and Attorney Advisor, U.S. Department of the Treasury (1973-1982). Member of the Bar of the District of Columbia and of New York; and member of the Council on Foreign Relations. She has served as a director or trustee of the AB Funds since 2006 and has been Chairman of the Governance and Nominating Committees of the Funds since August 2014.		120	None

AB EXCHANGE RESERVES  • 31

Management of the Fund

NAME, ADDRESS*, AGE, (YEAR FIRST ELECTED**)	PRINCIPAL OCCUPATION(S) DURING PAST FIVE YEARS AND OTHER RELEVANT QUALIFICATIONS***	PORTFOLIOS IN FUND COMPLEX OVERSEEN BY DIRECTOR		OTHER PUBLIC COMPANY DIRECTORSHIPS CURRENTLY HELD BY DIRECTOR
DISINTERESTED DIRECTORS (continued)
Garry L. Moody, # 63 (2008)	Independent Consultant. Formerly, Partner, Deloitte & Touche LLP (1995-2008) where he held a number of senior positions, including Vice Chairman, and U.S. and Global Investment Management Practice Managing Partner; President, Fidelity Accounting and Custody Services Company (1993-1995); and Partner, Ernst & Young LLP (1975-1993), where he served as the National Director of Mutual Fund Tax Services and Managing Partner of its Chicago Office Tax department. He is a member of both the Governing Council of the Independent Directors Council (IDC), an organization of independent directors of mutual funds, and the Trustee Advisory Board of BoardIQ, a biweekly publication focused on issues and news affecting directors of mutual funds. He has served as a director or trustee, and as Chairman of the Audit Committees, of the AB Funds since 2008.		120	None
Earl D. Weiner, # 75 (2007)	Of Counsel, and Partner prior to January 2007, of the law firm Sullivan & Cromwell LLP and is a former member of the ABA Federal Regulation of Securities Committee Task Force to draft editions of the Fund Director’s Guidebook. He also serves as a director or trustee of various non-profit organizations and has served as Chairman or Vice Chairman of a number of them. He has served as a director or trustee of the AB Funds since 2007 and served as Chairman of the Governance and Nominating Committees of the AB Funds from 2007 until August 2014.		120	None

32 •  AB EXCHANGE RESERVES

Management of the Fund

* The address for each of the Fund’s disinterested Trustees is c/o AllianceBernstein L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New York, NY 10105.

** There is no stated term of office for the Fund’s Trustees.

*** The information above includes each Trustee’s principal occupation during the last five years and other information relating to the experience, attributes, and skills relevant to each Trustee’s qualifications to serve as a Trustee, which led to the conclusion that each Trustee should serve as a Trustee for the Fund.

+ Mr. Keith is an “interested person” of the Fund, as defined in the 1940 Act, due to his position as a Senior Vice President of the Adviser.

# Member of the Audit Committee, the Governance and Nominating Committee and the Independent Directors Committee.

## Member of the Pricing Committee.

AB EXCHANGE RESERVES  • 33

Management of the Fund

Officer Information

Certain information concerning the Fund’s Officers is listed below.

NAME, ADDRESS* AND AGE	POSITION(S) HELD WITH FUND	PRINCIPAL OCCUPATION DURING PAST FIVE YEARS**
Robert M. Keith 55	President and Chief Executive Officer	See biography above.
Philip L. Kirstein 70	Senior Vice President and Independent Compliance Officer	Senior Vice President and Independent Compliance Officer of the AB Funds, with which he has been associated since October 2004. Prior thereto, he was Of Counsel to Kirkpatrick & Lockhart, LLP from October 2003 to October 2004, and General Counsel of Merrill Lynch Investment Managers, L.P. since prior to March 2003.
Raymond J. Papera 59	Senior Vice President	Senior Vice President of the Adviser,** with which he has been associated since prior to 2010.
Maria R. Cona 60	Vice President	Vice President of the Adviser,** with which she has been associated since prior to 2010.
Edward J. Dombrowski 37	Vice President	Vice President of the Adviser,** with which he has been associated since prior to 2010.
Lucas Krupa 28	Vice President	Associate Officer of the Adviser** and Money Market Associate on the Fixed Income Cash Management team with which he has been associated since June 2010. Prior thereto, he was associated with Omnicom Capital Inc. since prior to 2010.
Emilie D. Wrapp 59	Secretary	Senior Vice President, Assistant General Counsel and Assistant Secretary of ABI,** with which she has been associated since prior to 2010.
Joseph J. Mantineo 56	Treasurer and Chief Financial Officer	Senior Vice President of AllianceBernstein Investor Services, Inc. (“ABIS”),** with which he has been associated since prior to 2010.
Stephen M. Woetzel 43	Controller	Vice President of ABIS,** with which he has been associated since prior to 2010.
Vincent S. Noto 50	Chief Compliance Officer	Senior Vice President since 2015 and Mutual Fund Chief Compliance Officer of the Adviser** since 2014. Prior thereto, he was Vice President and Director of Mutual Fund Compliance of the Adviser** since prior to 2010.

* The address for each of the Fund’s Officers is 1345 Avenue of the Americas, New York, NY 10105.

** The Adviser, ABI and ABIS are affiliates of the Fund.

The Fund’s Statement of Additional Information (SAI) has additional information about the Fund’s Trustees and Officers and is available without charge upon request. Contact your financial representative or AB at 800-227-4618, or visit www.abglobal.com, for a free prospectus or SAI.

34 •  AB EXCHANGE RESERVES

Management of the Fund

Information Regarding the Review and Approval of the Fund’s Advisory Agreement

The disinterested trustees (the “trustees”) of AB Exchange Reserves (the “Fund”) unanimously approved the continuance of the Fund‘s Advisory Agreement with the Adviser at a meeting held on November 3-6, 2014.

Prior to approval of the continuance of the Advisory Agreement, the trustees had requested from the Adviser, and received and evaluated, extensive materials. They reviewed the proposed continuance of the Advisory Agreement with the Adviser and with experienced counsel who are independent of the Adviser, who advised on the relevant legal standards. The trustees also reviewed an independent evaluation prepared by the Fund’s Senior Officer (who is also the Fund’s Independent Compliance Officer) of the reasonableness of the advisory fee, in which the Senior Officer concluded that the contractual fee for the Fund was reasonable. The trustees also discussed the proposed continuance in private sessions with counsel and the Fund’s Senior Officer.

The trustees considered their knowledge of the nature and quality of the services provided by the Adviser to the Fund gained from their experience as trustees or directors of most of the registered investment companies advised by the Adviser, their overall confidence in the Adviser’s integrity and competence they have gained from that experience, the Adviser’s initiative in identifying and raising potential issues with the trustees and its responsiveness, frankness and attention to concerns raised by the trustees in the past, including the Adviser’s willingness to consider and implement organizational and operational changes designed to improve investment results and the services provided to the AllianceBernstein Funds. The trustees noted that they have four regular meetings each year, at each of which they receive presentations from the Adviser on the investment results of the Fund and review extensive materials and information presented by the Adviser.

The trustees also considered all other factors they believed relevant, including the specific matters discussed below. In their deliberations, the trustees did not identify any particular information that was all-important or controlling, and different trustees may have attributed different weights to the various factors. The trustees determined that the selection of the Adviser to manage the Fund and the overall arrangements between the Fund and the Adviser, as provided in the Advisory Agreement, including the advisory fee, were fair and reasonable in light of the services performed, expenses incurred and such other matters as the trustees considered relevant in the exercise of their business judgment. The material factors and conclusions that formed the basis for the trustees’ determinations included the following:

Nature, Extent and Quality of Services Provided

The trustees considered the scope and quality of services provided by the Adviser under the Advisory Agreement, including the quality of the investment research

AB EXCHANGE RESERVES  • 35

capabilities of the Adviser and the other resources it has dedicated to performing services for the Fund. They also noted the professional experience and qualifications of the Fund’s portfolio management team and other senior personnel of the Adviser. The trustees also considered that the Advisory Agreement provides that the Fund will reimburse the Adviser for the cost to it of providing certain clerical, accounting, administrative and other services to the Fund by employees of the Adviser or its affiliates. Requests for these reimbursements are made on a quarterly basis and subject to approval by the trustees. Reimbursements, to the extent requested and paid, result in a higher rate of total compensation from the Fund to the Adviser than the fee rate stated in the Fund’s Advisory Agreement. The trustees noted that the methodology used to determine the reimbursement amounts had been reviewed by an independent consultant retained by the Fund’s Senior Officer. The quality of administrative and other services, including the Adviser’s role in coordinating the activities of the Fund’s other service providers, also were considered. The trustees concluded that, overall, they were satisfied with the nature, extent and quality of services provided to the Fund under the Advisory Agreement.

Costs of Services Provided and Profitability

The trustees reviewed a schedule of the revenues, expenses and related notes indicating the profitability of the Fund to the Adviser for calendar years 2012 and 2013 that had been prepared with an expense allocation methodology arrived at in consultation with an independent consultant retained by the Fund’s Senior Officer. The trustees noted the assumptions and methods of allocation used by the Adviser in preparing fund-specific profitability data and understood that there are a number of potentially acceptable allocation methodologies for information of this type. The trustees noted that the profitability information reflected all revenues and expenses of the Adviser’s relationship with the Fund, including those relating to its subsidiaries that provide transfer agency and distribution services to the Fund. The trustees recognized that it is difficult to make comparisons of the profitability of the Advisory Agreement with the profitability of advisory contracts for unaffiliated funds because comparative information is not generally publicly available and is affected by numerous factors. The trustees focused on the profitability of the Adviser’s relationship with the Fund before taxes and distribution expenses. The trustees were satisfied that the Adviser’s level of profitability from its relationship with the Fund was not unreasonable.

Fall-Out Benefits

The trustees considered the other benefits to the Adviser and its affiliates from their relationships with the Fund, including, but not limited to, benefits relating to 12b-1 fees and sales charges received by the Fund’s principal underwriter (which is a wholly owned subsidiary of the Adviser) in respect of certain classes of the Fund’s shares and transfer agency fees paid by the Fund to a wholly

36 •  AB EXCHANGE RESERVES

owned subsidiary of the Adviser. The trustees recognized that the Adviser’s profitability would be lower without these benefits. The trustees understood that the Adviser also might derive reputational and other benefits from its association with the Fund.

Investment Results

In addition to the information reviewed by the trustees in connection with the meeting, the trustees receive detailed performance information for the Fund at each regular Board meeting during the year. At the November 2014 meeting, the directors reviewed information prepared by Lipper showing the performance of the Class A Shares of the Fund as compared with that of a group of similar funds selected by Lipper (the “Performance Group”) and as compared with that of a broad array of funds selected by Lipper (the “Performance Universe”), and information prepared by the Adviser showing performance of the Class A Shares as compared with the Lipper Money Market Funds Average (the “Lipper Average”) and the Barclays U.S. Treasury Bills Index (the “Index”), in each case for the 1-, 3-, 5- and 10-year periods ended July 31, 2014 and (in the case of comparisons with the Lipper Average and the Index) the period since inception (March 1994 inception). The trustees noted that on a net return basis, the Fund was in the 1st quintile of the Performance Group and the Performance Universe for the 1-, 3- and 5-year periods, and in the 5th quintile of the Performance Group and the Performance Universe for the 10-year period. On a gross return basis, the Fund was in the 4th quintile of the Performance Group and 3rd quintile of the Performance Universe for the 1-year period, in the 3rd quintile of the Performance Group and 2nd quintile of the Performance Universe for the 3-year period, and in the 3rd quintile of the Performance Group and the Performance Universe for the 5- and 10-year periods. The Fund outperformed the Lipper Average in the 1-, 3- and 5-year periods, and lagged it in the 10-year period and the period since inception. The Fund matched the Index in the 3-year period and lagged it in all other periods. Based on their review, the trustees concluded that the Fund’s relative performance was satisfactory.

Advisory Fees and Other Expenses

The trustees considered the advisory fee rate paid by the Fund to the Adviser and information prepared by Lipper concerning advisory fee rates paid by other funds in the same Lipper category as the Fund at a common asset level. The trustees recognized that it is difficult to make comparisons of advisory fees because there are variations in the services that are included in the fees paid by other funds. The trustees noted that, at the Fund’s current size, its contractual effective advisory fee rate of 24.7 basis points, plus the less than 1 basis point impact of the administrative expense reimbursement in the latest fiscal year, was lower than the Expense Group median.

The trustees also considered the Adviser’s fee schedule for non-fund clients pursuing a similar investment style. For this purpose, they reviewed the relevant

AB EXCHANGE RESERVES  • 37

advisory fee information from the Adviser’s Form ADV and the evaluation from the Fund’s Senior Officer. The trustees noted that the institutional fee schedule and the Fund’s fee schedule started at different rates and that the Fund’s fee schedule had breakpoints. The application of the institutional fee schedule to the Fund’s net assets would result in a fee rate lower than the rate at the same asset level provided in the Fund’s Advisory Agreement. The directors noted that the Adviser may, in some cases, agree to fee rates with large institutional clients that are lower than those reviewed by the directors and that they had previously discussed with the Adviser its policies in respect of such arrangements. The trustees also noted that the Adviser advises a portfolio of another AB Fund that invests in different types of money market securities, pays no advisory fee but is offered only as a cash management vehicle for selected institutional clients, including most of the AB Funds, that pay advisory fees at various rates and that a portfolio of another AB Fund advised by the Adviser that invests in different types of money market securities pays a lower advisory fee but is available primarily as a vehicle for certain private clients and institutional clients of the Adviser.

The Adviser reviewed with the trustees the significantly greater scope of the services it provides to the Fund relative to institutional clients. The Adviser also noted that because mutual funds are constantly issuing and redeeming shares, they are more difficult to manage than an institutional account, where the assets tend to be relatively stable. In light of the substantial differences in services rendered by the Adviser to institutional clients as compared to funds such as the Fund, the trustees considered these fee comparisons inapt and did not place significant weight on them in their deliberations.

The trustees also considered the total expense ratio of the Class A shares of the Fund in comparison to the fees and expenses of funds within two comparison groups created by Lipper: an Expense Group and an Expense Universe. Lipper described an Expense Group as a representative sample of funds similar to the Fund and an Expense Universe as a broader group, consisting of all funds in the Fund’s investment classification/objective with a similar load type as the Fund. The Class A expense ratio of the Fund was based on the Fund’s latest fiscal year. The trustees noted that it was likely that the expense ratios of some of the other funds in the Fund’s Lipper category were lowered by waivers or reimbursements by those funds’ investment advisers, which in some cases might be voluntary or temporary. The trustees view the expense ratio information as relevant to their evaluation of the Adviser’s services because the Adviser is responsible for coordinating services provided to the Fund by others.

The trustees noted that the Fund’s total expense ratio was lower than the Expense Group and the Expense Universe medians. The Adviser informed the trustees that the Adviser and its affiliates have been waiving all or a portion of the Fund’s advisory fees, distribution services fees and transfer agency fees. The trustees concluded that the Fund’s expense ratio was satisfactory.

38 •  AB EXCHANGE RESERVES

Economies of Scale

The trustees noted that the advisory fee schedule for the Fund contains breakpoints and that the net assets of the Fund were in excess of the first breakpoint. Accordingly, the Fund’s current effective advisory fee rate reflected a reduction due to the breakpoint and would be further reduced to the extent the net assets of the Fund increase. The trustees took into consideration prior presentations by an independent consultant on economies of scale in the mutual fund industry and for the AB Funds, and by the Adviser concerning certain of its views on economies of scale. The trustees also had requested and received from the Adviser certain updates on economies of scale at the May 2014 meetings. The trustees believe that economies of scale may be realized (if at all) by the Adviser across a variety of products and services, and not only in respect of a single fund. The trustees noted that there is no established methodology for setting breakpoints that give effect to the fund-specific services provided by a fund’s adviser and to the economies of scale that an adviser may realize in its overall mutual fund business or those components of it which directly or indirectly affect a fund’s operations. The trustees observed that in the mutual fund industry as a whole, as well as among funds similar to the Fund, there is no uniformity or pattern in the fees and asset levels at which breakpoints (if any) apply. The trustees also noted that the advisory agreements for many funds do not have breakpoints at all. Having taken these factors into account, the trustees concluded that the Fund’s breakpoint arrangements were acceptable and provide a means for sharing of any economies of scale.

AB EXCHANGE RESERVES  • 39

THE FOLLOWING IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

SUMMARY OF SENIOR OFFICER’S EVALUATION OF INVESTMENT ADVISORY AGREEMENT¹

The following is a summary of the evaluation of the Investment Advisory Agreement between AllianceBernstein L.P. (the “Adviser”) and AllianceBernstein Exchange Reserves (the “Fund”).² The evaluation of the Investment Advisory Agreement was prepared by Philip L. Kirstein, the Senior Officer of the Fund, for the Trustees of the Fund, as required by the September 1, 2004 Assurance of Discontinuance (“AoD”) between the Adviser and the New York State Attorney General (the “NYAG”). The Senior Officer’s evaluation of the Investment Advisory Agreement is not meant to diminish the responsibility or authority of the Board of Trustees of the Fund to perform its duties pursuant to Section 15 of the Investment Company Act of 1940 (the “40 Act”) and applicable state law. The purpose of this summary is to provide shareholders with a synopsis of the independent evaluation of the reasonableness of the advisory fees proposed to be paid by the Fund which was provided to the Trustees in connection with their review of the proposed approval of the continuance of the Investment Advisory Agreement. The Senior Officer’s evaluation considered the following factors:

1. Advisory fees charged to institutional and other clients of the Adviser for like services;

2. Advisory fees charged by other mutual fund companies for like services;

3. Costs to the Adviser and its affiliates of supplying services pursuant to the advisory agreement, excluding any intra-corporate profit;

4. Profit margins of the Adviser and its affiliates from supplying such services;

5. Possible economies of scale as the Fund grows larger; and

6. Nature and quality of the Adviser’s services including the performance of the Fund.

These factors, with the exception of the first factor, are generally referred to as the “Gartenberg factors,” which were articulated by the United States Court of Appeals for the Second Circuit in 1982. Gartenberg v. Merrill Lynch Asset Management, Inc., 694 F. 2d 923 (2d Cir. 1982). On March 30, 2010, the Supreme Court held the Gartenberg decision was correct in its basic formulation of what Section 36(b) requires: to face liability under Section 36(b), “an investment adviser must charge a fee that is so disproportionately large that it bears no

1 The Senior Officer’s fee evaluation was completed on October 23, 2014 and discussed with the Board of Trustees on November 4-6, 2014.

2 Future references to the Fund do not include “AllianceBernstein.” References in the fee summary pertaining to performance and expense ratios refer to the Class A shares of the Fund.

40 •  AB EXCHANGE RESERVES

reasonable relationship to the services rendered and could not have been the product of arm’s length bargaining.” Jones v. Harris Associates L.P., 130 S. Ct. 1418 (2010). In Jones, the Court stated the Gartenberg approach fully incorporates the correct understanding of fiduciary duty within the context of Section 36(b) and noted with approval that “Gartenberg insists that all relevant circumstances be taken into account” and “uses the range of fees that might result from arm’s length bargaining as the benchmark for reviewing challenged fees.”³

INVESTMENT ADVISORY FEES, NET ASSETS & EXPENSE RATIOS

The Adviser proposed that the Fund pays the advisory fee set forth below for receiving the services to be provided pursuant to the Investment Advisory Agreement.⁴ Also shown below are the Fund’s net assets as of September 30, 2014.

Fund	Advisory Fee Based on % of Average Daily Net Assets	Net Assets 09/30/14 ($MM)
Exchange Reserves	0.25% on 1st $1.25 billion	$1,815.3
	0.24% on next $0.25 billion
	0.23% on next $0.25 billion
	0.22% on next $0.25 billion
	0.21% on next $1.0 billion
	0.20% on the balance

The Adviser is reimbursed as specified in the Investment Advisory Agreement for certain clerical, legal, accounting, administrative and other services provided to the Fund. During the fiscal year ended September 30, 2014, the Adviser was received $62,992 (0.003% of the Fund’s average daily net assets) for such services, although it should be noted that the Adviser and its affiliates waived its fees and/or reimbursed the Fund in the aggregate amount of $4,088,833.

In response to low interest rates⁵ in the marketplace that have depressed money market yield, the Adviser or its affiliates are waiving advisory fees and reimbursing additional expenses on its proprietary money market products, including the

3 Jones v. Harris at 1427.

4 The Fund was not affected by the Adviser’s agreement with the NYAG since the Fund’s fee schedule already had lower breakpoints than the NYAG related fee schedule for AllianceBernstein Mutual Funds with a category of “Low Risk Income.”

5 The Federal Reserve has kept the Federal Funds Rate between zero and 0.25% since December 2008.

AB EXCHANGE RESERVES  • 41

Fund, in order for those products to achieve a target yield of 0.01%. Set forth below are the Fund’s total expense ratios for the most recent semi-annual period:

Fund	Total Expense Ratio6							Fiscal Year
	Class	Net			Gross
Exchange Reserves	Advisor Class A Class B Class C Class R Class K Class I		0.13 0.13 0.15 0.14 0.16 0.16 0.10	%  %  %  %  %  %  %		0.31 0.61 1.33 1.07 0.85 0.59 0.29	%  %  %  %  %  %  %	September 30 (ratios as of March 31, 2014)

I. ADVISORY FEES CHARGED TO INSTITUTIONAL AND OTHER CLIENTS

The advisory fees charged to investment companies which the Adviser manages and sponsors are normally higher than those charged to similar sized institutional accounts, including pension plans and sub-advised investment companies. The fee differential reflects, among other things, different services provided to such clients, and different liabilities assumed. Services provided by the Adviser to the Fund that are not provided to non-investment company clients and sub-advised investment companies include providing office space and personnel to serve as Fund Officers, who among other responsibilities make the certifications required under the Sarbanes-Oxley Act of 2002, and coordinating with and monitoring the Fund’s third party service providers such as Fund counsel, auditors, custodians, transfer agents and pricing services. The accounting, administrative, legal and compliance requirements for the Fund are more costly than those for institutional client assets due to the greater complexities and time required for investment companies, although as previously noted, the Adviser is reimbursed for providing such services. Also, retail mutual funds managed by the Adviser are widely held. Servicing the Fund’s investors is more time consuming and labor intensive compared to institutional clients since the Adviser needs to communicate with a more extensive network of financial intermediaries and shareholders. The Adviser also believes that it incurs substantial entrepreneurial risk when offering a new mutual fund since establishing a new mutual fund requires a large upfront investment and it may take a long time for the fund to achieve profitability since the fund must be priced to scale from inception in order to be competitive and assets are acquired one account at a time. In addition, managing the cash flow of an investment company may be more difficult than that of a stable pool of assets, such as an institutional account with little cash movement in either direction, particularly if the fund is in net redemption and the Adviser is frequently forced to sell securities to raise cash for redemptions. However, managing a fund with positive cash flow may be easier at times than managing a stable pool of assets. Finally, in recent years, investment

6 Annualized.

42 •  AB EXCHANGE RESERVES

advisers have been sued by institutional clients and have suffered reputational damage both by the attendant publicity and outcomes other than complete victories. Accordingly, the legal and reputational risks associated with institutional accounts are greater than previously thought, although arguably still not equal to those related to the mutual fund industry.

Notwithstanding the Adviser’s view that managing an investment company is not comparable to managing other institutional accounts because the services provided are different, the Supreme Court has indicated consideration should be given to the advisory fees charged to institutional accounts that have a substantially similar investment style as the Fund.⁷ In addition to the AllianceBernstein Institutional fee schedule, set forth below is what would have been the effective advisory fee for the Fund had the AllianceBernstein Institutional fee schedule been applicable to the Fund advisory fee based on September 30, 2014 net assets.⁸

Fund	Net Assets 9/30/14 ($MM)	AllianceBernstein (“AB”) Institutional (“Inst.”) Fee Schedule	Effective AB Inst. Adv. Fee		Portfolio Advisory Fee
Exchange Reserves9	$1,815.3	Fixed Income Money Market 0.10% (no breakpoints) Minimum Account Size: $100m		0.100%		0.245%

The Adviser represented that it does not sub-advise any registered investment company with a substantially similar investment style as the Fund.

II. MANAGEMENT FEES CHARGED BY OTHER MUTUAL FUND COMPANIES FOR LIKE SERVICES.

Lipper, Inc. (“Lipper”), an analytical service that is not affiliated with the Adviser, compared the fees charged to the Fund with fees charged to other investment companies for similar services offered by other investment advisers.¹⁰ Lipper’s analysis included the comparison of the Fund’s contractual management

7 The Supreme Court stated that “courts may give such comparisons the weight that they merit in light of the similarities and differences between the services that the clients in question require, but the courts must be wary of inapt comparisons.” Among the significant differences the Supreme Court noted that may exist between services provided to mutual funds and institutional accounts are “higher marketing costs.” Jones v. Harris at 1428.

8 The Adviser has indicated that with respect to institutional accounts with assets greater than $300 million, it will negotiate a fee schedule. Discounts that are negotiated vary based upon each client relationship.

9 The Fund’s effective advisory fee shown is based on the Fund’s September 30, 2014 net assets and does not include any advisory fee waivers and/or expense reimbursements that the Fund may have had during its most recently completed annual or semi-annual period.

10 The Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since “these comparisons are problematic because these fees, like those challenged, may not be the product of negotiations conducted at arm’s length.” Jones v. Harris at 1429.

AB EXCHANGE RESERVES  • 43

fee, estimated at the approximate current asset level of the Fund, to the median of the Fund’s Lipper Expense Group (“EG”)¹¹ and the Fund’s contractual management fee ranking.¹²

Lipper describes an EG as a representative sample of comparable funds. Lipper’s standard methodology for screening funds to be included in an EG entails the consideration of several fund criteria, including fund type, investment classification/objective, load type and similar 12b-1/non-12b-1 service fees, asset (size) comparability, expense components and attributes. An EG will typically consist of seven to twenty funds.

Fund	Contractual Management Fee (%)13		Lipper Exp. Group Median (%)		Lipper Group Rank
Exchange Reserves		0.247		0.388		2/17

Lipper also compared the Fund’s total expense ratio to the medians of the Fund’s EG and Lipper Expense Universe (“EU”). The EU is a broader group compared to the EG, consisting of all funds that have the same investment classification/objective and load type as the subject Fund.¹⁴

Fund	Total Expense Ratio  (%)15		Lipper Exp. Group Median (%)		Lipper Group Rank		Lipper Exp. Universe Median (%)		Lipper Universe Rank
Exchange Reserves		0.143		0.199		5/17		0.199		21/91
excluding 12b-1/ non-12b-1 service fee		0.143		0.141		10/17		0.152		44/91

Based on this analysis, the Fund has a more favorable ranking on a contractual management fee basis than it does on a total expense ratio basis.

11 Lipper does not consider average account size when constructing EGs. Funds with relatively small average account sizes tend to have higher transfer agent expense ratios than comparable sized funds that have relatively large average account sizes. There are limitations to Lipper expense category data because different funds categorize expenses differently.

12 The contractual management fee is calculated by Lipper using the Fund’s contractual management fee rate at a hypothetical asset level. The hypothetical asset level is based on the combined net assets of all classes of the Fund, rounded up to the next $25 million. Lipper’s total expense ratio information is based on the most recent annual report except as otherwise noted. A ranking of “1” would mean that Fund had the lowest effective fee rate in the Lipper peer group.

13 The contractual management fee does not reflect any expense reimbursements made by the Fund to the Adviser for certain clerical, legal, accounting, administrative, and other services.

14 Except for asset (size) comparability, Lipper uses the same criteria for selecting an EG when selecting an EU. Unlike the EG, the EU allows for the same adviser to be represented by more than just one fund.

15 Most recently completed fiscal year Class A share total expense ratio.

44 •  AB EXCHANGE RESERVES

III. COSTS TO THE ADVISER AND ITS AFFILIATES OF SUPPLYING SERVICES PURSUANT TO THE ADVISORY FEE ARRANGEMENT, EXCLUDING ANY INTRA-CORPORATE PROFIT.

The Adviser utilizes two profitability reporting systems, which operate independently but are aligned with each other, to estimate the Adviser’s profitability in connection with investment advisory services provided to the Fund. The Senior Officer has retained a consultant to provide independent advice regarding the alignment of the two profitability systems as well as the methodologies and allocations utilized by both profitability systems. See Section IV for additional discussion.

IV. PROFIT MARGINS OF THE ADVISER AND ITS AFFILIATES FOR SUPPLYING SUCH SERVICES.

The profitability information for the Fund prepared by the Adviser for the Board of Trustees was reviewed by the Senior Officer and the consultant. The Adviser’s profitability from providing investment advisory services to the Fund decreased in the calendar year 2013, relative to 2012.

In addition to the Adviser’s direct profits from managing the Fund, certain of the Adviser’s affiliates have business relationships with the Fund and may earn a profit from providing other services to the Adviser. The courts have referred to this type of business opportunity as “fall-out benefits” to the Adviser and indicated that such benefits should be factored into the evaluation of the total relationship between the Fund and the Adviser. Neither case law nor common business practice precludes the Adviser’s affiliates from earning a reasonable profit on this type of relationship provided the affiliates’ charges and services are competitive. These affiliates provide transfer agent and distribution related services to the Fund and receive transfer agent fees, Rule 12b-1 payments, and contingent deferred sales charges (“CDSC”). During the fiscal year ended September 30, 2013, ABI received from the Fund $1,002,499 and $31,552 in Rule 12b-1 and CDSC fees, respectively.¹⁶

AllianceBernstein Investments, Inc. (“ABI”), an affiliate of the Adviser, is the Fund’s principal underwriter. ABI and the Adviser have disclosed in the Fund’s prospectus that they may make revenue sharing payments from their own resources, in addition to revenues derived from sales loads and Rule 12b-1 fees, to firms that sell shares of the Fund. In 2013, ABI paid approximately 0.05% of the average monthly assets of the AllianceBernstein Mutual Funds or approximately $19.4 million for distribution services and educational support (revenue sharing payments).

16 For the fiscal year ended September 30, 2013, ABI agreed to voluntarily waive all of the Rule 12b-1 distribution fees in the amounts of $579,782, $126,417, $169,588, $35,219 and $91,493 for Class A, Class B, Class C, Class R and Class K shares, respectively, limiting the effective annual rates to 0%.

AB EXCHANGE RESERVES  • 45

Fees and reimbursements for out of pocket expenses charged by AllianceBernstein Investor Services, Inc. (“ABIS”), the affiliated transfer agent for the Fund, are charged on a per account basis, based on the level of service provided and the class of share held by the account. ABIS also receives a fee per shareholder sub-account for each account maintained by an intermediary on an omnibus basis. During the fiscal year ended September 30, 2013, ABIS received $253,465 in fees from the Fund.

V. POSSIBLE ECONOMIES OF SCALE

The Adviser has indicated that economies of scale are being shared with shareholders through pricing to scale, breakpoints, fee reductions/waivers and enhancement to services.

In May 2012, an independent consultant, retained by the Senior Officer, provided the Board of Trustees information on the Adviser’s firm-wide average costs from 2005 through 2011 and the potential economies of scale. The independent consultant noted that from 2005 through 2007 the Adviser experienced significant growth in assets under management (“AUM”). During this period, operating expenses increased, in part to keep up with growth, and in part reflecting market returns. However, from 2008 through the first quarter of 2009, AUM rapidly and significantly decreased due to declines in market value and client withdrawals. When AUM rapidly decreased, some operating expenses categories, including base compensation and office space, adjusted more slowly during this period, resulting in an increase in average costs. Since 2009, AUM has experienced less significant changes. The independent consultant noted that changes in operating expenses reflect changes in business composition and business practices in response to changes in financial markets. Finally, the independent consultant concluded that the increase in average cost and the decline in net operating margin across the Adviser since late 2008 are inconsistent with the view that there are currently reductions in average costs due to economies of scale that can be shared with the AllianceBernstein Mutual Funds managed by the Adviser through lower fees.

Previously, in February 2008, the independent consultant provided the Board of Trustees an update of the Deli¹⁷ study on advisory fees and various fund characteristics.¹⁸ The independent consultant first reiterated the results of his

17 The Deli study, originally published in 2002 based on 1997 data and updated for the February 2008 Presentation, may be of diminished value due to the age of the data used in the presentation and the changes experienced in the industry since 2008.

18 As mentioned previously, the Supreme Court cautioned against accepting mutual fund fee comparisons without careful scrutiny since the fees may not be the product of negotiations conducted at arm’s length. See Jones v. Harris at 1429.

46 •  AB EXCHANGE RESERVES

previous two dimensional comparison analysis (fund size and family size) with the Board of Trustees.¹⁹ The independent consultant then discussed the results of the regression model that was utilized to study the effects of various factors on advisory fees. The regression model output indicated that the bulk of the variation in fees predicted were explained by various factors, but substantially by fund AUM, family AUM, index fund indicator and investment style. The independent consultant also compared the advisory fees of the AllianceBernstein Mutual Funds to similar funds managed by 19 other large asset managers, regardless of the fund size and each Adviser’s proportion of mutual fund assets to non-mutual fund assets.

VI. NATURE AND QUALITY OF THE ADVISER’S SERVICES, INCLUDING THE PERFORMANCE OF THE FUND

With assets under management of approximately $473 billion as of September 30, 2014, the Adviser has the investment experience to manage and provide non-investment services (described in Section I) to the Fund.

The information below, prepared by Lipper, shows the 1, 3, 5 and 10 year net and gross performance returns and rankings of the Fund²⁰ relative to the Fund’s Lipper Performance Group (“PG”) and Lipper Performance Universe (“PU”)²¹ for the periods ended July 31, 2014.²²

19 The two dimensional analysis showed patterns of lower advisory fees for funds with larger asset sizes and funds from larger family sizes compared to funds with smaller asset sizes and funds from smaller family sizes, which according to the independent consultant is indicative of a sharing of economies of scale and scope. However, in less liquid and active markets, such is not the case, as the empirical analysis showed potential for diseconomies of scale in those markets. The empirical analysis also showed diminishing economies of scale and scope as funds surpassed a certain high level of assets.

20 The performance returns and rankings are for the Class A shares of the Fund. The performance returns of the Fund were provided by Lipper.

21 The Fund’s PG is identical to the Fund’s EG. The Fund’s PU is not identical to the Fund’s EU as the criteria for including/excluding a fund in/from a PU are somewhat different from that of an EU.

22 The current Lipper investment classification/objective dictates the PG and PU throughout the life of the Fund even if the Fund may have had a different investment classification/objective at different points in time.

AB EXCHANGE RESERVES  • 47

	Fund Return		PG Median (%)		PU Median (%)		PG Rank	PU Rank
Net
1 year		0.05		0.01		0.01	1/17	4/105
3 year		0.10		0.01		0.01	1/17	3/103
5 year		0.07		0.01		0.01	1/17	6/97
10 year		1.37		1.48		1.50	15/15	77/87
Gross
1 year		0.19		0.21		0.20	11/17	57/104
3 year		0.25		0.24		0.24	8/17	41/103
5 year		0.28		0.28		0.29	8/17	51/97
10 year		1.94		1.94		1.94	8/15	44/87

Set forth below are the 1, 3, 5, 10 year and since inception net performance returns of the Fund (in bold)²³ versus its benchmarks.²⁴

	Periods Ending July 31, 2014 Annualized Net Performance
	1 Year (%)		3 Year (%)		5 Year (%)		10 Year (%)		Since Inception (%)
Exchange Reserves		0.05		0.10		0.07		1.36		2.33
Lipper Money Market Funds Average		0.01		0.01		0.02		1.39		2.65
Barclays Capital U.S. Treasury Bills Index		0.07		0.10		0.15		1.67		3.01
Inception Date: March 25, 1994

CONCLUSION:

Based on the factors discussed above the Senior Officer’s conclusion is that the proposed advisory fee for the Fund is reasonable and within the range of what would have been negotiated at arm’s-length in light of all the surrounding circumstances. This conclusion in respect of the Fund is based on an evaluation of all of these factors and no single factor was dispositive.

Dated: November 18, 2014

23 The performance returns and risk measures shown in the table are for the Class A shares of the Fund.

24 The Adviser provided Fund and benchmark performance return information for periods through July 31, 2014.

48 •  AB EXCHANGE RESERVES

THIS PAGE IS NOT PART OF THE SHAREHOLDER REPORT OR THE FINANCIAL STATEMENTS

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We also offer Exchange Reserves, which serves as the money market fund exchange vehicle for the AB mutual funds. An investment in Exchange Reserves is not a deposit in a bank and is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund.

Investors should consider the investment objectives, risks, charges and expenses of the Fund carefully before investing. For copies of our prospectus or summary prospectus, which contain this and other information, visit us online at www.abglobal.com or contact your AB representative. Please read the prospectus and/or summary prospectus carefully before investing.

* Prior to December 15, 2014, All Market Growth Portfolio was named Dynamic All Market Fund; All Market Real Return Portfolio was named Real Asset Strategy.

AB EXCHANGE RESERVES  • 49

AB Family of Funds

NOTES

50 •  AB EXCHANGE RESERVES

NOTES

AB EXCHANGE RESERVES  • 51

NOTES

52 •  AB EXCHANGE RESERVES

AB EXCHANGE RESERVES

1345 Avenue of the Americas

New York, NY 10105

800.221.5672

EXC-0151-0415                

ITEM 2. CODE OF ETHICS.

(a) The registrant has adopted a code of ethics that applies to its principal executive officer, principal financial officer and principal accounting officer. A copy of the registrant’s code of ethics is filed herewith as Exhibit 12(a)(1).

(b) During the period covered by this report, no material amendments were made to the provisions of the code of ethics adopted in
2(a) above.

(c) During the period covered by this report, no implicit or explicit waivers to the provisions of the code of ethics adopted in 2(a) above were granted.

ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.

The registrant’s Board of Directors has determined that independent directors Garry L. Moody, William H. Foulk, Jr. and Marshall C. Turner, Jr. qualify as audit committee financial experts.

ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

(a) - (c) The following table sets forth the aggregate fees billed by the independent registered public accounting firm, Ernst & Young LLP, for the Fund’s last two fiscal years for professional services rendered for: (i) the audit of the Fund’s annual financial statements included in the Fund’s annual report to stockholders; (ii) assurance and related services that are reasonably related to the performance of the audit of the Fund’s financial statements and are not reported under (i), which include advice and education related to accounting and auditing issues, quarterly press release review (for those Funds that issue quarterly press releases), and preferred stock maintenance testing (for those Funds that issue preferred stock); and (iii) tax compliance, tax advice and tax return preparation.

		Audit Fees		Audit-Related     Fees		Tax Fees
AB Exchange Reserves	2014	$	30,983	$	—	$	8,723
	2015	$	25,538	$	—	$	5,462

(d) Not applicable.

(e) (1) Beginning with audit and non-audit service contracts entered into on or after May 6, 2003, the Fund’s Audit Committee policies and procedures require the pre-approval of all audit and non-audit services provided to the Fund by the Fund’s independent registered public accounting firm. The Fund’s Audit Committee policies and procedures also require pre-approval of all audit and non-audit services provided to the Adviser and Service Affiliates to the extent that these services are directly related to the operations or financial reporting of the Fund.

(e) (2) All of the amounts for Audit Fees, Audit-Related Fees and Tax Fees in the table under Item 4 (a)–(c) are for services pre-approved by the Fund’s Audit Committee.

(f) Not applicable.

(g) The following table sets forth the aggregate non-audit services provided to the Fund, the Fund’s Adviser and entities that control, are controlled by or under common control with the Adviser that provide ongoing services to the Fund:

		All Fees for Non-Audit Services Provided to the Portfolio, the Adviser and Service Affiliates		Total Amount of Foregoing Column Pre- approved by the Audit Committee (Portion Comprised of Audit Related Fees) (Portion Comprised of Tax Fees)
AB Exchange Reserves	2014	$	377,528	$	8,723
				$	—
				$	(8,723	)
	2015	$	413,337	$	5,462
				$	—
				$	(5,462	)

(h) The Audit Committee of the Fund has considered whether the provision of any non-audit services not pre-approved by the Audit Committee provided by the Fund’s independent registered public accounting firm to the Adviser and Service Affiliates is compatible with maintaining the auditor’s independence.

ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable to the registrant.

ITEM 6. SCHEDULE OF INVESTMENTS.

Please see Schedule of Investments contained in the Report to Shareholders included under Item 1 of this Form N-CSR.

ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable to the registrant.

ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable to the registrant.

ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable to the registrant.

ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

There have been no material changes to the procedures by which shareholders may recommend nominees to the Fund’s Board of Directors since the Fund last provided disclosure in response to this item.

ITEM 11. CONTROLS AND PROCEDURES.

(a) The registrant’s principal executive officer and principal financial officer have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended) are effective at the reasonable assurance level based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this document.

(b) There were no significant changes in the registrant’s internal controls over financial reporting during the second fiscal quarter of the period that could significantly affect these controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

ITEM 12. EXHIBITS.

The following exhibits are attached to this Form N-CSR:

EXHIBIT NO.	DESCRIPTION OF EXHIBIT
12 (a) (1)	Code of Ethics that is subject to the disclosure of Item 2 hereof
12 (b) (1)	Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12 (b) (2)	Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
12 (c)	Certification of Principal Executive Officer and Principal Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

(Registrant): AB Exchange Reserves

By:	/s/ Robert M. Keith
	Robert M. Keith
	President
Date:	June 9, 2015

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Robert M. Keith
	Robert M. Keith
	President
Date:	June 9, 2015
By:	/s/ Joseph J. Mantineo
	Joseph J. Mantineo
	Treasurer and Chief Financial Officer
Date:	June 9, 2015