full rating report - raiffeisen bank international ag

Banks

www.fitchratings.com 23 March 2012

Austria

Raiffeisen Bank International AG Full Rating Report

Key Rating Drivers

Sovereign Support: Raiffeisen Bank International AG‟s (RBI) ratings – except its Viability

Rating (VR) – reflect Fitch Ratings‟ view that as an integral part of Austria‟s largest banking

group, Raiffeisen Banking Group (RBG), the Austrian financial authorities would be extremely

likely to support RBI if need be. Fitch believes that RBG and hence RBI are systemically

important in Austria and most adjacent Central and Eastern European (CEE) countries.

RBI is a lender to Austria‟s corporates and a major bank in CEE. It is 78.5% owned by

Raiffeisen Zentralbank Oesterreich AG (RZB), the Raiffeisen sector‟s central institution.

Viability Rating Under Pressure: RBI‟s VR reflects its well-diversified franchise in CEE, its

sound domestic corporate franchise and its resilient pre-impairment profitability throughout the

financial crisis and the downturn in CEE. However, the quality of RBI‟s capital is below average,

containing a considerable share of non-core government (EUR1.75bn) and commercial

(EUR1.5bn) hybrid capital, and its core capital ratio is thin for RBI‟s current rating level.

Improving Capital a Challenge: While itself not subject to the European Banking Authority

(EBA) capital requirements, RBI‟s parent RZB has to make up a sizeable capital shortfall

(EUR2.1bn as of end-Q311) by end-H112 to meet the EBA‟s 9% core capital ratio. RZB and

RBI jointly aim to improve RZB‟s capitalisation by between EUR2.5bn and EUR3.6bn through a

combination of capital optimisation and reduction of risk-weighted assets (RWA), although

RBI/RZB may, in Fitch‟s view, find it challenging to achieve this by end-H112.

Performance Linked to CEE: Its diversified revenue base has helped RBI to report sound and

stable pre-impairment profitability throughout the financial crisis. Operating profitability has

stabilised at adequate levels largely as a result of sharply lower loan impairment charges (LICs)

and despite a drop in capital market revenue. In 2012, Fitch expects RBI‟s revenue generation

to remain subdued and LICs to remain relatively high albeit below levels observed in 2009.

Mainly CEE Credit Risk: At end-Q311, 51% of RBI‟s total credit exposure was in CEE. Its loan

book, of which around 90% was outside Austria (predominantly in CEE), was largely to

corporates with 67% of total loans. Due to its business model, bank counterparty risk is also

considerable (19% of end-Q311 assets, around half outside Austria), but this is being reduced.

Asset Quality Improvements Stalling: Overall, non-performing loans (NPLs) have stabilised

at elevated levels, with negative trends in Hungary and Croatia being offset by improvements in

Russia and, to a lesser extent, the Czech Republic. Coverage remains adequate. Moderate

market risk largely relates to unhedged capital investments in CEE.

Some Capital Market Sensitivity: Safeguarding or expanding its already sound deposit

franchise across CEE (aggregate loans/deposits ratio of 113% at end-Q311) is likely to be a

key priority for RBI. Still, wholesale funding remains an important secondary funding source.

What Could Trigger a Rating Action

Weakening Support: The government becoming less able to support Austria‟s large banks

(signalled by a change in Austria‟s sovereign rating) or Fitch‟s reassessment of the likelihood of

support (eg as a result of legislative changes) could lead to a downgrade of RBI‟s IDRs.

CEE: A significant delay in improving capitalisation and/or a worse-than-expected development

in CEE, suppressed earnings and increasing LICs could lead to a downgrade of RBI‟s VR.

Ratings

Foreign Currency

Long-Term IDR A

Short-Term IDR F1 Viability Rating bbb Support Rating 1 Support Rating Floor A Sovereign Risk Long-Term Foreign-Currency IDR AAA Long-Term Local-Currency IDR AAA

Outlooks

Long-Term Foreign-Currency IDR Stable Sovereign Long-Term Foreign-Currency IDR

Stable

Sovereign Long-Term Local-Currency IDR

Stable

Financial Data

Raiffeisen Bank International AG

30 Sep 11 31 Dec 10

Total assets (USDm) 200,334.9 175,271.4 Total assets (EURm) 148,368.0 131,173.1 Total equity (EURm) 7,847.0 7,903.9 Fitch core capital (EURm)

6,385.2 6,414.3

Operating profit (EURm)

1,034.0 1,282.6

Published net income (EURm)

759.0 1,177.2

Comprehensive income (EURm)

411.0 1,394.9

Pre-impairment operating ROAE (%)

30.44 33.93

Loan impairment charges/av. loans (%)

1.33 2.12

Operating ROAA (%) 0.99 1.46 Operating ROAE (%) 17.33 17.57 Fitch core capital/ RWA (%)

6.33 6.77

Tier 1 ratio (%) 8.70 9.70 Tangible common equity/tang. assets (%)

4.52 4.95

Equity/assets (%) 5.29 6.03

Related Research

2012 Outlook: Major Austrian Banks (December 2011)

Austrian Banks: Capital, the EBA and CEE (January 2011)

Analysts

Christian Kuendig +44 20 3530 1399 [email protected] Anna Deineko +44 20 3530 1538 [email protected]

http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=659666




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March 2012 2

Profile and Strategy

Listed CEE and Corporate Bank of Raiffeisen Banking Group

RBI is the result of a merger between RZB‟s former CEE subsidiary, Raiffeisen International

Bank-Holding AG (RI, the absorbing entity), and the bulk of RZB‟s corporate lending and

investment banking business in October 2010. Listed in Vienna, RBI is majority-owned by RZB,

the central institution of RBG. RBG itself, a cooperative banking group, is Austria‟s largest

banking group, with market shares of around 29.3% in domestic deposits and 25.5% in lending

at end-2010. At end-2010, RBI employed almost 60,000 staff, spread between 2,961 branches.

RBG consists of three tiers: Firstly, 527 local (and typically small) Raiffeisen retail banks;

secondly, eight larger Landesbanks (regional central institutions owned by the Raiffeisen retail

banks); and thirdly, RZB, which is 87.8% owned by the Landesbanks. RZB itself holds around

78.5% in RBI. RBI in turn owns 15 banking and various non-banking subsidiaries in most

countries in CEE, south-eastern Europe (SEE) and the Commonwealth of Independent States

(CIS; CEE, SEE, CIS combined: CEE). Together with UniCredit S.p.A. („A−‟/Outlook Negative)

(through its Austrian subsidiary UniCredit Bank Austria AG, „A‟/Stable), RBI is one of the largest

western European banks in CEE.

Figure 1 Raiffeisen Banking Group (End-2010) (EURm) RBG RZB RBI (total) RBI – Austria RBI – foreign

Total assets 255,220 136,496 131,173 25,992 105,181 Total loans 162,777 78,270 75,657 7,914 67,743 Total deposits 149,742 57,936 57,633 5,718 51,915 Tier 1 ratio (%) 7.8 9.3 8.9 n.a. n.a. Employees 81,411 60,356 59,782 3,044 56,738 Branches 5,194 2,970 2,961 13 2,948

Source: RBI

Since retail operations in Austria are conducted by the individual Raiffeisen banks (not

consolidated into RBI), the vast majority of RBI‟s assets, liabilities, employees and branches

relate to its CEE activities (see table above).

Although the banks in the three tiers operate independently, there is an increasing degree of

cohesion within RBG. A cross-support mechanism (Raiffeisen-Kundengarantiegemeinschaft

Österreich; see Annex for further details), put in place in 2000, covers about 90% of the group‟s

customer deposits (end-2010).

Figure 2 Figure 3

USA

2%CIS other

4%

Asia

5%

Other

3%

SEE

14%

Russia

10%

CEE

24%

Austria

23%

Total Credit Exposure by Region(End-Q311; EUR186bn)

Source: RBI

Western Europe - EU

15%

Czech

Rep.

12%

Othersª

22%

Ukraine

8%

Romania

8%

Poland

10%

Hungary

11%

Slovakia

12%

Russia

17%

CEE Loan Book by Country(End-Q311; EUR55.3bn)

a Others includes Croatia, Bulgaria, Bosnia,

Serbia, Slovenia, Belarus, Albania, Kosovo

Source: RBI

Polish Acquisition Complements Comprehensive CEE Presence

RBI‟s predecessor was one of the first western European banks to enter CEE in 1986 through

entry into the Hungarian market. Today, RBI operates in 17 CEE markets and has one of the

most comprehensive networks in the region. Compared with its national and international peers,

Related Criteria

Global Financial Institutions Rating Criteria (August 2011)

Evaluating Corporate Governance (December 2011)

Main subsidiary of Austria‟s largest banking group.

One of the key Western European players in CEE region.

Polish acquisition complements comprehensive CEE franchise.




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March 2012 3

RBI is disproportionately well represented in Russia, the Balkans and Ukraine. Outside the

CEE region, RBI is a major corporate lender in Austria, targeting the country‟s 1,000 largest

corporates. It also offers a wide range of treasury and investment banking services, the latter

partly concentrated in its Centrobank subsidiary. Proprietary trading and, notably, interbank

activities at RZB and RI had traditionally been relatively pronounced, but have been scaled

down somewhat at RBI. Conversely, in recent years RBI has expanded its presence in Asia,

where it predominately offers corporate lending and trade finance to both Austrian/CEE and, to

a lesser extent, Asian corporates.

Having been present in Poland since 1991, RBI complemented its largely corporate franchise

with the forthcoming acquisition of EFG Eurobank Ergasias S.A.‟s (rated „B−‟/Stable) former

branch network, Polbank, in 2011. The acquisition, announced in February 2011 and expected

to close in Q112, will establish RBI as the eighth-largest Polish bank by deposits and number of

branches (around 440) and the fourth-largest by loans.

Performance and Outlook

Revenue Base Well-Diversified by Type and Geography

RBI‟s diversified corporate and retail banking model allowed the bank to report relatively

resilient earnings throughout the financial crisis. During 9M11, net interest income (NII, typically

accounting for two-thirds of operating revenue) remained broadly unchanged quarter-on-

quarter (qoq) and Fitch expects revenue to remain relatively resilient in Q411 and 2012,

courtesy of adequate volumes and margins and despite significant macroeconomic headwinds

in CEE and, to a lesser extent, Austria. RBI‟s earnings base benefits from sound regional

diversification, with each CEE sub-region accounting for less than 30% (see Figure 3).

RBI‟s net interest margin (NIM) is narrower than most of its peers‟, largely due to its less

leveraged balance sheet (gross loans accounted for 54.8% of total assets at end-Q311) and its

sizeable low-margin interbank business. Still, its NIM has remained broadly stable in 9M11

despite sluggish loan volume growth, largely due to loan re-pricing efforts, above-average

growth in higher-yielding markets like Russia and Ukraine and its broad and relatively pricing-

insensitive deposit base (loans/deposits ratio of 118% at end-Q311), which in turn makes RBI

relatively insensitive to increasing wholesale funding costs.

Despite not being reduced in absolute terms, RBI‟s cost base is, in Fitch‟s view, well managed

and increases in operating expenses have been negligible in 9M11, supporting the bank‟s

operating profitability. Until Q311, operating profitability was also helped by gradually falling

LICs resulting from a marginally improving operating environment in CEE. Sizeable Hungarian

LICs in Q311 (EUR373m) however reversed this trend and Fitch expects LICs to remain

elevated throughout 2012.

Overall, RBI‟s operating profitability remained sound in 9M11 (operating ROAE of around 17%)

but given sluggish volume growth and a poor macroeconomic outlook for many CEE countries,

RBI will, in the agency‟s view, find it challenging to maintain this operating profitability in 2012.

Profitability in 2012 will also depend on RBI‟s ability to contain increases in funding costs,

which could be caused by increasing competition for deposits in selected CEE markets or

conditions remaining strained in capital markets.

While one-off operating effects remained relatively insignificant in 9M11, RBI will continue to be

burdened by balance-sheet-based bank levies in both Austria and Hungary, at least in the short

term (discussions to reduce or abolish the bank levies are ongoing).

Resilient NII Underpins Performance

Overall, NII remained broadly unchanged in 9M11, with NII falls in group markets and

Ukraine/Belarus compensated for by sound NII developments in CEE and SEE and a strong

improvement in Russia and group corporates (each up around 13% yoy). Also, the composition

Earnings diversification mitigates volatile operating environment across CEE.

Cost base likely to be reduced in 2012.

Sharp increase in Hungarian LICs stops improving trend; LIC developments not consistent across CEE.

Net income line burdened by bank levies in Austria and Hungary; levies unlikely to be withdrawn in the medium term.

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March 2012 4

of interest income remained unchanged and continues to be dominated by interest income from

customer lending (71% of total interest income in 9M11), followed by bonds (12%) and

interbank business (7%). Importantly, increases in interest expenses for customer deposits

were well-contained (up 1% yoy) despite a strong rise in deposit balances (see Funding below).

Interest expenses for outstanding bonds were up by a moderate 0.7% yoy. As a result, RBI‟s

NIM remained broadly stable in 9M11, oscillating at around 2.8%.

RBI‟s net fee income largely relates to its lending and transaction-based businesses and tends

to move in line with business and transaction volumes, remaining broadly unchanged yoy in

9M11 (EUR1.125bn, or 27.4% of total operating revenue). At end-Q311, around 40% of RBI‟s

net fee income related to payment transactions, 22% to its FX and commodities business and

20% to its lending business. Wealth and asset management fee income accounted for a

relatively small 8% of total net fee income. By division, net fee income developed well across

all regions with the exception of SEE (down 5%; 24% of total net fee income) and Fitch expects

this trend to continue.

RBI‟s remaining operating revenue (around 6% in 9M11) mainly relates to net trading income,

the marking-to-market of derivatives and gains/losses from financial investments and tends to

be fairly volatile. Net trading income mainly relates to interest rate and FX transactions, with

smaller balances in equity and credit trading. Although trading and derivative income performed

well in 9M11, RBI reported a EUR146m loss on financial investments, largely due to mark-to-

market movements.

Operating Expenses

Reacting to the somewhat improving macroeconomic climate in CEE since early 2010, RBI‟s

cost base increased during 9M11, although given the more negative outlook for 2012 Fitch

expects operating expenses to be cut back in 2012. In 9M11, total operating expenses

increased by a relatively high 7.8% yoy and personnel expenses (accounting for roughly half of

total operating expenses) by 8.0%, largely due to expansion in Russia, Austria and the Czech

Republic.

However, increases in operating expenses in Q311 were markedly lower (total operating

expenses up 1.5%, staff costs up 2.4%). Reflecting RBI‟s decision to concentrate expansion on

well-performing countries, operating expense increases were largely limited to CEE and Russia

(up by around 11% yoy; accounting for 31% and 15% of total operating expenses respectively)

and remained broadly unchanged in other regions. Trends in operating expenses are to some

extent affected by exchange rate movements.

As a result of resilient revenue and well-contained operating expenses, RBI‟s operating

efficiency and flexibility remained sound during 9M11 and its cost/income and cost/assets

Figure 4 Peer Comparison – Performance

RBI Erste Group

Bank AG UniCredit Bank

Austria AG Intesa Sanpaolo

SpA KBC Group Sberbank of

Russia

(%) Q311 2010 Q311 2010 Q311 2010 Q311 2010 Q311 2010 Q311 2010

Total assets (EURm) 148,368 131,173 216,094 205,938 197,667 193,049 667,322 658,757 220,683 210,691 91,191 83,969 Fitch core capital (EURm) 6,385 6,414 9,769 10,601 14,011 13,135 28,901 24,228 23,694 3,772 4,074 Pre-impairment ROAE 30.44 33.93 21.08 23.9 17.84 19.74 12.68 11.93 37.08 44.6 13.79 13.73 Operating ROAE 17.33 17.57 4.69 10.21 7.55 8.8 5.88 6.05 38.97 26.34 12.43 11.43 Cost/income ratio 55.74 54.61 54.93 51.99 58.51 54.87 55.93 62.63 45.61 41.94 59.34 59.24 LIC/pre-impairment op. profit 43.06 48.21 77.75 57.28 57.65 55.42 53.64 49.29 (5.09) 40.95 9.82 16.8 LIC/average gross loans 1.33 2.12 1.86 1.55 1.02 1.37 0.74 0.81 (0.34) 2.72 0.15 0.27 Loans/deposits ratio 117.96 131.27 111.2 113.43 134.37 136.64 214.57 186.14 101.17 93.1 135.81 145.31 Fitch core capital ratio 6.33 6.77 8.15 8.85 11.32 10.27 8.97 7.29 12.89 8.47 9.53 Tangible common equity ratio 4.52 4.95 4.78 5.31 7.42 7.25 7.22 4.43 12.3 11.26 5.84 6.72 LT IDR/Outlook/VR ‘A’/Stable/‘bbb’ ‘A’/Stable/‘a−’ ‘A’/Stable/‘bbb+’ ‘A−’/Negative/‘a−’ ‘A-’/Stable/‘a-’ ‘BBB’/Stable/‘bbb’

Sovereign Rating/Outlook ‘AAA’/Stable ‘AAA’/Stable ‘AAA’/Stable ‘A−’/Negative ‘AA’/Negative ‘BBB’/Stable

Source: Banks‟ financial statements

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March 2012 5

ratios amounted to 56% and 2.2% respectively at end-Q311, comparing reasonably well with

those of peers.

Sharp Increase in Hungarian LICs Hinders Improving LIC Trend

Like peers‟, LICs were markedly lower in Q111 (1.10% of average gross loans as opposed to

2.12% in 2010, 2.82% in 2009) and remained broadly flat in Q211 (1.06%). However, LIC

improvements came to an abrupt stop in Q311 when RBI booked EUR190m higher LICs in its

Hungarian operations (see Figure 5). Positively, LIC/average assets ratios remained broadly

unchanged in all other segments in Q311 with credit costs in Russia remaining particularly low.

Fitch expects LICs to remain elevated in 2012 but they should remain below levels observed in

2009 and 2010. The predictability of LICs is, however, currently poor – largely because of the

volatile situation in Hungary and potential spill-over effects from the eurozone crisis.

Bank Levies Burden Earnings Retention

RBI‟s operating profitability in 9M11 was negatively affected by higher charges relating to bank

levies in Austria and Hungary (9M11: EUR95m; 9M10: EUR31m). Both bank levies are asset-

based (in the case of Austria it relates to the end-2010 unconsolidated balance sheet). Both

bank levies are relatively significant: Austria‟s bank levy amounts to 0.055% of adjusted assets

for small banks (up to EUR20bn adjusted balance sheet) and 0.085% for larger banks

(including RBI) plus a flat 0.015% charge for derivatives. Both countries have announced that

they will revisit their respective bank levy in the coming years (by 2013 in the case of Austria),

although Fitch believes that the bank levies are likely to remain in place in the medium term.

Risk Management

RBI‟s risk management systems and policies are generally centralised, with most functions and

the risk committee being located at RBI group level. RZB‟s role is largely to set risk targets (in

the form of economic capital allocation) and monitor compliance with policies, although RZB

risk management staff sits on various RBI risk committees (eg for the extension of large

credits). For CEE subsidiaries, delegated risk authority depends on the size of the subsidiary

but is generally moderate compared to peers. Financial institutions credit risk is fully centralised

in Vienna and risk frameworks for local retail and corporate lending in CEE have to be

approved centrally. The appropriateness of foreign systems and policies relating to CEE

operations is audited by the bank‟s internal audit function every other year.

An economic capital model (99.95% confidence level, one-year time horizon, „A+‟ target rating)

is RBI‟s main internal risk steering tool. Unsurprisingly, credit risk is by far RBI‟s main source of

risk, accounting for 74% of total economic capital (including a 9% risk buffer, see Figure 6) at

end-Q311. While market risk overall is moderate (9% of economic capital), RBI‟s capitalisation

shows some sensitivity to exchange rate movements, as evidenced in 9M11 when its capital

ratios dropped due to an appreciation of the euro versus many CEE currencies, notably the

Russian rouble.

For regulatory purposes, RBI calculates around 50% of RWA under the standardised approach

(parts of its corporate loan book and the majority of its retail book) and the remainder under the

foundation internal ratings-based approach. Corporate lending (and exposure to financial

institutions) is assessed using a 10-point rating model, and project finance is assessed using a

five-point rating model. Application and behavioural scorecards are used for most types of retail

lending.

Credit Risk

Reflecting its business model, credit risk in RBI‟s corporate loan book is by far its largest

source of risk, absorbing 38% of economic capital and accounting for 67% of credit RWA at

end-Q311. While smaller in absolute terms, credit risk in retail lending is also significant and

likely to increase proportionately as RBI attempts to improve its retail franchise. Having scaled

it down in 2009 and 2010, in 2011 RBI decided to cautiously expand its well-established

Figure 5

0

70

140

210

280

350

CE

E

SE

E

Russia

CIS

Oth

er

Gro

up

corp

ora

tes

Q111 Q211 Q311

Loan Impairment Charges

(EURm)

Source: RBI

Corporate credit risk across CEE is main source of risk.

Large share of FX loans elevates risk profile.

Sizeable credit exposure to banks and sovereigns generally of good quality.

NPL improvements came to a halt in Q311; NPL ratio likely to increase in 2012.

Moderate exposure to market risk mainly through partially unhedged capital investments in CEE.

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March 2012 6

financial institutions business, so bank counterparty risk is likely to remain significant.

In 9M11, total corporate credit exposure continued to grow significantly (by 14.5% annualised

to EUR89.7bn at end-Q311), notably in Russia and Asia, although Fitch would expect growth to

slow down in 2012. At end-Q311, 21.7% of corporate credit exposure was in CEE, followed by

Austria (19.6%), Russia (12.8%), western Europe (13.5%) and SEE (13.3%). In recent years

RBI has expanded corporate lending in Asia (facilitating trade flows between Austria/CEE and

Asia) and Asian corporate loans accounted for a meaningful 8.7% at end-Q311. By sector,

corporate lending is well diversified, with acceptable concentration in real estate (5.3% of total

credit exposure at end-Q311; see Figure 14) and the construction industry (4.1%).

Reflecting its corporate lending business model, concentration risk at RBI is significant, Fitch

believes, with the 20 largest credit exposures accounting for around 5% of total credit exposure

(or 12% of gross loans) and 144% of Fitch core capital at end-2010. At the same time, 17

exposures exceeded 5% of Fitch core capital (nine exceeded 5% of regulatory Tier 1 capital).

The biggest exposure amounted to 13% of Fitch core capital. All large exposures had sound

internal ratings. Despite efforts to improve this, collateralisation of corporate exposures remains

relatively low and at end-2010, RBI‟s 20 largest exposures were only 20% covered by tangible

collateral.

After strong growth in 2008 and 2009, growth in retail loans (including SME loans) came to a

halt in 9M11, reflecting the deteriorating operating environment in CEE. At end-Q311, around

half of retail loans were extended in CEE, followed by SEE (30%) and Russia (11%). At the

same date, 51% of retail loans were residential mortgages, followed by consumer loans (22%)

and smaller balances of car loans, credit cards and overdrafts (each 8%). Despite the attempts

to reduce foreign-currency retail loans, FX retail loans remain significant, at 36% of total retail

loans. More importantly, the proportion of overall FX loans is not evenly distributed across CEE

countries and FX loans are particularly prevalent in Hungary, Bulgaria and Croatia (see Figure

13). Underwriting criteria for FX loans are somewhat stricter (20% additional collateral haircut

and tighter debt/income ratios) and have been altogether discontinued for certain markets and

product types.

Given RBI‟s role within RBG but also its sizeable trade finance business, interbank assets

account for a larger proportion of credit risk than at many of its peers (around 19% of total

assets at end-Q311). However, 37% of RBI‟s total bank exposure was to RBG, due to its role

as liquidity manager for the group. At end-Q311, the majority of interbank assets were in

Austria (41%) and western Europe (40%) with minor balances in Asia (7%) and the rest of the

world (12%). Around 69% of interbank assets were rated in the three best internal rating

classes, with 3.1% lowly rated and 1.8% at risk of default or in default.

While credit exposure to CEE banks is limited (around EUR3bn at end-Q311), exposure to

CEE sovereigns is significant, amounting to EUR15.6bn, or 61% of RBI‟s total sovereign

exposure at end-Q311 (the remainder largely related to Austria, 30%). Exposure to eurozone

peripheral countries is limited to some Italian sovereign (EUR434m at end-Q311) and Italian

(EUR909m) and Spanish (EUR755m) interbank exposure.

RBI is also exposed to credit risk in its EUR11bn trading and derivatives book (derivatives

accounting for EUR7bn) and its EUR18.8bn financial investments book (almost exclusively

Figure 6

Economic Capital by

Risk Type(End-Q311)

Source: RBI

Credit -

corporates

38%

Operational

risk

9%

Credit -

public sector

10%

Market risk

9%

Risk buffer

9%

Credit - FI

6%

Credit - retail

19%

Figure 7

Austria

26%

Other

3%

SEE

19%

CEE

30%

CIS

other

8%

Russia

14%

Economic Capital by Region(End-Q311)

Source: RBI

Figure 8 Asset Quality As of end-Q311 CZE HUN POL SVK SVN ALB BIH BGR HRV KOS ROM SER RUS BLR UKR Corp Markets Total

Loans (EURbn) 6.8 5.9 5.3 6.5 1.3 0.9 1.4 2.9 3.8 0.4 4.4 1.3 9.2 0.9 4.2 20.1 1.8 81.3 NPL ratio (%) 6.8 19.7 6.1 4.8 6.5 13.6 7.5 11.4 10.3 9.1 9.2 12.8 5.9 2.2 33.9 3.6 10.4 8.4 Coverage ratio (%) 56.9 66.9 59.0 67.1 52.8 71.4 62.8 62.8 53.8 73.9 71.0 56.6 107.3 263.4 68.9 75.4 88.6 70.5

Source: RBI, Fitch

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March 2012 7

fixed income instruments, EUR15.8bn of which were ECB-eligible). RBI also holds a EUR700m

ABS portfolio (end-2011 market value: EUR477m) although legacy assets are being gradually

disposed of.

Having been somewhat reduced during the financial crisis, off-balance-sheet commitments

remain a sizeable source of credit risk for RBI. At end-Q311, they amounted to EUR39.6bn, or

26.7% of RBI‟s balance sheet and were roughly evenly split between contingent liabilities (31%;

largely credit and other guarantees), irrevocable credit lines (32%) and revocable credit lines.

Asset Quality

After a sharp deterioration, RBI‟s asset quality improved gradually during 2010 and H111.

During 9M11, RBI‟s NPL ratio remained broadly stable as a result of still moderate NPL inflows

but also due to positive FX effects, amounting to 8.8% at end-Q311. However, Fitch expects

this ratio to deteriorate in 2012 both as a result of lower volume growth and an increased inflow

of NPLs in some markets, notably Hungary and Croatia.

While recent trends indicate a renewed worsening of asset quality, this is by no means uniform

across all CEE markets: NPLs in markets like Hungary, Croatia, Bosnia and Bulgaria continued

to increase during 2011 and at least for Hungary and Croatia, Fitch expects asset quality to

continue to deteriorate in 2012. More worryingly, asset quality improvements in some of the

better-performing markets have started to slow down since mid-2011 and some of the stronger

countries, eg the Czech Republic or Poland, even reported an increased NPL ratio at end-

Q311. Among the largest CEE presences, RBI‟s Russian subsidiary was the only one still

reporting NPL ratio improvements in Q311.

More positively, RBI‟s NPL coverage ratio has improved, standing at around 71% at end-Q311.

Still, considering the relatively low collateralisation levels of RBI‟s corporate loans, Fitch

believes that this coverage ratio will have to be maintained at current levels. Despite RBI‟s

sizeable corporate loan book, NPLs tend to be fairly granular. At end-2010, RBI‟s 20 largest

NPLs (58.8% coverage ratio) accounted for 15.3% of Fitch core capital (6.3% after taking loan

loss reserves into account).

Market Risk

Market risk, which Fitch views as relatively moderate at RBI, largely relates to FX risk due to

unhedged capital investments in subsidiaries and, to a lesser degree, structural interest rate

risk in the banking book. In terms of FX positions, the bank partially hedges the book value of

its investments in CEE and sometimes part of the expected profit (the latter is decided by the

assets and liabilities committee (ALCO) every two months).

RBI uses a value-at-risk (VaR) model to calculate market risk capital requirements and

calculates both a trading book VaR and a banking book VaR (for both: 1-day holding period,

99% confidence level, one-business-year observation period). VaR is stress-tested weekly,

using the biggest market movements in the previous five years. Back-testing takes place

regularly. Total VaR (for both the trading and banking books) is limited to EUR380m (after

taking into account diversification effects; EUR425m on a gross basis). In early December 2011,

utilisation stood at 90% (peaking at 112% during 2011). During 9M11, RBI‟s maximum 10-day

VaR excluding diversification effects (as calculated by Fitch) amounted to an acceptable 11%

of Fitch core capital. Interest rate (4.5% of core capital) and FX risk (4.1%) tend to be RBI‟s

main VaR components followed by credit spread risk (2.4%).

Equity risk is small. Furthermore, interest rate risk in the banking book, defined as a 200bp

interest rate movement, has a regulatory limit of 20% of eligible own funds. The bank is known

as an active trading bank in Austria and emerging markets. Credit derivatives are used mostly

for hedging purposes.

Banks


March 2012 8

Operational Risk

For Basel II purposes, RBI uses the standardised approach. It has defined key risk indicators

and has implemented an early warning system. The group‟s main exposure to operational risk

probably resides in its extensive branch network in CEE.

Funding and Capital

Funding

CEE and (to a lesser extent) Austrian customer deposits fund around half of RBI‟s balance

sheet (and 85% of gross loans at end-Q311). RBI‟s loans/deposits ratio compares reasonably

well with peers‟ (118% at end-Q311). If adjusted for RBG liquidity placed with RBI (accounted

for as interbank funding), RBI‟s loans/deposits ratio falls to below 100% (95% at end-Q311).

Overall, despite having reduced, wholesale funding in the form of interbank funding and bond

issuance remains significant.

Reflecting its sizeable corporate business, deposits from corporates dominate RBI‟s customer

deposit base (53% of total deposits at end-Q311), followed by retail deposits (35%) and SME

deposits (9%). Geographically, RBI‟s deposit base is well diversified, with some concentration

in Russia (13% of total deposits), Slovakia (10%), the Czech Republic (9%), Austria (9%),

Hungary (7%) and Poland (6%). Deposits from RBI‟s overseas branches (London, Singapore,

Beijing, Malta) are also relatively significant.

While some CEE subsidiaries are largely self-funded (eg Slovakia and Russia, see Figure 15),

RBI continues to be reliant on wholesale funding to finance part of its CEE operations. However,

sluggish growth in CEE and efforts to raise local deposits has meant that the CEE funding gap

has narrowed considerably to around EUR6bn at end-Q311. Moreover, RBI obtains a

significant part of interbank funding from within the RBG sector (around 45% at end-Q311). At

end-2011, RBI did not have any central bank funding, from either the ECB or the Swiss

National Bank (for CHF loans in CEE). In 2012, around EUR3bn of publicly placed bonds will

mature, in addition to EUR1.25bn of government-guaranteed bonds and EUR1.5bn of private

placements.

Liquidity management for all of RBI‟s subsidiaries is centralised. Reflecting its large and long-

term loan book (at end-Q311, 20% of loans matured after five years and 35% between one and

five years), RBI has, based on remaining contractual maturities, a significant liquidity gap in the

“up to three months” bucket (EUR13.9bn; excluding equity). According to its internal liquidity

assumptions (which include off-balance-sheet outflows), RBI had a more than two-year

“survival period” at end-Q311. RBI‟s liquidity stress test assumes no access to wholesale

markets for six months, budgeted credit growth and a 20% outflow in retail deposits. Liquidity is

supported by RZB‟s sizeable counterbalancing capacity, which at end-Q311 consisted of ECB-

eligible assets (EUR15bn; around EUR7bn of which were unencumbered) and assets eligible

for tender at local central banks.

Capital

RBI‟s majority owner, RZB, reported a EUR2.1bn capital shortfall under EBA scenarios

published in Q411. While the shortfall at RBI level has not been published, given that RBI

represents the bulk of RZB, Fitch assumes that the capital shortfall at RBI is of a similar

magnitude and addressing this shortfall by end-H112 (the EBA deadline) will be one of RBI‟s

key challenges in H112.

Capital strengthening measures announced in Q411 include making privately owned

participation capital (EUR750m) EBA-compliant (a boost to capitalisation of between EUR500m

and EUR1bn, according to RBI), generating regulatory capital at RZB level (EUR400m),

earnings retention (EUR600m to EUR800m), optimising RWA utilisation (EUR700m to

EUR900m) and various other capital-enhancing measures (EUR300m to EUR500m),.

According to RBI, business reduction (deleveraging) will roughly correspond to RWA growth in

Figure 9 RBI Funding Structure End-Q311 (EURm) (%)

a

Bank deposits 37,607 27 O/w from RBG sector

16,813 12

O/w ECB 0 0 O/w other Austrian 8,244 O/w foreign 13,325 Customer deposits

68,936 50

O/w Austrian 6,497 5 O/w foreign 62,439 45 Debt securities 15,161 11 O/w maturing Q411/2012

6,040

Subordinated debt 4,091 O/w Tier 2 3,279 Total non-equity 138,020 100 a As % of total non-equity funding

Source: RBI; Fitch

Good customer deposit franchise throughout CEE.

Efforts to contain wholesale funding requirements for CEE.

Thin core capital ratios.

Meeting EBA capital ratio requirements feasible, but challenging given market conditions.

Banks


March 2012 9

2011 and should therefore not be overly detrimental to business opportunities in CEE. The

bank does not intend to raise capital externally. Fitch views RZB‟s and RBI‟s capital-

strengthening plan as challenging, especially given the currently difficult operating environment.

In late January 2012, RBI/RZB stated that around two-thirds of the required additional capital

had already been raised.

Compared to many peers‟, RBI‟s core Tier 1 capitalisation is thin, reflected in a low Fitch core

capital ratio (see Figure 10), as RBI‟s Tier 1 capital contains a large proportion of privately-

placed hybrid and participation capital, and EUR1.75bn of government participation capital

injected in late-2008 and 2009. Both forms of participation capital are considered core Tier 1

capital by the Austrian regulator but have been reclassified as hybrid capital (100% equity

credit) by Fitch.

To limit the impact of FX on RBI‟s capital ratios, the bank partly hedges its non-euro capital

investments in CEE and elsewhere. Nonetheless, RBI‟s capital ratios remain sensitive to FX

volatility, as witnessed in 9M11 when FX effects had a significant negative impact on capital

ratios (20bp in Q311 alone).

Figure 10 RBI Capital Structure End-Q311 (EURm)

Core Tier 1 capital 5,506 Hybrid capital 800 Private part cap 750 Government par cap 1,750 Tier 2 capital 3,260 Total RWA 100,863 O/w credit 80,438 O/w market 10,575 O/w operational 9,850 (%)

Fitch core capital 6.3 RBI core Tier 1 7.9 Tier 1 8.7 Total capital ratio 12.1

Source: RBI; Fitch

Banks


March 2012 10

Annex

Group Structure and Support Mechanism

The Raiffeisen group has a cross-guarantee support mechanism in place. While there has

always been a voluntary support mechanism, a legally binding mechanism was established in

the early 2000s. The voluntary support scheme remains in place but has been enhanced by an

“ultimate payment guarantee” through the setting up of a fund (Raiffeisen ‐

Kundengarantiegemeinschaft Österreich). The regional cross-guarantee systems are also part

of the Raiffeisen-Kundengarantiegemeinschaft, with the exception of the regions of Salzburg

and Carinthia. Consequently, around 81% of all group banks are members of the guarantee

scheme, including RBI, resulting in around 90% of deposits being guaranteed.

Revenue by Region

Figure 12

Group markets

8%

Corporate centre

8%

SEE

22%Russia

14%

CEE

27%

Group corporates

10%

CIS other

11%

Revenue by Region(9M11)

Source: RBI; excluding consolidation effects

Figure 11

Raiffeisen Banking Group, RZB AG and RBI – Simplified Organisational Chart

a Legal merger with Polbank expected in Q112

Source: RBI

1.6m Members (Mainly Private Individuals in Austria) ZAO Raiffeisenbank Moscow (100%)

527 Austrian Raiffeisen Banks (Around 2,200 Domestic Branches)

8 Regional Raiffeisen Banks (Raiffeisenlandesbanken) and Zveza

Bank (Klagenfurt)

Raiffeisen Zentralbank Oesterreich Ag (RZB AG)


Ra

iffe

ise

n B

an

kin

g G

rou

p (

RB

G)

Raiffeisen Bank Zrt. Budapest (73.24%)

Raiffeisenbank a.s. Prague (51.0%)

Tatra banka a.s. Bratislava (70.6%)

Raiffeisen Bank Polska S.A. Warsaw (100%)a

Raiffeisen Bank S.A. Bucharest (99.5%)

Raiffeisenbank Austria d.d. Zagreb (75.0%)

Raiffeisen Bank Aval JSC Kiev (96.2%)

Raiffeisenbank (Bulgaria) EAD Sofia (100%)

Raiffeisen Bank d.d. Bosnia I Herce. (97.0%)

Raiffeisen Bank Sh.a. Tirana (100%)

Raiffeisen banka a.d. Belgrade (100%)

Raiffeisen Banka d.d. Maribor/Slovenia (86.3%)

Priorbank JSC Minsk (87.7%)

Other subsidiaries in CEE and elsewhere

Banks


March 2012 11

Total Credit Exposure and Loan Book

Figure 13

0

10

20

30

40

50

60

70

80

CZE HUN POL SVK SVN ALB BIH BGR HRV KOS ROM SER RUS BLR UKR

Corporate loans FX loans (total)

CEE - Lending by Type and Currency(End-Q311)

(%)

Source: RBI

Figure 14 Total Exposure by Type (EUR186.0bn; End-Q311) (%)

Trade 12.3 Manufacturing 11.3 Real estate 5.3 Financial intermediation 4.7 Construction 4.1 Transport & communication 2.0 Other corporates 12.1 Total corporates 51.9 Residential mortgages 6.4 Car loans 1.0 Consumer loans 2.7 Credit cards 1.0 SME loans 0.3 Retail overdrafts 1.0 Total retail 12.4 FI – A1 to A3 rating (A to AAA) 15.1 FI – B1 to B3 rating (BB to A-) 5.7 FI – rated B4, below B4 or NR (BB- and below) 1.2 Total financial institutions 22.0 Sovereign – A1 to A3 rating 7.2 Sovereign – B1 to B3 rating 4.3 Sovereign – rated B4 or below 2.3 Total sovereigns 13.7 Total 100.0

Source: RBI, Fitch

Banks


March 2012 12

Figure 15 CEE Funding Gap End-H111 LDR (%)

a Gap

b

Czech Rep. 113.2 -795 Hungary 121.2 -1,036 Poland 130.5 -1,249 Slovakia 92.9 501 Slovenia 333.8 -940 Albania 46.5 985 Bosnia 85.2 238 Bulgaria 137.8 -803 Croatia 120.9 -659 Kosovo 72.6 159 Romania 117.2 -646 Serbia 118.3 -209 Russia 99.4 51 Belarus 115.9 -120 Ukraine 163.5 -1,615 Total CEE 112.5 -6,138 a Loans/deposits ratio

b Deposits minus loans in EURm

Country data as reported by the bank; source: RBI, Fitch

Banks


March 2012 13

Figure 16 RBI – Peer Group Comparison

RBI* UniCredit Bank Austria AG Erste Group Bank AG

(EURm) 9M11 2010 9M11 2010 9M11 2010

Net interest income 2,724 3,578 3,402 4,574 4,115 5,392 Net fee income 1,125 1,491 1,401 1,991 1,352 1,936 Total non-interest operating income 1,379 1,878 1,877 2,552 1,149 1,951 Personal expenses 1,141 1,453 1,513 1,931 1,720 2,264 Other operating expenses 1,146 1,527 1,576 1,979 1,171 1,553 Total operating expenses 2,287 2,980 3,089 3,910 2,892 3,817 Pre-impairment operating profit 1,816 2,477 2,340 3,340 2,391 3,546 Loan impairment charge (LIC) 782 1,194 1,044 1,837 1,859 2,031 Operating profit 1,034 1,283 991 1,489 532 1,515 Pre-tax profit 1,034 1,283 287 1,146 (670) 1,515 Net income 759 1,177 43 798 (775) 1,186 Fitch comprehensive income 411 1,395 (144) 1,068 (691) 1,341 Net interest margin (%) 2.82 4.45 2.48 2.56 2.83 2.91 Pre-impairment op. profit/av. equity (%) 30.44 33.93 17.84 19.74 21.08 23.9 Pre-impairment op. profit/av. assets (%) 1.74 2.82 1.62 1.7 1.51 1.72 LIC/pre-impairment operating profit (%) 43.06 48.21 57.65 55.42 77.75 57.28 Operating profit/average equity (%) 17.33 17.57 7.55 8.8 4.69 10.21 Operating profit/average assets (%) 0.99 1.46 0.68 0.76 0.33 0.73 Comprehensive income/av. equity (%) 6.89 19.11 (1.1) 6.31 (6.09) 9.04 Eligible capital/risk-weighted assets (%) 6.33 9.4 11.65 10.58 8.15 9.83 Tang. common equity/tangible assets %) 4.52 4.95 7.42 7.25 4.78 5.31 Equity/assets (%) 5.29 6.03 8.74 9.05 6.33 7.46 Tier 1 ratio (%) 8.7 9.7 10.75 10.35 9.8 10.2 Impaired loans (EURm) 7,153 6,661 14,007 12,478 11,113 10,087 Loan loss reserve (LLR; EURm) 5,052 4,756 7,554 6,936 7,189 6,119 Impaired loans/total loans (%) 8.8 8.8 10.1 9.11 8.22 7.6 LLR/impaired loans (%) 70.63 71.4 53.93 55.59 64.69 60.66 LIC/average gross loans (%) 1.33 2.12 1.02 1.37 1.86 1.55 LLR/total assets (%) 3.33 3.33 3.33 3.33 3.33 3.33 Loans/customer deposits (%) 117.96 131.27 134.37 136.64 111.2 113.43 Total assets 148,368 131,173 197,667 193,049 216,094 205,938 Total customer deposits 68,937 57,633 103,209 100,284 121,594 117,016 Total long-term funding 18,439 19,737 31,474 24,539 39,341 35,957 Total equity 7,847 7,904 17,284 17,475 13,677 15,365 Fitch core capital 6,385 6,414 14,011 13,135 9,769 10,601

*2010 figures are not fully comparable due to the October 2010 merger of RI with RZB‟s corporate and investment banking business to form RBI. Source: Banks‟ financial statements

Banks


March 2012 14


Income Statement

9 Months - 3rd Quarter 9 Months - 3rd Quarter As % of Year End As % of Year End As % of Year End As % of Year End As % of

USDm EURm Earning EURm Earning EURm Earning EURm Earning EURm Earning

Unaudited Unaudited Assets Unqualified Assets Unqualified Assets Unqualified Assets Unqualified Assets

1. Interest Income on Loans 4,689.4 3,473.0 3.41 4,571.9 3.76 4,498.8 6.51 5,761.9 7.68 4,309.4 6.54

2. Other Interest Income 1,868.8 1,384.0 1.36 1,793.1 1.47 1,092.7 1.58 422.0 0.56 295.9 0.45

3. Dividend Income n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

4. Gross Interest and Dividend Income 6,558.2 4,857.0 4.77 6,365.0 5.23 5,591.5 8.10 6,183.9 8.24 4,605.3 6.99

5. Interest Expense on Customer Deposits 1,328.7 984.0 0.97 1,251.0 1.03 1,593.8 2.31 2,697.6 3.59 1,998.5 3.03

6. Other Interest Expense 1,551.4 1,149.0 1.13 1,535.8 1.26 1,061.2 1.54 254.3 0.34 188.0 0.29

7. Total Interest Expense 2,880.1 2,133.0 2.10 2,786.8 2.29 2,655.0 3.84 2,951.9 3.93 2,186.5 3.32

8. Net Interest Income 3,678.1 2,724.0 2.68 3,578.2 2.94 2,936.5 4.25 3,232.0 4.31 2,418.8 3.67

9. Net Gains (Losses) on Trading and Derivatives 596.8 442.0 0.43 243.9 0.20 194.5 0.28 147.7 0.20 97.8 0.15

10. Net Gains (Losses) on Other Securities -81.0 -60.0 -0.06 n.a. - 0.0 0.00 0.0 0.00 0.0 0.00

11. Net Gains (Losses) on Assets at FV through Income Statement -116.1 -86.0 -0.08 137.2 0.11 41.4 0.06 -25.6 -0.03 -9.2 -0.01

12. Net Insurance Income n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

13. Net Fees and Commissions 1,519.0 1,125.0 1.11 1,490.8 1.22 1,223.1 1.77 1,496.3 1.99 1,249.8 1.90

14. Other Operating Income -56.7 -42.0 -0.04 6.3 0.01 0.1 0.00 7.9 0.01 26.5 0.04

15. Total Non-Interest Operating Income 1,862.0 1,379.0 1.36 1,878.2 1.54 1,459.1 2.11 1,626.3 2.17 1,364.9 2.07

16. Personnel Expenses 1,540.6 1,141.0 1.12 1,452.9 1.19 1,054.2 1.53 1,275.9 1.70 1,084.9 1.65

17. Other Operating Expenses 1,547.4 1,146.0 1.13 1,526.8 1.25 1,235.9 1.79 1,372.9 1.83 1,104.2 1.68

18. Total Non-Interest Expenses 3,088.0 2,287.0 2.25 2,979.7 2.45 2,290.1 3.32 2,648.8 3.53 2,189.1 3.32

19. Equity-accounted Profit/ Loss - Operating n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

20. Pre-Impairment Operating Profit 2,452.1 1,816.0 1.78 2,476.7 2.03 2,105.5 3.05 2,209.5 2.94 1,594.6 2.42

21. Loan Impairment Charge 1,055.9 782.0 0.77 1,194.1 0.98 1,737.9 2.52 780.3 1.04 357.0 0.54

22. Securities and Other Credit Impairment Charges n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

23. Operating Profit 1,396.2 1,034.0 1.02 1,282.6 1.05 367.6 0.53 1,429.2 1.90 1,237.6 1.88

24. Equity-accounted Profit/ Loss - Non-operating 0.0 0.0 0.00 n.a. - n.a. - n.a. - n.a. -

25. Non-recurring Income n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

26. Non-recurring Expense n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

27. Change in Fair Value of Own Debt n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

28. Other Non-operating Income and Expenses n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

29. Pre-tax Profit 1,396.2 1,034.0 1.02 1,282.6 1.05 367.6 0.53 1,429.2 1.90 1,237.6 1.88

30. Tax expense 367.3 272.0 0.27 110.2 0.09 80.5 0.12 350.9 0.47 264.1 0.40

31. Profit/Loss from Discontinued Operations -4.1 -3.0 0.00 4.8 0.00 n.a. - n.a. - n.a. -

32. Net Income 1,024.8 759.0 0.75 1,177.2 0.97 287.1 0.42 1,078.3 1.44 973.5 1.48

33. Change in Value of AFS Investments -10.8 -8.0 -0.01 10.1 0.01 8.7 0.01 n.a. - n.a. -

34. Revaluation of Fixed Assets n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

35. Currency Translation Differences -472.6 -350.0 -0.34 180.4 0.15 -248.9 -0.36 n.a. - n.a. -

36. Remaining OCI Gains/(losses) 13.5 10.0 0.01 27.2 0.02 0.0 0.00 n.a. - n.a. -

37. Fitch Comprehensive Income 555.0 411.0 0.40 1,394.9 1.15 46.9 0.07 1,078.3 1.44 973.5 1.48

38. Memo: Profit Allocation to Non-controlling Interests n.a. n.a. - n.a. - 74.9 0.11 96.3 0.13 132.2 0.20

39. Memo: Net Income after Allocation to Non-controlling Interests 1,024.8 759.0 0.75 1,177.2 0.97 212.2 0.31 982.0 1.31 841.3 1.28

40. Memo: Common Dividends Relating to the Period n.a. n.a. - 30.1 0.02 142.9 0.21 142.8 0.19 n.a. -

41. Memo: Preferred Dividends Related to the Period n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Exchange rate

31 Dec 2007

USD1 = EUR0.67930

31 Dec 2009

USD1 = EUR0.69416

31 Dec 2008

USD1 = EUR0.71855

30 Sep 2011

USD1 = EUR0.74060

31 Dec 2010

USD1 = EUR0.74840

Banks


March 2012 15


Balance Sheet


USDm EURm Assets EURm Assets EURm Assets EURm Assets EURm Assets

AssetsA. Loans

1. Residential Mortgage Loans 23,648.4 17,514.0 11.80 16,887.9 12.87 17,874.8 23.43 17,249.1 20.20 12,432.6 17.09

2. Other Mortgage Loans n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

3. Other Consumer/ Retail Loans n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

4. Corporate & Commercial Loans n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

5. Other Loans 86,155.8 63,807.0 43.01 58,769.2 44.80 32,640.2 42.79 40,653.2 47.60 36,447.2 50.10

6. Less: Reserves for Impaired Loans/ NPLs 6,821.5 5,052.0 3.41 4,755.9 3.63 3,084.0 4.04 1,641.3 1.92 1,103.2 1.52

7. Net Loans 102,982.7 76,269.0 51.41 70,901.2 54.05 47,431.0 62.18 56,261.0 65.88 47,776.6 65.68

8. Gross Loans 109,804.2 81,321.0 54.81 75,657.1 57.68 50,515.0 66.23 57,902.3 67.80 48,879.8 67.20

9. Memo: Impaired Loans included above 9,658.4 7,153.0 4.82 6,660.6 5.08 4,905.9 6.43 1,780.0 2.08 308.9 0.42

10. Memo: Loans at Fair Value included above n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

B. Other Earning Assets

1. Loans and Advances to Banks 38,314.9 28,376.0 19.13 21,532.4 16.42 10,310.1 13.52 9,038.1 10.58 11,053.2 15.19

2. Reverse Repos and Cash Collateral n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

3. Trading Securities and at FV through Income 5,432.1 4,023.0 2.71 4,443.8 3.39 3,163.1 4.15 2,268.0 2.66 2,281.0 3.14

4. Derivatives 11,286.8 8,359.0 5.63 5,112.6 3.90 879.2 1.15 2,360.1 2.76 620.7 0.85

5. Available for Sale Securities 25,448.3 18,847.0 12.70 19,630.9 14.97 7,270.5 9.53 5,136.6 6.01 4,133.4 5.68

6. Held to Maturity Securities n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

7. At-equity Investments in Associates 6.8 5.0 0.00 5.0 0.00 5.4 0.01 2.5 0.00 24.0 0.03

8. Other Securities n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

9. Total Securities 42,173.9 31,234.0 21.05 29,192.3 22.25 11,318.2 14.84 9,767.2 11.44 7,059.1 9.70

10. Memo: Government Securities included Above n.a. n.a. - 18,130.7 13.82 8,171.4 10.71 4,645.1 5.44 4,144.3 5.70

11. Memo: Total Securities Pledged n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

12. Investments in Property 221.4 164.0 0.11 112.7 0.09 n.a. - n.a. - n.a. -

13. Insurance Assets n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

14. Other Earning Assets n.a. n.a. - 0.0 0.00 0.0 0.00 0.0 0.00 0.0 0.00

15. Total Earning Assets 183,693.0 136,043.0 91.69 121,738.6 92.81 69,059.3 90.54 75,066.3 87.90 65,888.9 90.58

C. Non-Earning Assets

1. Cash and Due From Banks 10,172.8 7,534.0 5.08 4,806.9 3.66 4,179.6 5.48 7,129.9 8.35 3,664.2 5.04

2. Memo: Mandatory Reserves included above n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

3. Foreclosed Real Estate n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

4. Fixed Assets 1,705.4 1,263.0 0.85 1,340.9 1.02 1,244.2 1.63 1,263.8 1.48 1,153.6 1.59

5. Goodwill 789.9 585.0 0.39 613.7 0.47 581.4 0.76 610.2 0.71 757.0 1.04

6. Other Intangibles 819.6 607.0 0.41 606.1 0.46 390.5 0.51 341.7 0.40 379.8 0.52

7. Current Tax Assets 81.0 60.0 0.04 31.5 0.02 109.4 0.14 66.3 0.08 96.2 0.13

8. Deferred Tax Assets 588.7 436.0 0.29 462.7 0.35 120.1 0.16 89.8 0.11 70.3 0.10

9. Discontinued Operations 8.1 6.0 0.00 5.3 0.00 n.a. - n.a. - n.a. -

10. Other Assets 2,476.4 1,834.0 1.24 1,567.4 1.19 590.8 0.77 829.0 0.97 732.8 1.01

11. Total Assets 200,334.9 148,368.0 100.00 131,173.1 100.00 76,275.3 100.00 85,397.0 100.00 72,742.8 100.00

Liabilities and Equity

D. Interest-Bearing Liabilities

1. Customer Deposits - Current 36,592.0 27,100.0 18.27 23,781.0 18.13 17,140.4 22.47 16,242.7 19.02 17,584.9 24.17

2. Customer Deposits - Savings 1,717.5 1,272.0 0.86 1,469.8 1.12 1,393.1 1.83 952.0 1.11 1,244.0 1.71

3. Customer Deposits - Term 54,773.2 40,565.0 27.34 32,382.4 24.69 24,044.8 31.52 27,011.3 31.63 21,628.3 29.73

4. Total Customer Deposits 93,082.6 68,937.0 46.46 57,633.2 43.94 42,578.3 55.82 44,206.0 51.77 40,457.2 55.62

5. Deposits from Banks 17,119.9 12,679.0 8.55 12,491.1 9.52 16,965.0 22.24 20,252.7 23.72 13,634.3 18.74

6. Repos and Cash Collateral n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

7. Other Deposits and Short-term Borrowings 33,659.2 24,928.0 16.80 21,168.1 16.14 3,145.1 4.12 5,960.4 6.98 6,292.6 8.65

8. Total Deposits, Money Market and Short-term Funding 143,861.7 106,544.0 71.81 91,292.4 69.60 62,688.4 82.19 70,419.1 82.46 60,384.1 83.01

9. Senior Debt Maturing after 1 Year 10,557.7 7,819.0 5.27 9,959.5 7.59 2,526.7 3.31 3,393.4 3.97 2,320.4 3.19

10. Subordinated Borrowing 4,426.1 3,278.0 2.21 3,182.0 2.43 1,301.3 1.71 1,684.5 1.97 1,531.8 2.11

11. Other Funding 9,913.6 7,342.0 4.95 6,595.8 5.03 n.a. - n.a. - n.a. -

12. Total Long Term Funding 24,897.4 18,439.0 12.43 19,737.3 15.05 3,828.0 5.02 5,077.9 5.95 3,852.2 5.30

13. Derivatives 11,844.5 8,772.0 5.91 5,794.4 4.42 773.6 1.01 2,292.0 2.68 695.2 0.96

14. Trading Liabilities 1,743.2 1,291.0 0.87 1,210.7 0.92 n.a. - n.a. - n.a. -

15. Total Funding 182,346.7 135,046.0 91.02 118,034.8 89.98 67,290.0 88.22 77,789.0 91.09 64,931.5 89.26

E. Non-Interest Bearing Liabilities

1. Fair Value Portion of Debt n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

2. Credit impairment reserves n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

3. Reserves for Pensions and Other 978.9 725.0 0.49 671.9 0.51 311.5 0.41 436.8 0.51 315.0 0.43

4. Current Tax Liabilities n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

5. Deferred Tax Liabilities n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

6. Other Deferred Liabilities 275.5 204.0 0.14 189.7 0.14 111.5 0.15 174.6 0.20 193.5 0.27

7. Discontinued Operations n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

8. Insurance Liabilities n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

9. Other Liabilities 1,664.9 1,233.0 0.83 1,053.7 0.80 393.2 0.52 478.4 0.56 680.7 0.94

10. Total Liabilities 185,266.0 137,208.0 92.48 119,950.1 91.44 68,106.2 89.29 78,878.8 92.37 66,120.7 90.90

F. Hybrid Capital

1. Pref. Shares and Hybrid Capital accounted for as Debt 1,097.8 813.0 0.55 819.1 0.62 1,169.0 1.53 n.a. - n.a. -

2. Pref. Shares and Hybrid Capital accounted for as Equity 3,375.6 2,500.0 1.68 2,500.0 1.91 600.0 0.79 n.a. - n.a. -

G. Equity

1. Common Equity 9,403.1 6,963.9 4.69 6,628.1 5.05 5,402.6 7.08 5,595.2 6.55 5,827.4 8.01

2. Non-controlling Interest 1,420.5 1,052.0 0.71 1,065.7 0.81 997.5 1.31 923.0 1.08 794.7 1.09

3. Securities Revaluation Reserves 2.8 2.1 0.00 10.1 0.01 n.a. - n.a. - n.a. -

4. Foreign Exchange Revaluation Reserves -229.0 -169.6 -0.11 180.4 0.14 n.a. - n.a. - n.a. -

5. Fixed Asset Revaluations and Other Accumulated OCI -1.9 -1.4 0.00 19.6 0.01 n.a. - 0.0 0.00 0.0 0.00

6. Total Equity 10,595.5 7,847.0 5.29 7,903.9 6.03 6,400.1 8.39 6,518.2 7.63 6,622.1 9.10

7. Total Liabilities and Equity 200,334.9 148,368.0 100.00 131,173.1 100.00 76,275.3 100.00 85,397.0 100.00 72,742.8 100.00

8. Memo: Fitch Core Capital 8,621.7 6,385.2 4.30 6,414.3 4.89 5,349.1 7.01 n.a. - n.a. -

9. Memo: Fitch Eligible Capital 11,997.3 8,885.2 5.99 8,914.3 6.80 5,949.1 7.80 n.a. - n.a. -

Exchange rate

31 Dec 2007

USD1 = EUR0.67930

31 Dec 2009

USD1 = EUR0.69416

31 Dec 2008

USD1 = EUR0.71855

30 Sep 2011

USD1 = EUR0.74060

31 Dec 2010

USD1 = EUR0.74840

Banks


March 2012 16


Summary Analytics30 Sep 2011 31 Dec 2010 31 Dec 2009 31 Dec 2008 31 Dec 2007

9 Months - 3rd Quarter Year End Year End Year End Year End

A. Interest Ratios

1. Interest Income on Loans/ Average Gross Loans 5.91 8.12 8.35 10.58 10.28

2. Interest Expense on Customer Deposits/ Average Customer Deposits 2.10 2.73 3.75 6.31 5.48

3. Interest Income/ Average Earning Assets 5.03 7.92 7.90 8.61 8.07

4. Interest Expense/ Average Interest-bearing Liabilities 2.27 3.58 3.71 4.12 3.82

5. Net Interest Income/ Average Earning Assets 2.82 4.45 4.15 4.50 4.24

6. Net Int. Inc Less Loan Impairment Charges/ Av. Earning Assets 2.01 2.97 1.69 3.42 3.61

7. Net Interest Inc Less Preferred Stock Dividend/ Average Earning Assets 2.82 4.45 4.15 4.50 4.24

B. Other Operating Profitability Ratios

1. Non-Interest Income/ Gross Revenues 33.61 34.42 33.19 33.47 36.07

2. Non-Interest Expense/ Gross Revenues 55.74 54.61 52.10 54.52 57.86

3. Non-Interest Expense/ Average Assets 2.20 3.40 2.88 3.33 3.43

4. Pre-impairment Op. Profit/ Average Equity 30.44 33.93 32.68 32.51 29.52

5. Pre-impairment Op. Profit/ Average Total Assets 1.74 2.82 2.65 2.78 2.50

6. Loans and securities impairment charges/ Pre-impairment Op. Profit 43.06 48.21 82.54 35.32 22.39

7. Operating Profit/ Average Equity 17.33 17.57 5.71 21.03 22.91

8. Operating Profit/ Average Total Assets 0.99 1.46 0.46 1.80 1.94

9. Taxes/ Pre-tax Profit 26.31 8.59 21.90 24.55 21.34

10. Pre-Impairment Operating Profit / Risk Weighted Assets 2.41 2.61 3.29 3.07 2.96

11. Operating Profit / Risk Weighted Assets 1.37 1.35 0.57 1.98 2.30

C. Other Profitability Ratios

1. Net Income/ Average Total Equity 12.72 16.13 4.46 15.87 18.02

2. Net Income/ Average Total Assets 0.73 1.34 0.36 1.35 1.53

3. Fitch Comprehensive Income/ Average Total Equity 6.89 19.11 0.73 15.87 18.02

4. Fitch Comprehensive Income/ Average Total Assets 0.39 1.59 0.06 1.35 1.53

5. Net Income/ Av. Total Assets plus Av. Managed Securitized Assets n.a. n.a. n.a. n.a. n.a.

6. Net Income/ Risk Weighted Assets 1.01 1.24 0.45 1.50 1.81

7. Fitch Comprehensive Income/ Risk Weighted Assets 0.54 1.47 0.07 1.50 1.81

D. Capitalization

1. Fitch Core Capital/Weighted Risks 6.33 6.77 8.35 n.a. n.a.

2. Fitch Eligible Capital/ Weighted Risks 8.81 9.40 9.29 n.a. n.a.

3. Tangible Common Equity/ Tangible Assets 4.52 4.95 7.11 6.49 7.66

4. Tier 1 Regulatory Capital Ratio 8.70 9.70 11.00 8.10 10.50

5. Total Regulatory Capital Ratio 12.10 13.30 13.00 9.70 12.40

6. Core Tier 1 Regulatory Capital Ratio 7.90 8.90 9.20 n.a. n.a.

7. Equity/ Total Assets 5.29 6.03 8.39 7.63 9.10

8. Cash Dividends Paid & Declared/ Net Income n.a. 2.56 49.77 13.24 n.a.

9. Cash Dividend Paid & Declared/ Fitch Comprehensive Income n.a. 2.16 304.69 13.24 n.a.

10. Cash Dividends & Share Repurchase/Net Income n.a. n.a. n.a. n.a. n.a.

11. Net Income - Cash Dividends/ Total Equity 12.93 14.51 2.25 14.35 14.70

E. Loan Quality

1. Growth of Total Assets 13.11 71.97 -10.68 17.40 30.21

2. Growth of Gross Loans 7.49 49.77 -12.76 18.46 39.49

3. Impaired Loans(NPLs)/ Gross Loans 8.80 8.80 9.71 3.07 0.63

4. Reserves for Impaired Loans/ Gross loans 6.21 6.29 6.11 2.83 2.26

5. Reserves for Impaired Loans/ Impaired Loans 70.63 71.40 62.86 92.21 357.14

6. Impaired Loans less Reserves for Imp Loans/ Equity 26.77 24.10 28.47 2.13 -11.99

7. Loan Impairment Charges/ Average Gross Loans 1.33 2.12 3.23 1.43 0.85

8. Net Charge-offs/ Average Gross Loans n.a. 0.55 n.a. n.a. n.a.

9. Impaired Loans + Foreclosed Assets/ Gross Loans + Foreclosed Assets 8.80 8.80 9.71 3.07 0.63

F. Funding

1. Loans/ Customer Deposits 117.96 131.27 118.64 130.98 120.82

2. Interbank Assets/ Interbank Liabilities 223.80 172.38 60.77 44.63 81.07

3. Customer Deposits/ Total Funding excl Derivatives 54.59 51.35 64.01 58.55 62.98

Banks


March 2012 17


Reference Data


USDm EURm Assets EURm Assets EURm Assets EURm Assets EURm Assets

A. Off-Balance Sheet Items

1. Managed Securitized Assets Reported Off-Balance Sheet n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

2. Other off-balance sheet exposure to securitizations n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

3. Guarantees n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

4. Acceptances and documentary credits reported off-balance sheet n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

5. Committed Credit Lines n.a. n.a. - 11,992.5 9.14 5,395.1 7.07 6,342.9 7.43 8,080.9 11.11

6. Other Contingent Liabilities n.a. n.a. - 11,855.5 9.04 4,667.7 6.12 5,052.4 5.92 4,598.5 6.32

7. Total Business Volume 200,334.9 148,368.0 100.00 155,021.1 118.18 86,338.1 113.19 96,792.3 113.34 85,422.2 117.43

8. Memo: Total Weighted Risks 136,173.4 100,850.0 67.97 94,793.7 72.27 64,065.1 83.99 72,077.3 84.40 53,905.6 74.10

9. Fitch Adjustments to Weighted Risks. n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

10. Fitch Adjusted Weighted Risks 136,173.4 100,850.0 67.97 94,793.7 72.27 64,065.1 83.99 72,077.3 84.40 53,905.6 74.10

B. Average Balance Sheet

Average Loans 105,816.2 78,367.5 52.82 56,321.8 42.94 53,884.3 70.64 54,469.7 63.78 41,939.8 57.65

Average Earning Assets 174,185.7 129,001.9 86.95 80,326.6 61.24 70,798.5 92.82 71,786.1 84.06 57,073.4 78.46

Average Assets 187,874.4 139,139.8 93.78 87,702.5 66.86 79,387.9 104.08 79,612.9 93.23 63,751.3 87.64

Average Managed Securitized Assets (OBS) n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Average Interest-Bearing Liabilities 169,605.3 125,609.7 84.66 77,847.4 59.35 71,515.0 93.76 71,562.8 83.80 57,212.3 78.65

Average Common equity 9,241.8 6,844.5 4.61 6,230.7 4.75 5,043.8 6.61 5,908.2 6.92 4,707.7 6.47

Average Equity 10,769.2 7,975.7 5.38 7,298.4 5.56 6,442.3 8.45 6,795.4 7.96 5,401.9 7.43

Average Customer Deposits 84,748.6 62,764.8 42.30 45,862.1 34.96 42,520.7 55.75 42,757.1 50.07 36,437.8 50.09

C. Maturities

Asset Maturities:

Loans & Advances < 3 months n.a. n.a. - 19,426.3 14.81 11,808.9 15.48 12,547.4 14.69 11,154.3 15.33

Loans & Advances 3 - 12 Months n.a. n.a. - 13,704.0 10.45 9,683.0 12.69 11,659.7 13.65 10,161.2 13.97

Loans and Advances 1 - 5 Years n.a. n.a. - 26,393.4 20.12 15,509.4 20.33 18,755.5 21.96 16,613.6 22.84

Loans & Advances > 5 years n.a. n.a. - 16,133.3 12.30 13,513.7 17.72 13,298.4 15.57 9,847.5 13.54

Debt Securities < 3 Months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Debt Securities 3 - 12 Months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Debt Securities 1 - 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Debt Securities > 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Interbank < 3 Months n.a. n.a. - 16,405.6 12.51 9,684.6 12.70 15,393.2 18.03 14,225.3 19.56

Interbank 3 - 12 Months n.a. n.a. - 2,004.7 1.53 506.6 0.66 419.9 0.49 375.8 0.52

Interbank 1 - 5 Years n.a. n.a. - 2,266.2 1.73 78.6 0.10 298.2 0.35 50.7 0.07

Interbank > 5 Years n.a. n.a. - 855.8 0.65 40.4 0.05 56.7 0.07 65.5 0.09

Liability Maturities:

Retail Deposits < 3 months n.a. n.a. - 43,798.2 33.39 33,245.6 43.59 n.a. - n.a. -

Retail Deposits 3 - 12 Months n.a. n.a. - 8,648.1 6.59 6,892.0 9.04 n.a. - n.a. -

Retail Deposits 1 - 5 Years n.a. n.a. - 3,115.8 2.38 2,330.2 3.05 n.a. - n.a. -

Retail Deposits > 5 Years n.a. n.a. - 2,071.1 1.58 110.4 0.14 n.a. - n.a. -

Other Deposits < 3 Months n.a. n.a. - n.a. - 3,145.1 4.12 34,840.1 40.80 33,509.2 46.07

Other Deposits 3 - 12 Months n.a. n.a. - n.a. - n.a. - 7,577.9 8.87 5,048.6 6.94

Other Deposits 1 - 5 Years n.a. n.a. - n.a. - n.a. - 1,788.0 2.09 1,899.4 2.61

Other Deposits > 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Interbank < 3 Months n.a. n.a. - 16,969.7 12.94 562.1 0.74 6,071.0 7.11 5,157.5 7.09

Interbank 3 - 12 Months n.a. n.a. - 6,290.9 4.80 5,474.3 7.18 5,851.2 6.85 5,542.3 7.62

Interbank 1 - 5 Years n.a. n.a. - 7,954.4 6.06 10,040.9 13.16 14,291.0 16.73 9,227.2 12.68

Interbank > 5 Years n.a. n.a. - 2,444.2 1.86 887.8 1.16 n.a. - n.a. -

Senior Debt Maturing < 3 months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Senior Debt Maturing 3-12 Months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Senior Debt Maturing 1- 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Senior Debt Maturing > 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Total Senior Debt on Balance Sheet n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Fair Value Portion of Senior Debt n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Covered Bonds n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Subordinated Debt Maturing < 3 months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Subordinated Debt Maturing 3-12 Months n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Subordinated Debt Maturing 1- 5 Year n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Subordinated Debt Maturing > 5 Years n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

Total Subordinated Debt on Balance Sheet 4,426.1 3,278.0 2.21 3,182.0 2.43 1,301.3 1.71 1,684.5 1.97 1,531.8 2.11

Fair Value Portion of Subordinated Debt n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

D. Equity Reconciliation

1. Equity 10,595.5 7,847.0 5.29 7,903.9 6.03 6,400.1 8.39 6,518.2 7.63 6,622.1 9.10

2. Add: Pref. Shares and Hybrid Capital accounted for as Equity 3,375.6 2,500.0 1.68 2,500.0 1.91 600.0 0.79 n.a. - n.a. -

3. Add: Other Adjustments n.a. n.a. - n.a. - n.a. - n.a. - n.a. -

4. Published Equity n.a. n.a. - n.a. - 7,000.1 9.18 n.a. - n.a. -

E. Fitch Eligible Capital Reconciliation

1. Total Equity as reported (including non-controlling interests) 10,595.5 7,847.0 5.29 7,903.9 6.03 6,400.1 8.39 6,518.2 7.63 6,622.1 9.10

2. Fair value effect incl in own debt/borrowings at fv on the B/S- CC only 0.0 0.0 0.00 0.0 0.00 0.0 0.00 n.a. - n.a. -

3. Non-loss-absorbing non-controlling interests 0.0 0.0 0.00 0.0 0.00 0.0 0.00 n.a. - n.a. -

4. Goodwill 789.9 585.0 0.39 613.7 0.47 581.4 0.76 610.2 0.71 757.0 1.04

5. Other intangibles 819.6 607.0 0.41 606.1 0.46 390.5 0.51 341.7 0.40 379.8 0.52

6. Deferred tax assets deduction 364.3 269.8 0.18 269.8 0.21 79.1 0.10 89.8 0.11 n.a. -

7. Net asset value of insurance subsidiaries 0.0 0.0 0.00 0.0 0.00 0.0 0.00 n.a. - n.a. -

8. First loss tranches of off-balance sheet securitizations 0.0 0.0 0.00 0.0 0.00 0.0 0.00 n.a. - n.a. -

9. Fitch Core Capital 8,621.7 6,385.2 4.30 6,414.3 4.89 5,349.1 7.01 n.a. - n.a. -

10. Eligible weighted Hybrid capital 1,012.7 750.0 0.51 750.0 0.57 600.0 0.79 n.a. - n.a. -

11. Government held Hybrid Capital 2,362.9 1,750.0 1.18 1,750.0 1.33 0.0 0.00 n.a. - n.a. -

12. Fitch Eligible Capital 11,997.3 8,885.2 5.99 8,914.3 6.80 5,949.1 7.80 n.a. - n.a. -

13. Eligible Hybrid Capital Limit 3,695.0 2,736.5 1.84 2,749.0 2.10 2,292.5 3.01 n.a. - n.a. -

Exchange Rate

31 Dec 2007

USD1 = EUR0.67930

31 Dec 2009

USD1 = EUR0.69416

31 Dec 2008

USD1 = EUR0.71855

30 Sep 2011

USD1 = EUR0.74060

31 Dec 2010

USD1 = EUR0.74840

Banks


March 2012 18

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