Íà êîðèöàòà 1. Ëàâðîâ âåíåö, çëàòî, Ñúêðîâèùå îò Ìîãèëàíñêà ìîãèëà, Ðåãèîíàëåí èñòîðè÷åñêè ìóçåé – Âðàöà, IV âåê ïð. Õð. 2. Íàêîëåííèê, ñðåáðî ñ ïîçëàòà, Ñúêðîâèùå îò Ìîãèëàíñêà ìîãèëà, Ðåãèîíàëåí èñòîðè÷åñêè ìóçåé – Âðàöà, IV âåê ïð. Õð. 2 www.rbb.bg www.rbb.bg 1 Financial Highlights

Financial Highlights

Monetary values in BGN Thousand 2005 Change 2004 2003

Income Statement Net interest income after provisioning for possible loan losses 84,062 74% 48,293 23,432 Net commission income 18,863 84% 10,279 11,088 Trading profit (loss) 11,241 44% 7,795 10,252 Administrative expenses – 62,933 73% – 36,308 – 26,921 Profit before tax 52,691 73% 30,403 17,851 Profit after tax 44,544 82% 24,460 13,842

Balance Sheet Loans and advances to banks 546,195 174% 199,245 13,923 Loans and advances to customers 1,362,008 40% 971,767 645,394 Deposits from banks 385,754 122% 173,475 98,850 Deposits from customers 1,597,311 21% 1,325,223 513,961 Equity 193 052 61% 120,171 57,084 Balance-sheet total 2,808,762 40% 2,005,771 846,999

Regulatory own funds Total own funds 237,017 53% 155,237 78,748 Own funds requirement / According to Local Regulations 214,583 66% 128,967 71,402 Excess cover 22,434 – 15% 26,270 7,346 Core capital ratio 7.89% – 26% 10.67% 6.62% Own funds ratio 13.25% – 8% 14.44% 13.23%

Performance Return on equity (RoE) before tax 36.4% – 11% 40.8% 43.6% Cost/Income Ratio 50.2% 11% 45.2% 52.6% Return on assets (RoA) before tax 2.5% – 5% 2.6% 2.7% Provisions for possible loan losses/risk-weighted assets/ According to Local Regulations 43,858 33% 33,085 19,987

Resources Number of staff on balance-sheet date 1,342 63% 823 598 Banking outlets on balance-sheet date 73 43% 51 36

Official Exchange Rate (BNB) EUR 1 BGN BGN BGN 1.95583 1.95583 1.95583

Source: Audited Financial Statements of Raiffeisenbank (Bulgaria) EAD as of 31 December 2005

2 www.rbb.bg General Information

General Information

Establishment of the Bank

Raiffeisenbank (Bulgaria) EAD is the first greenfield foreign investment in the Bulgarian banking sector made in 1994.

Main Shareholder

Raiffeisenbank (Bulgaria) EAD is a 100% subsidiary of Raiffeisen International Bank-Holding AG, Vienna.

Banking License

Raiffeisenbank (Bulgaria) EAD has a full banking license for domestic and overseas banking and financial operations.

Profile

Raiffeisenbank (Bulgaria) EAD is a universal commercial bank with a focus on corporate and SME lending, retail banking, bonds and securities trading on the local and international money and capital markets, asset management, etc.

Correspondent Relations

Raiffeisenbank (Bulgaria) EAD has established correspondent banking relations with more than 640 banks world-wide. The Bank maintains over 20 accounts in major currencies with first-class foreign banks.

Branch Network

As of 31 December 2005 the Bank has been operating through 73 branches, 16 outlets are located in Sofia.

www.rbb.bg 3 General Information

Memberships in Organizations and Others

Association of Commercial Banks in Bulgaria Banking Integrated System for Electronic Transfers (BISERA) Real Time Gross Settlement System (RINGS) Bulgarian National Card Operator (BORICA) VISA International MasterCard International S.W.I.F.T. Bulgarian Stock Exchange Central Depository Licensed primary dealer of Bulgarian Government Securities Licensed investment intermediary MoneyGram Agent Bank.

Market Shares

Source: Official statistics published by the Bulgarian National Bank

4 www.rbb.bg General Information

www.rbb.bg 5 Contents

Contents

Statement by the Chairman of the Management Board and Executive Director 7

Management Report 8 The Bulgarian Economy and Banking Sector in 2005 8 Key Figures 10 Human Resources 12

Segment Reports 13 Corporate Banking 13 Public Sector and Institutional Clients 13 Retail Banking 14 Branch Network and Alternative Distribution Channels 15 Treasury and Investment Banking 16 Financial Institutions 17 Operations and key projects 19 Operations 19 Quality and Processes Management 20 Information Technologies 20

Auditor’s Report 21

Awards 53

Corporate Social Responsibility 54

The Bank’s Management 55

RZB Group 56

Raiffeisen Leasing Bulgaria 58

Raiffeisen Asset Management (Bulgaria) 59

Addresses and Contacts 60

6 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Statement by the Chairman of the Management Board

Statement by the Chairman of the Management Board

Ladies and Gentlemen,

Raiffeisenbank (Bulgaria) EAD saw another very successful year. In 2005, the Bank outperformed the market across all segments and achieved excellent results while continuing to invest in business expansion.

The performance highlights for 2005 include 82% growth of after tax profit to BGN 44,5 mln and 40% increase of balance sheet total to BGN 2,8 bln. In 2005 the total loan portfolio of the Bank increased by 40% to BGN 1,4 bln, while excellent asset quality was maintained. The deposits reached BGN 1,5 bln posting 21% increase, compared to 2004.

Raiffeisenbank is among the leaders in corporate lending with a market share above 8.5%.

In 2005 Raiffeisenbank further increased its market share in Retail banking. The retail loan portfolio grew by 277% to BGN 363,6 mln while the SME loan portfolio rose by 67%.

In 2005 the distribution network was expanded by 23 new offices, bringing the total number of outlets to 73. The staff increased by 63% in 2005 as 519 new employees joined Momtchil Andreev Raiffeisenbank (Bulgaria) EAD, many of them being young Chairman of the Management Board and Executive Director graduates.

2005 was the first full year of Raiffeisen Leasing Bulgaria. In 2005 Raiffeisen Leasing captured 4.15% of the market and our expectations are for an even more dynamic development in 2006.

At the end of 2005 Raiffeisen Asset Management (Bulgaria) – a fully owned subsidiary of Raiffeisenbank (Bulgaria) EAD was established, offering 8 foreign and 4 local funds.

Finally, let me thank all our clients, business partners and the staff of Raiffeisenbank (Bulgaria) EAD for their contribution to the Bank’s successful development.

Momtchil Andreev Chairman of the Management Board

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 7 Management Report

Management Report

The Bulgarian Economy in 2005

The Bulgarian economy remained among the top performers in Europe in 2005 registering a growth rate of 5.5% despite the slowdown in the third quarter largely attributable to the summer floods and the oil prices rise. Investments and consumption were the key drivers behind growth. Final consumption marked a 6.8% real growth. Gross fixed capital formation recorded a double-digit The Management Board of Raiffeisenbank (Bulgaria) EAD. From left to right: Tzenka Petkova – Member of the MB and Executive Director, Momtchil Andreev – Chairman of the MB and Executive Director, Evelina real growth for a third year in a row Miltenova – Member of the MB and Executive Director, Nadezhda Mihaylova – Member of the MB and by increasing with another 19% for Procurator, Jan Majtan – Member of the MB and Executive Director. 2005. The industrial sector was the most dynamic sector in 2005 posting a 7.3% real growth in gross value added. Services registered a growth of 6.6%, while agriculture, struck by the summer floods, suffered an 8.6% decline in gross value added.

Annual consumer price inflation accelerated sharply to 6.5% at the end of 2005 – the highest in the last 5 years – compared to the 4% in 2004. Average inflation stood at 5.3% slightly above the 5.1% registered in 2004 in response to the joint impact of several factors – weak agricultural production due to the flooding, adjustments in controlled prices (electricity, gas, heating), higher oil prices which also translated into increased transport prices and hikes in excise tax on tobacco, alcohol and fuels at the end of 2005.

Unemployment rate at the end of 2005 declined to 10% (against 12% in 2004), being the lowest unemployment figure for last seven years. This favorable development in the labor market resulted from the higher number of new job openings in the real sector driven by the relatively high economic growth and the Government sponsored programs.

The current account deficit at the end of the year doubled in comparison to 2004 escalating to the record 11.9% of the GDP. The worsening has been largely driven by a raising trade deficit, which came to 20.6% of GDP (compared to 15.2% in 2004). Despite the strong export growth (19.5% YoY) import growth accelerated by the end of the year (27.5% YoY) boosted by strong demand for capital goods and influenced by price and quantity effects relating to energy imports. Foreign direct investments declined due to lack of privatization deals in 2005 to 6.7% of GDP (against 14% in 2004) covering some 68% of the current account deficit against 240% in 2004. If privatization proceeds in 2004 are to be excluded, this would mean an increase of nearly 40% of foreign investments pointing to the capacity of the economy to attract foreign inflows even without privatization sales. Nevertheless, overall Balance of Payments ended with a surplus, adding to the Central Bank foreign reserves.

8 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Management Report

Overperformance of the budget receipts from VAT, capital yield tax and customs duties allowed the state to spend (BGN 0.5 bln) more than planned and still come up with a record budget surplus of 2.36% of GDP at the end of 2005 (against 1.7% of GDP in 2004), thus fulfilling its agreement with the IMF for big savings in state spending.

Gross external debt at the end of 2005 increased by 14.4% from end 2004 and reached 67.6% of GDP compared to 64.4% in 2004 as a result of the considerable expansion of private, non-guaranteed debt (51% increase in comparison to 2004). The strong fiscal position, however, allowed a further accelerated reduction of public foreign debt. The ratio of public foreign debt to GDP reached 20.8% at the end of the year, from 30% at the end of 2004 as a result of the buy-back operations of the remaining Brady bonds.

The sound condition of public finances and the approaching date for EU accession prompted Standard & Poor’s to upgrade Bulgaria’s country rating from BBB– to BBB at the end of October 2005.

Bulgarian Banking Sector Overview

As at year-end 2005 the Bulgarian banking sector consisted of 34 commercial banks. Over 95% of the total assets in the banking system are now controlled by private entities. More than 85% of the banking sector is owned by renowned foreign financial institutions.

Financial intermediation and lending in particular continued to expand rapidly in 2005. As of 31 December 2005 the total assets of the banking system increased by 32% compared to end-2004, reaching BGN 32,85 bln. Customer deposits marked another period of high annual growth of 22% (as per BNB statistics).

Total loans of the Banking system increased by 33% compared to the end 2004. Loans to individuals (housing and consumer) registered a growth of 63%, while loans to companies – 22%. Gross loans totaled BGN 18,38 bln and represented 56% of the total assets of the Bulgarian banking system. After-tax profit of the banking sector increased by 35% in 2005 to BGN 584 mln driven by the fast growth of the local banks’ loan portfolios.

Capitalization of the banking sector is high with capital to asset ratio of 11% with a strong banking supervision in the sector. As of 31 December 2005, classified loans were 7.68% of total loans (Dec’2004: 6.89%) while non-performing loans represented 2.24% of total loans (Dec’2004: 2.01%).

As a result of the continuing dynamic growth in the first quarter of 2005, the Bulgarian National Bank imposed a series of measures aiming at limiting credit growth. Further to the amendments made in Regulation No.9 on the classification and evaluation of risk exposures and in Regulation No. 21 on the minimum reserve requirements, effective 1st April 2005 the credit growth cap was limited to 24% per annum. The amendments, introduced in April 2005, provided for additional minimum reserves double the amount by which they exceed the quarterly lending growth limits. In addition, in November 2005, the Central Bank imposed higher provisions on loans to private individuals targeting to limit the overall credit growth in 2006 to less than 20%.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 9 Management Report

Key Figures

In 2005 Raiffeisenbank (Bulgaria) EAD proved to be one of the leading banking institutions in the country. The dynamic development of the Bank in 2005, fully supported by its shareholder, is illustrated by the improvement of its market position in all segments at the end of 2005.

Source: Audited Financial Statements of Raiffeisenbank (Bulgaria) EAD

The total assets of the Bank reached BGN 2,8 bln increasing by 40%. In absolute terms the balance sheet marked a strong growth by BGN 802,9 mln compared to the end-2004.

The loans extended by Raiffeisenbank (Bulgaria) to private individuals and companies posted a 40% increase from BGN 1 bln in 2004 to BGN 1,4 bln in 2005, while maintaining the excellent quality of the loan portfolio.

Source: Audited Financial Statements of Raiffeisenbank (Bulgaria) EAD

10 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Management Report

The total deposit base of Raiffeisenbank (Bulgaria) EAD grew by 21% to BGN 1,6 bln year-on-year.

The paid-in capital of the Bank increased to BGN 94,9 mln or by BGN 29,3 mln raising the total capital base to BGN 237 mln in 2005. Raiffeisenbank (Bulgaria) EAD has increased also its supplementary capital by another EUR 30 mln in debt-capital hybrid instrument from RZB.

Source: Audited Financial Statements of Raiffeisenbank (Bulgaria) EAD

As of 31 December 2005 the Bank reported a net profit of BGN 44,54 mln representing 82% growth compared to 2004 (BGN 24,46 mln).

The total operating income rose by 57% to BGN 126.0 mln. The net interest income was the major contributor and recorded 53% increase to BGN 94.5 mln, while the net fees and commissions were up by 84% reaching BGN 18,8 mln.

Due to the dynamic expansion of the network of Raiffeisenbank (Bulgaria) EAD, in 2005 Cost/Income Ratio increased to 50.2% as compared to 45.2% in 2004 and 52.6% in 2003.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 11 Management Report

In 2005 Raiffeisenbank (Bulgaria) EAD increased its market shares in all segments by maintaining efficiency ratios, which are among the best in the sector with Return on Equity (RoE) after tax of 30.8% and Return on Assets (RoA) after tax of 2.1%.

Human resources

In 2005 the staff of Raiffeisenbank (Bulgaria) EAD increased by 63% reaching 1342 employees, 80% of which were university graduates. The average staff age was 32 years.

The Bank was one of the most active employers on the local market offering excellent career opportunities for young graduates and professionals. Through its internship programs more than160 graduates started their professional career in the Banking industry. 40% are already permanently employed by Raiffeisenbank (Bulgaria) EAD.

The Bank also actively recruits specialists for its Mobile Agent Network, which as of 31.12.2005 reached 106 agents.

12 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Segment Reports

Segment Reports

Corporate Banking

2005 was another successful year for the corporate banking of Raiffeisenbank (Bulgaria) EAD. The Bank remained among the top five creditors to corporate clients with a market share of 8.55%.

As a universal bank, Raiffeisenbank (Bulgaria) EAD offers to small, medium and large companies a full range of banking products including lending, cash management, documentary operations, deposits, foreign exchange, custody, structuring and placement of bond issues, etc. At the end of 2005, the number of corporate customers increased by 64% in comparison to 2004.

The commercial loans increased by 15.5% compared to 2004, while the quality of the portfolio remains exceptionally good. Raiffeisenbank (Bulgaria) EAD continued to increase the volume of long-term loans. The attracted funds from corporate customers amounted to BGN 780 mln as at end-2005.

In 2005 the loans extended to small and medium sized Nadezhda Mihaylova Member of the MB and Procurator customers increased by 66% to BGN 585 mln. The attracted funds from customers in the segment reached BGN 286 mln, while the number of small and medium sized customers increased by 47%.

Public Sector and Institutional Clients

In 2005 Raiffeisenbank (Bulgaria) EAD focused also on institutional clients such as budget organisations, non-governmental organisations, professional unions, funds, foundations, etc.

Raiffeisenbank (Bulgaria) EAD developed special offers and products for institutional clients such as: municipal financing through bond issues, overdraft-credits for municipalities; complex servicing of budget organisations; preferential packages for employees of institutional clients.

In 2005 Raiffeisenbank (Bulgaria) EAD managed to attract important budget organisations from the Public Sector such as the National Fund at the Ministry of Finance and the Implementing Agencies under the pre-accession instrument ISPA within the Ministry of Regional Development and Public Works, the Ministry of Environment and Water and Ministry of Transport, as well as Municipalities, District Courts, Regional Health Insurance Funds, Territorial Tax Directorates, etc. As of 31 December 2005 the number of budget organizations – customers of Raiffeisenbank (Bulgaria) EAD exceeded 100.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 13 Segment Reports

Retail Banking

In 2005 Raiffeisenbank (Bulgaria) EAD continued to actively expand its market positions in the Retail banking segment. The number of retail customers increased by 68% compared to the previous year.

At the end of 2005 the total amount of retail assets reached BGN 364 mln, registering a growth of 277% compared to 2004. The retail assets of the Bank grew faster compared to the whole banking system. Thus, the market share of Raiffeisenbank in this segment reached 5.9% at the end of 2005.

The total amount of retail liabilities reached BGN 520 mln, showing a growth of 62% compared to 2004. Term deposits represent the biggest share – 66% of the total liabilities in the segment, followed by current accounts – 24% and card accounts – 10%.

In 2005 Raiffeisenbank introduced new products including Energy Efficiency Loan, domestic credit card „RaiCard” and Instant credit card (sales finance) sold Jan Majtan in retailer stores. Member of the MB and Executive Director

The number of Maestro debit, VISA Electron and VISA Classic debit cards, issued by Raiffeisenbank (Bulgaria) EAD increased by 77%. The Bank expanded its ATM network and POS terminals by 134% and 140%, respectively.

Visa Acquiring license was obtained in 2005 and the Bank started a project for EMV migration.

14 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Segment Reports

Branch Network and Alternative Distribution Channels

In 2005 Raiffeisenbank (Bulgaria) EAD continued its branch network expansion. 23 newly opened offices increased the total number of business outlets to 73. 4 were opened in Sofia, the rest were in Varna, Bourgas, Stara Zagora, Vratza, Pleven, Targovishte, Razgrad, Sevlievo, Karlovo, Kardzhali, Assenovgrad, Dimitrovgrad, Peshtera, Karnobat, Dupnitza, Gotze Delchev and Petrich.

Raiffeisenbank (Bulgaria) EAD was the first Bulgarian bank to launch its own network of mobile bankers for direct sales of retail products. In 2005 the network expanded to 106 mobile consultants, covering 10 major Bulgarian cities.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 15 Segment Reports

Treasury and Investment Banking

Treasury and Investment Banking

Foreign Exchange Trading

In 2005 Raiffeisenbank (Bulgaria) EAD strengthened its leading position of a key market maker on the local interbank and customer FX market. In terms of total traded volumes its market share was above 17% (2004: above 13%). The Bank affirmed its position as the preferred partner for FX transactions with multinationals and big corporate clients. The continued expansion of the branch network generated a 30% increase of currency operations with private individuals and SME.

Money Market Operations

In 2005 the market environment for EUR-based transactions became even more competitive and EUR/ BGN spreads almost disappeared for big multinationals. Evelina Miltenova This tendency of narrowing FX spreads will further hit Member of the MB and Executive Director the Banks’ ability to generate FX profits. Nevertheless, in 2005 Raiffeisenbank (Bulgaria) EAD generated 40% higher FX results based on the increased volume of transactions.

Capital Market Operations

Raiffeisenbank (Bulgaria) EAD firmed up its position as the leader on the securities market and one of the major primary dealers in Government securities approved by the Ministry of Finance/BNB. Raiffeisenbank (Bulgaria) EAD submitted orders in excess of 23% of the total volume of securities offered by the Ministry of Finance for the Jan-Dec 2005 regular BNB auctions of Government securities. For the same period Raiffeisenbank’s government securities portfolio increased by 81.2%. Net interest income from securities held in trading and investment portfolios increased by 80% YoY on the back of the stable rise in the volume of the portfolio at the end of 2005 the value of the trading portfolio reached BGN 328 mln of the total balance sheet compared to BGN 134 mln a year before. The fixed income portfolio is made up

16 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Segment Reports

primarily of bonds issued by the Bulgarian and the G7 Governments, as well as corporate and mortgage- backed securites of prime local issuers.

Raiffeisenbank (Bulgaria) EAD is a leader on the local corporate and mortgage debt origination market. In 2005 its market share in terms of total volume of locally issued and placed corporate/ mortgage bonds reached 56.6%. At the same time the market share of the Bank in terms of total number of newly launched local corporate/mortgage debt deals rose to 41%.

For 2005 Raiffeisenbank (Bulgaria) EAD is the number three investment intermediary in terms of volume traded on the local regulated stock exchange market – BSE-Sofia AD (source: BSE-Sofia AD statistics). The Bank has successfully managed the delisting of the largest public company on the local stock exchange – Lukoil Neftochim, Burgas.

Financial Institutions

Raiffeisenbank (Bulgaria) EAD has established correspondent banking relations with more than 640 banks world-wide. The Bank maintains over 20 accounts in major currencies with first-class foreign banks, including Raiffeizen Zentralbank Oesterreich AG – Vienna, Deutsche Bank AG – Frankfurt, Commerzbank AG – Frankfurt, American Express Bank NA – New York, JP Morgan Chase Bank NA – New York, The Bank of Tokyo Mitsubishi – Tokyo, UBS AG – Zurich, etc.

For the past three years Raiffeisenbank (Bulgaria) EAD has actively used the benefits of the increasing confidence and support of International Financial Institutions and foreign banks. The Bank became one of their leading partners in Bulgaria in negotiating and concluding long-term loan agreements for lending to local SMEs, municipalities and private individuals.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 17 Segment Reports

As of 31 December 2005 Raiffeisenbank (Bulgaria) EAD has attracted EUR 230 mln in total, including EUR 150 mln syndicated loan and EUR 80 mln granted by international organizations.

In May 2005 Raiffeisenbank (Bulgaria) EAD signed a mid-term Syndicated Loan Agreement lead arranged by DZ Bank AG, The Bank of Tokyo Mitsubishi Ltd, BayernLB and Bank Austria Creditanstalt. The transaction is the largest syndicated loan ever arranged for a financial institution in Bulgaria with 31 participating banks located in Austria, Denmark, Germany, France, Italy, Japan, France, Ireland, the US and United Kingdom. In March 2005 Raiffeisenbank (Bulgaria) EAD prepaid in full the first syndicated loan to the amount of EUR 75 mln concluded and successfully disbursed in June 2004.

As of 31 December 2005 the funds attracted from international institutions amounted to EUR 80 mln, including the last EUR 10 mln credit line signed in June 2005 for financing residential energy efficiency projects with the European Bank for Reconstruction and Development (EBRD). Raiffeisenbank (Bulgaria) EAD has negotiated the remaining EUR 70 mln for SMEs and municipalities lending with European Investment Bank (EUR 30 mln), the Council of Europe Development Bank (EUR 20 mln), EBRD (EUR 10 mln) and with Kreditanstalt fur Wiederaufbau (EUR 10 mln). As a result, local companies have finalized more than 700 projects and created some 1,900 permanent jobs.

In March 2005 Raiffeisenbank (Bulgaria) EAD extended a Bulgarian Leva funding to the European Bank for Reconstruction and Development (EBRD) via signing a Revolving Facility Agreement amounting to BGN 40 mln for EBRD’s on-lending activities to other Bulgarian borrowers.

18 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Segment Reports

Operations and Key Projects

Operations

During 2005 the Bank reported a significant increase of the number of transactions processed and a 45% growth of the respective income compared to the previous year. The number of consumers of electronic banking services also grew by 55%, thus contributing to the increase of the share of electronic banking payments versus the paper-filed payments. The Bank further strengthened its market position as a financial intermediary in the payments area and as one of the few banking institutions offering value-added cash-management services to its customers.

Local Currency Payments

In 2005 the total number of local currency payments, initiated by Raiffeisenbank (Bulgaria) EAD clients grew by 60% compared to 2004, ensuring a market share of 5.4% and commission income growth of 60%. Real-time local currency payments, processed via RINGS ensured a market share of Tzenka Petkova 9.7% as of 2005 year-end. Member of the MB and Executive Director In 2005 Raiffeisenbank (Bulgaria) EAD strengthened its position as one of the most active banks, offering the EXPRESS M local currency product, tailored mainly for non-account holders. Only a year after the product launching, the number of transactions processed, ensured the Bank a market share of about 60%.

Foreign Currency Payments

The number of customer clean payments in foreign currency grew by 26% in 2005, generating a revenue increase of 21% as EUR payments continued to predominate over USD payments.

Custody Transactions

The quality of custody services, provided by Raiffeisenbank (Bulgaria) EAD to local and foreign customers, as well as the potential profitability of the local equity and bond markets were among the key drivers for the strong investor interest in the debt/equity securities of local issuers. In 2005 the volume of assets under custody grew by 38%, compared to 2004 year-end, with a continually increasing share of non-residents’ assets. The ability to offer global custodial services enabled the Bank to attract as its clients an increasing number of funds, investing in local and foreign securities.

Documentary Transactions

2005 was successful considering also income generated from documentary business, the number of transactions processed realizing a growth of 24%, compared to 2004.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 19 Segment Reports

Quality and Processes Management

During the two years of applying the 6 Sigma methodology for process optimization, Raiffeisenbank has simultaneously finalized the implementation of a Business Process Management System that provides for routinely monitoring a set of pre-defined Key Process Indicators (KPI), analyzing their current levels, identify areas for improvement and taking respective measures with the main objective to actively manage process quality and meet customer requirements.

Such specific KPI were defined for the loan application and approval process in the Private Individual and SME segments, current- and card accounts opening, payment processing in local and foreign currency. Based on the data supplied by KPI, the relevant process owners constantly monitor and control the processes.

Aiming at process optimization and based on the delivered projects, the centralized payment processing was introduced for local and foreign currency payment orders execution. The centralization operations reduced the execution time of outgoing payments and released manpower in branches that was shifted to achieving higher quality of customer service and attaining higher levels of client satisfaction.

Potential areas for introducing future process optimizations and developing 6 Sigma projects, as well as other productivity initiatives, are related to account opening processes, loan approval and collection processes for PI individuals, archiving, paper-based document flow handling and procurement processing.

Information Technologies

During 2005 the Bank continued to develop and improve its information technologies in line with the requirements and needs of the business. More than 32 projects were successfully completed in 2005.

A system for cenralizing payments input and processing was introduced thus improving the efficiency of the whole process. Some improvements and changes were introduced in the core banking system and in the local clearance system.

In accordance with Raiffeisen Group Network Security Policy Guidelines as well as the leading standards in the area, IT focused on the continuous increase of the security level of all information resources.

Under the supervision of Raiffeisen International, Raiffeisenbank (Bulgaria) continued to work on adapting its information systems and data storage to fulfill the requirements of BASEL II.

The major infrastructure projects of the Bank covered providing business continuity for the main business processes and implementing state-of-the-art technologies in the telephony and the internal network of the Bank.

20 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Independent Auditors’ Report

Independent Auditors’ Report

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 21 Balance Sheets

Balance Sheets

As at December 31, 2005

In BGN Thousand Note December 31, 2005 December 31, 2004 Assets Cash 9 43,122 27,234 Balances with the Central Bank 9 187,189 219,884 Placements with, and loans to banks 10 549,432 199,245 Receivables under repurchase agreements 11 11,942 4,159 Financial assets held for trading 12 339,135 533,200 Other financial instruments at fair value through profit and loss 13 252,651 Loans and advances to customers 14 1,362,877 971,767 Securities held to maturity 15 29,601 29,960 Other assets 16 9,802 3,840 Fixed assets 17 23,011 16,482 Total assets 2,808,762 2,005,771 Liabilities Deposits from banks 18 385,754 173,475 Liabilities under repurchase agreements 19 6,948 Liabilities from trading activities 20 13,008 9,223 Deposits from customers 21 1,597,311 1,325,223 Medium-term bonds 22 53,808 46,603 Other liabilities 23 42,868 21,278 Deferred tax liabilities 8 297 66 Long-term borrowings 24 422,261 261,444 Subordinated debt 25 100,403 41,340 Total liabilities 2,615,710 1,885,600 Net assets 193,052 120,171 Shareholders’ equity Share capital 26 94,932 65,595 Reserves 26 98,120 54,576 Total shareholders’ equity 193,052 120,171 Commitments and contingencies 27 438,703 257,217

The accompanying notes are an integral part of these financial statements.

Approved on behalf of Raiffeisenbank (Bulgaria) EAD on February 20, 2006:

Momchil Andreev Tzenka Petkova Krassimir Hadjidinev Margarita Goleva Executive Director Executive Director Registered Auditor Registered Auditor Authorized Representative

22 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Income Statement

Income Statement

For the year ended December 31, 2005

In BGN Thousand Note Year ended Year ended December 31, 2005 December 31, 2004 Interest and similar income 3 132,656 81,576 Interest expense and similar charges 3 -38,184 -19,680 Net interest income 94,472 61,896 Net fee and commission income 4 18,863 10,278 Net gain on trading securities 4,070 2,670 Net gain on dealing in foreign currencies 5 7,171 5,126 Other operating income, net 1,458 343 Total income 126,033 80,313 General and administrative expenses 6 -62,933 -36,308 Net allowances for impairment and uncollectability 7 -10,409 -13,603 Profit before taxation 52,691 30,402 Tax expense 8 -8,147 -5,942 Net profit 44,544 24,460

The accompanying notes are an integral part of these financial statements.

Approved on behalf of Raiffeisenbank (Bulgaria) EAD on February 20, 2006:

Momchil Andreev Tzenka Petkova Executive Director Executive Director

Krassimir Hadjidinev Margarita Goleva Registered Auditor Registered Auditor Authorized Representative

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 23 Statements of Cash Flows

Statements of Cash Flows

For the year ended December 31, 2005

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Cash flows from operating activities: Profit before taxation 52,691 30,402 Adjustments for non cash itemsto net cash provided by operating activities: Depreciation and amortization 5,305 4,598 Allowances for impairment and uncollectability on loans and advances 10,409 13,603 Income taxes paid – 7,916 – 6,047 Deferred taxation – 231 104 Unrealized losses / (gains) on foreign currency operations 12,799 – 4,593 Change in operating assets (Increase) / decrease in trading securities 197,031 – 465,431 (Increase) in loans and advances to customers – 391,012 – 348,220 (Increase) in receivable under repurchase agreements – 7,687 – 4,159 (Increase) in interest receivable and other assets – 6,531 – 2,820 Change in operating liabilities Increase in deposits from banks 205,225 75,444 Decrease in funds obtained under repurchase agreements – 3,162 – 27,687 Increase in deposits from customers 249,378 820,520 Increase in other liabilities 21,813 9,653 Net cash flow from operating activities 265,055 95,367 Cash flows from investing activities Other current financial assets – 251,983 Purchases of securities held to maturity – 10,786 Net purchases of fixed assets – 11,836 – 7,162 Net cash used by investing activities – 263,819 – 17,948 Cash flows from financing activities Proceeds from increase in paid in capital 29,337 39,116 Proceeds from issuance of subordinated debt 59,063 9,722 Proceed on issuance of medium-term bonds – 40 Proceeds from increase in long-term borrowings 160,817 222,004 Dividends paid – 1,000 – 489 Net cash provided by financing activities 248,217 270,313 Unrealized (gains)/losses on cash and cash equivalents, denominated in foreign currency 10,871 – 270 Change in cash and cash equivalents 333,381 347,462 Cash and cash equivalents at beginning of year 446,362 98,900 Cash and cash equivalents at end of year (note 29) 779,743 446,362 The accompanying notes are an integral part of these financial statements.

Approved on behalf of Raiffeisenbank (Bulgaria) EAD on February 20, 2006:

Momchil Andreev Tzenka Petkova Krassimir Hadjidinev Margarita Goleva Executive Director Executive Director Registered Auditor Registered Auditor Authorized Representative

24 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Statement of Changes in Shareholders’ Equity

Statement of Changes in Shareholders’ Equity

As of December 31, 2005

In BGN Thousand Share capital Statutory Other Total Reserves Reserves

Balance at January 1, 2004 26,479 9,286 21,319 57,084

Increase in share capital 39,116 39,116

Transferred to statutory reserves 4,354 – 4,354

Dividends paid – 489 – 489

Net profit for the year ended December 31, 2004 24,460 24,460

Balance at December 31, 2004 65,595 13,640 40,936 120,171

Increase in share capital 29,337 29,337

Dividends paid – 1,000 – 1,000

Transferred to statutory reserves 14,648 – 14,648

Net profit for the year ended December 31, 2005 44,544 44,544

Balance at December 31, 2005 94,932 28,288 69,832 193,052

The accompanying notes are an integral part of these financial statements.

Approved on behalf of Raiffeisenbank (Bulgaria) EAD on February 20, 2006:

Momchil Andreev Tzenka Petkova Executive Director Executive Director

Krassimir Hadjidinev Margarita Goleva Registered Auditor Registered Auditor Authorized Representative

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 25 Notes to the Financial Statements

Notes to the Financial Statements

1. Basis of Preparation

(a) Statement of compliance

The financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB), and interpretations issued by the Standing Interpretations Committee of the IASB.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Bank’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in Note 2 (o).

(b) Basis of preparation

The financial statements are presented in Bulgarian Leva (BGN) rounded to the nearest thousand.

The financial statements are prepared on a fair value basis for derivative financial instruments, financial assets and liabilities held for trading, and available-for-sale assets, except those for which a reliable measure of fair value is not available. Other financial assets and liabilities and non-financial assets and liabilities are stated at amortised cost or historical cost convention and restated for the effects of hyperinflation where necessary.

2. Significant Accounting Policies

(a) Income recognition

Interest income and expense is recognised in the income statement as it accrues, taking into account the effective yield of the asset or an applicable floating rate. Interest income and expense include the amortisation of any discount or premium or other differences between the initial carrying amount of an interest bearing instrument and its amount at maturity calculated on an effective interest rate basis.

Fee and commission income arises on financial services provided by the Bank and is recognised when the corresponding service is provided. Fees and commissions arising from negotiating, or participating in the negotiation of a transaction for a third party, such as the acquisition of loans, shares or other securities, are recognised on completion of the underlying transaction.

Net trading income includes gains and losses arising from disposals and changes in the fair value of financial assets and liabilities held for trading.

(b) Foreign currency transactions

Transactions in foreign currencies are translated at the foreign exchange rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are translated at

26 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

the foreign exchange rate ruling at that date at initial recognition. Foreign exchange differences arising on translation are recognized in the income statement.

Non-monetary assets and liabilities denominated in foreign currencies, which are stated at historical cost, are translated at the foreign exchange rate ruling at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to the reporting currency at the foreign exchange rates ruling at the dates that the values were determined.

All assets and liabilities denominated in foreign currencies are translated into Bulgarian Leva at the rates of exchange prevailing at the balance sheet date.

(c) Financial assets

The Bank classifies its financial assets in the following categories: financial assets at fair value through profit or loss; loans and receivables; held-to-maturity investments; and available-for-sale financial assets. Management determines the classification of its investments at initial recognition.

(i) Financial assets at fair value through profit or loss

This category has two sub-categories: financial assets held for trading, and those designated at fair value through profit or loss at inception. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by management. Derivatives are also categorized as held for trading unless they are designated as hedges.

(ii) Loans and receivables

Loans originated by the Bank by providing money directly to the borrower or to a sub-participation agent at draw down, other than those that are originated with the intent of being sold immediately or in the short term which are recorded as trading assets, are categorized as loans originated by the Bank and are carried at amortized cost, which is defined as the fair value of cash consideration given to originate those loans as is determinable by reference to market prices at origination date.

(iii) Held-to-maturity

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Bank’s management has the positive intention and ability to hold to maturity. Were the Bank to sell other than an insignificant amount of held-to-maturity assets, the entire category would be tainted and reclassified as available for sale.

(iv) Available-for-sale

Available-for-sale investments are those intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, exchange rates or equity prices.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 27 Notes to the Financial Statements

(v) Measurement

Purchases and sales of financial assets at fair value through profit or loss, held to maturity and available for sale are recognized on the date of the actual delivery of the assets. Loans are recognized when cash is advanced to the borrowers. Financial assets are initially recognized at fair value plus transaction costs for all financial assets. Financial assets are derecognized when the rights to receive cash flows from the financial assets have expired or when the Bank has transferred substantially all risks and rewards of ownership.

Available-for-sale financial assets and financial assets at fair value through profit or loss are subsequently carried at fair value. Loans and receivables and held-to-maturity investments are carried at amortized cost using the effective interest method. Gains and losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are included in the income statement in the period in which they arise. Gains and losses arising from changes in the fair value of available-for-sale financial assets are recognized directly in equity, until the financial asset is derecognized or impaired at which time the cumulative gain or loss previously recognized in equity should be recognized in profit or loss.

However, interest calculated using the effective interest method is recognized in the income statement. Dividends on available-for-sale equity instruments are recognized in the income statement when the entity’s right to receive payment is established.

The fair values of quoted investments in active markets are based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Bank establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, discounted cash flow analysis, option pricing models and other valuation techniques commonly used by market participants.

(d) Fair values of financial assets and liabilities

International Accounting Standards 32 “Financial Instruments: Disclosure and Presentation”, requires disclosure of information about fair value of the financial assets and liabilities. In the notes to the financial statements fair value for this purpose is defined as the amount for which an asset can be exchanged or a liability settled, between knowledgeable, willing parties in an arm length transaction. Sufficient market experience, stability and liquidity do not currently exist for certain purchases and sales of loans and other financial assets or liabilities for which published market information is not readily available. Accordingly, their fair values cannot be readily determined. In the opinion of the Management, their reported carrying amounts are the most valid and useful reporting value in the circumstances.

(e) Derecognition

A financial asset is derecognized on the value date after the Bank loses control over the contractual rights that comprise that asset. This occurs when the rights are realized, expire or are surrendered. A financial liability is derecognized when it is extinguished.

Available-for-sale assets and assets held for trading that are sold are derecognized and corresponding receivables from the buyer for the payment are recognized as of the date the Bank commits to sell the assets. The Bank uses the specific identification method to determine the gain or loss on derecognition.

28 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

Held-to-maturity instruments and originated loans and receivables are derecognized on the day they are transferred by the Bank.

(f) Cash and cash equivalents

Cash and cash equivalents comprise cash balances on hand, cash deposited with the central bank and short-term highly liquid investments with maturity of three months or less when purchased.

(g) Investments

Investments that the Bank holds for the purpose of short-term profit taking are classified as trading instruments. Debt investments that the Bank has the intent and ability to hold to maturity are classified as held-to-maturity assets. Other investments are classified as available-for-sale assets.

(i) Securities borrowing and lending business and repurchase transactions

(i) Securities borrowing and lending

Investments lent under securities lending arrangements continue to be recognized in the balance sheet and are measured in accordance with the accounting policy for assets held for trading or available-for-sale as appropriate. Cash collateral received in respect of securities lent is recognized as liabilities to either banks or customers. Investments borrowed under securities borrowing agreements are not recognized. Cash collateral placements in respect of securities borrowed are recognized under loans and advances to either banks or customers. Income and expenses arising from the securities borrowing and lending business are recognized on an accrual basis over the period of the transactions and are included in interest income or expense.

(ii) Repurchase agreements

The Bank enters into purchases (sales) of investments under agreements to resell (repurchase) substantially identical investments at a certain date in the future at a fixed price. Investments purchased subject to commitments to resell them at future dates are not recognized. The amounts paid are recognized in loans to either banks or customers. The receivables are shown as collateralised by the underlying security. Investments sold under repurchase agreements continue to be recognized in the balance sheet and are measured in accordance with the accounting policy for either assets held for trading or available-for-sale as appropriate. The proceeds from the sale of the investments are reported as liabilities to either banks or customers.

The difference between the sale and repurchase considerations is recognized on an accrual basis over the period of the transaction and is included in interest.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 29 Notes to the Financial Statements

(iii) Borrowings

Borrowings are recognized initially at ‘cost’, being their issue proceeds (fair value of consideration received) net of transaction costs incurred. Borrowings are subsequently stated at amortized cost and any difference between net proceeds and the redemption value is recognized in the income statement over the period of the borrowings using the effective yield method.

If the Bank purchases its own debt, it is removed from the balance sheet and the difference between the carrying amount of a liability and the consideration paid is included in net trading income.

(h) Offsetting

Financial assets and liabilities are offset and the net amount is reported in the balance sheet when the Bank has a legally enforceable right to set off the recognized amounts and the transactions are intended to be settled on a net basis.

(i) Impairment

The carrying amounts of the Bank’s assets are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognized whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognized in the income statement.

(i) Loans and advances and held-to-maturity loans

The recoverable amount of originated loans and advances and purchased loans that are classified as held-to-maturity, is calculated as the present value of the expected future cash flows, discounted at the instrument’s original effective interest rate. Short-term balances are not discounted.

Loans and advances are presented net of specific and general allowances for impairment. Specific allowances are made against the carrying amount of loans and advances that are identified as being impaired based on regular reviews of outstanding balances to reduce these loans and advances to their recoverable amounts. General allowances are maintained to reduce the carrying amount of portfolios of similar loans and advances to their estimated recoverable amounts at the balance sheet date. The expected cash flows for portfolios of similar assets are estimated based on previous experience and considering the credit rating of the underlying customers and late payments of interest or penalties. Increases in the allowance account are recognized in the income statement. When a loan is identified to be not recoverable, all the necessary legal procedures have been completed, and the final loss has been determined, the loan is written off directly.

If in a subsequent period the amount of an impairment loss decreases and the decrease can be linked objectively to an event occurring after the write-down, the write-down or allowance is reversed through the income statement.

30 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

(ii) Financial assets re-measured to fair value directly through equity

The recoverable amount of an equity instrument is its fair value. The recoverable amount of debt instruments and purchased loans re-measured to fair value is calculated as the present value of expected future cash flows discounted at the current market rate of interest.

Where an asset re-measured to fair value directly through equity is impaired, and a write down of the asset was previously recognized directly in equity, the write down is transferred to the income statement and recognized as part of the impairment loss. Where an asset measured to fair value directly through equity is impaired, and an increase in the fair value of the asset was previously recognized in equity, the increase in fair value of the asset recognized in equity is reversed to the extent the asset is impaired. Any additional impairment loss is recognized in the income statement.

If in a subsequent period the amount of an impairment loss decreases and the decrease can be linked objectively to an event occurring after the write-down, the write-down is reversed through the income statement.

(j) Property, plant and equipment

Items of property, plant and equipment are stated in the balance sheet at their acquisition cost less accumulated depreciation restated for the effects of hyperinflation.

Depreciation is calculated on a straight line basis at prescribed rates designed to decrease the cost or valuation of fixed assets over their expected useful lives. The following are approximations of the annual rates used:

Assets % Buildings 4 Equipment 15 – 30 Fixtures and fittings 15 Vehicles 25

Assets are not depreciated until they are brought into use and transferred from assets in the course of construction into the relevant asset category.

(k) Intangible assets

Intangible assets, which are acquired by the Bank, are stated at cost less accumulated amortization and any impairment losses.

Amortization is calculated on a straight-line basis over the expected useful life of the asset. The annual rates of amortization are as follows:

Assets % Licences 15 – 30 Computer software 30

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 31 Notes to the Financial Statements

(l) Provisions

A provision is recognized in the balance sheet when the Bank has a legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

(m) Acceptances

An acceptance is created when the Bank agrees to pay, at a stipulated future date, a draft drawn on it for a specified amount. The Bank’s acceptances primarily arise from documentary credits stipulating payment for the goods to be made a certain number of days after receipt of required documents. The Bank negotiates most acceptances to be settled at a later date following the reimbursement from the customers. Acceptances are accounted for as liabilities evidenced by paper.

(n) Taxation

Tax on the profit for the year comprises current tax and the change in deferred tax. Current tax comprises tax payable calculated on the basis of the expected taxable income for the year, using the tax rates enacted by the balance sheet date, and any adjustment of tax payable for previous years.

Deferred tax is provided using the balance sheet liability method on all temporary differences between the carrying amounts for financial reporting purposes and the amounts used for taxation purposes.

Deferred tax is calculated on the basis of the tax rates that are expected to apply to the period when the asset is realized or the liability is settled. The effect on deferred tax of any changes in tax rates is charged to the income statement, except to the extent that it relates to items previously charged or credited directly to equity.

A deferred tax asset is recognized only to the extent that it is probable that future taxable profits will be available against which the unused tax losses and credits can be utilized. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realized.

(o) Critical accounting estimates and judgements in applying accounting policies

The Bank makes estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

(i) Impairment losses on loans and advances

The Bank reviews its loan portfolios to assess impairment on a monthly basis. In determining whether an impairment loss should be recorded in the income statement, the Bank makes judgements as to whether there is any observable data indicating that there is a measurable decrease in the estimated future cash flows from a portfolio of loans before the decrease can be identified with an individual loan in that portfolio. This evidence may include observable data indicating that there has been an adverse change in the payment status of borrowers in a group, or national or local economic conditions that correlate with defaults on assets in the group. Management uses estimates based on historical loss experience for assets with credit risk characteristics and objective evidence of impairment similar to those in the portfolio

32 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

when scheduling its future cash flows. The methodology and assumptions used for estimating both the amount and timing of future cash flows are reviewed regularly to reduce any differences between loss estimates and actual loss experience.

(p) Standards, interpretations and amendments to published International Financial Reporting

Standards that are not yet effective and might be relevant to the Bank’s activities

IFRS 7 Financial Instruments: Disclosures (effective from 1 January 2007)

The Standard will require increased disclosure in respect of the Bank’s financial instruments. It supersedes IAS 30 Disclosures in the Financial Statements of Banks and Similar Financial Institutions and is applicable to all entities that prepare financial statements in accordance with IFRS.

The Bank considers that the significant additional disclosures required will relate to its financial risk management objectives, policies and processes.

Amendment to IAS 1 Presentation of Financial Statements – Capital Disclosures (effective from 1 January 2007)

As a complimentary amendment arising from IFRS 7 (see above), the Standard will require increased disclosure in respect of the Bank’s capital.

This amendment will require significantly more disclosures regarding the capital structure of the Bank.

Amendment to IAS 39 Financial Instruments: Recognition and Measurement – Cash Flow Hedge Accounting of Forecast Intragroup Transactions (effective from 1 January 2006)

The amendment allows the foreign currency risk of a highly probable forecast intragroup transaction to qualify as a hedged item if certain criteria are met.

This amendment is not relevant to the Bank’s operations.

Amendment to IAS 39 Financial Instruments: Recognition and Measurement – The Fair Value Option (effective from 1 January 2006)

The amendment restricts the designation of financial instruments as “at fair value through profit or loss”.

The Bank believes that this amendment should not have a significant impact on the classification of financial instruments, as the Bank should be able to comply with the amended criteria for the designation of financial instruments at fair value through profit or loss.

Amendment to IAS 39 Financial Instruments: Recognition and Measurement and IFRS 4 Insurance Contracts – Financial Guarantee Contracts (effective from 1 January 2006)

The amendment requires guarantees that are not insurance contracts to be measured at fair value upon initial recognition.

The Bank has not yet completed its analysis of the impact of the amendment.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 33 Notes to the Financial Statements

3. Net Interest Income

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Interest and similar income Enterprises and individuals 109,392 73,085 Banks 9,603 2,209 Financial assets held for trading 9,302 4,693 Securities 4,359 1,590 Total 132,656 81,576 Interest expense and similar charges Enterprises and individuals – 22,103 – 8,275 Banks – 11,123 – 7,170 Subordinated debt – 2,559 – 1,835 Medium-term bonds – 2,399 – 2,400 Total – 38,184 – 19,680 Net interest income 94,472 61,896

4. Net Fee and Commision Income

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Payment transactions 7,362 5,193 Card transactions 2,938 1,509 Cash transactions 3,451 2,475 Opening and maintenance of accounts 2,588 1,520 Other loan fees 3,551 2,084 Documentary transactions 1,337 1,217 Other 4,110 1,325 Fee and commission income 25,337 15,323 Long term financing and guarantees – 3,689 – 3,989 Card operations – 1,015 – 576 Maintenance of corresponding accounts – 310 – 346 Other – 1,460 – 134 Fee and commission expense – 6,474 – 5,045 Net fee and commission income 18,863 10,278

34 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

5. Net Gain on Dealing in Foreign Currencies

Net gains from dealing in foreign currencies amounting to BGN 7,171 thousand (2004: BGN 5,126 thousand) represent the net result arising from purchases and sales of foreign currencies, as well as translation gains arising from the translation of assets and liabilities, denominated in foreign currencies into Bulgarian Leva.

6. General Administrative Expenses

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Personnel costs – 22,485 – 13,919 Materials and services – 31,476 – 15,610 Depreciation and amortization charge – 5,305 – 4,583 Other administrative costs – 3,667 – 2,196 Total – 62,933 – 36,308

Personnel costs include salaries, social and health security contributions under the provisions of the local legislation. For the year 2005, the average number of employees is 1,111 (2004:726).

7. Impairment Losses

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Balance as àò January 1 33,085 19,987 Additional allowances for impairment losses 26,243 24,243 Reversals – 15,467 – 10,231 Written off receivables – 3 – 914 Balance as at December 31 43,858 33,085

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Write-downs – 26,243 – 24,243 Reversal of write-downs 15,467 10,231 Recoveries from non performing loans previously written off 367 409 Loss on impairment and uncollectability – 10,409 – 13,603

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 35 Notes to the Financial Statements

8. Income Tax Expense

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Current tax expense – 7,916 – 6,047 Deferred tax (expense) / income related to origination and reversal of temporary differences – 231 85 Deferred tax (expense) / income resulting from reduction in the tax rate 20 Total tax (expense) / income – 8,147 – 5,942

Current income tax expense represents the amount of due corporate tax to be paid under Bulgarian law. Deferred tax income or expense results from the change in the carrying amounts of deferred tax assets and deferred tax liabilities.

The relationship between tax expense and accounting profit is as follows:

In BGN Thousand Year ended Year ended December 31, 2005 December 31, 2004 Accounting profit 52,691 30,402 Tax at the applicable tax rate (15% for 2005, 19.5% for 2004) – 7,904 – 5,928 Tax effect on permanent differences – 243 – 34 Tax effect from change in the tax rate 20 Total tax expense – 8,147 – 5,942 Effective tax rate 15.46% 19.55%

Reported deferred tax liabilities at December 31, 2005 and 2004 comprise the following:

In BGN Thousand Assets Liabilities Net (Assets) / Liabilities 2005 2004 2005 2004 2005 2004 Fixed assets 330 91 330 91 Unused leave of personnel (33) (25) (33) (25) Net (Assets) / Liabilities (33) (25) 330 91 297 66

Deferred income taxes are calculated on all temporary differences under the liability method using a principal tax rate of 15%.

Movements in temporary differences during the year are recognised in income statement on the following items:

Movements during the year

Deferred taxes 2004 Changes 2005 In BGN Thousand Income statement – loss / (profit) Fixed assets/net 91 239 330 Unused leave (25) (8) (33) 66 231 297

36 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

9. Cash and Balances with the Central Bank

Cash

In BGN Thousand December 31, 2005 December 31, 2004 Cash on hand 32,476 22,469 ATM cash 10,646 4,765 Total 43,122 27,234

Balances with the Central Bank

In BGN Thousand December 31, 2005 December 31, 2004 Current account with BNB in Bulgarian Leva 108,956 156,883 Obligatory minimum reserve with BNB in foreign currency 78,233 63,001 Total 187,189 219,884

The current account with the Central Bank is used for direct participation in the money and treasury bills markets and for settlement purposes.

As of December 31, 2005, the Bank maintains minimum obligatory reserve in EUR with the Central Bank, calculated as a percentage on the deposits in foreign currency. The minimum reserve for deposits in Bulgarian Leva is covered by the current account with BNB.

10. Placements with and Loans to Banks

(a) Analysis by currency

In BGN Thousand December 31, 2005 December 31, 2004 Bulgarian Leva 35,177 19,261 Foreign currency 514,255 179,984 Total 549,432 199,245

(b) Geographical analysis

In BGN Thousand December 31, 2005 December 31, 2004 Domestic banks 82,330 70,899 Foreign banks 467,102 128,346 Total 549,432 199,245

11. Receivables Under Repurchase Agreement

Receivables on repurchase agreements represent securities purchased under agreements to sell them back to the counterparty on a future fixed date at a contracted fixed price. As of December 31, 2005 the fair value of received government securities as pledge on such agreements amounts to BGN 12,069 thousand, 4,554 thousand as of December 31, 2004 respectively.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 37 Notes to the Financial Statements

12. Financial Assets Held for Trading

In BGN Thousand December 31, 2005 December 31, 2004 Bulgarian government securities Bulgarian Leva 51,243 22,585 Foreign currency 229,450 72,419 280,693 95,004 Other trading securities Foreign government securities 4,155 398,473 Bulgarian corporate bonds 51,043 39,220 Foreign corporate bonds 2,634 Compensatory vouchers 610 503 58,442 438,196 Total 339,135 533,200

Income from debt and other fixed-income instruments is recognized in interest and similar income. Gains and losses arising from changes in fair value of trading instruments are recognized in net trading income.

13. Other Financial Instruments at Fair Value trough Profit and Loss

In BGN Thousand December 31, 2005 December 31, 2004 Bulgarian government securities 46,173 Bulgarian corporate bonds 195,243 Bulgarian corporate shares 382 Foreign corporate bonds 10,853 Total 252,651

In 2005 the Bank formed a security portfolio, neither held for trading not to maturity. The value of this portfolio is the market price of the securities. Gains or losses from changes in fair values of the securities in this portfolio are included in the net profit or loss for the reporting period in which it occurred.

Bulgarian corporate bonds comprise issues of Bulgarian banks and large corporate bank clients.

The foreign corporate bonds represent a middle-term bonds issue of EIB in BGN.

38 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

14. Loans and Advances to Customers

In BGN Thousand December 31, 2005 December 31, 2004 Individuals Bulgarian Leva 291,370 73,577 Foreign currency 72,277 22,796 363,647 96,373 Private companies and sole traders Bulgarian Leva 207,528 155,606 Foreign currency 833,311 752,873 1,040,839 908,479 State owned companies and enterprises Bulgarian Leva 2,249 Foreign currency 2,249 1,406,735 1,004,852 Allowances for impairment and uncollectability – 43,858 – 33,085 Total 1,362,877 971,767

Analysis of loans by industry

December 31, 2005 December 31, 2004 In Thousand Bulgarian Foreign Total Bulgarian Foreign Total Leva Currency Leva Currency Manufacturing 47,992 196,829 244,821 58,313 239,669 297,982 Construction 8,382 47,914 66,296 10,610 40,468 51,078 Transport 2,096 22,419 24,515 1,879 20,923 22,802 Trade 121,322 377,508 498,830 73,319 295,491 368,810 Other 19,986 188,640 208,626 11,485 156,322 167,807 Individuals 291,370 72,277 363,647 73,577 22,796 96,373 501,148 905,587 1,406,735 229,183 775,669 1,004,852 Impairment –14,547 – 29,311 – 43,858 – 4,781 – 28,304 – 33,085 Total 486,601 876,276 1,362,877 224,402 747,365 971,767

Interest sensitivity

Interest rates on most loans are calculated at the cost of funds plus a set margin. Cost of funds depends on the interest- fixing period and of the respective currency of the loan. Loan margins vary and are based on the loan term and on the credit risk associated with the borrower.

In case of overdue loan interest and principal penalty interest is applied.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 39 Notes to the Financial Statements

15. Securities Held to Maturity

Long-term securities held to maturity represent debt investments that the Bank has the intent and ability to hold to maturity.

In BGN Thousand December 31, 2005 December 31, 2004 Bulgarian government securities in foreign currency 22,618 21,464 Bulgarian corporate bonds 6,983 8,496 Total 29,601 29,960

16. Other Assets

In BGN Thousand December 31, 2005 December 31, 2004 Fair value of derivatives 240 275 Prepaid expenses 2,855 1,896 Other 6,707 1,669 Total 9,802 3,840

Other assets as of December 31, 2005 comprise cheque receivables as well as receivables arising from debit cards transactions, guarantee deposits, shares and participations.

This position includes as well confirmed import letter of credits amounting to BGN 1,692 thousand.

17. Fixed Assets

In BGN Thousand Total Land and Computer Office Motor Software Other Assets Buildings Equipment Furniture Vehicles Intangible under fixed assets construction Cost January 1, 2005 35,114 2,292 7,656 15,044 828 5,028 3,934 332 Additions / (disposals) 10,125 – 2,292 2,137 6,301 – 828 2,192 2,581 34 December 31, 2005 45,239 9,793 21,345 7,220 6,515 366 Accumulated Depreciation and amortization January 1, 2005 18,632 439 5,233 7,931 532 3,100 1,397 Charge for the period 5,305 46 1,599 1,813 77 1,077 693 Depreciation of disposals – 1,709 – 485 – 563 – 23 – 609 – 29 December 31, 2005 22,228 6,269 9,721 4,177 2,061 Net Book Value December 31, 2004 16,482 1,853 2,423 7,113 296 1,928 2,537 332 Net Book Value December 31, 2005 23,011 3,524 11,624 3,043 4,454 366

In 2005 all Bank’s premises and cars were transferred from to Bank to Raiffeisen Services EAD (RS) as a contribution in- kind. Raiffeisen Services is 100% owned by Raiffeisenbank (Bulgaria) EAD.

As a result of this transfer the capital of Raiffeisen Services raised from BGN 50 thousand to BGN 3 000 thousand

40 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

18. Deposits from Banks

In BGN Thousand December 31, 2005 December 31, 2004 In Bulgarian Leva Domestic commercial banks 24,113 26,081 Foreign commercial banks 2,972 2,591 27,085 28,672 In foreign currency Domestic commercial banks 115,772 89,668 Foreign commercial banks 242,898 55,135 358,669 144,803 Total 385,754 173,475

As at December 31, 2005 deposits in foreign currency from banks include deposits of RZB, Vienna at the amount of BGN 197,286 thousand (2004: BGN 53,100 thousand).

19. Liabilities under Repurchase Agreements

The Bank raises funds by selling financial instruments under agreements to repay the funds by repurchasing the instruments at future dates at the same price plus interest at a predetermined rate. Repurchase agreements are commonly used as a tool for short-term financing of interest-bearing assets, depending on the prevailing interest rates.

As at December 31, 2005 the Bank has no assets sold under repurchase agreements.

20. Liabilities from Trading Activities

In BGN Thousand December 31, 2005 December 31, 2004 Short selling liabilities 10,804 Negative fair value of derivatives 2,204 9,223 Total 13,008 9,223

Trading liabilities comprise the short selling liabilities and the negative fair value of derivatives.

As at December 31, 2005 the negative fair value of the forward exchange deals amounts to BGN 69 thousand The foreign exchange swap transactions are to the amount of BGN 2,135 thousand

As at December, 2004 the negative fair value of the forward foreign exchange deals amounts to BGN 126 thousand. The foreign exchange swap transactions are to the amount of BGN 9,097 thousand

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 41 Notes to the Financial Statements

21. Deposits from Customers

(a) Amounts owed to depositors by customer segment

In BGN Thousand December 31, 2005 December 31, 2004 Individuals Bulgarian Leva 174,323 86,673 Foreign currency 345,296 233,670 519,619 320,343 Companies and sole traders Bulgarian Leva 449,475 244,999 Foreign currency 387,201 715,428 836,676 960,427 Budgetary organisations Bulgarian Leva 35,271 8,859 Foreign currency 205,745 35,594 241,016 44,453 Total 1,597,311 1,325,223

In 2004 the Bank won the tender for the opening of a deposit account with regard to the privatization deal of the state owned electricity companies in Plovdiv and Stara Zagora. The price of the deal amounting to EUR 271 mln is a part of the deposit base of the Bank as of December 31, 2004. The Bank has invested the funds in trading securities. In January 2005, the amount of EUR 217 mln was transferred to the Privatization Agency and the rest of EUR 54 mln Will be transferred in 2006.

In July, 2005 the Bank took up the service of the National Fund of the Ministry of Finance under ISPA programme. As at December, 2005 the attracted resource amounts to BGN 240 mln.

22. Medium-Term Bonds

The position medium-term bonds includes a 3-year unsecured bonds emission at a fixed year interest rate (coupon) 4.75%.

23. Other Liabilities

The bank recognizes as a liability for unused holidays, the undiscounted amount of the expected short-term income of its employees for the work performed during the current period. Taking into consideration the age stricture of the employees, the bank does not provide for post employment benefits.

In BGN Thousand December 31, 2005 December 31, 2004 Transfers in process 32,294 13,011 Third party relations and other liabilities. 2,126 2,554 Due to staff 4,891 2,856 Current tax payable 3,557 2,857 Total 42,868 21,278

Transfers in process represent customers’ money transfer orders with value date after the date of the financial statements.

42 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

24. Long-Term Borrowings

Long-term borrowings comprise loans attracted from international financial institutions for financing projects of SMEs and private individuals in the field of environmental conservation, energy savings, industry, services and tourism.

25. Subordinated Debt

With the permission of the Bulgarian National Bank, in March 2001, the Bank entered into an agreement with Raiffeisen Zentralbank Oesterreich AG for a subordinated debt in the form of debt – capital hybrid instrument. These funds are a supplementary capital reserve and increase the capital base of Raiffeisenbank (Bulgaria) EAD for regulatory purposes. As at December 31, 2005 the subordinate debt of the Bank amounts to EUR 51 mln.

The repayment of the debt is not bound by any maturity. Management believes that the use of this instrument will be for a term of over 5 years.

The treatment of these liabilities for capital adequacy purposes is in accordance with the requirements of local legislation. Any prepayment of subordinated debt prior to its final maturity is subject to written approval from the Bulgarian National Bank.

26. Capital and Reserves

(a) Share capital

In 2005 the Bank increased its share capital by BGN 29,337 thousand. The capital was fully paid by its shareholder Raiffeisen International Bank Holding AG.

As of December 31, 2005 the registered and fully paid-in capital of the Bank comprised 94,932,152 registered shares with a par value of BGN 1 each.

(b) Statutory reserve

Statutory reserves comprise amounts appropriated for purposes defined by the local legislation. Under local legislation, the Bank is required to set aside one fifth of its profit in a statutory reserve until it reaches 1.25 % of the banks’ total assets and off-balance-sheet liabilities

(c) Retained earnings

The Bank presents under retained earnings section all distributable reserves in excess of the statutory reserves under (b).

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 43 Notes to the Financial Statements

27. Commitments and Contingent Liabilities

(a) Memorandum items

The Bank provides financial guarantees and letters of credit to guarantee the performance of customers to third parties. These agreements have fixed limits and generally extend for a period of up to two years.

The contractual amounts of commitments and contingent liabilities are set out in the following table by category. The amounts reflected in the table for guarantees and letters of credit represent the maximum accounting loss that would be recognised at the balance sheet date if counterparts failed completely to perform as contracted.

In BGN Thousand December 31, 2005 December 31, 2004 Letters of guarantee and letters of credit issued 120,667 59,629 Unused credit lines 318,036 197,588 Total commitments and contingencies 438,703 257,217

These commitments and contingent liabilities have off balance-sheet credit risk because only organization fees and accruals for probable losses are recognised in the balance sheet until the commitments are fulfilled or expire. Many of the contingent liabilities and commitments will expire without being advanced in whole or in part. Therefore, the amounts do not represent expected future cash flows.

28. Cash and Cash Equivalents

For the purposes of the cash flow statement, cash and cash equivalents comprises the following balances with less than 90 days original maturity:

In BGN Thousand As of December 31, 2005 As of December 31, 2004 Cash on hand and nostro accounts 45,720 31,983 Current account with the Central Bank 187,189 219,884 Placements with banks with original maturity of less than 3 months 546,834 194,495 Total 779,743 446,362

29. Risk Management Disclosures

(a) Trading activities

The Bank maintains active trading positions in a limited number of derivatives, mainly short-term forward contracts and non-derivative financial instruments. Most of the Bank’s trading activities are customer driven. In anticipation of customer demand, the Bank carries an inventory of money market instruments and maintains access to market liquidity by trading with other market makers. These activities constitute the proprietary trading business and enable the Bank to provide customers with money market products at competitive prices. As trading strategies depend on both market-making and proprietary positions, given the relationships between instruments and markets, those are managed in concert to maximize net trading income.

The Bank manages its trading activities by type of risk involved and on the basis of the categories of trading instruments held.

44 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

(i) Credit risk

The Bank is permanently exposed to credit risk, arising from the probability that counterparties might default on their contractual obligation under loans and advances when due or in full. The Bank has a set of policies and procedures in relation to credit approval and credit exposures management. In addition, the Bank is exposed to off-balance sheet credit risk through commitments under unutilized extended credit lines and issued guarantees.

Concentrations of credit risk (whether on or off-balance sheet) might arise from risk exposures to one borrower or group of borrowers, with similar economic characteristics, that might be affected in equal terms by changes in economic or other circumstances in meeting their contractual obligations.

The Bank is exposed to credit risk also in result of its trading and investment activities, as well as in result of its activities as an investment broker for its customers or for third parties. The credit risk arising from trading and investment activities of the Bank is controlled by market risk management

The risk that counterparts to financial instruments might default on their obligations is monitored on an ongoing basis. In monitoring credit risk exposures related to trading instruments, consideration is given to instruments with a positive fair value and to the volatility of the fair value of trading instruments.

(ii) Market risk

All marked-to-market instruments are subject to market risk, the risk that future changes in market conditions may make an instrument less valuable or more onerous. The instruments are recognized at fair value based on quoted bid prices, and all changes in market conditions directly affect net trading income (through trading instruments) or equity value (through available for sale instruments).

Exposure to market risk is formally managed in accordance with risk limits set by senior management by buying or selling instruments.

(b) Non-trading activities

Below is a discussion of the various risks the Bank is exposed to as a result of its non-trading activities and the approach taken to manage those risks.

(i) Liquidity risk

The Bank is exposed to daily calls on its available cash resources from overnight deposits, current accounts, maturing term deposits, loan drawdown and guarantees. The Bank does not maintain cash resources required to meet all possible outgoing cash flows as experience has shown that there is a minimum level of reinvestment of maturing funds that can be predicted with a high level of certainty. The correlation between assets and liabilities, as well as the outgoing and incoming cash flows are managed to guarantee the regular and timely fulfillment of current obligations for the “going concern” scenario as well as for “liquidity shortage”.

The maturity of assets and liabilities and the ability to replace, at an acceptable cost, interest bearing liabilities as they mature, are important factors in assessing the liquidity of the Bank and its exposure to changes in interest rates and exchange rates.

The diversification of deposits by type and customer segment, and the past experience of the Bank give reason management to believe that deposits are a long-term and stable source of funding for the Bank.

The following table provides an analysis of the financial assets and liabilities of the Bank into relevant maturity groupings based on the remaining periods to repayment.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses Íàãðàäè www.rbb.bg 45 Notes to the Financial Statements

Maturity table as at 31 December 2005

In BGN Thousand Demand Up to 3 3 months 1 to 5 Over Undefined Total Months to 1 year years 5 years Maturity

Assets

Cash 43,122 43,122

Balances with the Central Bank 187,189 187,189

Placements with, and loans to banks 154,136 395,296 549,432

Receivables on repurchase agreements 11,942 11,942

Trading securities 204 1,022 137,483 199,816 610 339,135

Other current securities 235,499 16,770 382 252,651

Loans and advances to customers 212,038 377,193 575,780 197,866 1,362,877

Securities held to maturity 11,741 17,860 29,601

Other assets 9,802 9,802

Fixed assets 23,011 23,011

Total assets 384,447 629,282 378,215 960,503 432,312 24,003 2,808,762

Liabilities

Deposits from banks 14,560 367,194 4,000 385,754

Liabilities on repurchase agreements

Liabilities on repurchase agreements 13,008 13,008

Deposits from customers 115,549 1,075,058 216,476 190,228 1,597,311

Medium-term bonds 53,808 53,808

Other liabilities 42,868 42,868

Deferred tax liabilities 297 297

Long-term borrowings 5,018 7,173 373,905 36,165 422,261

Subordinated debt 100,403 100,403

Total liabilities 130,109 1,503,146 281,457 564,430 136,568 2,615,710

Net position 254,338 – 873,864 96,758 393,073 295,744 24,003 193,052

46 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

Maturity table as at 31 December 2004

In BGN Thousand Demand Up to 3 3 months 1 to 5 Over Undefined Total Months to 1 year years 5 years Maturity

Assets

Cash 27,234 27,234

Balances with the Central Bank 219,884 219,884

Placements with, and loans to banks 4,750 194,495 199,245

Receivables on repurchase agreements 4,159 4,159

Trading securities 109 3,376 168,055 361,158 502 533,200

Loans and advances to customers 113,579 379,515 407,274 71,399 971,767

Securities held to maturity 2,418 6,867 20,675 29,960

Interest receivables and other assets 3,840 3,840

Fixed assets 16,482 16,482

Total assets 251,868 316,182 385,309 582,196 453,232 16,984 2,005,771

Liabilities

Deposits from banks 171,475 2,000 173,475

Liabilities on repurchase agreements 6,948 6,948

Trading liabilities 9,223 9,223

Deposits from customers 486,873 433,757 214,889 189,704 1,325,223

Medium-term bonds 46,603 46,603

Interest liabilities and other liabilities 21,278 21,278

Deferred tax liabilities 66 66

Long-term borrowings 3,927 3,260 202,691 51,566 261,444

Subordinated debt 41,340 41,340

Total liabilities 486,873 637,385 220,149 448,287 92,906 1,885,600

Net position – 235,005 – 321,203 165,160 133,909 360,326 16,984 120,171

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 47 Notes to the Financial Statements

(ii) Market risk

Interest rate risk

The Bank’s operations are subject to the risk of interest rate fluctuations to the extent that interest-earning assets and interest-bearing liabilities mature or reprice at different times or in differing amounts. In comparison to the other risks the interest rate risk could be minimized trough the mutual management of assets and liabilities.

The future EU accession and the expectations for stable development of the Bulgarian economy will lead to conversion of interest rates to the current levels in the Euro zone.

The policy of the bank to minimize interest rate risk is to grant floating rate loans against the received floating rate external financings. Interest rate risk is also managed through the balanced use of different funding sources (borrowings from other local banks, long-term borrowings from foreign banks, customer deposits etc.), as well as through purposeful credit policy, providing for increasing return.

It is of crucial importance for the Management of the bank to control the interest rate sensitivity of assets and liabilities. Due to the nature of banking an absolute mismatching in maturities or in periods of re-pricing of contracted interests on financial assets and liabilities is not possible. An unmatched position potentially enhances profitability, but may also increase the risk of losses.

The Bank’s interest rate exposures are monitored and managed by generating interest rate sensitivity reports. The majority of the Bank’s interest bearing assets and liabilities are structured to match either short-term assets and short-term liabilities, or long-term assets and liabilities with re-pricing opportunities within one year, or long-term assets and corresponding liabilities whereby re-pricing is performed simultaneously.

For most interest-bearing assets and liabilities exists a possibility of re-pricing at a relatively short notice and any interest rate sensitivity gaps are considered immaterial.

The following table indicates the effective interest rates at 31 December 2005 and the periods in which financial liabilities and assets reprice.

48 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

In BGN Thousand Up to 3 From 3 From More Total Effective months months to 1 year than interest 1 year to 5 years 5 years rate Asets Placements with, and loans to banks 549,432 549,432 2.5% Receivables on repurchase agreements 11,942 11,942 2.5% Financial assets held for trading 37,170 23,047 114,171 164,747 339,135 4.2% Other current financial assets 235,499 16,770 252,269 5.0% Loans and advances to customers 800,294 129,309 229,519 203,755 1,362,877 8.9% Securities held to maturity 1,995 8,963 18,643 29,601 6.8% Total assets 1,400,833 152,356 588,152 403,915 2,545,256 liabilities Deposits from banks 381,754 4,000 385,754 2.5% Deposits from customers 1,501,393 72,204 23,714 1,597,311 1.6% Medium-term bonds 53,808 53,808 4.7% Long-term borrowings 402,703 19,558 422,261 2.9% Subordinated debt 100,403 100,403 4.0% Total liabilities 2,386,253 130,012 43,272 2,559,537 Net position – 985,420 22,344 544,880 403,915 – 14,281

The following table indicates the effective interest rates at 31 December 2004 and the periods in which financial liabilities and assets reprice.

In BGN Thousand Up to 3 From 3 From More Total Effective months months to 1 year than interest 1 year to 5 years 5 years rate Assets Placements with, and loans to banks 199,245 199,245 2.1% Receivables on repurchase agreements 4,159 4,159 2.1% Trading securities 13,753 23,776 157,131 338,540 533,200 6.5% Loans and advances to customers 752,725 70,048 109,880 39,114 971,767 9.0% Securities held to maturity 3,472 5,024 21,464 29,960 6.5% Total assets 969,882 97,296 272,035 399,118 1,738,331 Liabilities Deposits from banks 173,475 173,475 2.1% Receivables on repurchase agreements 6,948 6,948 2.1% Deposits from customers 1,252,500 59,607 13,116 1,325,223 1.2% Medium-term bonds 46,603 46,603 4.7% Long-term borrowings 94,125 146,687 20,632 261,444 3.3% Subordinated debt 41,340 41,340 5.7% Total liabilities 1,568,388 206,294 59,719 20,632 1,855,033 Net position – 598,506 – 108,998 212,316 378,486 – 116,702

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 49 Notes to the Financial Statements

Currency risk

The Bank is exposed to currency risk through transactions in foreign currencies.

As a result of the currency Board in place in Bulgaria, the Bulgarian currency is pegged to the Euro. As the currency in which the Bank presents it financial statements is the Bulgarian Lev, the Bank’s financial statements are effected by movements in the exchange rates between the Bulgarian Leva and currencies other than the Euro.

The Bank’s transactional exposures give rise to foreign currency gains and losses that are recognized in the income statement. These exposures comprise the monetary assets and monetary liabilities of the Bank that are not denominated in the measurement currency of the Bank. As of December 31, 2005 the BGN equivalent of the total assets denominated in EUR amounts to 1,620 mln, respectively total liabilities 1,563 mln.

The foreign currency position of the bank as of December 31, 2005, respectively December 31, 2004 is represented below:

December 31, 2005

In BGN Thousand In Bulgarian EUR Other Foreign Total Leva Currency Assets Cash 25,550 12,857 4,715 43,122 Balances with the Central Bank 108,956 78,233 187,189 Placements with, and loans to banks 35,177 366,144 148,111 549,432 Receivables on repurchase agreements 301 11,641 11,942 Trading securities 76,673 174,020 88,442 339,135 Other current financial assets 118,771 133,880 252,651 Loans and advances to customers 486,600 825,629 50,648 1,362,877 Securities held to maturity 5,610 14,426 9,565 29,601 Other assets 6,521 2,810 471 9,802 Fixed assets 23,011 23,011 Total assets 887,170 1,619,640 301,952 2,808,762 Liabilities Deposits from banks 27,085 257,007 101,662 385,754 Liabilities on repurchase agreements Trading liabilities 2,204 10,804 13,008 Deposits from customers 659,069 746,863 191,379 1,597,311 Medium-term bonds 53,808 53,808 Other liabilities 12,667 25,192 5,009 42,868 Deferred tax liabilities 297 297 Long-term borrowings 422,261 422,261 Subordinated debt 100,403 100,403 Total liabilities 701,322 1,562,530 351,858 2,615,710 Net position 185,848 57,110 – 49,906 193,052

50 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Notes to the Financial Statements

December 31, 2004

In BGN Thousand In Bulgarian EUR Other Foreign Total Leva Currency Assets

Cash 16,843 6,867 3,524 27,234 Balances with the Central Bank 156,780 63,104 219,884 Placements with, and loans to banks 19,261 93,940 86,044 199,245 Receivables on repurchase agreements 2,652 891 616 4,159 Trading securities 31,880 482,148 19,172 533,200 Loans and advances to customers 224,402 685,392 61,973 971,767 Securities held to maturity 7,249 14,462 8,249 29,960 Other assets 1,778 1,332 730 3,840 Fixed assets 16,482 16,482 Total assets 477,327 1,285,032 243,412 2,005,771 Liabilities

Deposits from banks 28,672 46,399 98,404 173,475 Liabilities on repurchase agreements 6,948 6,948 Trading liabilities 9,223 9,223 Deposits from customers 340,532 826,633 158,058 1,325,223 Medium-term bonds 46,603 46,603 Other liabilities 7,439 9,824 4,015 21,278 Deferred tax liabilities 66 66 Long-term borrowings 261,444 261,444 Subordinated debt 41,340 41,340 Total liabilities 385,932 1,192,589 307,080 1,885,600 Net position 91,395 92,444 – 63,668 120,171

In respect of monetary assets and liabilities in foreign currencies that are not economically hedged, the Bank manages foreign currency risk in line with policy that sets limits on currency positions and dealer limits.

(iii) Credit risk

The Bank is subject to credit risk through its lending activities and in cases where it acts as an intermediary on behalf of customers or other third parties or issues guarantees. In this respect, the credit risk for the Bank stems from the possibility that different counterparties might default on their contractual obligations. The management of the credit risk exposures to borrowers is conducted through regular analysis of the borrowers’ credit worthiness and the assignment of a rating grade. Exposure to credit risk is also managed in part by obtaining collateral and guarantees.

The Bank’s primary exposure to credit risk arises through its loans and advances. The amount of credit exposure in this regard is represented by the carrying amounts of the assets on the balance sheet. In addition, the Bank is exposed to off- balance sheet credit risk through commitments to extend credit and guarantees issued.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 51 Notes to the Financial Statements

Concentrations of credit risk (whether on or off balance sheet) that arise from financial instruments exist for counterparties when they have similar economic characteristics that would cause their ability to meet contractual obligations to be similarly affected by changes in economic or other conditions.

The major concentrations of credit risk arise by location and type of customer in relation to the Bank’s investments, loans and advances, commitments to extend credit and guarantees issued.

Collateral for loans, guarantees, and letters of credit is usually in the form of cash, mortgage inventory, listed investments, or other property.

30. Related Party Transactions

Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party on making financial or operational decisions, or the parties are under common control with the Bank.

A number of banking transactions are entered into with related parties in the normal course of business. These include loans, deposits and other transactions.

Related party Type of relation Type of transaction Balance as of December 31,2005 In BGN Thousand Raiffeisen Owner of Raiffeisen Nostro accounts 546 Zentral Bank AG International Bank Receivables from deposits 401,006 Holding AG Liabilities on deposits 197,286 Subordinated debt 51,335 Commissions for credit lines and guarantees paid 1,648 Interest income 5,733 Interest expense 2,776 Operating expenses 5,498 Positive fair value of derivative financial instruments 58 Negative fair value of derivative financial instruments 1,149 Other liabilities 31 Raiffeisen Leasing Asscosiated company Current accounts Bulgaria OOD and term deposits 13,356 RAISA Subsidiary of RZB Operating expenses 1,145 Pro Invest DaVinci Subsidiary of RZB Operating expenses (Rent of the bank’s premises) 1,270 Management and Loans and advances employees of the Bank 7,677

31. Post Balance Sheet Events

In February 2006 the subordinated debt of the Bank was increased by EUR 10 mln according to a contract with Raiffeisen Zentral Bank, Vienna. The procedure for the approval by BNB is in progress.

52 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Awards

Awards

In 2005 Raiffeisenbank (Bulgaria) EAD received the following awards:

„Bank Of The Client”, Pari Daily

„Bank Of The Year”, The Banker Magazine

The title „Bank of the Year” is awarded by The Banker for different regions, countries and categories. It is considered to be one of the most prestigious business awards. The decision is not only based on quantitative criteria, such as total assets or earning power, but also the development of state-of-the-art technical infrastructures and future-oriented strategies and their implementation.

„Best Web Design In CEE” and „Best Consumer Internet Bank” Global Finance Magazine

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 53 Corporate Social Responsibility

Corporate Social Responsibility

In 2005 Raiffeisenbank (Bulgaria) EAD was part of the initiative „Bulgarian Christmas” („Bulgarska Koleda”), under the patronage of the Bulgarian President Georgi Parvanov. The Bank supported an operation on 3 year old Liubomir Elenkov – one of the children of the „Bulgarian Christmas” initiative.

Raiffeisenbank was among the general sponsors of the charity Vienna Ball under the patronage of the Austrian ambassador Dr. Karl Diem. The funds raised were donated to the Neurology Clinic in the Alexandrovska University Hospital and the Home for the retired culture veterans in Sofia.

54 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement The Bank’s Management

The Bank’s Management

Shareholders

Raiffeisen International Bank-Holding AG – 100%

Supervisory Board

Chairman: Herbert Stepic Chairman of the Managing Board of Raiffeisen International Bank-Holding AG and Deputy Chairman of Raiffeisen Zentralbank Österreich AG (RZB).

SB Members: Heinz Höedl

Peter Lenkh

Management Board

Chairman: Momtchil Andreev

Members of the Board: Evelina Miltenova

Jan Majtan

Nadezhda Mihaylova

Tzenka Petkova

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 55 RZB Group and Raiffeisen International at a Glance

RZB Group and Raiffeisen International at a glance

Raiffeisenbank (Bulgaria) EAD is a member of the RZB Group and subsidiary of Raiffeisen International Bank-Holding AG. Raiffeisen International in turn is a fully consolidated subsidiary of Vienna-based Raiffeisen Zentralbank Österreich AG (RZB). RZB is the parent company of the RZB Group and the central institution of the Austrian Raiffeisen Banking Group, the country’s most powerful banking group with the largest local distribution network.

Founded in 1927, RZB provides the full range of commercial and investment banking services in Austria and is regarded a pioneer in Central and Eastern Europe (CEE). It ranks among the region’s leading banks, offering commercial, investment and retail banking services in the following markets:

Albania Raiffeisen Bank Belarus Priorbank, JSC Bosnia and Herzegovina Raiffeisen Bank d.d. Bosna i Hercegovina Bulgaria Raiffeisenbank (Bulgaria) EAD Croatia Raiffeisenbank Austria d.d. Czech Republic Raiffeisenbank a.s. Hungary Raiffeisen Bank Zrt. Kosovo Raiffeisen Bank Kosovo J.S.C. Poland Raiffeisen Bank Polska S.A. Romania Raiffeisen Bank S.A. Russia ZAO Raiffeisenbank Austria Serbia and Montenegro Raiffeisenbank a.d. Slovakia Tatra Banka, a.s. Slovenia Raiffeisen Krekova Banka d.d. Ukraine JSCB Raiffeisenbank Ukraine and JSPP Bank Aval

Raiffeisen International acts as these banks’ steering company, owning the majority of shares (in most cases 100 or almost 100 per cent). Furthermore, numerous finance leasing companies (including one in Kazakhstan) are part of the group. Following the largest IPO in Austria’s history in April 2005, RZB remains Raiffeisen International’s majority shareholder owning 70 per cent of the capital stock. The remaining 30 per cent is free-float, owned by institutional and retail investors.

At year-end 2005 2,443 business outlets covered the CEE-region and more than 43,600 employees attended to 9.7 million customers.

As of year-end 2005 Raiffeisen International’s total assets amounted to 40.7 bln, up 41 per cent compared with December 2004. Consolidated profit (after minorities) according to IFRS came to 382.3 million, an increase of 83 per cent. The return on equity before tax reached 21.8 per cent and the cost/income ratio improved to 61.6 per cent.

As per 31 December 2005 the RZB Group’s balance-sheet total amounted to 93.9 bln, up 38 per cent on the figure for year-end 2004. IFRS-compliant profit before tax amounted to 929.9 million, an increase of 34 per cent compared with the same period of 2004. The return on equity before tax was 23.9 per cent and the cost/income ratio improved to 58.9 per cent.

56 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement RZB Group and Raiffeisen International at a Glance

In addition to its banking operations – which are complemented by representative offices in Lithuania (Vilnius), Moldova (Chisinau) and Russia (Moscow) – RZB runs several specialist companies in CEE offering solutions, among others, in the areas of M&A, real estate development, fund management, leasing and mortgage banking.

In Western Europe and the USA, RZB operates a branch in London and representative offices in New York, Brussels, Frankfurt, Milan, Paris and Stockholm. A finance company in New York (with representative offices in Chicago and Houston) and a subsidiary bank in Malta complement the scope. In Asia, RZB runs branches in Beijing (with a representative office in Zhuhai) and Singapore as well as representative offices in Ho Chi Minh City, Hong Kong, Mumbai, Tehran and Seoul. This international presence clearly underlines the Bank’s emerging markets strategy.

RZB is rated as follows:

Standard & Poor’s Short-term A1 Moody’s Short-term P-1 Moody’s Long-term A1 Moody’s Financial Strength C+

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 57 Raiffeisen Leasing Bulgaria OOD

Raiffeisen Leasing Bulgaria

Raiffeisen Leasing Bulgaria OOD (RLBG) was established in 2004 with 24.5% ownership from Raiffeisenbank (Bulgaria) EAD and the other 75.5% owned by Raiffeisen Leasing International GmbH. Raiffeisen Leasing OOD has a 100% shares in Raiffeisen Auto Leasing EOOD.

The companies have established 9 braches throughout the country with 2 leasing experts. The leasing experts are situated in the Raiffeisenbank’s braches. The establishment of branches as legal units enables the registration of leased assets at the local authorities which speeds up client service.

A Vendor relationship department has been set up with the purpose to develop the vendor channels and achieve better cooperation with importers and dealers.

As of 31 December 2005 Raiffeisen Leasing Bulgaria OOD and Raiffeisen Auto Leasing EOOD have a market share of 4.15% with total assets amounting to BGN 72,4 mln. The new business for 2005 represents 8.18% of the overall new business generated on the local market. During 2005 the companies succeeded in realizing a growth of 510% in total assets and a growth of 717% of the leasing portfolio, respectively.

58 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Raiffeisen Asset Management

Raiffeisen Asset Management (Bulgaria)

The new asset management company Raiffeisen Asset Management (Bulgaria) EAD (RAM) was established at the end of 2005 and is fully owned by Raiffeisenbank (Bulgaria) EAD.

The company offers 4 local funds, as well as opportunities for investment in 8 Raiffeisen Capital Management funds ran by the Austrian asset management company. Thus, the company provides local investors with the unique opportunity to invest in assets on international as well as on local markets with the intermediation of a team of professionals of just one company.

The establishment of Raiffeisen Asset Management is a logical step in Raiffeisenbank’s policy aimed at expanding its financial and investment services. Due to Raiffeisenbank’s excellent market positions in investment banking and its wide distribution network, the asset management company will be able to meet the increasing demand for alternative investment products on the Bulgarian market.

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 59 Branch Network in Bulgaria

Addresses and Contacts Branch Network in Bulgaria

Head Office Sofia 7 Sofia M & M 1504 Sofia 1336 Sofia 1387 Sofia 18-20, Gogol Str. Lyulin 6 Militzer & Munich Tel.: (+ 359 2) 919 85 101 41, Dzhavaharlal Neru Blvd. 11, Obelsko Shose Fax: (+ 359 2) 943 45 28 Tel.: (+ 359 2) 921 69 11 Tel.: (+ 359 2) 984 57 75 Fax: (+ 359 2) 925 23 71 Fax: (+ 359 2) 925 05 83

Raiffeisenbank Sofia 8 Sofia 14 (Bulgaria) EAD 1715 Sofia Sofia Offices in Sofia Business Park Sofia 43, Shipchenski Prohod Blvd. Building 11A, Ground Floor Tel.: (+ 359 2) 817 18 63 Sofia Main Branch Tel.: (+ 359 2) 970 57 11 Fax: (+ 359 2) 971 20 08 1504 Sofia Fax: (+ 359 2) 974 20 19 18-20, Gogol Str. Sofia 15 Tel.: (+ 359 2) 919 85 714 Sofia 9 1407 Sofia Fax: (+ 359 2) 979 85 139 1330 Sofia 55, Nikola Vaptzarov Blvd. Krasna Polyana EXPO 2000 Centre Sofia 2 331, Nikola Mushanov Blvd. Tel.: (+ 359 2) 819 00 61 1000 Sofia Tel.: (+ 359 2) 812 60 51 Fax: (+ 359 2) 868 20 80 5, Saborna Str. Fax: (+ 359 2) 920 11 34 Tel.: (+ 359 2) 980 04 74 Fax: (+ 359 2) 980 30 42 Sofia 10 Raiffeisenbank 1220 Sofia (Bulgaria) EAD Sofia 3 Nadezhda Offices in Bulgaria 1750 Sofia 171, Lomsko Shose Blvd. Mladost 1, Bl. 30, Entr. Â Tel.: (+ 359 2) 813 40 11 Asenovgrad Tel.: (+ 359 2) 976 09 76 Fax: (+ 359 2) 936 11 93 4230 Asenovgrad Fax: (+ 359 2) 975 31 58 Izlozhenie Str. Sofia 11 Tel.: (+ 359 331) 60 060 Sofia 4 1463 Sofia Fax: (+ 359 331) 64 902 1303 Sofia 3, Hristo Stambolski Str. 87, Tzar Samuil Str. Tel.: (+ 359 2) 917 81 11 Blagoevgrad Tel.: (+ 359 2) 915 99 10 Fax: (+ 359 2) 954 93 86 2700 Blagoevgrad Fax: (+ 359 2) 981 19 21 5, Georgi Izmirliev Square Sofia 12 Tel.: (+ 359 73) 88 20 91 Sofia 5 1202 Sofia Fax: (+ 359 73) 88 20 92 1606 Sofia 65, Maria Luiza Blvd. 5, Gen. Totleben Blvd. Tel.: (+ 359 2) 926 40 43 Burgas 1 Tel.: (+ 359 2) 915 79 11 Fax: (+ 359 2) 980 07 81 8000 Burgas Fax: (+ 359 2) 953 28 80 5, Ferdinandova Str. Sofia 13 Tel.: (+ 359 56) 85 14 21 Sofia 6 1000 Sofia Fax: (+ 359 56) 84 26 40 1404 Sofia 5, Dondukov Blvd. 49, Bulgaria Blvd. Tel.: (+ 359 2) 981 45 89 Vitosha Business Centre Fax: (+ 359 2) 981 47 05 Tel.: (+ 359 2) 818 19 20 Fax: (+ 359 2) 958 99 61

60 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Branch Network in Bulgaria

Burgas 2 Vratza Dupnitza 8000 Burgas 3000 Vratza 2600 Dupnitza 115, Alexandrovska Str. Hristo Botev Square 2, Solun Str. Tel.: (+ 359 56) 83 01 72 Tel.: (+ 359 92) 66 88 11 Tel.: (+ 359 701) 5 98 13 Fax: (+ 359 56) 83 01 73 Fax: (+ 359 92) 66 66 98 Zlatni Pyasatzi 1 Burgas 3 Gabrovo 9007 KK Zlatni Pyasatzi 8000 Burgas 5300 Garbrovo Admiral Hotel 117, Bratya Miladinovi 5, P. Karavelov Str. Tel.: (+ 359 52) 38 94 13 Tel.: (+ 359 56) 85 94 87 Tel.: (+ 359 66) 80 13 00 Fax: (+ 359 52) 35 57 13 Fax: (+ 359 56) 83 18 25 Fax: (+ 359 66) 80 13 45 Zlatni Pyasatzi 2 Varna Gorna Oryahovitza 9007 KK Zlatni Pyasatzi 9000 Varna 5100 Gorna Oryahovitza Information Centre 32, Tzar Simeon I Str. 1, Mano Todorov Str. Tel.: (+ 359 52) 35 72 07 Tel.: (+ 359 52) 68 80 11 Tel.: (+ 359 618) 6 44 90 Fax: (+ 359 52) 35 72 02 Fax: (+ 359 52) 63 30 07 Fax: (+ 359 618) 6 44 91 Kardzhali Varna 2 Galabovo 6600 Kardzhali 9000 Varna 6280 Galabovo 1, Hristo Botev Str. 61, Preslav Str. Brikel EAD Tel.: (+ 359 361) 606 53 Tel.: (+ 359 52) 65 86 51 Tel.: (+ 359 418) 25 63 Fax: (+ 359 361) 613 66 Fax: (+ 359 52) 62 06 80 Fax: (+ 359 418) 24 87 Karlovo Varna 3 Gotze Delchev 4300 Karlovo 9000 Varna 2900 Gotze Delchev 1, Evstati Geshev Str. 80-82, 8-mi Primorski polk Blvd. 1, Byalo More Str. Tel.: (+ 359 431) 6 21 23 Tel.: (+ 359 52) 68 57 13 Tel.: (+ 359 751) 61 322 Fax: (+ 359 431) 6 34 36 Fax: (+ 359 52) 60 37 44 Devin Karnobat Veliko Tarnovo 4800 Devin 8400 Karnobat 5000 Veliko Tarnovo 2, Druzhba Str., Devin Spa Hotel 1, Karnobatska Komuna Str. 31, Marno Pole Str. Tel.: (+ 359 3041) 26 86 Tel.: (+ 359 559) 28 843 Tel.: (+ 359 62) 60 24 24 Fax: (+ 359 3041) 41 71 Fax: (+ 359 559) 22 908 Fax: (+ 359 62) 60 12 04 Dimitrovgrad Kazanlak Velingrad 6400 Dimitrovgrad 6100 Kazanlak 4600 Velingrad 9, D. Blagoev Str. 18, Skobelev Str. 1, Al. Stamboliiski Str. Tel.: (+ 359 391) 6 51 13 Tel.: (+ 359 431) 6 21 23 Tel.: (+ 359 359) 5 69 21 Fax: (+ 359 431) 6 34 36 Fax: (+ 359 359) 5 10 26 Dobrich 9300 Dobrich Lovech Vidin 25, 25 Septemvri Str. 5500 Lovech 3700 Vidin Tel.: (+ 359 58) 65 30 00 3, Bulgaria Blvd. 1, Tzar Ivan Asen II Str. Fax: (+ 359 58) 60 17 83 Tel.: (+ 359 68) 68 90 11 Tel.: (+ 359 94) 60 91 10 Fax: (+ 359 68) 68 90 20 Fax: (+ 359 94) 60 71 43

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 61 Branch Network in Bulgaria

Montana Plovdiv 2 Silistra 3400 Montana 4000 Plovdiv 7500 Silistra 47, 3 Mart Blvd. 1, Konstantin Stoilov Str. 20, Tzar Shishman Str. Tel.: (+ 359 96) 39 19 11 Tel.: (+ 359 32) 60 66 30 Tel.: (+ 359 86) 82 23 22 Fax: (+ 359 96) 30 30 36 Fax: (+ 359 32) 60 66 88 Fax: (+ 359 86) 82 28 77

Nessebar Plovdiv 3 Sliven 8230 Nessebar 4000 Plovdiv 8800 Sliven 3, Priboina Str. 1, Maria Luiza Blvd. 11, Tzar Simeon Str. Tel.: (+ 359 554) 4 66 60 Tel.: (+ 359 32) 64 65 66 Tel.: (+ 359 44) 66 20 25 Fax: (+ 359 554) 4 35 16 Fax: (+ 359 32) 66 29 00 Fax: (+ 359 44) 66 21 23

Pazardzhik Primorsko Slanchev Bryag 4400 Pazardzhik 8290 Primorsko 8240 KK Slanchev Bryag 12, Konstantin Velichkov Str. 50, 3 Mart Str. Diamant Hotel Tel.: (+ 359 34) 40 30 10 Tel.: (+ 359 550) 3 10 40 Tel.: (+ 359 554) 2 36 21 Fax: (+ 359 34) 40 30 20 Fax: (+ 359 550) 3 22 86 Fax: (+ 359 554) 2 3621

Peshtera Radnevo Smolyan 4550 Peshtera 6260 Radnevo 4700 Smolyan 19, Doiranska Epopeya Str. 6, G. Dimitrov Str. 8, Bulgaria Blvd Tel.: (+ 359 350) 63 71 Tel.: (+ 359 417) 8 24 36 Tel.: (+ 359 301) 6 20 94 Fax: (+ 359 350) 41 51 Fax: (+ 359 417) 8 24 56 Fax: (+ 359 301) 9 20 96

Petrich Razgrad Sozopol 2850 Petrich 7200 Razgrad 8130 Sozopol 51/53, Rokfeler Str. 2, Stefan Karadzha Str. 3, Industrialna Zona Str. Tel.: (+ 359 745) 69 192 Tel.: (+ 359 84) 61 14 63 Tel.: (+ 359 550) 2 45 50 Fax: (+ 359 745) 61 461 Fax: (+ 359 84) 66 02 89 Fax: (+ 359550) 2 23 13

Pleven Rousse Stara Zagora 5800 Pleven 7000 Rousse 6000 Stara Zagora 1, Pirot Str. 22, Slavyanska Str. 79, Knyaz Boris Str. Tel.: (+ 359 64) 89 44 11 Tel.: (+ 359 82) 82 32 00 Tel.: (+ 35942) 60 40 88 Fax: (+ 359 64) 80 43 94 Fax: (+ 359 82) 82 15 97 Fax: (+ 35942) 60 44 98

Pleven 2 Sandanski Stara Zagora – Zagorka 5800 Pleven 2800 Sandanski 6000 Stara Zagora 2, Tzar Boris III, Str. 4, General Todorov Str. Zagorka AD Tel.: (+ 359 64) 80 33 34 Tel.: (+ 359 746) 3 27 04 41, Han Asparuh Str. Fax: (+ 359 64) 80 34 70 Fax: (+ 359 746) 3 27 03 Tel.: (+ 359 42) 60 55 18

Plovdiv 1 Sevlievo Stara Zagora Bagira 4000 Plovdiv 5400 Sevlievo 6000 Stara Zagora 5, Avksentii Veleshki Str. 1, Svoboda Square 39, P. Evtimii Blvd. Tel.: (+ 359 32) 60 12 71 Tel.: (+ 359 675) 3 12 13 Tel.: (+ 359 42) 63 60 96 Fax: (+ 359 32) 62 99 66 Fax: (+ 359 675) 3 30 91

62 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Branch Network in Bulgaria

Stara Zagora 2 Others: 6000 Stara Zagora 67, Tzar Simeon Veliki Str. Raiffeisen Leasing Tel.: (+ 35942) 60 20 43 Bulgaria OOD Fax: (+ 35942) 60 19 94 1715 Sofia Business Park Sofia, Targovishte Building 11A 7700 Targovishte Tel.: (+ 359 2) 970 79 79 2, Preslav Str. Fax: (+ 359 2) 974 20 57 Tel.: (+ 359 601) 6 95 53 Fax: (+ 359 670) 6 93 03 Raiffeisen Asset Management Troyan 1504 Sofia 5600 Troyan 18-20, Gogol Str. 1, Rakovski Square Tel.: (+ 359 2) 919 85 452 Tel.: (+ 359 670) 6 09 77 Fax: (+ 359 2) 943 33 65 Fax: (+ 359 670) 6 09 77 Raiffeisen Direct – Call Centre Haskovo 1715 Sofia 6300 Haskovo Business Park Sofia, 1-3, Pirin Str. Building 11A Tel.: (+ 359 38) 60 47 12 Tel.: 0 700 10 000 Fax: (+ 359 38) 66 47 21 Fax: (+359 2) 974 20 24 Shumen 9700 Shumen 97, Tzar Osvoboditel Str. Tel.: (+ 359 54) 83 20 60 Fax: (+ 359 54) 83 07 57

Yambol 8600 Yambol 15, Vasil Karagyozov Str. Tel.: (+ 359 46) 66 41 64 Fax: (+ 359 46) 66 41 75

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 63 Selected RZB Group-members

Addresses and Contacts for the selected members of the Raiffeisen International Group

Raiffeisen Bosnia and Herzegovina Czech Republic

International Raiffeisen Bank d.d. Raiffeisenbank a.s. Bank-Holding AG Bosna i Hercegovina Olbrachtova 2006/9 Danijela Ozme 3, 71000 Sarajevo 140 21 Praha 4 Austria (Head Office) Phone: (+387-33) 287 100 Phone: (+420) 221 141 111 Am Stadtpark 9, 1030 Wien Fax: (+387-33) 213 851 Fax: (+420)221 142 111 Phone: (+43-1) 71 707-3504 SWIFT/BIC: RZBABA2S SWIFT/BIC: RZBCCZPP Fax: (+43-1) 71 707-1377 www.raiffeisenbank.ba www.rb.cz www.ri.co.at Contact: Edin Muftic Contact: Lubor Zalman Contact: Roman Hager [email protected] [email protected] [email protected] 68 banking outlets 50 banking outlets

Bulgaria Banking Network Hungary in Central and Raiffeisenbank (Bulgaria) E.A.D. Raiffeisen Bank Zrt. Eastern Europe 18/20 Gogol Ulica, 1504 Sofia Akadémia útca 6, 1054 Budapest Phone: (+359-2) 9198 5101 Phone: (+36-1) 484 4400 Albania Fax: (+359-2) 943 4528 Fax: (+36-1) 484 4444 Raiffeisen Bank Sh.a. SWIFT/BIC: RZBBBGSF SWIFT/BIC: UBRTHUHB Rruga Kavajes, Tirana www.rbb.bg www.raiffeisen.hu

Phone: (+355-4) 274 912 Contact: Momtchil Andreev Contact: Eva Felegyhazi [email protected] Fax: (+355-4) 230 013 [email protected] SWIFT/BIC: SGSBALTX 74 banking outlets 99 banking outlets www.raiffeisen.al

Contact: Steven Grunerud Croatia Kosovo [email protected] Raiffeisenbank Austria d.d. Raiffeisen Bank Kosovo J.S.C. 87 banking outlets Petrinjska 59, 10000 Zagreb Rruga UÇK 51, Priština Phone: (+385-1) 456 6466 Phone: (+381-38) 226 400 Belarus Fax: (+385-1) 481 1624 Fax: (+381-38) 244 193 Priorbank, JSC SWIFT/BIC: RZBHHR2X SWIFT/BIC: RBKOCS22 31–A, V. Khoruzhey Str. www.rba.hr www.raiffeisen-kosovo.com

Minsk, 220002 Contact: Lovorka Penavic Contact: Oliver Whittle [email protected] Phone: (+375-17) 289 9087 [email protected] Fax: (+375-17) 289 9191 39 banking outlets 29 banking outlets SWIFT/BIC: PJCBBY2X www.priorbank.by

Contact: Olga Gelakhova [email protected] 43 banking outlets

64 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Selected RZB Group-members

Malta Russia Slovenia

Raiffeisen Malta Bank plc ZAO Raiffeisenbank Austria Raiffeisen Krekova banka d.d. 71, II-Piazzetta, Tower Road Troitskaya Ul. 17/1 18 Slomskov trg, 2000 Maribor Sliema SLM 16, Malta 129090 Moskwa Phone: (+386-2) 229 3100 Phone: (+356) 2132 0942 Phone: (+7-495) 721 9900 Fax: (+386-2) 252 4779 Fax: (+356) 2132 0954 Fax: (+7-495) 721 9901 SWIFT/BIC: KREKSI22 Contact: Anthony C. Schembri SWIFT/BIC: RZBMRUMM www.r-kb.si [email protected] www.raiffeisen.ru Contact: Zoran Nemec

Contact: Johann Jonach [email protected] Poland [email protected] 13 banking outlets 27 banking outlets Raiffeisen Bank Polska S.A. Ul. Piêkna 20, 00-549 Warszawa Ukraine Phone: (+48-22) 585 2000 Serbia and Montenegro JSCB Raiffeisenbank Ukraine Fax: (+48-22) 585 2585 Raiffeisenbank a.d. 43, Zhylyanska vul., 01033 Kyiv SWIFT/BIC: RCBWPLPW Bulevar AVNOJ-a 64a Phone: (+38 044) 490 05 00 www.raiffeisen.pl 11070 Novi Beograd Fax: (+38 044) 490 05 01

Contact: Piotr Czarnecki Phone: (+381-11) 320 2100 SWIFT/BIC: RZBUUAUK [email protected] Fax: (+381-11) 220 7080 www.rbua.com 83 banking outlets SWIFT/BIC: RZBJCSBG Contact: Leonid Zyabrev www.raiffeisenbank.co.yu [email protected] Romania 39 banking outlets Contact: Oliver Rögl

Raiffeisen Bank S.A. [email protected] JSPP Bank Aval 45 banking outlets Piata Charles de Gaulle 15 9, Leskova vul., 01011 Kyiv 011857 Bucuresti 3 Phone: (+38 044) 490 88 88 Phone: (+40-21) 306 1000 Slovakia Fax: (+38 044) 295 32 31 Fax: (+40-21) 230 0700 SWIFT/BIC: AVAL UA UK Tatra banka, a.s. SWIFT/BIC: RZBRROBU Hodzovo námestie 3 www.aval.ua www.raiffeisen.ro 811 06 Bratislava 1 Contact: Leonid Zyabrev

Contact: Steven C. van Groningen Phone: (+421-2) 5919 1111 [email protected] [email protected] Fax: (+421-2) 5919 1110 1,342 banking outlets 216 banking outlets SWIFT/BIC: TATRSKBX www.tatrabanka.sk

Contact: Rainer Franz [email protected] 136 banking outlets

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 65 Selected RZB Group-members

Raiffeisen-Leasing Croatia Poland

International Raiffeisen Leasing d.o.o. Raiffeisen-Leasing Polska S.A. Froudeova 11a, Siget Ul. Jana PawIa II 78 Austria 10 002 Zagreb 00175 Warszawa Phone: (+385-1) 659 5000 Phone: (+48-22) 562 3600 Raiffeisen-Leasing International GmbH Fax: (+385-1) 659 5050 Fax: (+48-22) 562 3601 Am Stadtpark 9, 1030 Wien Contact: Miljenko Tumpa Contact: Marek Balawejder [email protected] [email protected] Phone: (+43-1) 71 707-2966 11 branches 52 branches Fax: (+43-1) 71 707-2059

Contact: Dieter Scheidl [email protected] Czech Republic Romania

Raiffeisen-Leasing, s.r.o. Raiffeisen Leasing SRL Belarus Olbrachtova 2006/9 Calea 13 Septembrie 90 14021 Praha 4 Grand Offices Marriott SOOO Raiffeisen Leasing 31A, V. Khoruzhey Str. Phone: (+420-2) 215 11 611 Grand Hotel 220002 Minsk Fax: (+420-2) 215 11 666 Sector 5, 76122 Bucuresti Contact: Richard Dvorák Phone: (+375-17) 289 9394 Phone: (+40-21) 403 3300 [email protected] Fax: (+375-17) 289 9394 Fax: (+40-21) 403 3298 11 branches Contact: Bernd Künzel Contact: Maksim Litisky [email protected] [email protected] Hungary 17 branches

Bosnia and Herzegovina Raiffeisen Lízing Rt. Russia Váci utca 81-85, 1139 Budapest Raiffeisen Leasing d.o.o. Phone: (+36-1) 298 8200 OOO Raiffeisen Leasing St. Branilaca Sarajeva 20 Fax: (+36-1) 298 8010 Nikoloyamskaya 13/2 71000 Sarajevo Contact: Pál Antall 109240 Moskwa Phone: (+387-33) 254 340 [email protected] Phone: (+7-495) 721 9901 Fax: (+387-33) 212 273 14 branches Fax: (+7-495) 721 9901 Contact: Belma Sekavic-Bandic [email protected] Contact: Jaroslaw Konczewski 5 branches Kazakhstan [email protected] 4 branches Raiffeisen Leasing Kazakhstan LLP Bulgaria Ul. Shevchenko 146, office 12 Serbia and Montenegro 1st floor, Almaty Raiffeisen Leasing Bulgaria OOD Phone: (+7-3272) 709 836 Raiffeisen Leasing d.o.o. Business Park Sofia Contact: Uwe Fisker Bulevar AVNOJ-a 45a Building 11, 2nd floor, 1715 Sofia [email protected] 11070 Beograd Phone: (+359-2) 970 7979 Phone: (+381-11) 301 6580 Fax: (+359-2) 974 2057 Fax: (+381-11) 313 0081 Contact: Ekaterina Hristova [email protected] Contact: Ralph Zeitlberger 10 branches [email protected] 5 branches

66 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement Selected RZB Group-members

Slovakia Raiffeisen Zentralbank United Kingdom

Tatra Leasing s.r.o. Österreich AG London Branch Tovarenska 10, 820 04 Bratislava 10, King William Street Tel.: (+421-2) 591 93 050 Austria (Head Office) London EC4N 7TW Fax: (+421-2) 591 93 048 Am Stadtpark 9, 1030 Wien Phone: (+44-20) 7933 8000 Contact: Igor Horvath Phone: (+43-1) 71 707-0 Fax: (+44-20) 7933 8099 [email protected] Fax: (+43-1) 71 707-1715 SWIFT/BIC: RZBAGB2L 8 branches SWIFT/BIC: RZBAATWW www.london.rzb.at

www.rzb.at Contact: Ian Burns Slovenia [email protected]

Raiffeisen Leasing d.o.o. China Tivolska 30 (Center Tivoli) U.S.A. 1000 Ljubljana Beijing Branch RZB Finance LLC Phone: (+386-1) 241 6250 Beijing International Club, 1133, Avenue of the Americas Fax: (+386-1) 241 6268 Suite 200 16th floor, New York, N.Y. 10036 Contact: Borut Bozic 21, Jianguomenwai Dajie Phone: (+1-212) 845 4100 [email protected] 100020 Beijing Fax: (+1-212) 944 2093 2 branches Phone: (+86-10) 6532 3388 Fax: (+86-10) 6532 5926 www.rzbfinance.com SWIFT/BIC: RZBACNBJ Contact: Dieter Beintrexler Real-estate Contact: Andreas Werner [email protected] Leasing Companies [email protected]

Czech Republic Singapore Representative Offices in Europe Raiffeisen Leasing Real Estate s.r.o. Singapore Branch Olbrachtova 2006/9 50, Raffles Place #45-01 Belgium 140 21 Praha Singapore Land Tower Singapore 048623 Phone: (+420-2) 215 11 610 Brussels Fax: (+420-2) 215 11 641 Phone: (+65) 6225 9578 Rue du Commerce 20–22 Contact: Alois Lanegger Fax: (+65) 6225 3973 1000 Bruxelles Contact: Rainer Silhavy [email protected] Phone: (+32-2) 549 0678 3 branches [email protected] Fax: (+32-2) 502 6407

Contact: Helga Steinberger Hungary [email protected]

Raiffeisen Inglatan Rt. Akadémia u. 6, 1054 Budapest Phone: (+36-1) 484 8400 Fax: (+36-1) 484 8404

Contact: Laszlo Vancsko [email protected]

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 67 Selected RZB Group-members

France Moldova Representative

Paris Chisinau (Raiffeisen Bank S.A.) Offices in America 9–11, Avenue Franklin Roosevelt 65 Stefan cel Mare blvd., and Asia 75008 Paris MD-2001, Chisinãu Phone: (+33-1) 4561 2700 Phone: (+373-22) 279 331 U.S.A. Fax: (+33-1) 4561 1606 Fax: (+373-22) 279 343 Chicago (RZB Finance LLC) Contact: David Mollerat Contact: Victor Bodiu 10 N. Martingale Road, Suite 400 [email protected] [email protected] Schaumburg, IL 60173 Phone: (+1-847) 466 1043 Germany Russia Fax: (+1-847) 466 1295 Frankfurt am Main Moscow Contact: Charles T. Hiatt Mainzer Landstrasse 51 14, Pretchistensky Pereulok [email protected]

D-60329 Frankfurt am Main Building 1, 119034 Moskwa Houston (RZB Finance LLC) Phone: (+49-69) 29 92 19-18 Phone: (+7-495) 721 9903 10777, Westheimer, Suite 1100 Fax: (+49-69) 29 92 19-22 Fax: (+7-495) 721 9907 Houston, TX 77042 Contact: Dorothea Renninger www.raiffeisen.ru Phone: (+1-713) 260 9697 [email protected] Contact: Evgheny Rabovsky Fax: (+1-713) 260 9602 [email protected] Contact: Stephen A. Plauche Italy [email protected]

Milan Sweden New York Via Andrea Costa 2 1133, Avenue of the Americas Stockholm 20131 Milano 16th floor, New York, NY 10036 Stureplan 4C Phone: (+39-02) 2804 0646 Phone: (+1-212) 593 7593 11435 Stockholm Fax: (+39-02) 2804 0658 Fax: (+1-212) 593 9870 Phone: (+43-1) 71 707-1588 www.rzb.it Contact: Dieter Beintrexler Fax: (+43-1) 71 707-76 1588 [email protected] Contact: Maurizio Uggeri Contact: Daniela Vorbeck [email protected] [email protected] China Lithuania Hong Kong Vilnius (Raiffeisen Bank Lippo Centre, 89 Queensway Polska S.A.) Unit 2001, 20th Floor, Tower 1 A. Jaksto Street 12, Hong Kong 01105 Vilnius Phone: (+85-2) 2730 2112 Phone: (+370-5) 266 6600 Fax: (+85-2) 2730 6028

Fax: (+370-5) 266 6601 Contact: Edmond Wong www.raiffeisen.lt [email protected]

Contact: Vladislovas Jancis [email protected]

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Zhuhai Vietnam Subsidiaries und representative Hangao Building 2003 offices in Belgrade, Bucharest, Ho Chi Minh City Fenghuang South Street 1030 6, Phung Khac Khoan Str., Istanbul, Kiev, Moscow, Xiangzhou District, Zhuhai District 1 Podgorica, Sofia and Warsaw. Guangdong Province Room G6, Ho Chi Minh City 519000 China Phone: (+84-8) 8297 934 Bosnia and Herzegovina Phone: (+86-756) 2213 075 Fax: (+84-8) 8221 318 Fax: (+86-756) 2213 165 Raiffeisen Bank d.d. Contact: Ta Thi Kim Thanh Contact: Susanne Zhang-Pongratz Bosna i Hercegovina [email protected] [email protected] Danijela Ozme 3, 71000 Sarajevo India Investment Banking Phone: (+387-33) 287 100 Fax: +387-33-213 851 Mumbai www.raiffeisenbank.ba 87, Maker Chamber VI Austria Nariman Point, Mumbai 400 021 Contact: Dragomir Grgic Phone: (+91-22) 5630 1700 Raiffeisen Zentralbank [email protected] Österreich AG Fax: (+91-22) 5632 1982 Fixed Income Contact: Anupam Johri Bulgaria [email protected] Am Stadtpark 9, 1030 Wien Phone: (+43-1) 71 707-3347 Raiffeisenbank (Bulgaria) E.A.D. Fax: (+43-1) 71 707-1091 18/20 Gogol str., 1504 Sofia Iran www.rzb.at Phone: (+359-2) 9198 5451 Tehran Fax: (+359-2) 943 4528 Contact: Christian Säckl Vanak, North Shirazi Avenue [email protected] www.rbb.bg 16, Ladan Str., 19917 Tehran Contact: Evelina Miltenova Raiffeisen Centrobank AG Phone: (+98-21) 804 6767-2 [email protected] Equity Fax: (+98-21) 803 6788 Tegetthoffstr. 1, 1015 Wien Ansprechpartner: Gerd Wolf Croatia [email protected] SWIFT/BIC: CENBATWW Phone: (+43-1) 51 520-0 Raiffeisenbank Austria d.d. South Korea Fax: (+43-1) 513 4396 Petrinjska 59, 10000 Zagreb www.rcb.at Phone: (+385-1) 456 6466 Seoul Contact: Eva Marchart Fax: (+385-1) 456 6490 Leema Building, 8th floor [email protected] www.rba.hr 146-1, Soosong-dong Chongro-ku, 110-755 Seoul Raiffeisen Investment AG Contact: Ivan Zizic [email protected] Phone: (+822) 398 5840 Advisory Fax: (+822) 398 5807 Tegetthoffstr. 1, 1015 Wien

Contact: Kun II Chung Phone: (+43-1) 710 5400-0 [email protected] Fax: (+43-1) 710 5400-39 www.riag.at

Contact: Heinz Sernetz [email protected]

Awards Social Responsibility Management RZB Group RLBG RAM Addresses www.rbb.bg 69 Selected RZB Group-members

Czech Republic Romania Slovenia

Raiffeisenbank a.s. Raiffeisen Capital & Investment S.A. Raiffeisen Krekova banka d.d. Olbrachtova 2006/9 Unirii Blvd. 74 Slomskov trg 18, 2000 Maribor 140 21 Praha 4 030837 Bucuresti 3 Phone: (+386-2) 229 3111 Phone: (+420) 221 141 863 Phone: (+40-21) 302 0082 Fax: (+386-2) 252 5518 Fax: (+420) 221 143 804 Fax: (+40-21) 320 9983 www.r-kb.si

www.rb.cz www.raiffeisen.ro Contact: Gvido Jemensek

Contact: Martin Bláha Contact: James Stewart [email protected] [email protected] [email protected]

Ukraine Hungary Russia Raiffeisen Investment TOV Raiffeisen Bank Rt. ZAO Raiffeisenbank Austria 43, Zhylyanska Str., 01033 Kyiv Akadémia útca 6, Troitskaya Ul. 17/1 Phone: (+38-044) 490 6898 1054 Budapest 129090 Moskwa Fax: (+38-044) 490 6899 Phone: (+36-1) 484 4400 Phone: (+7-495) 721 9900 Contact: Vyacheslav Yakymuk Fax: (+36-1) 484 4444 Fax: (+7-495) 721 9901 [email protected] www.raiffeisen.hu www.raiffeisen.ru

Contact: Gábor Liener Contact: Pavel Gourine [email protected] [email protected]

Poland Serbia and Montenegro

Raiffeisen Investment Polska Raiffeisen Investment AG Obilicev venac 27/II Sp.z o.o. 11000 Beograd Ul. Piêkna 20, 00-549 Warszawa Phone: (+381-11) 328 1638 Phone: (+48-22) 585 2900 Fax: (+381-11) 262 3542 Fax: (+48-22) 585 2901 Contact: Tatjana Terzic www.riag.at [email protected]

Contact: Marzena Bielecka [email protected] Slovakia

Tatra banka, a.s. Hodzovo námestie 3 811 06 Bratislava 1 Tel.: (+421-2) 5919 1111 Fax: (+421-2) 5919 1110 www.tatrabanka.sk

Contact: Igor Vida [email protected]

70 www.rbb.bg Statement by the Chairman Management Report Segment Reports Auditors’ Report Financial Statement