Annual Report Key Figures

Wiener Städtische (Individual Accounts) 1999/in AT S 1998/in AT S

Gross Premiums Earned (in millions) 18,456 17,709 e 1,341.2

– Property & Casualty Insurance (in millions) 8,154 8,406 e 592.6

– Health Insurance (in millions) 3,260 3,201 e 236.9

– Life Insurance (in millions) 7,043 6,102 e 511.8

Combined Ratio (Property & Casualty) (in %) 105.2 102.9 Financial Results (in millions) 4,875 5,051 e 354.3

Earnings from Ordinary Activities (in millions) 435 784 e 31.6

Investments (in millions) 83,981 80,124 e 6,103.1

Underwriting Provisions (in millions) 71,806 67,305 e 5,218.3

Capital and Reserves (in millions) 10,270 10,084 e 746.3

Number of Employees 4,030 4,096 – Office Staff 1,997 2,045 – Field Staff 2,033 2,051 Number of Branch Offices 171 171 Contents

Introduction 2 Wiener Städtische AG Annual Financial Statements Company Bodies 4 Balance Sheet 6 6 P rofit & Loss Account 7 2 Wiener Städtische AG Status Report Separate Income Statement for Economic Situation in 1999 9 Auto Third Party Liability Insurance 7 9 Wiener Städtische in 1999 1 2 A p p e n d i x 8 0 P ro p e rty & Casualty Insurance 1 7 A u d i t o r’s Cert i f i c a t e 9 2 Health Insurance 2 0 L i f e / P e n s i o n s 2 2 Consolidated Annual Financial Statements I n v e s t m e n t s 2 4 Balance Sheet 9 8 S t a ff/Socio-economic Issues 2 8 P rofit & Loss Account 1 0 2 C u rrent Situation and Outlook 3 1 A p p e n d i x 1 0 7 A u d i t o r’s Cert i f i c a t e 1 2 1 Supervisory Board Report 35 Contact Information 128 Group Status Report G roup Status Report 3 8 Investor Relations 131 The Group (Diagram) 4 2 Donau Ve r s i c h e ru n g 4 4 About this Publication 132 Vo l k s f ü r s o rge Jupiter 4 6 Union Ve r s i c h e ru n g 4 7 M o n t a n v e r s i c h e ru n g 4 8 CA Ve r s i c h e ru n g 5 1 K a p i t a l &We rt Ve rm ö g e n s v e rwaltung AG 5 2 Kooperativa Praha 5 4 Kooperativa Bratislava 5 5 InterRisk Wi e s b a d e n 5 6 H e ros S.A. 5 8 Union Biztosító Rt. 5 9 Wiener Städtische osiguranje d.d. 6 0 Wiener Städtische Italy 6 1 Vienna Life Liechtenstein 6 1 C u rrent Situation and Outlook 6 2

99 1 and transportation insurance operations. As one Introduction of our strategic goals is to step up our core activity of insurance, we intend to make similar acquistions in other markets as we expand. The 175th birthday of Wiener Städtische, on 24 December 1999, fell during a period of rapid P roduct sales is another area where the insur- economic and social change. In the course of its ance industry will face major challenges over the long history the company has come under thre a t next few years. With this in mind, it is vital that we f rom various external forces, including war, become an information company. Like many economic crisis and the Nazi dictatorship, but other industries, insurance companies are just these days our biggest challenge is change. The s t a rting to become Internet companies, and in company as a whole, our employees and the some cases may not yet have fully grasped the management team must rise to that challenge. need to adjust to the new opportunities. Wi e n e r Städtische was the first Austrian insurance com- Like other industries, the insurance business is pany to offer customers the option of buying u n d e rgoing concentration to an unfore s e e n polices online. We are well aware of the impor- d e g ree. Several venerable insurance companies tance of Internet sales and are taking all the – some of them over 100 years old – became the a p p ropriate measures. Our organizational stru c- t a rgets of either friendly or hostile acquisitions t u re and task chains are already geared toward s and were subsumed into large global units. m o re open company processes, integrating new Others, including several famous pro p e rty insur- media into operations and generating additional ers and re i n s u rers, have withdrawn from cert a i n customer benefits. a reas of insurance. They believe their future lies exclusively in asset management, where invest- Another major challenge in sales is to step up ment risk is transferred to the investor, rather selling via intermediaries. In the retail sector, than in carrying risk. The factors driving this tre n d many brand name manufacturers have lost con- a re the plunge in premiums in certain areas of the t rol over how their products are sold, due to con- business in recent years and the resulting negati- centration. Similarly, sales channels are start i n g ve underwriting re s u l t s . to play a greater role in the insurance industry. In many areas of insurance, alternative sales org a- H o w e v e r, while some companies have withdrawn nizations or independent brokers are now more f rom specific areas of insurance, others have i m p o rtant than traditional employed field staff . seized the opportunity to pursue growth, even in The traditional direct relationship between the l a rgely saturated markets, and to exploit econo- i n s u red party and the insurance company has mies of scale. become less significant than the insure d p a rt y / i n t e rm e d i a ry relationship. This has an At Wiener Städtische, we have made good use of impact on companies’ task chains, as an inter- our opportunities. In 1999, Montanversicheru n g , m e d i a ry ’s expectations concerning pro c e s s i n g a Group company, acquired Basler Ve r s i c h e- and customer service often differ from those of rungs-Aktiengesellschaft's Austrian industrial the insured part y.

2 99 F rom left to right: Chairman of the Board of Management Dr. Siegfried Sellitsch; Vi c e - C h a i rman Dr. Günter Geyer; Vi c e - C h a i rm a n D r. Franz Lauer; Dkfm. Karl Fink, Dire c t o r, Board of Management; Heinz Jaindl, Dire c t o r, Board of Management; Ing. Mag. Robert L a s s h o f e r, Dire c t o r, Board of Management.

In light of these developments, Wiener Städtische e ff o rts to change are likely to have change impo- continued to pursue a consistent strategy in ’99. sed on them. We stepped up our international operations and b o l s t e red our position in the domestic market. The Board of Management would like to thank Thanks to the support of the principal share h o l- the employees of Wiener Städtische and its d e r, we have sufficient capital to carry out planned G roup companies for their whole-hearted com- activities in the foreign markets where our mitment to implementing these changes, and for subsidiaries have operations, and have had no recognizing how crucial they are for our future . d i fficulty financing those activities. As a re s u l t , we can also aggressively pursue new goals and We also wish to thank our customers and busi- strategic alliances. To set up a life insurance ness partners for placing their confidence in us. company in Poland, for example, we found an In many cases we have enjoyed this trust for i m p o rtant partner in the European Bank for decades. They can rest assured that we will con- R e c o n s t ruction and Development (EBRD). tinue to offer products and services that are ap- p ropriate to the changing economic, social and We are in a position to form strategic alliances political conditions. h e re or abroad at any time, either at the Wi e n e r Städtische level or at the subsidiary level. We further appreciate the willingness of our share- H o w e v e r, we have certain specific re q u i re m e n t s , holders and investors to provide the capital both now and in the future: Alliances must n e c e s s a ry for our strategic development, based s t rengthen the Wiener Städtische Group, and on their belief in our ability to boost the value of they must not affect our status as an Austrian the company over the long term . insurance company. The search for new alliances is conducted not on the basis of looking for sup- The fact that 1999 was a successful year can be p o rt but rather as an exploration of potentially seen from this Annual Report of the Wi e n e r p rofitable opportunities that would not thre a t e n Städtische Allgemeine Ve r s i c h e rung Aktien- our historically successful and continually evolv- gesellschaft Group and Wiener Städtische All- ing company stru c t u re, and which could involve gemeine Ve r s i c h e rung Aktiengesellschaft. Wi t h the acquisition of competitors. 175 years as an insurance company under our belt, we can confidently look forw a rd to an equal- It is worth noting that, as discussed above, ly successful future . Wiener Städtische has stayed abreast of intern a- tional and domestic trends. We are pleased to The Board of Management point out that we had a successful year in ’99, in Austria as well as abroad. We are not afraid of change. We view it as an opport u n i t y. We are currently in the process of re o rganizing and re s t ru c- turing, so that we can meet change head on. As we enter the information age, speed is of the essence. Companies that fail to undertake active

99 3 D r. Johann S e re i n i g, Dire c t o r, Board of Company Management, Verbund Elektrizitäts-Wi rt s c h a f t

D r. Karl S k y b a, Senior Senate Councilman, Bodies C h a i rman of the Board of Management of Wi e n e r S t a d t w e r k e

S u p e rv i s o ry Board Employees’ Repre s e n t a t i v e s

C h a i rman: Paul A m b ro z y, Gmünd P resident Komm.-Rat Karl S a m s t a g, Vi c e - C h a i rman of the Board of Management of Renate D o r i n g e r, Linz (until 30 April 2000) Bank Austria AG Sylvia F i e d l e r, Vienna, 1st Vice-Chairperson of Vice Chairm a n : the Central Workers’ Council (until 31 January Komm.-Rat Dkfm. Klaus S t a d l e r, 2 0 0 0 ) C h a i rman of the Board of Management of Wi e n e r Holding AG Peter G r i m m, Graz, 2nd Vice-Chairperson of the Central Workers’ Council M e m b e r s : Abbot Präses Dr. Clemens L a s h o f e r, Göttweig Heinz N e u h a u s e r, Vi e n n a M o n a s t e ry Egon P i n z g e r, Ty rol (since 1 May 2000) N o r b e rt G r i n n i n g e r, Vi c e - C h a i rman of the Municipal Employees’ Trade Union Franz U r b a n, Vienna, Chairperson of the Central Workers’ Council D r. Alfred H o l o u b e k, Chairman of the Board of Management, Retire d Fritz Z i c k b a u e r, Vienna (since 1 Febru a ry 2000)

Ing. We rner K a s z t l e r, Chairman of the Board of Trustees in accordance with § 22, Management, Retire d Section 1, Insurance Companies Dipl.-Ing. Guido K l e s t i l S u p e rvision Act

Dkfm. Helmut M a y r R o b e rt F re i t a g, Vi c e - C h a i rman of the Board of Management of the Employees’ Pension Komm.-Rat Walter N e t t i g, President of the A s s o c i a t i o n Vienna Chamber of Commerce and Industry D e p u t y : Wolfgang Radlegger, Vice-Chairman of the Board E rnestine G r a ß b e rg e r, head of the Ottakring of Management of Bausparkasse Wüstenrot AG District Council in Vi e n n a

4 99 B o a rd of Management Ing. Mag. Robert L a s s h o f e r D i re c t o r, Board of Management Dkfm. Dr. Siegfried S e l l i t s c h B o a rd member since 1 July 1999 C h a i rm a n Responsible for: B o a rd member since 1979 Marketing, sales, provincial management, C h a i rman of the Board of Management since a d v e rt i s i n g 1 9 8 9 Responsible for: Dkfm. Hans R a u m a u f Strategic planning, group issues, finance, invest- D i re c t o r, Board of Management ments, holdings, public relations, intern a t i o n a l B o a rd member from 1991 to 30 June 1999 re l a t i o n s h i p s Responsible for: Marketing, sales, provincial management D r. Günter G e y e r Vi c e - C h a i rm a n Extended Board B o a rd member since 1988 Responsible for: The members of the Board of Management, Human re s o u rces, information and internal org a- p l u s : nization, real estate management and constru c- tion issues K u rt E b n e r Member of the Board of Management of Union D r. Franz L a u e r Ve r s i c h e ru n g s - A k t i e n g e s e l l s c h a f t Vi c e - C h a i rm a n B o a rd member since 1986 D r. Rudolf E rt l Responsible for: Member of the Board of Management of Donau T h i rd party liability insurance, legal expenses Allgemeine Ve r s i c h e ru n g s - A G insurance, auto insurance, non-life personal lines D r. Hans-Peter H a g e n Dkfm. Karl F i n k Member of the Board of Management of D i re c t o r, Board of Management Kooperativa Praha B o a rd member since 1987 Responsible for: Mag. Gerald H a s l e r Industrial and key-account customers, Member of the Board of Management of re i n s u r a n c e K a p i t a l & We rt Ve rm ö g e n s v e rwaltung AG

Heinz J a i n d l D i re c t o r, Board of Management B o a rd member since 1992 Responsible for: Life insurance, health insurance, accident in s u r a n c e

99 5 Status Report AG Economic % Increase in Indices for Selected Stock Markets (Basis: ATS) 25 0 Situation 20 0 15 0

As in previous years, the United States was a glo- 10 0 bal economic juggernaut in ’99, with 4.2% gro w t h . 50 In the first half of the year, Euroland achieved rather modest growth of 1.5% relative to the 0 comparable period in ’98. Its economy picked up in the second half of the year, however. As a result, real GDP grew by 2.2% (average for the EU as a whole), with a particularly pro n o u n c e d u p t u rn in investment activities and exports. cations, technology and biotech sectors, and

Consumer t h e re was a dispro p o rtionately large increase in Increase in % Real GDP Inflation Rate Price Index the volume of capital channeled into those A u s t r i a 2 . 2 0 . 6 0 . 5 s t o c k s .

G e rm a n y 1 . 5 0 . 6 0 . 6 Concentration in the Insurance Industry U S A 4 . 2 2 . 2 2 . 7 The insurance industry underwent major changes J a p a n 0 . 3 - 0 . 3 - 0 . 3 in the Nineties. For the first time, insurers in

Average for the EU 2 . 2 1 . 3 1 . 2 E u rope were also affected. Hardly a month went as a Whole by without another merger announcement. The S o u rce: Austrian Institute of Economic Researc h conditions for buying companies were extre m e l y favorable due to low interest rates and incre a s- Surging Stock Markets ingly liberalized access to markets. Companies On the stock markets, ’99 was a year of major took advantage of these factors and went in m e rgers and acquisitions. Indeed, Europe saw s e a rch of synergies, economies of scale, more m o re mergers than ever. The flurry of merg e r s tightly woven operations, better access to capi- and strong company results drove up the stock tal, and qualified employees. markets. Much of the impetus came from the US, which experienced an economic boom for the M e g a m e rgers became fairly commonplace. ninth year in succession. Notable examples were the AXA/UAP merger in ’96; Credit Suisse’s acquisition of Wi n t e rthur in New economy, high-growth stock markets such ’97; Generali’s acquisition of AMB; A.I.G.’s acqui- as the NASDAQ in New York and the Neuer Markt sition of Sunamerica in ’98; Aegon’s acquisition in Frankfurt posted re c o rd gains. In ’99, gains of of Transamerica; and Metropolitan Life’s acquisi- over 100% were not unusual in the telecommuni- tion of General American in ’99.

99 9 Increase in the Number of Natural Disasters bad year for space insurance: six satellites were The number of natural disasters in ’99 was lost, and insured losses of over ATS 10 billion unusually high. The large number of storms and w e re incurred. In aviation insurance insured loss- e a rthquakes made it the second most expensive es of about ATS 8 billion were incurre d . year in the history of insurance. According to a recent Munich Re Report, 755 natural disasters Austrian Economic Growth in Line o c c u rred, causing around ATS 1,400 billion in with EU Average economic losses, with nearly 100,000 lives lost. Although economic growth in Austria in the first The long-term trend is towards greater losses, half of ’99 was fairly modest (+1.2%), the econ- for two reasons: Population and assets are omy picked up in the fall. As a result, GDP gre w i n c reasingly concentrated in urban areas; and by 2.2% relative to ’98, which meant that Austria l a rge areas of land in vulnerable regions are kept pace with average growth in the EU as a being developed. Climate change, however, is w h o l e . not to blame. The aforementioned natural disasters involved insured losses of ATS 310 billion, Investments in Securities Proving Popular 80% of which were caused by storms. To p p i n g In ’99, volumes in funds managed by Austrian the list were the windstorms in We s t e rn and investment firms reached the one thousand Central Europe in December (Lothar and Mart i n ) , billion schilling mark. By the end of the year, which caused insured losses of around ATS 80 total volumes had reached ATS 1,034 billion, billion, followed by Typhoon Bart in Japan and an increase of 38.9% relative to ’98. Thus H u rricane Floyd in the US. Austria has one of the highest figures in Euro p e for fund volume growth. Equity funds fared Man-made technical disasters caused insure d p a rticularly well, posting more rapid growth than losses of ATS 58 billion. According to Swiss Re, the market as a whole: In ’99 equity fund vol- this is slightly below the 30-year average. Fire s umes rose by 106.4% to over ATS 159 billion. and explosions accounted for roughly ATS 36 That constitutes a market share of 15.4%. billion of these man-made losses. It was also a Equity investments in the euro zone were most p o p u l a r, accounting for two-thirds of equity fund investments. The dollar region accounted for In billion ATS Fund Volumes 30%. 1, 2 0 0 The Austrian Insurance Market 1, 0 0 0 The Austrian insurance market as a whole did 80 0 v e ry well in ’99. The figure for total pre m i u m s 60 0 written was ATS 151 billion, an increase of 7.3% 1, 0 3 4 relative to ’98. Benefits paid increased by 6.4% 40 0 744 to ATS 104.8 billion. In other words, pre m i u m s 567 20 0 432 and benefits both grew more rapidly than inflation 336 161 171 222 256 0 152 (inflation rate: 0.6%) and the overall Austrian 19 9 0 19 9 1 19 9 2 19 9 3 19 9 4 19 9 5 19 9 6 19 9 7 19 9 8 19 9 9 e c o n o m y.

10 99 Boom in Fund-linked Life Insurance Pre m i u m s Change Rel. Be n e f i t s Change Rel. In billion ATS Austrians have changed their savings and invest- Wri t t e n to ’98 Pa i d to ’98 ment habits in recent years: Investing savings in To t a l 1 5 1 . 0 + 7 . 3 % 1 0 4 . 8 + 6 . 4 % securities and funds has become far more popu- Property & Casualty 6 8 . 8 - 0 . 1 % 5 2 . 7 + 6 . 1 % l a r. Just five years ago, market participants had H e a l t h 1 5 . 6 + 1 . 6 % 1 1 . 7 + 0 . 8 % re s e rvations about fund-linked life insurance p roducts. Yet by 1999 a total of 18 insurance L i f e 6 6 . 6 + 1 7 . 9 % 4 0 . 4 + 8 . 4 % companies were active in this rapidly gro w i n g The Austrian Insurance Market in 1999 niche market. In ’99 alone, Austrian insurance S o u rce: Austrian Association of Insurance Companies companies’ premium income in the fund-linked life insurance sector grew by about 92.1%. AT S 4.9 billion was paid into fund-linked policies, which re p resents 7.3% of total life insurance premiums written.

Auto Insurance: A Problem Child The auto insurance sector is experiencing major p roblems. Premium income is falling, the number of accidents is rising and the price of repairs is i n c reasing. In ’99, premium income in the auto t h i rd party liability sector fell 5.6%, while benefits paid grew by 4.8%. Since 1994, the average premium has fallen by about 23%, while the loss ratio has risen steadily to its current level of 86% (as compared with 73% in ’94).

99 11 million 435 were generated, as compared with ATS Wiener 784 million in 1998.

175th Anniversary Städtische In ’99 Wiener Städtische celebrated its 175th year of existence as an Austria-based insurance and in 1999 financial services company. Customers, employees, key business people and leading artists and intellectuals were invited to the celebrations. As a In ’99, Wiener Städtische’s earned premiums from gesture of gratitude, we have been offering loyal primary insurance rose 5.8% to ATS 17,775 million customers special profit distributions, premium- (total for all operations). However, our volume of free insured sums and discounts on premiums indirect business fell 24.4% to ATS 681 million. Life totalling ATS 120 million. We also sponsore d insurance accounted for ATS 6,811 million various social, scientific and cultural organizations (+15.5%), health insurance for ATS 3,254 million throughout Austria. (+1.8%), and property & casualty for ATS 7,710 million of earned premiums from primary insurance. In From Fire Insurance Company to Group with auto insurance operations, premium volume fell International Operations 3%. However, in non-auto property insurance op- The roots of Wiener Städtische in its present form erations it rose by 1.9%. Premium volume in acci- date back to 24 December 1824, when Georg dent insurance increased by 4.4%. Ritter von Högelmüller founded Wechselseitige k.k. privil. Brandschaden-Versicherung-Anstalt.

In million ATS 1 9 9 9 Change Rel. to 1998 In the course of the 20th century, Wiener Städtische G ross Premiums Earn e d 1 8 , 4 5 6 + 4 . 2 % took shareholdings in various companies and expanded to become a Group with operations all E x p e n d i t u res on Claims 1 6 , 2 2 7 + 6 . 1 % over Central Europe. In ’92, its insurance opera- Operating Expenses 4 , 6 6 3 + 5 . 6 % tions were combined to form Wiener Städtische E a rnings from Ord i n a ry Activities 4 3 5 - 4 4 . 5 % Allgemeine Ve r s i c h e rung Aktiengesellschaft. It went public in ’94, issuing preferred stock with a Capital Investments 8 3 , 9 8 1 + 4 . 8 % par value of ATS 135 million. Wiener Städtische Key Figure s Redesigned Website In ’98, disposal of participating interests helped In the fall of ’99 we completely revamped our web- boost the result. However, in ’99 extraordinary site (www.wienerstaedtische.at). We now off e r write-downs associated with mandatory fair-mar- customer service via the site, and customers and ket-value appraisals of real estate (carried out for web users can also use it to make payments or the first time) had to be posted, and higher obtain information. We became the first Austrian in- commissions had to be paid on new business. As surance company to offer customers the option of a result, earnings from ordinary activities of ATS obtaining information, filing applications, making

12 99 payments and settling claims via the Internet. Our website, which was first set up in 1995, attracts 100,000 visitors per month.

Wiener Städtische Preferred Stock At the extraord i n a ry shareholders’ meeting of Wiener Städtische AG held on 16 September 1999, a resolution was passed authorizing the Board of Management to buy back treasury stock. This will enable us to react flexibly to future challenges.

Wiener Städtische Ve r s i c h e rung AG pre f e rre d stock has been listed on the Vienna Stock Exchange since October ’94. In ’99, a year in which the Vienna stock market as a whole posted a weak performance, our preferred stock fared well, rising 10.9% to EUR 112.4. So far in 2000 it has once seventh largest capital investment firm. The two again bucked the trend on the Vienna stock market biggest funds open to the general public are and is performing well. Vorsorge Rentenfonds, which invests in bonds issued by prime borrowers, and VIF Fonds, which Investing for Customers focuses on international insurance equities. In ’99, Ringturm Kapitalanlagegesellschaft, which Ringturm KAG also manages special funds for is owned by Wiener Städtische, Bank Austria and institutional investors, including Wiener Städtische. Österreichische Beamtenversicherung, boosted its fund volume by 39.3% to ATS 33.1 billion. That At the beginning of 2000, Ringturm KAG launched gives it a market share of 3.2%, making it Austria’s two new pension investment funds and the Ringturm Blue Chip fund of funds, which invests in future-oriented industry funds. All three funds are components of Wiener Städtische’s fund-linked- type Double Pension.

14 99 Property & Casualty Insurance

The auto, pro p e rt y, third party liability and accident insurance business units fared very diff e r- ently from one another in ’99. The non-auto business units boosted premium income and thus posted improved results. By contrast, in the auto business units premiums fell and the loss ratio rose. The pro p o rtion of pro p e rty & casualty d i rect impact on company results for two re a s- business accounted for by the auto business unit ons: This business unit is only re i n s u red against fell to 38%. A few years ago it amounted to near- e x t reme losses; and the higher claims costs had ly 50 % . an impact on results from retained business due to the current claims stru c t u re . Tough Competition in Auto Insurance Although the number of policies in force in the auto insurance business unit rose from 664,879 In ATS Auto Third Party Liability Premiums and Auto Policies in Force to 689,199, the average premium fell. Since 1995, the average in-force premium in our auto 6, 0 0 0 11 4 % 111.4 t h i rd party liability business unit has fallen by 5, 0 0 0 11 1 % 4,657 109.3 4,539 4,201 24.6%, while the average in-force premium in our 4, 0 0 0 10 8 % 10 7 . 0 3,791 auto comprehensive coverage business unit has 3,511 fallen by 19.1%. 3, 0 0 0 10 5 % 2, 0 0 0 10 2 % Auto Claims Becoming More Expensive 1, 0 0 0 100.0 10 0 . 2 99 % Benefits paid in the auto business unit rose fro m ATS 2,081 million to ATS 2,214 million. Ve h i c l e 0 96 % 19 9 5 19 9 6 19 9 7 19 9 8 19 9 9 technology is becoming increasingly complex, and the average hourly rate for bodywork and • Average premium for third party liability insurance • Policies in force painting is rising steadily. Labor costs now account for 54% of total repair costs and have Premium Income Up in Many Business Units risen by about 4% relative to ’98, far outstripping Premium income in accident insurance rose an the ’99 consumer price index (0.6 %). Expen- encouraging 4.4%, thanks to the Multi Unfallschutz d i t u res on claims in the auto business unit had a product launched in ’98 and the annual index

99 17 curred by an aviation company with a comprehen- In million ATS 1 9 9 9 Change Rel. to 1998 sive aviation policy. It should be noted that in the G ross Premiums Earn e d 8 , 1 5 4 - 3 . 0 % event of substantial claims large portions of the benefits are paid by our re i n s u rers, which is E x p e n d i t u res on Claims 5 , 9 1 8 - 1 . 6 % obviously to our advantage in terms of our overall Operating Expenses 2 , 6 7 4 + 1 . 5 % results. E a rnings from Ord i n a ry Activities -9 1 - 1 5 7 . 6 % Indirect Business Number of Policies in Forc e 1 , 6 8 8 , 5 4 2 – E a rned premiums from inwards reinsurance fell Key Figures for the Pro p e rty & Casualty Division f rom ATS 543 million to ATS 322 million. In ’99 we continued to pursue a strategy whereby Gro u p adjustment. Premium income in household and companies and selected partners are the only com- homeowners’ insurance also rose. The new gen- panies for which we provide inwards re i n s u r a n c e . eration of Haushalt-System and Haushalt-System- Plus products are geared towards quality, which is ATS 1,058 million worth of premiums (’98 figure : finding increasing acceptance among customers. ATS 965 million) were ceded as part of intern a- Despite the drop in prices in fire and fire/shutdown tional plans. Reinsurance as a whole has become insurance, premium income was up in that busi- m o re expensive, as loss experience on ceded ness unit as well, thanks to improved customer ori- risks has deteriorated over the last few years. To entation and modifications made to products over counteract this, we are taking action to impro v e the last few years. As in recent years, Wiener the quality of our in-force business. The above Städtische is a leading provider of international f i g u res do not include the portion of re i n s u r a n c e insurance plans for Austria’s biggest industrial resulting from re p o rting indire c t - l i k e - d i rect co- companies. In the storm damage insurance busi- insurance as reinsurance (mandatory since ness unit premium income rose 6.5%. This may 1996). In 2000 we took further reinsurance mea- therefore be considered a growth area, in line with s u res to cover disasters. The storm damage that the trend of the last few years. o c c u rred in France, Germany and western Austria at the end of ’99 proved the import a n c e Stabilized Results from Retained Business of reinsurance measures of this kind. In non-auto operations, benefits paid fell from ATS 3,098 million to ATS 3,092 million. This was thanks to stable loss ratios in accident, third party liability and household operations, and a drop in benefits paid in fire insurance, despite some very substantial claims. The biggest losses in ’99 included ATS 200 million in fire damage at a trans- former plant in the United Kingdom; an ATS 50 million claim relating to machinery at a paper manufacturer with international operations; and roughly ATS 100 million in hailstorm damage in-

18 99 membership or a health check-up. Besser Leben He a l t hI n s u r a n c e also provides him/her with various services in the event of hospitalization.

In ’99, Wiener Städtische generated earned pre m i- More Hospitalizations um income of ATS 3,260 million from health insur- In ’99 benefits rose by 2.7% relative to ’98. This ance operations. We now have an appro x i m a t e l y was mainly due to the recent sharp increase in 22% share of the health insurance market, having the number of hospitalizations, despite the de- b o l s t e red our position as Austria’s No. 2 health cline in the cost of hospitalization. The gro w i n g insurance pro v i d e r. These strong premium income number of hospitalizations was largely a result of f i g u res were largely thanks to our successful add- the introduction of perf o rmance-based hospital on products, Besser Leben and Bonus neu. O u r financing in ’97. Tag für Ta g rate (benefits are paid on a per- d a y - o f - hospitalization basis) is still selling well, too. The increase in benefits paid was due to the i n c rease in the number of hospitalizations and the resulting additional expenditures (notwith- Change Rel. In million ATS 1 9 9 9 to 1998 standing the slight drop in prices at public hospitals). Naturally it had an impact on premium cal- G ross Premiums Earn e d 3 , 2 6 0 + 1 . 9 % culations, and we there f o re had to hike the rates E x p e n d i t u res on Claims 3 , 0 1 8 + 0 . 5 % on our top-tier policies by an average of 3%.

Operating Expenses 4 9 9 + 9 . 8 % Commissions rose to ATS 59.9 million. This was E a rnings from Ord i n a ry Activities 1 5 + 4 0 0 . 0 % due to changes to the commission system: The Number of Policies in Forc e 8 0 4 , 3 7 4 – commission on our new products is higher and is

Key Figures for the Health Insurance Division

Successful New Products We have sold over 16,000 units of our Bonus neu rate since its launch in Febru a ry ’99. The B o n u s n e u rate generates premium income of ATS 8.2 million per year. It offers a no-claims bonus, plus exemption from premiums in the event of illness. In its first eight months our Besser Leben a d d - o n p roduct generated premium income of over AT S 13 million, from nearly 12,800 policies sold. This p roduct reflects our commitment to the gro w i n g t rend of customer health awareness. After a customer buys the product, he/she can choose between a wellness vacation, a fitness club

20 99 paid on a one-time basis, i.e., there is no commis- We already organize various medical lectures and sion for providing subsequent services. p resentations, which have proved very popular with customers. We will now be adding the option Opting Out of breast cancer and high blood pre s s u re check- Since the beginning of 2000, self-employed per- u p s . sons have been legally permitted to opt out of compulsory medical insurance, thanks to a change in Austria’s social insurance laws. Austrian veter- inarians, for example, have passed a resolution t o opt out (the resolution was passed with an 80% majority), and have set up a Wiener Städtische group health insurance scheme. Wiener Städtische has a 16% share of the market for group schemes for Austrian attorneys, notary publics and fiduciary a g e n t s .

Satisfied Customers A c c o rding to market re s e a rch conducted by K re u t z e r, Fischer & Partner in 1999, Wi e n e r Städtische ranks No. 2 among health insurers in t e rms of customer satisfaction (we currently have over 800,000 policies in force). In the future we intend to focus on providing specialist advice, a b road range of products and good customer service. In the summer of ’99 we became the first Austrian insurer to add the option of worldwide coverage to individual rate products. In addition, our private patient cards, which have been popular in Vienna for several years, can now be used t h roughout Austria, in the form of coupon books.

Trust is Good, Control is Better We intend to put these words into practice once again in 2000. In the summer, we will begin off e r- ing our Worldwide MED customers the option of receiving treatment anywhere in the world, pro v i- ded there are sufficient medical grounds. Wi e n e r Städtische will pay for the costs of treatment and travel, and will also make all the necessary a rr a n g e m e n t s .

99 21 planning product. Wiener Städtische re a l i z e d Life/Pensions early on that the third pillar of old-age re t i re m e n t planning would play an important role. In ’99 we launched two more innovative products: U n i t e d Life/Pensions Division Enjoying Funds of Success®, a fund-linked life insurance Healthy Growth p roduct; and the government-subsidized D o u b l e Wiener Städtische was one of the key players in P e n s i o n . A u s t r i a ’s growing life insurance market in ’99. Indeed, we increased our life/pensions pre m i u m Success Story of ’99 income by more than 15%, to ATS 7,043 million. United Funds of Success® is Austria’s most com- New one-time-premium business accounted for p rehensive fund-linked life insurance product. We ATS 2.2 billion of this; re g u l a r- p remium policies launched it in response to growing demand for accounted for ATS 4.8 billion. There was a marked life insurance products of this kind. United Funds shift towards private old-age provision pro d u c t s , of Success® includes 36 prime investment funds which now account for 39.1% of business in the and three funds of funds that in turn include ten division. Wiener Städtische has a long tradition of fund companies. The funds are of all kinds, e.g., p roviding private pension schemes, and this was money-market funds and emerging market equi- reflected in benefits paid: In ’99, over ATS 4.9 bil- ty funds. lion was paid to customers in the form of pension payments to protect income in old age and In ’99 Wiener Städtische generated premium in- endowment & whole life payments. The number come of ATS 246 million in fund-linked life insur- of people who receive pension payments fro m ance operations, as compared with ATS 20 million Wiener Städtische rose from 3,285 to 4,229. in ’98. Every tenth new life insurance customer opts for a fund-linked product. Fund-of-funds- The ongoing debate over pensions is no cause type products in the medium risk range are the for panic. Nonetheless, one should bear the follow- most popular. The average annual premium is ing in mind: Even if the name of a product con- ATS 24,000, which is twice as much as in classic tains the word “provision,” that product is not life insurance. necessarily designed as an old-age re t i re m e n t The typical buyer of this product is under 40 and, to an increasing extent, female: 35% of new Change Rel. In million ATS 1 9 9 9 to 1998 customers are women. Altogether, 75% of buyers

G ross Premiums Earn e d 7 , 0 4 3 + 1 5 . 4 % of re g u l a r- p remium fund-linked life insurance are under 40, and 55% are under 35. E x p e n d i t u res on Claims 7 , 2 9 1 + 1 6 . 2 %

Operating Expenses 1 , 4 9 0 + 1 5 . 8 % Double Pension

E a rnings from Ord i n a ry Activities 5 1 1 - 1 9 . 0 % To celebrate our 175th anniversary, we are doubling the government subsidy for 2000 by Number of Policies in Forc e 1 , 5 4 2 , 8 5 8 – o ffering a jubilee bonus to all customers who set Key Figures for the Life/Pensions Division up a policy by 31 March 2000. In addition to the

22 99 g o v e rnment subsidy, the Double Pension has a S t a rting on 1 January 2000, in addition to the number of other attractive features, e.g., the annual profit-sharing arrangement we are paying choice between a classic investment plan with a an extra 5% bonus to all pension plan part i c i- guaranteed pension amount and a fund-linked pants who have entered the pension payment plan; the option of protection for surv i v i n g phase. This is another of our 175th anniversary dependants; and a bridging pension for the peri- bonuses. Nor have we forgotten the youngsters: od leading up to the legally defined start of pen- E v e ry child born on 24 December 1999 in Austria sion payments. was entitled to receive a starter provision policy w o rth EUR 1,000 (ATS 13,760). About 180 Christmas babies benefited from this off e r. In million ATS Fund-linked Life Insurance

30 0

25 0

20 0

15 0

10 0

0 Re g u l a r On e - t i m e Tot a l pr emium policies pr emium policies • 1998 • 1999

In million ATS Classic Life Insurance

7, 0 0 0

6, 0 0 0

5, 0 0 0

4, 0 0 0

3, 0 0 0

2, 0 0 0

1, 0 0 0

0 Re g u l a r On e - t i m e Tot a l pr emium policies pr emium policies • 1998 • 1999

99 23 r a p i d l y, indirect ownership of participating inter- Investments ests and real estate also renders investment results more stable and less volatile.

Investments up 5.0% Ordinary Result Up Wiener Städtische AG’s investments rose 5.0% in We generated ATS 4,299 million in ord i n a ry in- ’99 to a total of ATS 83,981 million. Our investment come from investments, an increase relative to strategy has changed considerably over the last ’98 (’98 figure: ATS 3,846 million). few years, and we now place greater emphasis on securities. The securitization trend is very apparent The extraord i n a ry financial result reflects the in the loans segment, where we tend to replace ongoing volatility in stocks and intere s t - b e a r i n g loans with bonds or participation financing. i n s t ruments. For example, the yield on the 10- year government bond fell from above 4% in Investment certificates now account for an in- M a rch ’99 to 3.8%, and then rose again to 5.3% c reasing pro p o rtion (currently 36.8%) of the secu- in the second half of the year. Nevert h e l e s s , rities segment. When making new purchases, we thanks to intensive trading we managed to gener- diversify risk efficiently and invest in specific mar- ate ATS 1,962 million in extraord i n a ry earnings in kets and industries in a focused manner. the securities segment. However, we had to post book losses of ATS 1,070 million, mostly in the Replacing certain capital investments with dire c t bond segment, due to surging interest rates. possession and ownership relationships has p roved a sound business strategy in other seg- Real Estate Investments Stepped Up ments too. More o v e r, it tends to have a stabiliz i n g We continue to invest large sums in real estate. e ffect on investment results. As the basic con- Our real estate portfolio includes commerc i a l ditions in commercial and tax law are changing p rojects, office buildings, hotels, shopping centers, income pro p e rties and social institutions such as hospitals and homes for the aged with a total usable floor space of over 700,000 m2.

We also invest in real estate funds and real estate abroad. The European market is part i c u l a r l y attractive thanks to the advent of the euro . A c c o rd i n g l y, together with a German insurer we a c q u i red the Taunus Tower in Eschborn, near F r a n k f u rt, a modern high-rise office building and one of the most important real estate projects in the re g i o n .

In ’99 we were involved in various innovative re a l Securities Investment, by Category estate projects, including TechGate and Austria’s

24 99 write-downs on specific pro p e rties, so as to bring their book value in line with anticipated capitalized value. This dragged down results by ATS 550 million.

biggest business park, Campus 21 in Brunn am G e b i rge. Campus 21 is being built on a 21-hec- t a re lot, and when completed will consist of 180,000 m2 of office, service and ware h o u s e facilities. We have invested a total of ATS 2.2 billion in the project.

The book value of our classic real estate holdings is ATS 8,918 million, following profit-taking to the tune of ATS 244 million. Real estate accounts for about 11% of our managed assets. Accord i n g to recent appraisals, our real estate assets have a fair market value of about ATS 10.3 billion. Fair market value appraisals had to be carried out to fulfill legal re q u i rements. We made use of the situation by making extraord i n a ry

Change Rel. In million ATS 1 9 9 9 to 1998

O rd i n a ry Financial Result 4 , 2 9 9 + 1 1 . 8 %

E x t r a o rd i n a ry Financial Result 5 7 6 - 5 2 . 2 %

Financial Result 4 , 8 7 5 - 3 . 5 %

Total Investments at the End of the Ye a r 8 3 , 9 8 1 + 5 . 0 %

Investments: Key Figures

26 99 time administrative staff rose from 196 to 211 St a ff / S o c i o - during the year, which will give us more flexi- b i l i t y.

ec o n o m i c Is s u e s Our selection criteria for hiring new field employees remain tough. As a result, the number of As of the end of ’99 Wiener Städtische employed employees who provide on-site customer serv i c e 4,030 people, i.e., 66 fewer than at the begin- fell somewhat (by eight people since ’98). The ning of the year. The number of administrative l o n g - t e rm trend of declining office staff and an employees fell by 48 relative to ’98, due to re t i- i n c rease in field staff continued in ’99.

The drop in personnel levels was beneficial in t e rms of costs. Over the last five years, personnel costs have remained unchanged in absolute t e rms, and account for a shrinking pro p o rtion of total costs.

Employee productivity is rising steadily. In 1992, each employee generated premium volume of just under ATS 3.3 million on average, as com- p a red with nearly ATS 4.6 million in ’99.

During periods of rapid economic and social change, companies must employ highly qualified people if they want to remain successful. In ’99, rements of employees who have not been re p l a- our staff development activities focused on org a- ced. Improved use of synergies within the nizational learning geared towards two issues: G roup made this feasible. The number of part - the importance of long-term customer re l a t i o n- ships, and the need to orient every process to the c u s t o m e r. Change Rel. 1 9 9 9 to 1998

Salaries and Wages (in million AT S ) 1 , 6 9 4 + 1 . 4 % S t a ff trends at foreign Group companies are quite diff e rent from those at Wiener Städtische Number of Employees (Personnel) 4 , 0 3 0 - 6 6 and domestic Group subsidiaries. Markets in Administrative Employees (Personnel) 1 , 9 9 7 - 4 8 Central and Eastern Europe are growing rapidly,

Sales Employees (Personnel) 1 , 9 0 6 - 8 which makes it vital to increase on-site staff c a p a c i t y. In addition, management is focusing Sales Employees (Personnel) 1 2 7 - 1 0 on allowing decentralization and letting com- Personnel: Key Figures panies function as independent entities within

28 99 the Group. One of our core competencies is our ability to swap information and know-how within a multicultural network of companies. re t u rns from life insurance, as investment targ e t s Current will be unaffected. We anticipate just under double-digit growth in premium income from life insurance operations, thanks to our innovative Situation and fund-linked life insurance products (United Funds of Success®) and innovative pension plans Outlook (Double Pension).

The global factors affecting Austria’s economy are expected to improve in 2000. The US economy will remain strong and the European economy will pick up, boosted by the weak euro and strong domestic demand, particularly in France, Spain and a few of the smaller EU countries. Austrian exports will benefit from growth in foreign markets, and will be more competitive thanks to improved p roductivity and conservative wage policies. According to the Austrian Institute of Economic Research, the inflation rate will be 1.4%, i.e., considerably higher than in ’99, while real GDP will grow by 2.8%.

Continued Growth in the Life Insurance Source: Austrian Association of Insurance Companies Division Based on these forecasts, the outlook for the insurance industry is good. The tax re f o rms being We expect a 2% increase in premium income in implemented in 2000 are the first signs that the health insurance operations, thanks to the rate g o v e rnment has recognized the importance of changes made at the beginning of the year. private old-age provision. More o v e r, the debate over the future of government and private old-age Austria’s insurance market is saturated. We there- p rovision is still going on. Both these factors sug- fore do not anticipate any spectacular growth rates gest the life/pensions division will enjoy faster in the Property & Casualty Division. Premium hikes absolute growth than the other divisions. and elimination of discounts in auto insurance will Expectations re g a rding re t u rns from life insurance have a slight impact on premium income during the will remain positive over the long term, even coming year, but should have more far-reaching though the re g u l a t o ry authorities have stipulated effects in subsequent years. As in the past, certain that the permitted guaranteed cap rate be re d u c e d sub-business-units have growth potential, but total to 3.25% on 1 July 2000. In fact, that re d u c t i o n growth is unlikely to outpace the consumer price is no reason to lower expectations re g a rd i n g index by much.

99 31 Customer Service handled on-site in the presence of the customer. Recently launched products or upcoming products As part of this decentralization process, we will set now include special customer service features. In up customer service centers where volume busi- accident insurance, customers who pay the Multi ness can be handled quickly and in a customer- Unfallschutz rate established in ’98 receive exten- friendly manner. sive assistance in the event of a loss, e.g., we pay the costs of household-related services, child care As a result, we will have to further streamline our for the children of the house, or legal advice. Our administrative operations. By using cutting-edge new Besser Leben rate also includes special cus- data processing systems, we will be able to free up tomer assistance features. Our Business Class personnel who previously handled policy process- p roduct includes emergency and counseling ing in the back office. These personnel will be re- services, and we also pay the costs of renovation assigned to on-site customer service. and cleaning, renovation work following pipe leaks, roofing work following storm damage, or locksmith Results in 2000 services, up to the specified insured sum. Our In auto insurance operations, we should be able to Haushalt System Plus rate, launched in March ’99, i m p rove the underwriting result by eliminating entitles the insured party to Rasche Hilfe: Following various discounts and modifying rates. However, an insured loss event, we provide the insured party the full impact, including the impact on costs, will with information and arrange and pay for repairs, a only be felt over the medium term. We can only security guard or a locksmith. p rovide a very approximate forecast reg a rd i n g results, due to two factors: Capital markets are Sales in the 3rd Millenium highly volatile at the moment, and in recent years The world of insurance sales is changing rapidly, our overall result has become more heavily depen- and it is vital to take a broader view of personal dent on the financial result. insurance. As classic insurance becomes more closely interwoven with asset management, fund- Proposed Appropriation of Profits linked life insurance, investment counseling and Wiener Städtische Allgemeine Ve r s i c h e ru n g pension plans, sales methods are changing, too. Aktiengesellschaft ended the 1999 business year Full-time field staff still account for about 40% of with net income for the year of ATS 255,014,314.93 new business and remain by far our most important (EUR 18,532,613.02). At the ord i n a ry general sales channel. Nevertheless, selling via brokers has shareholders’ meeting the following appropriation grown in significance in recent years and now of profits will be proposed: accounts for about 20% of our new business. Inter- net sales will also be a growth area in the future. The 10,986,800 ord i n a ry shares will receive a dividend of EUR 1.31 per share. That re p re s e n t s Fast – Reliable – Service-oriented a total dividend payment of EUR 14,392,708 In order to safeguard future earnings potential, we to ord i n a ry shares. The 1,350,000 pre f e rred intend to carefully analyze all company structures s h a res will receive a dividend of EUR 2.18 and processes and orient them to customer needs. per share. That re p resents a total dividend pay- The aim is to enable all standard transactions to be ment of EUR 2,943,000 to pre f e rred shares.

32 99 Thus the total dividend payment is EUR amount of ATS 16,469,772.14 (EUR 1,196,905.02) 17,335,708 (AT S 238,544,542.79); the remaining is to be carried forward. net income for the 1999 business year in the

The Board of Management:

Dkfm. Dr. Sellitsch

Dr. Geyer Dr. Lauer

Dkfm. Fink Jaindl Ing. Mag. Lasshofer

Vienna, April 2000

34 99 c h a i rman and deputy chairman took the opport u- Supervisory nity to monitor how the company has been managed. This included repeated discussions with members of the Board of Management, who Board Report p rovided exhaustive explanations and pro o f , including books and re c o rds, re g a rding the man- The Superv i s o ry Board has received the 1999 ner in which the company has been managed. annual financial statements, along with the appendices and the Board of Management’s In 1999 an ord i n a ry and an extraord i n a ry general status re p o rts, and has inspected and thoro u g h- s h a reholders’ meeting and four Superv i s o ry ly examined them. After inspecting the afore- B o a rd meetings were held. mentioned documents, the Superv i s o ry Board resolved unanimously to approve the annual F u rt h e rm o re, the Superv i s o ry Board here b y financial statements pre p a red by the Board i n f o rms the general shareholders’ meeting that of Management and the Board of Manage- the 1999 annual financial statements and the sta- m e n t ’s proposal re g a rding the appropriation of tus re p o rts have been audited by the auditors p ro f i t s . KPMG Austria Wi rt s c h a f t s p r ü f u n g s - G e s e l l s c h a f t m.b.H., that the auditor’s re p o rt was re c e i v e d , Thus the annual financial statements for 1999 inspected and discussed by the Superv i s o ry have been appro v e d . B o a rd, and that the audit did not give rise to any objections re g a rding its findings. The Superv i s o ry F u rt h e rm o re, the Superv i s o ry Board hereby B o a rd also hereby states that it has nothing to states that it as a whole and in certain cases its add to the auditor’s re p o rt .

The Superv i s o ry Board there f o re

h e reby moves

that the general shareholders’ meeting pass a resolution re g a rding the appro p r i a t i o n of profits proposed by the Board of Management, and that it formally approve the actions of the Board of Management and the Superv i s o ry Board .

Vienna, May 2000

The Superv i s o ry Board :

Karl Samstag ( C h a i rm a n )

99 35

Group Status Report cused on growth markets in Austria’s neighbors in Group Status Central and Eastern Europe. The Group currently includes Kooperativa pojisˇt’ovna, a.s., Praha in the Czech Republic and Kooperativa poist’ovnˇ a, a.s., Report Bratislava in Slovakia. Both are well-established insurance companies and the second-largest in Group As a Whole their respective countries after the state-owned Preparation of Group annual financial statements insurers which formerly held monopolies. 1999 also for Wiener Städtische Allgemeine Ve r s i c h e ru n g saw the founding of new Group companies in Aktiengesellschaft is not mandator y. These Group Croatia and Liechtenstein. In Hungary, we acquired annual financial statements are based on the indi- a majority holding in Gloria Swiss Life Biztosító Rt., vidual annual financial statements of the compa- which, in the form of Union Biztosító Rt., will play a nies shown in the chart on pp. 42-43, and were key role in our internationalization strategy. Our p re p a red in accordance with § 244 of the initial entry into the Polish market involved acquir- Commercial Code. ing a majority holding in Heros S.A., and we are currently expanding our presence by setting up a Earnings-oriented Growth life insurance company there. Wiener Städtische’s ’99 strategy was geare d towards earnings-oriented growth in Austria and Looking for Niches in Western Europe abroad. We will continue to pursue that strategy Although the growth markets in the countries in over the next few years. At the end of ’98, to com- transition are our primary targets, we are also seek- plement our existing domestic susbsidiaries, ing more business in Western Europe. With this in Donau Allgemeine Versicherung-Aktiengesellschaft mind, in 2000 we acquired a majority holding in and Montanversicherung Aktiengesellschaft, and InterRisk Internationale Ve r s i c h e ru n g s h o l d i n g our existing domestic affiliated companies, Union GmbH in Wiesbaden and set up a branch office in Ve r s i c h e rung AG and Vo l k s f ü r s o rge Jupiter Italy. Allgemeine Ve r i s c h e rung Aktiengesellschaft, we acquired a 50% shareholding in CA Versicherung Vig o r ous Growth Should Mean Higher Earni n g s AG. As a result, we now have an even firmer foot- Wiener Städtische Allgemeine Ve r s i c h e ru n g ing in the Austrian life insurance market. In 1999, Aktiengesellschaft is currently experiencing vigor- the Group company Montanversicherung acquired ous growth. This is reflected in the increase in pre- the transportation and industrial insurance opera- mium income. Total Group premium income rose tions of Basler Versicherungs-Aktiengesellschaft. from ATS 29 billion to ATS 31.8 billion, an increase At the beginning of 2000, Donau acquired Sun of 9.7%. Foreign premium income rose from ATS Alliance Versicherungs AG. Thus, over the last few 3.4 billion to ATS 3.9 billion, an increase of 14.1%, years Wiener Städtische has made good use of the and thus increased more dramatically than domes- opportunities for growth within Austria. tic premium income. Growth varied from one insurance sector to the next. In domestic operations, Operations in Central and Eastern Europe the life insurance sector grew most rapidly, where- Wiener Städtische’s foreign strategy is mainly fo- as non-life was the main source of growth abroad,

38 99 Domestic Group Foreign Group Companies Companies

D 50 %

75.0 % SK 92.5 %

47.7 % CZ 96.7 %

33.3 % H 100 %

50.0 % PL 71.1 %

86.4 % HR 90 %

I 100 %

FL 100 %

due to local market conditions and because life ensure a surge in earnings over the next few years. insurance plays a lesser role in those countries. The claims situation in the Czech auto third party The financial result has become the principal mea- liability market, where Kooperativa has carved out sure of overall Group results, as reinsurance tends a 20% share of the market in just three months, will to stabilize earnings. Group results as a whole have considerable influence on Group earnings dropped off due to the drop in the financial result of from ordinary activities. The financial result will also Wiener Städtische Allgemeine Ve r s i c h e ru n g affect earnings from ordinary activities, though we Aktiengesellschaft itself. However, it is important to take appropriate reinsurance measures to offset note that the result was dragged down by one-time the potential impact of extreme developments on expenditures of ATS 70 million at Kooperativa earnings. Praha associated with preparations for demonop- olization of the Czech auto third party liability insurance market, and by expenditures associated with Wiener Städtische’s 175th jubilee. The investments we made in ’99 and early 2000, and ongoing efforts by individual companies to boost earnings, should

99 41 The Group

Wiener Städtische Consolidated Entity Wiener Städtische Allg. Versicherung AG

Pensions- CA Projektbau PFG kasse Versicherung Wals 60% 25% 30.12% 50% 60% 60%

60% 55% 66.7% 100% 86.4% 75% Center Seniorenres. Wiener 16.6% Pro g re s s Hotel Hold. Veldidenapark Verein Montan Donau

20% 33% 100% 80% Center RD- 17.5 Gewista Hotel Beteiligung

100%

LVP

60% 100% 100% 74% 100% 70.54%

TECH GATE Wr. Städtische Hotel Europa Vösendorf Seniorenres. Beteilig. GmbH Salzburg REAL Tech Realb. GmbH Fultererpark

100% Altstadt Hotel- betriebs GmbH

42 99 Union Securia VLTAVA PKB Business- Kapital & IMPERIAL Wr. Städtische Biztosító Rt. GmbH park Brunn Wert Hungary osiguranje 100% 100% 100% 25% 50% 50.3% 25% 90% 7.09% 6.2% 33.3% 33.33% 47.67% 85.46% 49.95% 99.55% 71.07% 30% 100% 100% Kooperativa Kooperativa Hotel Europ a CROWN DBR DBR GmbH InterRisk Union VJV Bratislava Praha Vienna Heros WSF GmbH &Co KG

29.63% 40.53% 11% S-Ver- Medial- sicherung Beteiligung

0.45%

80% 66,6% 40% 100% Brunn am Grüner Gesundheitspark Neue Heimat Gebirge Baum Oberlaa Holding

Status as of 31 December 1999.

Full consolidation Pro-rata consolidation Equity method consolidation

99 43 P remium income in pro p e rty & casualty insurance D o n a u remained at the same level as in ’98 (ATS 3.9 billion). Despite the intense competition in the auto s e c t o r, Donau’s premium income in that sector Ver s i c h e ru n g fell by only 1.9 %, to ATS 1.8 billion. By pursuing a policy of taking on selected risk only, Donau is During the ’99 business year Donau Ve r s i c h e ru n g , t rying to halt the general downward slide in pre- A u s t r i a ’s seventh largest insurance company, miums in the auto third party liability sector. In i n c reased its premium income by 9.8 % to about the non-auto pro p e rty sector, Donau’s pre m i u m ATS 6.0 billion, which was a satisfactory re s u l t income rose by 1.7%, to ATS 2.1 billion. overall. Donau Ve r s i c h e rung focuses on re t a i l customers, agriculture and industry. Donau attaches particular importance to staff development, and provides every employee with Donau Ve r s i c h e rung has links under corporate law the chance to attend staff development courses to Wiener Städtische, Erste Bank der österre i c h i- t a i l o red specially to his/her needs. schen Sparkassen and S-Ve r s i c h e rung, and is the p ro p e rty insurer for Austria’s savings bank sector.

’99 was another successful year for Donau Ve r s i c h e rung. It generated premium income of ATS 2.1 billion, a 38.6% increase relative to ’98. In fall ’99, Donau added a new product to its existing range of pension products: the P r ä m i e n s p a r Private Pension, which is a govern m e n t - s u b s i- dized supplementary private pension plan. M o re o v e r, the Invest Polizze fund-linked life insurance product is proving popular with customers. In September ’99, the new Donau Star- F o n d s fund, which was set up as part of a joint venture with Erste Sparinvest KAG, was incorporated into the Invest Polizze p roduct.

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 6 , 0 0 3 +9 . 8 %

Capital Investments 2 1 , 6 7 7 +5 . 7 %

Net Profit for the Ye a r 7 5 +5 . 0 %

E a rnings from Ord i n a ry Activities 1 5 9 +2 0 . 2 %

Number of Employees 1,481 people - 4 5 p e o p l e

44 99 Innovative Products Volksfürsorge VJV strives to offer the very best in terms of customer service. It introduced several new insurance products in 1999. These included Jupiter E u ro TopLife IV, a fund-oriented endowment & whole life product with a one-time premium, a VJV is No. 14 in the Austrian market in terms of capital guarantee and guaranteed minimum inter- premium volumes. However, in the auto sector it est; and F ree Life Bonus Pension, a govern m e n t - has made the top ten (it currently ranks No. 7) by subsidized supplementary pension plan with a building up business in a carefully targeted manner. completely variable premium. To launch the latter p roduct, VJV ran a promotional campaign off e r- Successful Year ing a special bonus. Given the results in the industry as a whole and ongoing intense competition, 1999 was a suc- In the auto sector, VJV offers customers a com- cessful year for VJV. Total premiums were up p rehensive service package, thanks to its strate- 2 . 1 % to about AT S 3,372 million. Some of this gic alliance with Denzel-Gruppe. This includes i n c rease can be attributed to the 10.2 % gro w t h s e rvices ranging from vehicle registration to achieved in life insurance operations. claims adjustment. The package is to be expanded to include auto financing (the Fair Leasing & Fair Kre d i t p roduct), as part of a strategic alliance In million AT S 1 9 9 9 Change Rel. with GE Capital. to 1998 G ross Premiums Earn e d 3 , 3 7 2 +2 . 1 %

Capital Investments 9 , 6 0 7 +5 . 3 %

Net Profit for the Ye a r 5 n .e .

Earnings from Ordinary Activities 4 3 + 5 . 3 %

Number of Employees 742 people +33 people

In pro p e rty & casualty, the loss ratio rose, due to the decrease in premium income and an incre a s e in the number of accidents. Operating expenses (as a pro p o rtion of premium income) re m a i n e d s t a b l e .

The financial result before deduction of asset- m a n a g e m e n t - related costs was ATS 703 million, which corresponds to an average re t u rn of 7.4%. Most of VJV’s investments were in fixed-income securities and loans.

46 99 In keeping with current trends in the Austrian Union insurance market, fund-linked life insurance enjoyed strong growth. The M a s t e r L i f e p ro d u c t Ver s i c h e ru n g accounted for over 5% of new business. As of 31 December 1999 Union had a total of AT S Union Ve r s i c h e rung is a specialist life insurance 15,656 million in investments (+16.0%). During p rovider that focuses on private old-age pension the ’99 business year, income from investments plans and risk cover. Since 1992 it has also been rose 15.0 %, from ATS 960 million in ’98 to AT S involved in accident insurance. It is owned by 1,103 million in ’99. Bank Austria AG, Wiener Städtische Allgemeine Ve r s i c h e rung AG and ERGO Ve r s i c h e ru n g s g ru p p e AG, each of which has a one-third holding.

Once again, Union Ve r s i c h e rung achieved double-digit growth in premium income in ’99. It generated premium income of ATS 2,820 million (+22.7%) and thus remains Austria’s eighth-largest life insurance company. Its life insurance division accounts for about 98% of total pre m i u m income, making it Union’s most important division by far. New one-time-premium business – in p a rticular the new Active Cash p roduct – was the main source of growth (up 52.9%).

Change Rel. In million AT S 1 9 9 9 to 1998

G ross Premiums Earn e d 2 , 8 2 0 + 2 2 . 7 %

Capital Investments 1 5 , 6 5 6 + 1 6 . 0 %

Net Profit for the Ye a r 3 9 + 2 . 6 %

Earnings from Ordinary Activities 1 2 4 + 9 . 7 %

Number of Employees 117 people + 1 0p e o p l e

Accident insurance operations had another good year: Premium income rose 10.7% to ATS 53 million. The number of accident insurance policies in force rose 6.5% to 48,235.

99 47 As a result, the number of employees at Montan Montan- rose to 32 in ’99. The acquisition also created syn- e rgies, which meant that costs (not including brokerage fees) increased by only 11%, i.e., less than ve r s i c h e ru n g the increase in gross premium income.

Specialist provider of industrial and transportation insurance The Group company Montanversicherung is a specialist provider of industrial and transport a- tion insurance. Thank to its customized insurance plans, which are tailored to specific customer needs, it has an excellent reputation abroad as well as in Austria. In ’99 it acquired additional know-how in specialist insurance for intern a t i o n a l insurance schemes and innovative insurance solutions (captive insurance schemes, multi-line/ multi-year plans).

Good Year ’99 was another very successful year for Montan. In the fall of ’99 it acquired the transportation and industrial insurance operations of Basler Austria. As a result, it generated a much greater volume of business: Gross earned premium income rose to ATS 351 million, a 14 % increase relative to ’98.

Healthy Outlook Basler Austria’s transportation and industrial insurance operations staff were transferred to Montan.

Change Rel. In million AT S 1 9 9 9 to 1998

G ross Premiums Earn e d 3 5 1 + 1 4 . 0 %

Capital Investments 3 0 1 + 1 5 . 3 %

Net Profit for the Ye a r 5 n / a

E a rnings from Ordinay Activities - 1 6 n / a

Number of Employees 32 people +12 people

48 99 p roviders. The E u ro G a r a n t p roduct was part i c u- CA larly successful, generating total premiums of just under ATS 600 million. Versicherung

CA Ve r s i c h e rung, a subsidiary of CA and Wi e n e r Städtische, celebrates its 10th anniversary this y e a r. It has become one of Austria’s top life insurance companies.

Record Results 1999 was another re c o rd year: CA Ve r s i c h e ru n g generated ATS 1,661 million (+28.9%) in pre m i- ums written. Life insurance accounted for AT S 1,649 million, while pro p e rty & casualty accounted for ATS 12 million. Net premiums for the year f rom new business rose 34%, to ATS 1,402 million. A total of 46,000 new policies were sold during ’99. At the end of the year there were 240,000 policies in force, with a total amount i n s u red of ATS 25 billion.

Change Rel. In million AT S 1 9 9 9 to 1998 G ross Premiums 1 , 6 6 1 + 2 8 . 9 %

Capital Investments 6 , 2 9 0 + 3 2 . 3 %

Net Profit for the Ye a r 1 0 + 5 . 1 %

Earnings from Ordinary Activities 3 2 + 1 0 . 1 %

Number of Employees 41 people + 6 people

In life/pensions, the L i f e I n v e s t business unit (CA Ve r s i c h e ru n g ’s fund-linked life insurance pro d u c t ) was the most productive: Premiums for the year f rom new L i f e I n v e s t policies rose from ATS 660 million in ’98 to ATS 926 in ’99, a 40% leap. As a result, CA Ve r s i c h e rung held onto its position as one of Austria’s leading fund-linked life insurance

99 51 ness year. The number of Kapital & We rt custom- Kapital & Wert ers increased from 30,200 to 31,200 during the y e a r.

Vermögens- “Clever“ and “Victor“ With the help of Wiener Städtische, Kapital & verwaltung AG We rt intends to set up a real estate fund. The basic product will function as follows: Investors will acquire shares, and Wiener Städtische will During the ’98-’99 business year that ended on p rovide a guarantee to buy back those shares as 30 September 1999, Kapital & We rt Ve rm ö g e n s- n e c e s s a ry. Kapital & We rt has also set up strate- v e rwaltung AG generated a net profit of ATS 81 gic alliances with two major lending institutions million, an 8.6 % decrease relative to the pre v i o u s with a view to pursuing mortgage financing y e a r. In light of these lower earnings, the general business. It will offer two products, Clever a n d meeting of shareholders proposed issuing a divi- Vi c t o r, and will function as the redemption agent dend of ATS 32 per share rather than ATS 35. for ATS- and CHF-denominated maturity loans. Despite this reduction in the dividend, the divi- Kapital & We rt has placed the first tranche of an dend yield on the Kapital & We rt share is 7.6%, atypical dormant holding in the biotech firm making it one of the highest-yielding shares on I n t e rcell, and a second tranche is to follow in Q2. the Vienna Stock Exchange. In connection with the re s t ructuring of the stru g- Change Rel. gling Ankerbrot AG, Kapital & We rt has agre e d In million AT S 1 9 9 8 / 9 9 to 1997/98 with Ankerbro t ’s Board of Management that the Sales and Revenue 8 0 0 +1 4 . 3 % subscription period for the current tranche of the atypical dormant holding will be extended to 30 Net Pro f i t 8 1 - 8 . 6% M a rch. The volume of this tranche has been in- Equity Capital 3 8 5 - 1 . 9% c reased to ATS 150 million. Funds Available for Investment 8 4 +2 3 . 4 %

Earnings from Ordinary Activities 8 2 - 6 . 8%

Over 31,000 Customers In the ’98-’99 business year, Kapital & We rt generated sales and revenue of ATS 137 million, a 2.3% increase relative to the ’97-’98 business y e a r. The company has equity capital of ATS 385 million and uses own funds only. Its volume of invested capital is ATS 13.6 billion; of this, AT S 800 million was placed during the ’98-’99 busi-

52 99 thanks largely to its customized products, a Kooperativa network of 170 sales offices, and its extensive Praha s e rvice packages for motorists.

The biggest event in the first half of ’99 was the m e rger of the two Kooperativa companies in the Czech Republic. As a result, synergies have been exploited and tasks distributed between the two locations based on capacity.

Other important activities during the year included the creation of a corporate image as part of the merg e r, and the implementation of new soft- w a re tools. Kooperativa now has a 13% market s h a re and thus ranks No. 2 behind the state- owned insurer which had previously held a m o n o p o l y.

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 2 , 8 1 2 +1 0 . 1 %

Capital Investments 1 , 7 0 4 +1 9 . 2 %

Net Profit for the Ye a r 6 6 - 3 6 . 1%

E a rnings from Ord i n a ry Activities 7 8 +3 2 6 . 1 %

Number of Employees 2,690 people + 2 1 5p e o p l e

In July ’99, the Czech parliament abolished the state-owned insure r’s decades-long monopoly on auto third party liability insurance as of 1 J a n u a ry 2000. Between mid-October, when it was granted its license in this sector, and the end of 1999, Kooperativa insured over 1 million vehicles, gaining a market share of more than 1 9 %. In other words, it sold a policy every seven seconds. Kooperativa’s success far outstripped that of the other new entrants into this market,

54 99 e n s u re that administrative tasks are carried out Kooperativa m o re eff i c i e n t l y. Over the next few years a similar s o f t w a re/operating system combination will be implemented at Wiener Städtische’s other fore i g n Bratislava s u b s i d i a r i e s .

1999 was another successful year for Kooperativa As part of ongoing eff o rts to expand its network of po i s t ’ o v nˇa, a.s. Despite difficult basic economic o ffices in Slovakia, remodeling and new constru c- conditions, its market share rose from 7.8% to tion work has been carried out at various loca- 8 . 5%. It there f o re ranks No. 2 in the Slovak insur- tions. In most cases that work is now complete. ance market and has increased its lead over its This will help improve customer service. competitors. During the ’99 business year it re a c h- ed the SKK 2 billion mark in premium income.

Kooperativa achieved significant growth in both life insurance and pro p e rty insurance. It now in- s u res retail customers rather than just industrial

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 6 4 8 + 2 4 . 0 %

Capital Investments 7 4 0 + 3 1 . 9 %

Net Profit for the Ye a r 3 1 + 8 4 . 4 %

E a rnings from Ord i n a ry Activities 1 8 + 5 5 1 . 0 %

Number of Employees 5 3 3p e o p l e + 5 6p e o p l e companies and large corporations. It has in- c reased its capital stock, which reflects its rapid g rowth during the past year. It now has capital stock of SKK 550 million and own funds of SKK 796 million, which puts it on secure financial foot- ing and gives it plenty of financial muscle.

Various important projects were carried out during the past business year. Powerful new software was installed in administrative operations. This will be used in conjunction with an operating system that was developed in-house, and will

99 55 specialist German life insurance company that InterRisk also sells via brokers. By integrating this company into the Group, InterRisk hopes to enhance company know-how re g a rding the highly com- Wiesbaden petitive German personal insurance market. It also hopes to improve the company’s cost situa- The Wiesbaden-based InterRisk Ve r s i c h e ru n g s - tion by exploiting synergies. The InterRisk AG generated premium income of ATS 591 milli- G ro u p ’s premium income should double in 2000 on in ’99. Accident insurance, the core division, as a result of the acquisition. accounted for ATS 401 million of this. InterRisk sells exclusively via brokers and multiple agents. It has sales offices in Berlin, Hamburg, Cologne, Munich and Wiesbaden, which provide support for its sales agents. It employs 69 people.

InterRisk Lebensversicherungs-AG, which was founded in 1998, is not yet open for business, as negotiations concerning the acquisition of a G e rman life insurance company are still in pro g- ress. Nonetheless, it intends to enter the life insurance market in the next few months, so that it can offer its sales agents a broader pro d u c t r a n g e .

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 5 9 1 +2 . 5 %

Capital Investments 6 7 1 +1 . 1 %

Net Profit for the Ye a r 5 8 +5 0 3 . 5 %

Ea r nings from Ordi n a r y Activities 5 9 + 5 1 6 . 4 %

Number of Employees 69 people +2 people

InterRisk Ve r s i c h e ru n g s - A G ’s results were part i- cularly encouraging. Although even more funds had to be allocated to variable provisions, earnings rose fivefold, to ATS 58 million. InterRisk is c u rrently in negotiations over the acquisition of a

56 99 ATS 111 million in benefits were paid in ’99. As a Heros S.A. result, the loss ratio deteriorated to 40.6%. This is largely because in-force business accounted for 27.6% of business in the auto division, as In ’99, after Wiener Städtische acquired the c o m p a red with 17.2% in ’98. majority shareholding, Heros was compre h e n- sively re s t ru c t u red. It is geared towards pro p e rt y The re s t ructuring measures did not have an insurance rather than industrial insurance, and impact until Q4/99, when administrative costs fell o ffers its services to private households and c o n s i d e r a b l y. During the year as a whole, admin- small and medium-sized businesses. The main istrative costs rose by 16 % to ATS 110 million. goal of re o rganizing was to create new task chains. In part i c u l a r, pro c e d u res for drawing up and executing new policies and claims adjustment, along with the administrative pro c e d u re s for handling the growing number of separate

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 2 4 9 +1 5 . 2 %

Capital Investments 2 4 3 - 3 . 5 %

Net Profit for the Ye a r - 3 4 -2 9 0 . 6 %

E a rnings from Ord i n a ry Activities - 3 5 -4 0 1 . 2 %

Number of Employees 327 people - 2 0p e o p l e

transactions, have been simplified. In mid-year various new appointments were made at the top management level so that the afore m e n t i o n e d changes could be implemented. The new Board of Management is focusing its eff o rts on the re s t ructuring eff o rts and on exploiting the re s u l t- ing potential.

H e ros generated premium income of ATS 249 million in ’99, which means its volume of business increased by 15.2 % relative to ’98. This g rowth was much more dramatic than in the Polish pro p e rty insurance market as a whole, which grew by 7.8 % (inflation rate: 9.8 %).

58 99 b roader scope for meeting customers needs. The Union g rowth can also be attributed to a new type of G roup product in the life, health and accident Biztosító Rt. insurance business units. A second sales channel is to be implemented in A number of new competitors entered the 2000. This will take the form of brokers and spe- Hungarian insurance market in ’99. In addition, cial sales companies, who will complement the ’99 saw the first merger of two insurance compa- 4 0 0 - s t rong main sales team. nies since 1945, which suggests there may be m o re concentration ahead.

’99 was a year of major changes for Union. Wiener Städtische acquired Swiss Life’s shareholding and is now Union’s sole owner. At the same time, Union was integrated into Swiss Life’s network, with the goal of handling the intern a t i o n a l insurance market in Hungary exclusively. By dividing up tasks in this way, Wiener Städtische will be able to draw on its experiences in other countries in transition and handle the Hungarian market in an optimal manner.

In million AT S 1 9 9 9 Change Rel. to 1998 G ross Premiums Earn e d 9 5 + 1 5 . 8 %

Capital Investments 2 4 2 + 1 0 . 7 %

Net Profit for the Ye a r - 8 4 -2 0 5 . 5 %

E a rnings from Ord i n a ry Activities - 5 7 -5 9 1 . 9 %

Number of Employees 63 people + 1 p e o p l e

Union generated premium income of ATS 95 million in ’99. After adjustment for inflation, this constitutes an increase of 15%. Much of this encouraging growth can be attributed to Union’s new s t r a t e g y, and to the fact that it has transform e d itself into a composite insure r. As a result, it has

99 59 insurance, which currently accounts for just 14.8% Wiener of total premium income in Croatia. Städtische osiguranje d. d.

The Croatian company Wiener Städtische osiguranje d.d. opened for business in September 1999. Wiener Städtische Allgemeine Ve r s i c h e rung AG has a 90% shareholding, while the Croatian firm Niva d.d. holds the remaining 10%. Wi e n e r Städtische osiguranje d.d. has total capital stock of HRK 24 million (about ATS 43 million).

B roader Product Range in Future For the time being, Wiener Städtische osiguranje d.d. will only be offering life insurance policies to C ro a t i a ’s population of five million. Nevert h e l e s s , it is licensed to operate in all areas of insurance, and will steadily expand its product range over the next few years. It intends to offer a p e n s i o n plan product and pro p e rty insurance p roducts after that. Products will be sold via b rokers and agents. In ’99, the main task at hand was to re c ruit administrative and sales personnel. In addition, a new software application for policy- related administration has been successfully implemented and will serve as a model for all other foreign Group companies.

Life Insurance Products C ro a t i a ’s insurance market has grown steadily over the last few years: Total premium volume stood at about HRK 4 billion (about ATS 7.2 billion) in 1998, an increase of 33% since 1996. Demand is expected to increase furt h e r, as the standard of living is improving and there is not much insurance in force as yet. This is particularly true of life

60 99 Wiener Vienna Life Städtische Italy Liechtenstein

P re p a r a t o ry work at the Rome office, which is the Vienna Life Lebensversicherung Aktiengesell- head office of Wiener Städtische’s branch opera- schaft, which is based in Schaan, Liechtenstein, tions in Italy, was finally completed in January was set up during the last few days of ’99. In 2000 following several months of hard work. A F e b ru a ry 2000 it received its government license c o re team of sales and administrative staff has to operate as a life insure r. At the moment it is in been hired, and the following tasks have been the process of hiring staff, setting up data-pro- c o m p l e t e d : cessing systems, etc.

• A marketing and sales plan has been drawn Vienna Life Liechtenstein’s goal in terms of mar- up. keting and sales is to offer customized insurance • A basic outline for contracts with sales part - solutions to the affluent customer segment in ners has been drawn up. These contracts will Liechtenstein and neighboring countries. Special meet the re q u i rements stipulated under Italian p roducts that can be customized will be cre a t e d , l a w. o ffering wealthy customers maximum conve- • P roducts for branch operations in Italy have nience and potential re t u rn . been developed and translated. • Employees have been trained. The company will be working closely with one of • S o f t w a re used to fulfill the Italian authorities’ L i e c h t e n s t e i n ’s private banks, whose investment re p o rting re q u i rements has been developed. know-how will be of considerable benefit to Vienna Life Liechtenstein’s customers. At the moment, Wiener Städtische is in the process of looking for and establishing re l a t i o n s h i p s with sales partners in nort h e rn Italy. The goal is to set up a strategic alliance with or take a shareholding in a major sales part n e r.

99 61 rising demand and a resulting increase in export s Current to the EU and Russia.

In Poland and Hungary, economic growth slack- Situation and ened in ’99. However, they were largely unaffe c t e d by the Balkan crisis, and are expected to achieve Outlook GDP growth of 5.1% and 4.2% respectively in 2000. This should provide a sound basis for stea- Economic developments in Central and Eastern dy growth in premium volumes in their insurance E u rope will continue to vary considerably fro m m a r k e t s . c o u n t ry to country in 2000. Basically there will be a significant upturn in the region as a whole, fol- In Poland, Wiener Städtische and the Polish bank lowing two years during which economic gro w t h PBK are planning a merger of the insurance com- lagged behind that of the EU. The forecast for the panies Heros and TU PBK. A letter of intent was next two years is solid and sustained economic signed in Feburary 2000 in Wa r s a w. The goal is to g rowth in the countries in transition, driven by the c reate a leading Polish pro p e rty insurance com- incipient upturn in We s t e rn Europe and the coun- p a n y. Wiener Städtische will contribute insurance tries’ structural re f o rms in connection with furt h e r know-how and PBK, one of Poland’s biggest privatization. The markets where the Wi e n e r banks, financial services know-how. Resolutions Städtische Group has operations will benefit fro m on the merger should be passed by the end of June 2000. In addition, a life insurance company is to be set up under the name “Vienna Life.” The Polish re g u l a t o ry authorities for the insurance sector are close to completing the authorization p ro c e d u re s .

G roup premium income in Poland in 2000 could well reach ATS 1.2 billion.

Union Ve r s i c h e rung in Hungary has already start- ed to reap the benefits of the major re s t ru c t u r i n g it is currently undergoing. Production rose by 24% in the first two months of 2000. To furt h e r boost production Union plans to set up strategic alliances with various major Hungarian brokers in the course of 2000.

In ’99 Slovakia took dramatic macro e c o n o m i c m e a s u res to reduce its trade deficit. As a re s u l t , t h e re was a drop in domestic demand and eco-

62 99 nomic growth slowed. Modest economic gro w t h is currently assessing the pro p e rty insurance of 1.7% is expected in 2000. market and will enter it in 2001 if the outlook is good. It set up an initial sales alliance with Bank Over the next few months Kooperativa Bratislava Austria in January 2000. Sales booths are cur- intends to step up its life insurance operations. rently being erected at all four branches. This may well be the fastest growing segment of the Slovak insurance market over the next few Wiener Städtische is in the process of setting up years. Kooperativa is also gearing up for the pri- branch operations in Italy. Initial contracts on life vatization of the auto third party liability insur- insurance operations were signed at the begin- ance sector, slated for 2001. ning of 2000. The main goal over the next few months will be to negotiate sales alliances en- In ’99 the Czech Republic experienced negative abling it to cover the nort h e rn Italy sales re g i o n . economic growth for the second consecutive In Venetia, products will be sold via a network of y e a r. This mainly reflected continued delays in sole agents ( m o n o m a n d a t a r i ) . implementing key structural re f o rms. However, the country is likely to benefit from the stro n g e r S l o v e n i a ’s service sector will be fully liberalized economy and rising demand in Germ a n y, and is under the forthcoming association between the expected to achieve economic growth of 2.4% in c o u n t ry and the EU. Wiener Städtische plans to 2000. enter the Slovenian market later this year. The Slovenian parliament is scheduled to ratify the Like Kooperativa Bratislava, Kooperativa Praha relevant agreement between the EU and Slovenia will be focusing on life insurance in the months in 2000. ahead. It hopes to strengthen its position in the retail sector by introducing new products. That Wiener Städtische is considering moving into the will bolster Kooperativa’s position as No. 2 be- Romanian market. If it can find a suitable sales hind the state-owned insurer which pre v i o u s l y p a rt n e r, it will enter Romania’s life insurance mar- had a monopoly. It should enjoy steady growth ket by setting up its own subsidiary. in premium income over the next few years, as privatization of the auto third party liability sector In the future Wiener Städtische intends to contin- has already been completed. ue its strategy of steadily bolstering its position in the countries of Central and Eastern Euro p e . C roatia suff e red a major economic setback in P remium income in these countries should ’99. GDP fell by 7.5% due to ongoing political i n c rease to ATS 7-8 billion by the end of 2000, conflict in the Balkans and sluggish economic t h e reby accounting for as much as a quarter of re f o rms. GDP is expected to decline again in G roup sales. 2000, though only by 0.5%.

Wiener Städtische osiguranje intends to steadily b roaden its product range in 2000. It also plans to launch a fund-linked life insurance product. It

99 63

Annual Financial Statements AG

Wiener Städtische Balance Sheet as of 31 December 1999

A s s e t s P ro p e rty & Casualty ATS H e a l t h ATS

A . Intangible assets I . Other intangible assets 2 5 , 2 2 7 , 9 9 1 . 0 0 B .I n v e s t m e n t s I . Land and buildings 1 , 7 7 2 , 4 2 5 , 6 7 7 . 2 9 I I . Investments in affiliated companies and participating intere s t s 1. Shares in affiliated companies 5 , 4 1 9 , 0 6 7 , 2 1 9 . 0 0 0 . 0 0 2. Bonds issued by affiliated companies and loans to aff i l i a t e d c o m p a n i e s 2 1 0 , 2 1 5 , 7 2 6 . 2 1 0 . 0 0 3. Participating intere s t s 9 4 1 , 7 0 8 , 6 0 3 . 9 8 2 7 6 , 7 7 3 , 5 3 0 . 0 0 4. Bonds issued by and loans to companies where there is a p a rt i c i p a t o ry re l a t i o n s h i p 3 7 0 , 8 1 3 , 8 5 9 . 0 0 6 , 9 4 1 , 8 0 5 , 4 0 8 . 1 9 2 0 1 , 5 0 0 , 0 0 6 . 0 0 I I I . Other investments 1. Shares and other variable-yield securities 4 , 2 6 7 , 1 9 3 , 1 5 8 . 0 2 1 , 5 9 2 , 3 6 3 , 4 2 1 . 2 8 2. Bonds and other fixed-income securities 1 , 2 9 7 , 2 1 1 , 5 5 8 . 3 3 9 6 8 , 3 5 9 , 6 8 9 . 3 2 3. Mortgage loans 2 , 1 4 9 , 6 1 8 , 0 2 2 . 0 0 1 , 0 0 7 , 0 8 4 , 6 7 5 . 0 0 4. Prepayments on policies 0 . 0 0 0 . 0 0 5. Other loans 6 9 7 , 0 5 3 , 0 3 0 . 0 0 1 , 3 7 6 , 0 3 0 , 9 5 3 . 0 0 6. Balances at banks 4 6 , 3 2 3 , 1 0 9 . 1 1 8 , 4 5 7 , 3 9 8 , 8 7 7 . 4 6 0 . 0 0 I V. Deposits retained associated with inward s reinsurance business 2 0 , 9 1 6 , 9 1 5 . 4 6 Total investments 1 7 , 1 9 2 , 5 4 6 , 8 7 8 . 4 0 C. Investments for the benefit of fund-linked life insurance policyholders 0 . 0 0 D .R e c e i v a b l e s I . Receivables arising from primary insurance operations 1. Receivable from policyholders 4 5 9 , 3 1 0 , 9 4 4 . 3 8 5 7 , 5 8 8 , 0 6 3 . 2 3 2. Receivable from interm e d i a r i e s 6 6 , 3 9 6 , 5 1 7 . 0 0 0 . 0 0 3. Receivable from insurance companies 4 5 , 1 4 3 , 2 6 3 . 0 7 5 7 0 , 8 5 0 , 7 2 4 . 4 5 0 . 0 0 I I . Accounts receivable arising from reinsurance business 7 9 3 , 0 4 6 , 5 4 8 . 5 6 I I I . Other re c e i v a b l e s 1 , 0 1 9 , 6 4 7 , 9 9 9 . 3 6 Total investments 2 , 3 8 3 , 5 4 5 , 2 7 2 . 3 7 E . A c c rued interest and re n t 1 0 0 , 2 9 1 , 4 7 7 . 4 6 F. Other assets I. Tangible assets (not including land and buildings) and inventory 3 5 1 , 4 9 4 , 3 7 8 . 2 5 I I . Cash at banks and cash in hand 2 3 3 , 4 0 1 , 6 4 8 . 5 0 I I I . Other assets 3 6 1 , 7 6 4 , 2 0 8 . 2 3 Total other assets 9 4 6 , 6 6 0 , 2 3 4 . 9 8 G .D e f e rred expenses and accrued income I. U n d e r- a c c ruals per Art. X, Sections 3 and 4, Financial Reporting Act 2 6 3 , 8 7 0 , 6 8 4 . 0 0 I I . Other deferred expenses and accrued income 2 4 1 , 4 2 5 , 3 9 8 . 4 8 Total deferred expenses and accrued income 5 0 5 , 2 9 6 , 0 8 2 . 4 8 H .O ffset items between divisions -8 2 0 , 9 5 8 . 6 2 Balance sheet total 2 1 , 1 5 2 , 7 4 6 , 9 7 8 . 0 7

66 99 L i f e ATS Total in 1999 ATS 1 9 9 8 ATS

1 5 , 4 1 4 , 2 4 0 . 0 0 7 2 , 6 4 2 . 9 3 4 0 , 7 1 4 , 8 7 3 . 9 3 4 0 , 9 8 8 , 0 1 2 . 0 0

1 , 9 6 4 , 7 3 8 , 6 1 6 . 3 5 5 , 1 8 0 , 6 5 9 , 7 1 4 . 8 2 8 , 9 1 7 , 8 2 4 , 0 0 8 . 4 6 9 , 0 1 8 , 4 3 2 , 1 3 4 . 2 7

8 8 6 , 1 0 2 , 9 3 8 . 8 8 6 , 3 0 5 , 1 7 0 , 1 5 7 . 8 8 2 , 8 2 0 , 8 6 3 , 4 1 2 . 1 2

4 6 7 , 7 0 6 , 0 5 4 . 3 9 6 7 7 , 9 2 1 , 7 8 0 . 6 0 2 1 5 , 8 4 9 , 8 6 2 . 0 0 7 3 6 , 4 2 5 , 7 3 3 . 9 2 1 , 9 5 4 , 9 0 7 , 8 6 7 . 9 0 4 , 9 4 6 , 4 4 9 , 2 1 7 . 1 5

4 7 8 , 2 7 3 , 5 3 6 . 0 0 1 , 8 4 8 , 4 1 4 , 8 0 7 . 2 2 3 , 9 3 8 , 6 4 9 , 5 3 4 . 4 1 2 , 4 2 0 , 7 2 8 , 6 7 2 . 2 2 1 1 , 3 5 8 , 7 2 8 , 4 7 8 . 6 0 2 , 2 1 6 , 7 9 4 , 0 1 3 . 3 1

2 0 , 4 7 7 , 0 6 5 , 0 2 7 . 6 6 2 6 , 3 3 6 , 6 2 1 , 6 0 6 . 9 6 2 0 , 8 4 2 , 6 7 4 , 0 0 3 . 0 1 1 3 , 4 5 8 , 0 6 5 , 1 2 1 . 0 0 1 5 , 7 2 3 , 6 3 6 , 3 6 8 . 6 5 1 7 , 1 9 8 , 9 9 0 , 2 8 2 . 0 2 1 , 5 0 7 , 9 1 7 , 4 9 3 . 0 0 4 , 6 6 4 , 6 2 0 , 1 9 0 . 0 0 4 , 7 6 0 , 2 2 5 , 1 5 1 . 0 0 2 7 4 , 9 4 7 , 3 3 5 . 0 0 2 7 4 , 9 4 7 , 3 3 5 . 0 0 2 0 1 , 3 8 5 , 2 3 3 . 0 0 1 3 , 5 6 3 , 9 1 3 , 0 5 8 . 0 0 1 5 , 6 3 6 , 9 9 7 , 0 4 1 . 0 0 1 6 , 8 8 2 , 3 9 7 , 2 9 1 . 0 0 4 , 9 4 3 , 8 3 8 , 7 3 8 . 6 0 0 . 0 0 4 9 , 2 8 1 , 9 0 8 , 0 3 4 . 6 6 4 6 , 3 2 3 , 1 0 9 . 1 1 6 2 , 6 8 3 , 1 4 5 , 6 5 0 . 7 2 3 1 , 5 9 1 , 5 9 4 . 0 1

2 , 7 8 1 , 1 3 6 . 0 0 1 , 0 3 9 , 7 3 3 , 4 4 1 . 1 5 1 , 0 6 3 , 4 3 1 , 4 9 2 . 6 1 9 8 8 , 1 2 1 , 4 2 8 . 4 2 7 , 3 8 9 , 6 3 2 , 0 2 6 . 9 5 5 9 , 4 4 0 , 9 5 0 , 7 2 5 . 0 4 8 4 , 0 2 3 , 1 2 9 , 6 3 0 . 3 9 8 0 , 1 2 3 , 7 7 3 , 6 2 1 . 3 1 0 . 0 0 3 0 6 , 5 0 5 , 5 9 9 . 4 8 3 0 6 , 5 0 5 , 5 9 9 . 4 8 3 1 , 0 8 3 , 7 9 3 . 2 7

2 6 3 , 1 8 5 , 4 2 2 . 5 4 7 8 0 , 0 8 4 , 4 3 0 . 1 5 7 1 6 , 9 1 6 , 7 3 0 . 6 4 2 4 5 , 4 3 0 . 3 7 6 6 , 6 4 1 , 9 4 7 . 3 7 5 9 , 0 2 9 , 4 1 2 . 4 7 5 7 , 5 8 8 , 0 6 3 . 2 3 7 0 4 , 5 0 9 . 7 7 2 6 4 , 1 3 5 , 3 6 2 . 6 8 4 5 , 8 4 7 , 7 7 2 . 8 4 8 9 2 , 5 7 4 , 1 5 0 . 3 6 1 0 7 , 7 0 9 , 0 8 1 . 7 6 4 , 3 0 9 , 3 0 1 . 0 0 3 0 , 5 2 8 , 2 6 2 . 0 3 8 2 7 , 8 8 4 , 1 1 1 . 5 9 8 8 7 , 7 3 3 , 3 2 4 . 8 8 2 0 5 , 8 1 2 , 3 3 1 . 2 6 1 4 3 , 5 8 0 , 1 0 5 . 3 5 1 , 3 6 9 , 0 4 0 , 4 3 5 . 9 7 9 8 4 , 3 0 6 , 2 5 1 . 6 6 2 6 7 , 7 0 9 , 6 9 5 . 4 9 4 3 8 , 2 4 3 , 7 3 0 . 0 6 3 , 0 8 9 , 4 9 8 , 6 9 7 . 9 2 2 , 7 5 5 , 6 9 4 , 8 0 1 . 4 1 6 3 , 2 7 9 , 4 1 6 . 1 9 1 , 1 3 0 , 3 3 8 , 3 3 5 . 6 7 1 , 2 9 3 , 9 0 9 , 2 2 9 . 3 2 1 , 4 4 1 , 2 7 1 , 4 8 8 . 8 4

0 . 0 0 9 5 2 , 0 5 0 . 8 0 3 5 2 , 4 4 6 , 4 2 9 . 0 5 3 3 5 , 9 7 1 , 5 5 5 . 2 2 3 5 5 , 4 0 1 , 0 0 8 . 9 3 1 2 7 , 2 1 2 , 3 7 1 . 0 1 7 1 6 , 0 1 5 , 0 2 8 . 4 4 8 4 8 , 0 0 6 , 8 6 6 . 5 8 4 7 , 4 7 3 , 0 0 0 . 0 0 3 4 , 8 3 8 , 6 8 9 . 7 4 4 4 4 , 0 7 5 , 8 9 7 . 9 7 2 5 5 , 1 4 6 , 1 7 5 . 4 9 4 0 2 , 8 7 4 , 0 0 8 . 9 3 1 6 3 , 0 0 3 , 1 1 1 . 5 5 1 , 5 1 2 , 5 3 7 , 3 5 5 . 4 6 1 , 4 3 9 , 1 2 4 , 5 9 7 . 2 9

5 4 , 4 4 8 , 6 4 1 . 0 0 9 5 , 8 5 5 , 9 5 3 . 0 0 4 1 4 , 1 7 5 , 2 7 8 . 0 0 4 7 6 , 1 1 1 , 5 8 4 . 0 0 0 . 0 0 2 3 , 9 3 8 , 6 9 5 . 5 0 2 6 5 , 3 6 4 , 0 9 3 . 9 8 1 8 6 , 5 5 0 , 8 5 9 . 6 6 5 4 , 4 4 8 , 6 4 1 . 0 0 1 1 9 , 7 9 4 , 6 4 8 . 5 0 6 7 9 , 5 3 9 , 3 7 1 . 9 8 6 6 2 , 6 6 2 , 4 4 3 . 6 6 1 , 6 3 3 , 7 1 0 . 4 8 - 8 1 2 , 7 5 1 . 8 6 0 . 0 0 0 . 0 0 8 , 1 9 4 , 9 9 1 , 7 3 9 . 0 4 6 1 , 5 9 8 , 0 9 6 , 0 4 1 . 3 7 9 0 , 9 4 5 , 8 3 4 , 7 5 8 . 4 8 8 6 , 4 9 4 , 5 9 8 , 7 5 7 . 7 8

99 67 Balance Sheet as of 31 December 1999

L i a b i l i t i e s P ro p e rty & Casualty ATS Health ATS

A . S h a reholders' equity I . Capital stock 1. Par value: EUR 89,655,022.06 6 1 6 , 8 4 0 , 0 0 0 . 0 0 I I . Capital re s e rv e s 1. Non-available 1 , 7 8 3 , 4 8 1 , 8 7 5 . 0 0 I I I . Revenue re s e rv e s 1. Free re s e rv e s 1 , 1 2 4 , 0 7 8 , 5 9 6 . 0 0 I V. U n a p p ropriated retained earn i n g s 6 6 , 4 4 3 , 4 0 4 . 6 4 of which profit brought forw a rd 4 2 , 3 6 7 , 0 7 2 . 4 5 Total shareholders’ equity 3 , 5 9 0 , 8 4 3 , 8 7 5 . 6 4 B. Untaxed re s e rv e s I . Risk reserves per § 73a of the Insurance Companies Supervision Act 2 9 1 , 8 9 4 , 4 5 3 . 0 0 I I . Valuation re s e rves associated with special write-downs 5 9 0 , 6 4 5 , 1 6 1 . 0 0 I I I . Other untaxed re s e rv e s 1 8 1 , 3 9 6 , 6 4 2 . 0 0 Total re s e rv e s 1 , 0 6 3 , 9 3 6 , 2 5 6 . 0 0 C. Underwriting provisions associated with retained business I . U n e a rned pre m i u m s 1. Gross amount 1 , 0 6 8 , 8 0 4 , 6 6 6 . 4 9 8 , 5 5 4 , 6 7 0 . 0 0 2. Reinsurers’ share - 3 9 , 6 0 0 , 3 1 7 . 9 6 1 , 0 2 9 , 2 0 4 , 3 4 8 . 5 3 0 . 0 0 I I . P remium re s e rv e 1. Gross amount 0 . 0 0 5 , 4 7 0 , 6 9 2 , 9 4 4 . 0 0 2. Reinsurers’ share 0 . 0 0 0 . 0 0 - 1 0 , 5 3 7 , 2 7 4 . 0 0 I I I . P rovisions for outstanding claims 1. Gross amount 9 , 3 4 8 , 9 5 1 , 9 9 9 . 7 6 5 4 3 , 0 2 2 , 7 1 3 . 0 0 2. Reinsurers’ share -7 3 2 , 9 0 2 , 7 2 9 . 8 9 8 , 6 1 6 , 0 4 9 , 2 6 9 . 8 7 - 3 , 4 6 5 , 6 0 7 . 0 0 I V. P rovisions for premium re f u n d s 1. Gross amount 6 9 , 4 0 7 , 1 6 5 . 0 0 1 1 6 , 0 0 0 , 0 0 0 . 0 0 2. Reinsurers’ share 0 . 0 0 6 9 , 4 0 7 , 1 6 5 . 0 0 0 . 0 0 V. P rovisions for profit participation bonuses for p o l i c y h o l d e r s 1. Gross amount 1 4 6 , 3 0 2 , 4 5 2 . 3 6 4 9 , 5 5 2 , 3 8 8 . 5 8 2. Reinsurers’ share 0 . 0 0 1 4 6 , 3 0 2 , 4 5 2 . 3 6 0 . 0 0 V I . Claims equalization pro v i s i o n s 9 0 6 , 0 6 1 , 9 5 2 . 0 0 V I I . Other underwriting pro v i s i o n s 1. Gross amount 1 7 8 , 3 5 2 , 9 8 9 . 0 0 6 , 1 3 2 , 7 4 8 . 0 0 2. Reinsurers’ share - 5 , 7 9 2 , 6 0 7 . 0 4 1 7 2 , 5 6 0 , 3 8 1 . 9 6 0 . 0 0 Total underwriting pro v i s i o n s 1 0 , 9 3 9 , 5 8 5 , 5 6 9 . 7 2 D .U n d e rwriting provisions associated with fund-linked life insurance policies 0 . 0 0 C a rried forw a rd 1 5 , 5 9 4 , 3 6 5 , 7 0 1 . 3 6

68 99 Life ATS Total in 1999 ATS 1998 ATS

2 4 6 , 7 3 6 , 0 0 0 . 0 0 3 7 0 , 1 0 4 , 0 0 0 . 0 0 1 , 2 3 3 , 6 8 0 , 0 0 0 . 0 0 1 , 2 3 3 , 6 8 0 , 0 0 0 . 0 0

6 0 5 , 0 2 3 , 9 5 2 . 8 0 1 , 3 6 8 , 2 7 8 , 9 7 3 . 2 0 3 , 7 5 6 , 7 8 4 , 8 0 1 . 0 0 3 , 7 5 6 , 7 8 4 , 8 0 1 . 0 0

8 3 , 7 6 5 , 8 1 6 . 0 0 7 1 7 , 2 3 8 , 6 7 5 . 0 0 1 , 9 2 5 , 0 8 3 , 0 8 7 . 0 0 1 , 8 0 3 , 7 4 4 , 3 0 3 . 0 0 -2 , 4 7 6 , 8 6 8 . 5 5 1 9 1 , 0 4 7 , 7 7 8 . 8 4 2 5 5 , 0 1 4 , 3 1 4 . 9 3 2 8 5 , 2 8 0 , 6 8 4 . 8 3 - 8 2 , 9 6 5 , 4 2 6 . 2 0 6 2 , 9 4 3 , 0 3 8 . 5 8 2 2 , 3 4 4 , 6 8 4 . 8 3 1 7 , 1 9 2 , 0 9 0 . 4 4 9 3 3 , 0 4 8 , 9 0 0 . 2 5 2 , 6 4 6 , 6 6 9 , 4 2 7 . 0 4 7 , 1 7 0 , 5 6 2 , 2 0 2 . 9 3 7 , 0 7 9 , 4 8 9 , 7 8 8 . 8 3

1 3 1 , 0 8 9 , 6 7 4 . 0 0 2 7 7 , 8 7 2 , 0 9 7 . 0 0 7 0 0 , 8 5 6 , 2 2 4 . 0 0 6 6 9 , 3 4 7 , 2 3 3 . 0 0 1 8 2 , 2 4 5 , 2 1 6 . 2 4 8 2 9 , 7 1 0 , 1 6 6 . 9 2 1 , 6 0 2 , 6 0 0 , 5 4 4 . 1 6 1 , 8 9 1 , 2 3 4 , 9 5 4 . 3 7 2 8 , 2 1 0 , 0 4 3 . 0 0 5 8 6 , 3 6 5 , 4 8 3 . 0 0 7 9 5 , 9 7 2 , 1 6 8 . 0 0 4 4 3 , 3 7 0 , 4 0 1 . 0 0 3 4 1 , 5 4 4 , 9 3 3 . 2 4 1 , 6 9 3 , 9 4 7 , 7 4 6 . 9 2 3 , 0 9 9 , 4 2 8 , 9 3 6 . 1 6 3 , 0 0 3 , 9 5 2 , 5 8 8 . 3 7

7 0 2 , 2 0 7 , 4 7 2 . 2 0 1 , 7 7 9 , 5 6 6 , 8 0 8 . 6 9 1 , 7 2 2 , 9 3 4 , 4 5 3 . 7 7 8 , 5 5 4 , 6 7 0 . 0 0 - 1 2 , 5 3 4 , 6 0 0 . 7 3 6 8 9 , 6 7 2 , 8 7 1 . 4 7 - 5 2 , 1 3 4 , 9 1 8 . 6 9 1 , 7 2 7 , 4 3 1 , 8 9 0 . 0 0 - 4 8 , 5 8 4 , 7 5 1 . 5 2

5 1 , 9 0 6 , 9 9 1 , 1 7 5 . 4 3 5 7 , 3 7 7 , 6 8 4 , 1 1 9 . 4 3 5 3 , 3 2 9 , 9 5 7 , 3 1 8 . 1 4 5 , 4 6 0 , 1 5 5 , 6 7 0 . 0 0 - 4 7 5 , 2 4 6 , 1 7 2 . 0 2 5 1 , 4 3 1 , 7 4 5 , 0 0 3 . 4 1 - 4 8 5 , 7 8 3 , 4 4 6 . 0 2 5 6 , 8 9 1 , 9 0 0 , 6 7 3 . 4 1 - 5 1 1 , 8 0 4 , 2 4 1 . 3 8

1 5 8 , 3 4 2 , 9 1 4 . 0 0 1 0 , 0 5 0 , 3 1 7 , 6 2 6 . 7 6 9 , 6 7 3 , 3 0 7 , 3 8 8 . 9 3 5 3 9 , 5 5 7 , 1 0 6 . 0 0 - 7 8 2 , 6 0 8 . 0 0 1 5 7 , 5 6 0 , 3 0 6 . 0 0 - 7 3 7 , 1 5 0 , 9 4 4 . 8 9 9 , 3 1 3 , 1 6 6 , 6 8 1 . 8 7 - 5 7 0 , 7 2 5 , 8 1 5 . 2 0

0 . 0 0 1 8 5 , 4 0 7 , 1 6 5 . 0 0 2 2 8 , 4 3 0 , 1 8 4 . 0 0 1 1 6 , 0 0 0 , 0 0 0 . 0 0 0 . 0 0 0 . 0 0 0 . 0 0 1 8 5 , 4 0 7 , 1 6 5 . 0 0 0 . 0 0

2 , 0 9 8 , 7 9 9 , 3 1 1 . 7 1 2 , 2 9 4 , 6 5 4 , 1 5 2 . 6 5 2 , 2 7 7 , 0 4 7 , 0 4 1 . 6 5 4 9 , 5 5 2 , 3 8 8 . 5 8 - 3 0 0 , 0 0 0 . 0 0 2 , 0 9 8 , 4 9 9 , 3 1 1 . 7 1 - 3 0 0 , 0 0 0 . 0 0 2 , 2 9 4 , 3 5 4 , 1 5 2 . 6 5 - 3 0 0 , 0 0 0 . 0 0 0 . 0 0 0 . 0 0 9 0 6 , 0 6 1 , 9 5 2 . 0 0 9 9 5 , 9 9 5 , 1 7 8 . 0 0

2 , 1 0 2 , 2 0 1 . 0 0 1 8 6 , 5 8 7 , 9 3 8 . 0 0 1 8 5 , 6 5 7 , 9 8 7 . 8 1 6 , 1 3 2 , 7 4 8 . 0 0 0 . 0 0 2 , 1 0 2 , 2 0 1 . 0 0 - 5 , 7 9 2 , 6 0 7 . 0 4 1 8 0 , 7 9 5 , 3 3 0 . 9 6 - 8 , 3 6 1 , 6 3 5 . 0 4 6 , 1 7 9 , 9 5 2 , 5 8 2 . 5 8 5 4 , 3 7 9 , 5 7 9 , 6 9 3 . 5 9 7 1 , 4 9 9 , 1 1 7 , 8 4 5 . 8 9 6 7 , 2 7 3 , 5 5 3 , 1 0 9 . 1 6

0 . 0 0 3 0 6 , 5 0 5 , 5 9 9 . 4 8 3 0 6 , 5 0 5 , 5 9 9 . 4 8 3 1 , 0 8 3 , 7 9 3 . 2 7 7 , 4 5 4 , 5 4 6 , 4 1 6 . 0 7 5 9 , 0 2 6 , 7 0 2 , 4 6 7 . 0 3 8 2 , 0 7 5 , 6 1 4 , 5 8 4 . 4 6 7 7 , 3 8 8 , 0 7 9 , 2 7 9 . 6 3

99 69 Balance Sheet as of 31 December 1999

L i a b i l i t i e s P ro p e rty & Casualty ATS Health ATS

B rought forw a rd 1 5 , 5 9 4 , 3 6 5 , 7 0 1 . 3 6

E . Other pro v i s i o n s I . P rovisions for severance payments 5 8 3 , 3 7 9 , 0 4 8 . 7 9 I I . P rovisions for pensions 2 , 1 5 0 , 4 1 3 , 4 2 0 . 4 7 I I I . P rovisions for taxation 1 8 , 9 2 3 , 4 0 0 . 0 0 I V. Other pro v i s i o n s 4 2 8 , 8 8 1 , 4 7 0 . 5 1 Total other pro v i s i o n s 3 , 1 8 1 , 5 9 7 , 3 3 9 . 7 7 F. Deposits associated with ceded re i n s u r a n c e b u s i n e s s 8 2 5 , 4 5 5 . 3 6 G . Other liabilities I . Liabilities arising from primary insurance operations 1. Payable to policyholders 3 9 6 , 5 6 1 , 1 3 7 . 5 2 2 2 , 5 9 9 , 8 8 5 . 0 3 2. Payable to interm e d i a r i e s 1 7 2 , 1 2 4 , 3 4 3 . 1 7 0 . 0 0 3. Payable to insurance companies 1 7 , 3 4 1 , 6 8 4 . 1 2 5 8 6 , 0 2 7 , 1 6 4 . 8 1 8 4 6 , 8 9 4 . 2 0 II . Accounts payable associated with reinsurance business 1 4 0 , 8 0 9 , 0 3 7 . 9 1 II I . Bonds payable (not including supplementary capital) 7 0 7 , 0 7 0 , 7 3 2 . 1 2 I V. Amounts owed to banks 1 5 0 , 0 0 0 , 0 0 0 . 0 0 V. Miscellaneous liabilities 7 7 6 , 1 9 8 , 6 6 3 . 1 1 Total other liabilities 2 , 3 6 0 , 1 0 5 , 5 9 7 . 9 5 H .D e f e rred income and accrued expenses 1 5 , 8 5 2 , 8 8 3 . 6 3 Balance sheet total 2 1 , 1 5 2 , 7 4 6 , 9 7 8 . 0 7

The amount of ATS 51,431,745,003.41 re p o rt e d of ATS 12,534,600.73. I hereby confirm that the under “Premium Reserve” in life insurance as of p remium re s e rve and the unearned pre m i u m s 31 December 1999 consists of the pre m i u m f rom primary business were calculated in ac- re s e rve for primary business totaling c o rdance with the applicable regulations and AT S 50,895,571,811.48 and the premium re- actuarial principles. s e rve for inwards reinsurance business totaling AT S 1,011,419,363.95 minus the port i o n ceded to the re i n s u rer in the amount of AT S 475,246,172.02. The amount of Vienna, 3 April 2000 Jaindl AT S 689,672,871.47 re p o rted under “Unearn e d P remiums” consists of unearned premiums fro m p r i m a ry business totaling ATS 618,069,065.00 and unearned premiums from inwards re i n s u r- ance business totaling ATS 84,138,407.20 minus the portion ceded to the re i n s u rer in the amount

70 99 Life ATS Total in 1999 ATS 1998 ATS

7 , 4 5 4 , 5 4 6 , 4 1 6 . 0 7 5 9 , 0 2 6 , 7 0 2 , 4 6 7 . 0 3 8 2 , 0 7 5 , 6 1 4 , 5 8 4 . 4 6 7 7 , 3 8 8 , 0 7 9 , 2 7 9 . 6 3

1 2 4 , 0 8 3 , 4 4 2 . 6 2 2 6 9 , 0 4 9 , 3 1 9 . 5 9 9 7 6 , 5 1 1 , 8 1 1 . 0 0 9 9 9 , 8 9 4 , 4 1 6 . 0 0 4 4 6 , 8 5 6 , 9 7 0 . 4 9 8 9 5 , 1 9 9 , 2 5 9 . 0 4 3 , 4 9 2 , 4 6 9 , 6 5 0 . 0 0 3 , 4 8 3 , 2 9 9 , 6 2 0 . 0 0 3 2 , 3 8 8 , 0 0 0 . 0 0 2 3 9 , 8 2 9 , 3 6 0 . 0 0 2 9 1 , 1 4 0 , 7 6 0 . 0 0 1 8 0 , 6 7 7 , 6 2 1 . 0 0 5 2 , 7 0 6 , 7 6 9 . 2 9 1 2 3 , 1 0 1 , 7 8 9 . 9 7 6 0 4 , 6 9 0 , 0 2 9 . 7 7 6 2 5 , 9 1 1 , 9 9 4 . 6 2 6 5 6 , 0 3 5 , 1 8 2 . 4 0 1 , 5 2 7 , 1 7 9 , 7 2 8 . 6 0 5 , 3 6 4 , 8 1 2 , 2 5 0 . 7 7 5 , 2 8 9 , 7 8 3 , 6 5 1 . 6 2

2 , 7 8 1 , 1 3 6 . 0 0 4 7 4 , 7 2 3 , 4 1 8 . 2 5 4 7 8 , 3 3 0 , 0 0 9 . 6 1 5 0 8 , 8 3 6 , 5 1 3 . 8 1

1 7 3 , 6 6 4 , 0 2 4 . 3 5 5 9 2 , 8 2 5 , 0 4 6 . 9 0 6 3 5 , 5 7 1 , 2 6 9 . 8 2 3 , 7 3 7 . 6 2 1 7 2 , 1 2 8 , 0 8 0 . 7 9 1 6 6 , 7 2 2 , 3 4 5 . 6 6 2 3 , 4 4 6 , 7 7 9 . 2 3 0 . 0 0 1 7 3 , 6 6 7 , 7 6 1 . 9 7 1 8 , 1 8 8 , 5 7 8 . 3 2 7 8 3 , 1 4 1 , 7 0 6 . 0 1 1 8 , 6 4 0 , 7 5 5 . 6 0 0 . 0 0 2 1 , 2 2 0 , 4 3 4 . 9 9 1 6 2 , 0 2 9 , 4 7 2 . 9 0 1 1 4 , 0 0 9 , 2 4 3 . 5 2 0 . 0 0 0 . 0 0 7 0 7 , 0 7 0 , 7 3 2 . 1 2 7 0 7 , 0 5 7 , 7 0 0 . 0 0 0 . 0 0 0 . 0 0 1 5 0 , 0 0 0 , 0 0 0 . 0 0 1 4 9 , 8 0 7 , 5 8 0 . 9 8 5 5 , 2 0 4 , 1 2 2 . 6 9 3 1 2 , 3 5 2 , 8 3 0 . 0 2 1 , 1 4 3 , 7 5 5 , 6 1 5 . 8 2 1 , 4 4 9 , 1 4 8 , 5 2 9 . 8 7 7 8 , 6 5 0 , 9 0 1 . 9 2 5 0 7 , 2 4 1 , 0 2 6 . 9 8 2 , 9 4 5 , 9 9 7 , 5 2 6 . 8 5 3 , 2 4 0 , 9 5 7 , 4 2 5 . 4 5 2 , 9 7 8 , 1 0 2 . 6 5 6 2 , 2 4 9 , 4 0 0 . 5 1 8 1 , 0 8 0 , 3 8 6 . 7 9 6 6 , 9 4 1 , 8 8 7 . 2 7 8 , 1 9 4 , 9 9 1 , 7 3 9 . 0 4 6 1 , 5 9 8 , 0 9 6 , 0 4 1 . 3 7 90,945,834,758.48 86,494,598,757.78

The amount of ATS 5,460,155,670.00 re p o rt e d p remium re s e rve and the unearned pre m i u m s under “Premium Reserve” in health insurance as f rom primary business were calculated in accord- of 31 December 1999 consists of the pre m i u m ance with the applicable regulations and actuari- re s e rve for primary business totaling al principles. AT S 5,470,692,944.00 minus the port i o n ceded to the re i n s u rer in the amount of AT S 10,537,274.00. The amount of AT S 8,554,670.00 re p o rted under “Unearn e d P remiums” consists of unearned premiums fro m Vienna, 3 April 2000 Jaindl p r i m a ry business. I hereby confirm that the

I hereby confirm that the premium re s e rve fund has been invested in accordance with the applicable re g u l a t i o n s . Vienna, 3 April 2000 F re i t a g

99 71 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

P ro p e rty & Casualty 1999 ATS 1998 ATS

Technical account:

1. Earned pre m i u m s P remiums written G ro s s 8 , 1 7 8 , 4 9 2 , 2 3 7 . 4 4 Ceded reinsurance pre m i u m s - 1 , 1 9 4 , 6 9 9 , 8 8 0 . 6 4 6 , 9 8 3 , 7 9 2 , 3 5 6 . 8 0 7 , 2 7 4 , 2 0 6 , 0 1 3 . 1 1 Change due to premium accru a l s G ro s s - 2 4 , 5 0 8 , 3 4 6 . 4 7 R e i n s u rers’ share 1 1 , 8 6 5 , 3 1 2 . 0 2 - 1 2 , 6 4 3 , 0 3 4 . 4 5 2 3 , 1 5 5 , 3 1 4 . 1 6 Total pre m i u m s 6 , 9 7 1 , 1 4 9 , 3 2 2 . 3 5 7 , 2 9 7 , 3 6 1 , 3 2 7 . 2 7 2. Allocated investment income 3 , 2 5 0 , 6 5 1 . 6 6 4 , 5 8 0 , 5 6 8 . 3 4 3. Other underwriting income 4 5 , 6 1 0 , 5 4 7 . 5 9 2 4 , 0 6 5 , 2 1 9 . 4 2 4. Claims incurre d Claims paid G ro s s 5 , 5 4 4 , 6 9 7 , 9 1 7 . 9 2 R e i n s u rers’ share - 8 1 2 , 8 2 4 , 7 5 3 . 0 2 4 , 7 3 1 , 8 7 3 , 1 6 4 . 9 0 4 , 4 9 7 , 9 4 8 , 0 6 1 . 1 2 Change in provisions for outstanding claims G ro s s 3 7 3 , 5 7 3 , 0 9 9 . 6 8 R e i n s u rers’ share - 1 4 1 , 1 9 0 , 4 4 2 . 6 0 2 3 2 , 3 8 2 , 6 5 7 . 0 8 4 2 9 , 6 9 6 , 6 0 9 . 0 8 Total claims -4 , 9 6 4 , 2 5 5 , 8 2 1 . 9 8 -4 , 9 2 7 , 6 4 4 , 6 7 0 . 2 0 5. Increase in other underwriting pro v i s i o n s Other underwriting pro v i s i o n s G ro s s 0 . 0 0 R e i n s u rers’ share 0 . 0 0 0 . 0 0 1 1 8 , 7 9 8 , 1 8 8 . 0 0 Total increase in other underwriting pro v i s i o n s 0 . 0 0 - 1 1 8 , 7 9 8 , 1 8 8 . 0 0 6. Decrease in other underwriting pro v i s i o n s Other underwriting pro v i s i o n s G ro s s 1 , 7 6 9 , 9 9 9 . 8 1 R e i n s u rers’ share 0 . 0 0 1 , 7 6 9 , 9 9 9 . 8 1 0 . 0 0 Total decrease in other underwriting pro v i s i o n s 1 , 7 6 9 , 9 9 9 . 8 1 0 . 0 0 7 . E x p e n d i t u res on premium re f u n d s - 1 4 , 4 6 4 , 7 5 9 . 0 0 - 4 0 , 6 6 7 , 7 6 1 . 0 0 8 . E x p e n d i t u res on profit participation bonuses for policyholders 0 . 0 0 - 3 3 , 0 0 0 , 0 0 0 . 0 0 9. Operating expenses Acquisition costs 1 , 9 3 8 , 6 8 4 , 4 5 7 . 4 5 1 , 9 2 0 , 8 3 0 , 9 8 8 . 1 2 Other operating expenses 7 3 5 , 7 3 6 , 5 5 2 . 2 3 7 1 4 , 0 0 3 , 9 5 8 . 6 5 Reinsurance commissions and profit part i c i p a t i o n associated with ceded reinsurance business - 3 0 3 , 0 3 7 , 4 6 4 . 0 5 - 2 9 8 , 3 5 5 , 8 6 3 . 1 0 Total operating expenses - 2 , 3 7 1 , 3 8 3 , 5 4 5 . 6 3 - 2 , 3 3 6 , 4 7 9 , 0 8 3 . 6 7 1 0 . Other underwriting expenditure s - 2 3 1 , 1 3 2 , 1 7 0 . 2 3 - 1 9 1 , 2 5 0 , 6 7 8 . 5 2 1 1 . Change in equalization provisions 8 9 , 9 3 3 , 2 2 6 . 0 0 - 1 2 9 , 3 7 2 , 2 1 8 . 0 0 Technical result (carried forw a rd ) -4 6 9 , 5 2 2 , 5 4 9 . 4 3 -4 5 1 , 2 0 5 , 4 8 4 . 3 6

72 99 P ro p e rty & Casualty 1999 ATS 1998 ATS

Technical result (brought forw a rd ) - 4 6 9 , 5 2 2 , 5 4 9 . 4 3 - 4 5 1 , 2 0 5 , 4 8 4 . 3 6

Non-technical account:

1. Investment income and interest income Income from participating interests 1 5 1 , 4 5 0 , 0 7 2 . 5 3 1 3 3 , 1 7 7 , 8 8 5 . 4 7 Income from land and buildings 1 1 9 , 5 3 5 , 3 8 5 . 5 1 1 1 6 , 1 9 2 , 3 0 6 . 4 4 Income from other investments 4 7 1 , 9 6 0 , 0 3 1 . 7 5 4 8 5 , 7 0 9 , 2 1 2 . 0 6 P rofit from sale of investments 3 2 6 , 8 3 7 , 5 6 6 . 6 0 6 1 1 , 1 2 3 , 3 6 4 . 6 5 Other investment income and interest income 1 0 6 , 7 0 7 , 4 0 6 . 0 4 6 2 , 9 7 3 , 5 2 3 . 4 0 Total investment income 1 , 1 7 6 , 4 9 0 , 4 6 2 . 4 3 1 , 4 0 9 , 1 7 6 , 2 9 2 . 0 2 2 . Investment expenditures and interest paid Asset management expenditure s 4 0 , 0 0 1 , 7 4 8 . 8 9 4 2 , 4 1 6 , 6 0 9 . 4 0 Write-downs on investments 6 7 4 , 9 8 9 , 8 5 5 . 9 6 5 4 6 , 9 5 4 , 3 9 0 . 0 1 I n t e rest paid 4 5 , 2 6 1 , 8 8 8 . 7 4 4 7 , 7 6 2 , 1 6 1 . 6 1 Losses from sale of investments 8 , 0 2 5 , 2 8 9 . 8 1 2 , 3 4 7 , 1 4 7 . 9 8 Other investment expenditure s 2 8 , 4 4 3 , 4 4 9 . 7 7 1 5 4 , 1 9 1 , 6 9 4 . 4 4 Total investment expenditure s - 7 9 6 , 7 2 2 , 2 3 3 . 1 7 - 7 9 3 , 6 7 2 , 0 0 3 . 4 4 3. Allocated investment income transferred to the underwriting account - 3 , 2 5 0 , 6 5 1 . 6 6 - 4 , 5 8 0 , 5 6 8 . 3 4 4. Other non-technical income 7 , 4 7 8 , 5 5 2 . 9 0 3 , 5 8 0 , 3 5 2 . 4 7 5. Other non-technical expenditure s - 5 , 3 9 8 , 0 3 4 . 8 8 - 4 , 8 7 1 , 8 5 7 . 5 8 E a rnings from ord i n a ry activities (Pro p e rty & Casualty) - 9 0 , 9 2 4 , 4 5 3 . 8 1 1 5 8 , 4 2 6 , 7 3 0 . 7 7

99 73 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

Health 1 9 9 9 ATS 1 9 9 8 ATS

Technical account:

1. Earned pre m i u m s P remiums written G ro s s 3 , 2 6 1 , 1 8 1 , 5 0 1 . 2 8 Ceded reinsurance pre m i u m s - 1 1 , 7 5 5 , 9 3 0 . 0 0 3 , 2 4 9 , 4 2 5 , 5 7 1 . 2 8 3 , 1 9 0 , 8 4 4 , 5 7 6 . 2 0 Change due to premium accru a l s G ro s s - 1 , 6 5 4 , 0 5 6 . 0 0 R e i n s u rers’ share 0 . 0 0 -1 , 6 5 4 , 0 5 6 . 0 0 - 1 , 3 2 4 , 7 6 4 . 0 0 Total pre m i u m s 3 , 2 4 7 , 7 7 1 , 5 1 5 . 2 8 3 , 1 8 9 , 5 1 9 , 8 1 2 . 2 0 2. Allocated investment income 4 0 5 , 1 2 6 , 2 3 0 . 6 5 3 9 0 , 7 0 1 , 5 8 1 . 8 6 3. Other underwriting income 5 6 0 , 7 4 5 . 1 7 1 , 0 4 4 , 2 4 3 . 8 1 4. Claims incurre d Claims paid G ro s s 2 , 5 8 9 , 7 5 7 , 0 1 5 . 5 4 R e i n s u rers’ share - 1 3 , 0 0 1 , 0 7 3 . 0 0 2 , 5 7 6 , 7 5 5 , 9 4 2 . 5 4 2 , 5 1 0 , 8 3 9 , 7 2 9 . 6 9 Change in provisions for outstanding claims G ro s s 1 2 , 4 3 2 , 2 0 0 . 0 0 R e i n s u rers’ share - 2 9 6 , 5 7 6 . 0 0 1 2 , 1 3 5 , 6 2 4 . 0 0 1 0 , 5 0 1 , 6 2 7 . 0 0 Total claims -2 , 5 8 8 , 8 9 1 , 5 6 6 . 5 4 - 2 , 5 2 1 , 3 4 1 , 3 5 6 . 6 9 5. Increase in other underwriting pro v i s i o n s Other underwriting pro v i s i o n s G ro s s 4 1 7 , 6 2 4 , 1 9 1 . 0 0 R e i n s u rers’ share - 1 , 8 0 4 , 1 6 2 . 0 0 4 1 5 , 8 2 0 , 0 2 9 . 0 0 Total increase in other underwriting pro v i s i o n s - 4 1 5 , 8 2 0 , 0 2 9 . 0 0 - 4 6 7 , 5 8 3 , 4 3 1 . 0 0 6. Expenditures on profit participation bonuses for policyholders - 1 0 3 , 8 7 5 , 2 7 5 . 9 0 - 1 1 3 , 1 5 7 , 6 6 8 . 7 0 7. Operating expenses Acquisition costs 3 2 4 , 4 4 7 , 5 5 0 . 7 2 2 8 0 , 6 2 5 , 4 7 6 . 2 1 Other operating expenses 1 7 4 , 3 2 7 , 5 7 0 . 3 4 1 7 3 , 2 6 9 , 5 0 6 . 5 2 Reinsurance commissions and profit part i c i p a t i o n associated with ceded reinsurance business - 1 , 5 1 4 , 7 6 9 . 0 0 - 1 , 4 2 6 , 6 3 2 . 0 0 Total operating expenses - 4 9 7 , 2 6 0 , 3 5 2 . 0 6 - 4 5 2 , 4 6 8 , 3 5 0 . 7 3 8. Other underwriting expenditure s -3 2 , 6 9 6 , 6 1 3 . 0 2 -3 1 , 6 3 9 , 7 9 9 . 8 8 Technical result (carried forw a rd ) 1 4 , 9 1 4 , 6 5 4 . 5 8 - 4 , 9 2 4 , 9 6 9 . 1 3

74 99 H e a l t h 1 9 9 9 ATS 1 9 9 8 ATS

Technical result (brought forw a rd ) 1 4 , 9 1 4 , 6 5 4 . 5 8 - 4 , 9 2 4 , 9 6 9 . 1 3

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 2 7 , 1 4 7 , 0 7 7 . 8 1 1 2 , 9 7 7 , 5 9 1 . 5 4 Income from land and buildings 6 4 , 8 2 4 , 0 2 8 . 1 0 7 3 , 3 7 1 , 5 4 3 . 2 7 Income from other investments 2 8 9 , 1 1 0 , 4 0 7 . 1 6 3 2 4 , 6 5 4 , 1 0 0 . 7 1 P rofit from sale of investments 1 0 0 , 9 3 9 , 2 6 7 . 1 4 1 8 2 , 0 9 3 , 7 2 3 . 1 1 Other investment income and interest income 2 7 , 5 3 0 , 0 2 3 . 6 3 2 5 , 7 2 8 , 3 9 5 . 6 5 Total investment income 5 0 9 , 5 5 0 , 8 0 3 . 8 4 6 1 8 , 8 2 5 , 3 5 4 . 2 8 2. Investment expenditures and interest paid Asset management expenditure s 1 1 , 8 8 3 , 2 6 9 . 1 5 1 3 , 8 9 5 , 2 8 5 . 5 2 Write-downs on investments 8 9 , 1 6 9 , 7 9 9 . 3 8 1 9 5 , 5 5 4 , 8 7 5 . 6 6 I n t e rest paid 0 . 0 0 1 3 5 , 3 3 3 . 0 0 Other investment expenditure s 3 , 3 7 1 , 5 0 4 . 6 6 1 8 , 5 3 8 , 2 7 8 . 2 4 Total investment expenditure s - 1 0 4 , 4 2 4 , 5 7 3 . 1 9 - 2 2 8 , 1 2 3 , 7 7 2 . 4 2 3. Allocated investment income transferred to the underwriting account - 4 0 5 , 1 2 6 , 2 3 0 . 6 5 - 3 9 0 , 7 0 1 , 5 8 1 . 8 6 4. Other non-technical income 1 1 , 2 0 0 . 8 8 4 2 , 6 2 4 . 0 5 5. Other non-technical expenditure s - 6 5 , 1 5 9 . 3 2 - 1 , 2 5 5 . 6 2 E a rnings from ord i n a ry activities (Health) 1 4 , 8 6 0 , 6 9 6 . 1 4 -4 , 8 8 3 , 6 0 0 . 7 0

99 75 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

L i f e 1 9 9 9 ATS 1 9 9 8 ATS

Technical account:

1. Earned pre m i u m s P remiums written G ro s s 7 , 0 7 9 , 6 3 1 , 0 0 7 . 0 8 Ceded reinsurance pre m i u m s - 9 5 , 1 9 2 , 3 9 2 . 0 9 6 , 9 8 4 , 4 3 8 , 6 1 4 . 9 9 6 , 0 1 8 , 1 1 3 , 1 1 1 . 0 5 Change due to premium accru a l s G ro s s - 3 6 , 6 6 9 , 9 4 3 . 4 0 R e i n s u rers’ share -9 6 6 , 2 4 7 . 7 8 -3 7 , 6 3 6 , 1 9 1 . 1 8 -6 , 8 9 8 , 3 2 7 . 8 8 Total pre m i u m s 6 , 9 4 6 , 8 0 2 , 4 2 3 . 8 1 6 , 0 1 1 , 2 1 4 , 7 8 3 . 1 7 2. Allocated investment income 4 , 0 8 9 , 6 5 2 , 5 4 2 . 6 3 4 , 0 4 4 , 5 3 9 , 7 2 9 . 7 2 3. Non-realized profits from investments per Section C of the assets side of the balance sheet (fund-linked life insurance) 4 6 , 1 9 6 , 1 8 3 . 1 2 1 , 2 4 1 , 5 4 6 . 2 2 4. Other underwriting income 8 8 3 , 6 7 6 . 7 1 2 , 8 1 7 , 3 9 2 . 4 3 5. Claims incurre d Claims paid G ro s s 5 , 1 1 2 , 6 1 2 , 9 1 9 . 6 3 R e i n s u rers’ share - 7 0 , 3 9 5 , 9 3 0 . 9 7 5 , 0 4 2 , 2 1 6 , 9 8 8 . 6 6 4 , 9 2 7 , 8 8 2 , 5 8 8 . 2 9 Change in provisions for outstanding claims G ro s s - 2 , 8 4 1 , 0 2 7 . 0 0 R e i n s u rers’ share - 4 9 1 , 8 0 8 . 0 0 - 3 , 3 3 2 , 8 3 5 . 0 0 - 3 , 8 3 8 , 6 6 5 . 0 0 Total claims - 5 , 0 3 8 , 8 8 4 , 1 5 3 . 6 6 - 4 , 9 2 4 , 0 4 3 , 9 2 3 . 2 9 6. Increase in other underwriting pro v i s i o n s P remium re s e rv e G ro s s 2 , 1 8 0 , 8 2 2 , 4 9 1 . 1 9 R e i n s u rers’ share -5 , 3 8 0 , 0 2 2 . 9 6 2 , 1 7 5 , 4 4 2 , 4 6 8 . 2 3 1 , 2 7 2 , 5 9 0 , 3 6 1 . 9 2 Other underwriting pro v i s i o n s G ro s s 0 . 0 0 R e i n s u rers’ share 0 . 0 0 0 . 0 0 -3 8 , 5 0 0 , 0 0 0 . 0 0 Total increase in other underwriting pro v i s i o n s - 2 , 1 7 5 , 4 4 2 , 4 6 8 . 2 3 - 1 , 2 3 4 , 0 9 0 , 3 6 1 . 9 2 7 . E x p e n d i t u res on profit participation bonuses and pro f i t p a rticipation schemes for policyholders G ro s s 1 , 8 0 6 , 3 0 0 , 0 0 0 . 0 0 R e i n s u rers’ share -3 0 0 , 0 0 0 . 0 0 1 , 8 0 6 , 0 0 0 , 0 0 0 . 0 0 1 , 9 2 6 , 0 0 0 , 0 0 0 . 0 0 Total profit part i c i p a t i o n - 1 , 8 0 6 , 0 0 0 , 0 0 0 . 0 0 - 1 , 9 2 6 , 0 0 0 , 0 0 0 . 0 0 8. Operating expenses Acquisition costs 1 , 1 2 8 , 9 3 0 , 1 9 0 . 6 8 9 2 8 , 1 2 9 , 5 9 9 . 3 3 Other operating expenses 3 6 1 , 0 0 9 , 2 0 1 . 4 4 3 5 8 , 6 6 4 , 1 2 6 . 1 4 Reinsurance commissions and profit participation associated with ceded reinsurance business - 1 2 , 7 7 4 , 0 9 2 . 8 9 - 1 3 , 9 8 4 , 9 6 4 . 4 6 Total operating expenses - 1 , 4 7 7 , 1 6 5 , 2 9 9 . 2 3 - 1 , 2 7 2 , 8 0 8 , 7 6 1 . 0 1 9. Non-realized losses from investments per Section C of the assets side of the balance sheet (fund-linked life insurance) - 1 , 0 6 9 , 7 8 6 . 5 3 - 7 8 , 4 8 9 . 2 8 1 0 . Other underwriting expenditure s - 7 3 , 7 5 3 , 5 4 1 . 7 8 - 7 3 , 0 4 1 , 3 3 1 . 0 8 Technical result (carried forw a rd ) 5 1 1 , 2 1 9 , 5 7 6 . 8 4 6 2 9 , 7 5 0 , 5 8 4 . 9 6

76 99 L i f e 1 9 9 9 ATS 1 9 9 8 ATS

Technical result (brought forw a rd ) 5 1 1 , 2 1 9 , 5 7 6 . 8 4 6 2 9 , 7 5 0 , 5 8 4 . 9 6

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 7 1 , 6 7 9 , 2 2 4 . 6 7 4 8 , 6 0 2 , 6 4 2 . 8 0 Income from land and buildings 2 3 6 , 5 1 4 , 1 3 3 . 2 8 2 3 6 , 8 6 4 , 6 7 6 . 8 2 Income from other investments 2 , 9 9 5 , 2 1 8 , 8 0 2 . 6 3 3 , 0 3 7 , 4 7 7 , 4 3 1 . 7 9 P rofit from sale of investments 1 , 7 7 7 , 4 7 4 , 5 5 9 . 9 3 1 , 2 9 2 , 8 3 7 , 9 0 4 . 8 8 Other investment income and interest income 2 1 7 , 1 9 0 , 3 7 7 . 2 8 1 0 2 , 9 2 9 , 6 1 9 . 9 0 Total investment income 5 , 2 9 8 , 0 7 7 , 0 9 7 . 7 9 4 , 7 1 8 , 7 1 2 , 2 7 6 . 1 9 2. Investment expenditures and interest paid Asset management expenditure s 4 2 , 5 3 1 , 9 8 0 . 3 9 4 0 , 7 1 6 , 6 4 1 . 6 9 Write-downs on investments 1 , 1 6 1 , 1 5 9 , 0 6 4 . 5 8 5 5 3 , 0 3 0 , 0 4 9 . 0 5 I n t e rest paid 7 2 8 . 0 0 0 . 0 0 Losses from sale of investments 1 , 1 1 0 , 8 7 3 . 9 2 6 , 3 3 4 , 0 9 8 . 0 2 Other investment expenditure s 3 , 6 2 1 , 9 0 8 . 2 7 7 4 , 0 9 1 , 7 5 7 . 7 1 Total investment expenditure s - 1 , 2 0 8 , 4 2 4 , 5 5 5 . 1 6 - 6 7 4 , 1 7 2 , 5 4 6 . 4 7 3. Allocated investment income transferred to the underwriting account - 4 , 0 8 9 , 6 5 2 , 5 4 2 . 6 3 - 4 , 0 4 4 , 5 3 9 , 7 2 9 . 7 2 4. Other non-technical income 1 7 6 , 9 1 8 . 2 8 9 1 2 , 6 6 4 . 6 8 5. Other non-technical expenditure s - 3 0 6 , 7 6 8 . 4 6 - 7 0 , 4 3 0 . 6 1 E a rnings from ord i n a ry activities (Life) 5 1 1 , 0 8 9 , 7 2 6 . 6 6 6 3 0 , 5 9 2 , 8 1 9 . 0 3

99 77 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

P ro p e rty & Casualty + Health + Life = To t a l 1 9 9 9 ATS 1 9 9 8 ATS

Technical result (brought forw a rd ) 5 6 , 6 1 1 , 6 8 1 . 9 9 1 7 3 , 6 2 0 , 1 3 1 . 4 7

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 2 5 0 , 2 7 6 , 3 7 5 . 0 1 1 9 4 , 7 5 8 , 1 1 9 . 8 1 Income from land and buildings 4 2 0 , 8 7 3 , 5 4 6 . 8 9 4 2 6 , 4 2 8 , 5 2 6 . 5 3 Income from other investments 3 , 7 5 6 , 2 8 9 , 2 4 1 . 5 4 3 , 8 4 7 , 8 4 0 , 7 4 4 . 5 6 P rofit from sale of investments 2 , 2 0 5 , 2 5 1 , 3 9 3 . 6 7 2 , 0 8 6 , 0 5 4 , 9 9 2 . 6 4 Other investment income and interest income 3 5 1 , 4 2 7 , 8 0 6 . 9 5 1 9 1 , 6 3 1 , 5 3 8 . 9 5 Total investment income 6 , 9 8 4 , 1 1 8 , 3 6 4 . 0 6 6 , 7 4 6 , 7 1 3 , 9 2 2 . 4 9 2. Investment expenditures and interest paid Asset management expenditure s 9 4 , 4 1 6 , 9 9 8 . 4 3 9 7 , 0 2 8 , 5 3 6 . 6 1 Write-downs on investments 1 , 9 2 5 , 3 1 8 , 7 1 9 . 9 2 1 , 2 9 5 , 5 3 9 , 3 1 4 . 7 2 I n t e rest paid 4 5 , 2 6 2 , 6 1 6 . 7 4 4 7 , 8 9 7 , 4 9 4 . 6 1 Losses from sale of investments 9 , 1 3 6 , 1 6 3 . 7 3 8 , 6 8 1 , 2 4 6 . 0 0 Other investment expenditure s 3 5 , 4 3 6 , 8 6 2 . 7 0 2 4 6 , 8 2 1 , 7 3 0 . 3 9 Total investment expenditure s - 2 , 1 0 9 , 5 7 1 , 3 6 1 . 5 2 - 1 , 6 9 5 , 9 6 8 , 3 2 2 . 3 3 3. Allocated investment income transferred to the underwriting account - 4 , 4 9 8 , 0 2 9 , 4 2 4 . 9 4 - 4 , 4 3 9 , 8 2 1 , 8 7 9 . 9 2 4. Other non-technical income 7 , 6 6 6 , 6 7 2 . 0 6 4 , 5 3 5 , 6 4 1 . 2 0 5. Other non-technical expenditure s - 5 , 7 6 9 , 9 6 2 . 6 6 - 4 , 9 4 3 , 5 4 3 . 8 1 6. Earnings from ord i n a ry activities 4 3 5 , 0 2 5 , 9 6 8 . 9 9 7 8 4 , 1 3 5 , 9 4 9 . 1 0 7. Taxes on profit and income - 5 5 , 3 4 1 , 2 0 7 . 1 0 - 1 1 2 , 6 4 3 , 9 4 1 . 4 4 8. Profit for the year 3 7 9 , 6 8 4 , 7 6 1 . 8 9 6 7 1 , 4 9 2 , 0 0 7 . 6 6 9. Withdrawals from re s e rv e s Withdrawals from valuation re s e rves associated with special write-downs 2 9 5 , 2 4 6 , 2 1 9 . 2 1 4 6 , 7 3 8 , 3 5 7 . 1 4 Withdrawals from other untaxed re s e rv e s 2 3 2 , 0 5 6 , 9 6 1 . 0 0 2 6 4 , 9 5 9 , 3 5 1 . 0 0 Withdrawals from capital re s e rves/jubilee bonus 7 0 , 0 0 0 , 0 0 0 . 0 0 0 . 0 0 Withdrawals from free re s e rv e s 1 0 0 , 5 0 0 , 0 0 0 . 0 0 0 . 0 0 Total withdrawals from re s e rv e s 6 9 7 , 8 0 3 , 1 8 0 . 2 1 3 1 1 , 6 9 7 , 7 0 8 . 1 4 1 0 . Transfers to re s e rv e s Transfers to risk re s e rve per §73a of the Insurance Companies Supervision Act 3 1 , 5 0 8 , 9 9 1 . 0 0 8 , 1 2 3 , 1 5 6 . 0 0 Transfers to valuation re s e rves associated with special write-downs 6 , 6 1 1 , 8 0 9 . 0 0 3 2 9 , 8 4 7 , 9 3 8 . 4 1 Transfers to other untaxed re s e rv e s 5 8 4 , 6 5 8 , 7 2 8 . 0 0 6 8 , 8 8 8 , 5 6 9 . 0 0 Transfers to free re s e rv e s 2 2 2 , 0 3 8 , 7 8 4 . 0 0 3 0 8 , 2 4 1 , 4 5 8 . 0 0 Total transfers to re s e rv e s - 8 4 4 , 8 1 8 , 3 1 2 . 0 0 - 7 1 5 , 1 0 1 , 1 2 1 . 4 1 1 1 . P rofit for the year 2 3 2 , 6 6 9 , 6 3 0 . 1 0 2 6 8 , 0 8 8 , 5 9 4 . 3 9 1 2 . P rofit brought forw a rd 2 2 , 3 4 4 , 6 8 4 . 8 3 1 7 , 1 9 2 , 0 9 0 . 4 4 Net pro f i t 2 5 5 , 0 1 4 , 3 1 4 . 9 3 2 8 5 , 2 8 0 , 6 8 4 . 8 3

78 99 Auto Third Party Liability Insurance 1 9 9 9 ATS 1 9 9 8 ATS

Separate income statement ( p r i m a ry domestic business):

1. Earned pre m i u m s P remiums written G ro s s 1 , 9 4 8 , 6 1 0 , 2 6 2 . 0 0 Ceded reinsurance pre m i u m s - 2 2 , 1 9 8 , 0 7 5 . 4 4 1 , 9 2 6 , 4 1 2 , 1 8 6 . 5 6 2 , 0 3 7 , 1 1 6 , 8 0 4 . 5 3 Change due to premium accru a l s G ro s s 1 3 , 0 4 7 , 1 0 5 . 9 4 R e i n s u rers’ share - 3 9 5 , 9 5 1 . 4 9 1 2 , 6 5 1 , 1 5 4 , 5 4 9 , 6 4 6 , 3 1 8 . 3 8 Total pre m i u m s 1 , 9 3 9 , 0 6 3 , 3 4 1 . 0 1 2 , 0 4 6 , 7 6 3 , 1 2 2 . 9 1 2. Other underwriting income 1 , 1 7 0 , 4 2 2 . 0 0 1 , 6 7 3 , 1 9 9 . 0 0 3. Claims incurre d Claims paid G ro s s 1 , 4 8 7 , 9 8 8 , 0 4 6 . 0 0 R e i n s u rers’ share - 1 , 5 4 8 , 5 9 8 . 8 5 1 , 4 8 6 , 4 3 9 , 4 4 7 . 1 5 1 , 4 4 9 , 8 5 3 , 4 6 5 . 3 0 Change in provisions for outstanding claims G ro s s 3 4 , 5 8 3 , 6 9 0 . 0 0 R e i n s u rers’ share 1 7 , 8 3 8 , 9 9 7 . 1 6 5 2 , 4 2 2 , 6 8 7 . 1 6 9 7 , 9 6 9 , 8 1 5 . 0 5 Total claims - 1 , 5 3 8 , 8 6 2 , 1 3 4 . 3 1 -1 , 5 4 7 , 8 2 3 , 2 8 0 . 3 5 4. Expenditures on premium re f u n d s - 2 1 4 , 5 4 6 . 0 0 - 1 , 3 3 8 , 8 2 9 . 0 0 5. Operating expenses Acquisition costs 4 1 2 , 9 8 5 , 0 2 3 . 5 9 4 1 0 , 6 5 8 , 2 8 4 . 9 7 Other operating expenses 2 2 9 , 3 2 9 , 0 8 3 . 3 3 2 2 2 , 6 2 6 , 4 3 4 . 3 1 Reinsurance commissions and profit part i c i p a t i o n associated with ceded reinsurance business - 4 4 6 , 1 9 1 . 5 1 -6 3 3 , 3 5 6 . 0 9 Total operating expenses - 6 4 1 , 8 6 7 , 9 1 5 . 4 1 - 6 3 2 , 6 5 1 , 3 6 3 . 1 9 6. Other underwriting expenditure s - 5 4 , 1 2 5 , 1 6 7 . 0 0 -4 9 , 7 7 9 , 3 6 2 . 0 0 7. Change in equalization provisions 4 1 , 0 4 0 , 0 0 1 . 0 0 -5 1 , 9 0 9 , 4 9 6 . 0 0 Technical result (Auto Third Party Liability) - 2 5 3 , 7 9 5 , 9 7 8 . 7 1 - 2 3 5 , 0 6 6 , 0 0 8 . 6 3

99 79 Bank Austria Master Fonds dynamisch, Bank Appendix Austria Master Fonds pro g re s s i v, Europa To p Fund, Top Amerika Fonds, Cash Euro Fonds, Bank Austria Master Fonds traditionell, EU-Bond I. General Information Regard i n g Fonds, Dollar Rent Fonds, Plus Invest Fonds, Accounting and Va l u a t i o n Constantia Euro Bond Fonds, Fondis Investment M e t h o d s Fonds, Merc u ry ST. North American Fund, M e rc u ry ST. European Opport. Fund, Merc u ry ST. These annual financial statements were drawn up Japan Opport. Fund, Fidelity European Gro w t h in accordance with the principles of pro p e r Fund, Fidelity Japan Fund, Fleming FF American a c c o u n t i n g and the general re q u i rements that Fund, Fleming FF American Fledgeling Fund, stipulate that a true and fair view of the com- Fidelity Japan Small Companies Fund, Invesco p a n y ’s assets and financial and earnings situa- GT Japan Fund, Invesco GT Japan Enterprise tion be presented. Fund, Vontobel Fund Emerging Markets, Merc u ry S T. Emerging Markets Fund, CS EF (LUX) Small The principle of conservative accounting w a s Cap Fund, Fleming FF European Small o b s e rved in that only profits that had been re a l- Companies Fund, Invesco GT Pan Euro p e a n ized by the balance sheet date were re p o rt e d , Fund, Invesco GT Pan European Enterprise Fund, and all foreseeable risks and imminent losses Fidelity Growth Fidelity Portfolio Selector Fund, w e re included in the balance sheet. The amounts M o rgan Stanley Emerging Markets Fund, Morg a n shown are basically in ATS thousand. Figures for Stanley Japan Equity Fund, Morgan Stanley US- 1998 are either identified as such or put in pare n- Small Companies Fund, Fidelity Global Fidelity theses. P o rtfolio Selector Fund, Dekarent Intern a t i o n a l Fonds, Vontobel USD Bond Fund, Invesco GT II. Accounting and Va l u a t i o n E m e rging Markets Bond, Merc u ry ST. Euro p e a n Principles Bond Fund, CS Bond Fund (LUX) USD, CS Bond Fund (LUX) Euro, Fidelity Moderate Fidelity L a n d is valued at acquisition cost and b u i l d i n g s P o rtfolio Selector Fund, Fleming FF Emerg i n g at acquisition or construction costs, subject to Markets Debt. Fund and Morgan Stanley scheduled depreciation. Expenditures on main- E m e rging Markets Debt Fund. tenance for residential buildings rented to indivi- duals not employed by the company are basically All other securities, including shares in aff i l i- s p read over 10 years. ated companies and participating intere s t s, a re valued strictly according to the lower of cost Valuation of investments for the benefit of or market principle. fund-linked life insurance policyholders i s based on market value. Investments have been M o rtgage loans and other loans, including made in the following funds: Vo r s o rg e - loans to affiliated companies and companies Rentenfonds, C-Quadrat Leonardo Wa l k i n g w h e re there is a part i c i p a t o ry relationship, are Fonds, C-Quadrat Leonardo Jogging Fonds, generally valued at the nominal value outstand-

80 99 ing. Any discounts associated with additional u n f o reseeable major claims. Lump-sum pro v i- payments are distributed over the term of the sions are established for belated claims, based loan and re p o rted under deferred income and on past experience. a c c rued expenses on the liabilities side of the balance sheet. The provisions for outstanding insurance claims in health insurance are established based on flat- Adequate individual adjustments have been rate percentages of benefits paid during the year. made for doubtful re c e i v a b l e s; these have been The percentages did not change relative to 1998. deducted from the nominal amounts. Ta n g i b l e In indirect business, the provisions for outstand- a s s e t s (not including land and buildings) are ing claims are primarily based on inform a t i o n valued at acquisition cost, minus scheduled supplied by the original insurers on the balance d e p reciation. Low-value assets are completely sheet date(s) on 31 December 1998 and/or 31 written off in the year of entry. There were no December 1999. Additions were made to re- w r i t e - u p s on assets. p o rted amounts wherever this was considere d n e c e s s a ry in light of past experience. U n e a rned pre m i u m s in pro p e rty & casualty are essentially prorated temporally; a deduction in The equalization pro v i s i o n s a re determined in the amount of ATS thousand 163,540 (ATS thou- a c c o rdance with the regulations set forth in the sand 157,313) was made for costs. In life insur- o rdinance issued by the Federal Minister of ance, the provisions for unearned premiums are Finance (Federal Legal Gazette No. 545/1991, as established at the level stipulated in the com- amended by Federal Legal Gazette II, No. p a n y ’s general business plan; no deduction was 6 6 / 1 9 9 7 ) . made for costs. In health insurance, unearn e d p remiums are prorated temporally, with no The p rovisions for profit participation bonuses deduction for costs. and profit participation schemes include the amounts which were set aside for granting re- The p remium re s e rv e is computed in accord- bates to policyholders on premiums (as set fort h ance with formulae approved by the re g u l a t o ry in the general business plan and the articles authorities responsible for the insurance industry of incorporation), and which had not yet been or in accordance with the general business plan claimed as of the balance sheet date. submitted to the aforementioned re g u l a t o ry authorities, based on the accounting principles The p rovisions for severance payments a m o u n t specified in the general business plan. to 50% of the re q u i red cover for projected severance payments (the amounts applicable as of 31 In the case of claims re p o rted up to the balance December 1999 are set forth by law or in the sheet date, the p rovisions for outstanding collective bargaining agreement); the figure is claims in primary pro p e rty & casualty and life 60% for employees who have reached the age of insurance business are determined via individual 50 as of the balance sheet date. On the balance valuation of the outstanding claims and supple- sheet date on 31 December 1999, actuarial mented by a lump-sum additional allowance for methods were used to calculate the re q u i re d

99 81 cover for severance payments (an assumed inter- at the mean exchange rate on the balance sheet est rate of 6% and the standard - e n t ry - a g e date (and, re s p e c t i v e l y, converted at the fixed method were used); the resulting figure was AT S e u ro rate). thousand 1,111,239 (ATS thousand 171,130,457), which equals 63.0% of the re q u i red cover for In life and pro p e rty & casualty insurance, the p rojected severance payments. u n d e rwriting items for inwards insurance business and the associated re t rocession The provisions re p o rted in the balance sheet are c h a rges are in some cases entered in the annual ATS thousand 134,728 (ATS thousand 130,563) financial statements based on a deferral of one less than the re q u i red provisions calculated using y e a r. the aforementioned methods. The following should be noted with re g a rd to The ATS thousand 3,492,470 (ATS thousand contingencies not shown in the balance 3,483,300) in p rovisions for pensions re p o rt e d sheet: T h e re is a letter of comfort in favor of in the balance sheet as of 31 December 1999 Business Park Brunn Entwicklungs GmbH in the consist of the provisions for pensions in the amount of ATS thousand 32,000 (ATS thousand amount of ATS thousand 3,051,700 (ATS thou- 32,000) and a guarantee letter in favor of APC- sand 2,980,593), which were calculated in accord- Geschäftscenter Betriebsgesellschaft m.b.H. in ance with § 14 and § 116 of the Income Tax Act; the amount of ATS thousand 11,000 (ATS thou- a taxed amount of ATS thousand 26,595 sand 13,000). Furt h e rm o re, Wiener Städtische is ( ATS thousand 26,595); and an under- a c c ru a l jointly and severally liable for loans raised by of ATS thousand 414,176 (ATS 476,111) per C o u n t ry Inn VIC Hotelerrichtungs- und A rt. X, Sections 3 and 4 of the Financial Betriebsgesellschaft m.b.H. up to a total of AT S R e p o rting Act, which is re p o rted separately thousand 143,000 (ATS thousand 143,000); there under deferred expenses and accrued income is a letter of undertaking with respect to Züblin on the assets side of the balance sheet. P rojektentwicklung GmbH re g a rding the acquisi- In 1999 the under- a c c rual fell by tion of two buildings for the Friedrichscarre é ATS thousand 61,935 (ATS thousand 66,345). Berlin-Mitte project with a purchase price of about DEM thousand 115,000 (DEM thousand 0); The provisions for pensions are ATS thousand and there is a declaration of liability with re s p e c t 88,719 (ATS thousand 189,375) less than the sum to Technopark Grundstück GmbH & Co. KG of the cover capital for vested rights to future re g a rding the acquisition of the Technopark II pension payments (calculated using an assumed G r a s b runn München Ost land parcel (the port i o n i n t e rest rate of 6% [Ettl-Pagler method] and the of the purchase price is DEM thousand 69.500 s t a n d a rd - e n t ry-age method) and the cash value [DEM thousand 0]). Furt h e rm o re, there are decla- of liquid pensions in the amount of ATS thousand rations of liability re g a rding the payment of loan 3,581,189 (ATS 3,672,674). liabilities of Projektbau Wals GesmbH in the amount ATS thousand 48,000 (ATS thousand 0) Items in the annual accounts stated in f o re i g n and of loan liabilities of PFG Parkflächen- c u rre n c i e s a re converted into Austrian schillings b e w i rtschaftungs GmbH in the amount of

82 99 ATS thousand 24,900 (ATS thousand 0). The current market value of investments is as follows: F u rt h e rm o re, Wiener Städtische is liable for loan repayments made by our employees to Spar- und Items per § 81c, Section 2 of the Current value Current value Vorschuss-Kasse der Angestellten der Wi e n e r Insurance Companies Supervision Act as of 31 Dec. ’99 as of 31 Dec. ’98 Städtische Allgemeine Ve r s i c h e rung Aktien- Land and buildings 10,335,684 – gesellschaft re g . G e n . m.b.H. in the amount of Shares in affiliated companies 6,758,370 3,280,641 ATS thousand 2,782 (ATS thousand 2,570). Loans to affiliated companies and bonds issued by affiliated III. Notes Regarding Balance companies 679,244 215,850 Sheet Items Participating interests 2,512,172 5,398,465 Bonds issued by and loans to companies where there Intangible assets a c q u i red from affiliated com- is a participatory relationship 2,456,853 2,314,069 panies in the amount of ATS thousand 2,695 Shares and other ( ATS thousand 3,835) are included in the figure variable-yield securities 27,309,594 21,903,706 shown in the balance sheet. Bonds and other fixed- income securities 16,100,809 18,248,429 As of 31 December 1999, the land value of Mortgage loans 4,664,620 4,760,225 developed and undeveloped land was AT S Prepayments on policies 274,947 201,385 thousand 1,979,846 (ATS thousand 2,070,295). Other loans 15,636,997 16,882,397 Balances at banks 46,323 31,592 The balance-sheet value of land used by Deposits retained 1,063,432 988,121 Wiener Städtische is ATS thousand 1,187,987 87,839,045 74,224,880 ( ATS 1,077,545).

Other loans not covered by an insurance con- The current market values for land and buildings tract include the following: loans to the Republic w e re determined in accordance with the re c o m- of Austria in the amount of ATS thousand mendations of the Austrian Association of 11,996,300 (ATS thousand 13,324,910); loans Insurance Companies. Valuations were larg e l y to other public corporations in the amount of based on appraisals conducted in 1999. By ATS thousand 2,007,694 (ATS 1,891,004); and valuation year, the market values resulting fro m loans to other borrowers in the amount appraisals are as follows: 1999: ATS thousand of ATS thousand 1,633,003 (ATS thousand 8,722,642; 1998: ATS thousand 1,297,650; 1997: 1 , 6 6 6 , 4 8 3 ) . ATS thousand 112,392; 1996: ATS thousand 0; 1995: ATS thousand 203,000.

S h a res in affiliated companies and part i c i p a t i n g i n t e rests are valued at market prices. In cases w h e re this does not apply, they are valued at the higher of acquisition cost (minus non-scheduled d e p reciation, if any), or the appropriate pro p o rt i o n

99 83 of equity shown in the most recent financial state- In life insurance, the p remium re s e rv e s a re cal- ments. Shares and other securities are valued at culated in accordance with the principles set market prices or, if this does not apply, at acqui- f o rth in the general business plan and appro v e d sition cost minus non-scheduled depreciation, if by the re g u l a t o ry authorities responsible for the a n y. Other investments are valued at the nominal insurance industry, or in accordance with other value minus non-scheduled depreciation, if any. principles of which the aforementioned re g u l a t o ry In health insurance, premium re s e rv e s for each authorities have been informed. contract group were calculated in accord a n c e with the principles set forth in the general busi- The premium re s e rves are calculated separately ness plan and by the re g u l a t o ry authorities re s- for each individual contract; the pro s p e c t i v e ponsible for the insurance industry. method is used in almost all cases.

In the case of individual insurance contracts. The following are the most important pro b a b i l i t y the premium re s e rves are always calculated tables used: based on each individual contract. This also DM 24/26, ÖVM 80-82, ÖVM 90-92 in the case of applies to new contracts within group insurance endowment policies plans covered by the 1994 amendment to EROM/EROF; AVÖ (as revised in 1996) in the the Insurance Contract Act. In the case of case of pension plans. the remaining contracts within the group insurance plan, an overall premium re s e rve is estab- In the case of most existing policies, the pre m i u m l i s h e d . re s e rves are calculated based on an assumed i n t e rest rate of 3% p.a.; in the case of some of P remium re s e rves are always calculated using the more recent rates, the premium re s e rves were the prospective method. The method for calcula- calculated based on an assumed interest rate of ting premium re s e rves takes into account the fact 4% p.a. that in the event that the insured party cancels his/her contract early or dies, the premium re- Notes re g a rding pension pro v i s i o n s and s e v e r- s e rves for the contract in question will be forf e i- ance pay pro v i s i o n s a re to be found in Section II ted and will fall to the group of insured persons of the Appendix. as a whole. Under other liabilities, tax liabilities a c c o u n t e d The premium re s e rves are calculated based on for ATS thousand 180,192 (ATS thousand actuarial figures re g a rding the frequency of 319,584) and social security liabilities a c c o u n t- claims. These figures are based on Wi e n e r ed for ATS thousand 49,844 (ATS thousand S t ä d t i s c h e ’s own history of claims. Death rates 4 9 , 5 7 7 ) . w e re taken from the general mortality tables for Austrian men (1949-51). The premium re s e rv e s a re generally calculated based on an assumed i n t e rest rate of 3% p.a. (the same assumption as is made when calculating pre m i u m s ) .

84 99 A ffiliated companies and companies in which participating interests are held accounted for the following balance sheet items:

Amounts in ATS thousand Affiliated companies Companies in which participating interests are held

1 9 9 9 1 9 9 8 1 9 9 9 1 9 9 8

Balances at banks 0 0 2 , 0 0 0 2 , 5 0 0 M o rtgage loans 8 5 9 , 4 3 3 8 6 2 , 6 4 9 5 9 , 6 0 5 6 0 , 8 6 2 Deposits re t a i n e d 1 4 7 , 6 1 0 6 2 , 2 1 6 6 1 9 , 9 3 3 5 7 2 , 8 4 7 Receivables arising from primary insurance operations 5 , 6 4 7 1 , 8 6 7 1 , 9 8 2 5 7 7 Accounts receivable arising fro m reinsurance business 6 , 3 2 1 8 , 6 9 7 1 7 0 , 3 5 3 1 7 3 , 5 7 5 Other re c e i v a b l e s 7 8 1 , 3 6 4 5 1 9 , 4 7 8 1 5 7 , 6 6 2 9 0 , 7 9 8 Liabilities arising from primary insurance operations 5 , 2 0 2 1 , 9 1 6 3 , 0 3 1 1 , 7 0 3 Accounts payable associated with reinsurance business 1 4 , 3 4 6 1 0 , 4 4 4 4 5 , 1 8 0 2 2 , 2 9 9 Other liabilities 3 7 , 1 5 2 6 9 , 6 3 5 1 4 5 , 9 8 0 1 1 0 , 5 6 5

The balance sheet figures for intangible assets, land and buildings, and investments in a ffiliated companies and participating interests changed as follows during the year:

Amounts in I n t a n g i b l e Land and S h a res in Bonds issued P a rt i c i p a t i n g Bonds issued ATS thousand a s s e t s b u i l d i n g s a ff i l i a t e d by affi l i a t e d i n t e re s t s by and loans to c o m p a n i e s co m p a n i e s companies where and loans to t h e re is a part i c i p a t o ry aff i l i a t e d re l a t i o n s h i p co m p a n i e s

Status as of 31 December 1998 4 0 , 9 8 8 9 , 0 1 8 , 4 3 2 2 , 8 2 0 , 8 6 3 2 1 5 , 8 5 0 4 , 9 4 6 , 4 4 9 2 , 2 1 6 , 7 9 4 A d d i t i o n s 1 7 , 1 3 6 7 5 9 , 6 4 3 3 , 5 9 3 , 6 1 4 6 5 4 , 0 2 5 3 0 3 , 7 5 3 5 6 9 , 3 0 3 D i s p o s a l s 0 3 5 , 4 4 8 6 1 , 2 4 3 1 , 9 5 3 2 , 3 9 2 , 0 5 7 3 5 4 , 2 1 7 Tr a n s f e rred to another account 0 0 - 7 , 9 7 0 - 1 9 0 , 0 0 0 - 8 8 6 , 3 2 9 - 1 0 , 0 0 0 D e p re c i a t i o n 1 7 , 4 0 9 8 2 4 , 8 0 3 4 0 , 0 9 4 0 1 6 , 9 0 8 1 , 1 5 1 Status as of 31 December 1999 4 0 , 7 1 5 8 , 9 1 7 , 8 2 4 6 , 3 0 5 , 1 7 0 6 7 7 , 9 2 2 1 , 9 5 4 , 9 0 8 2 , 4 2 0 , 7 2 9

99 85 I V. Notes Regarding the Income Statement

In 1999, in pro p e rty & casualty the premiums written, earned premiums, claims incurred, operating expenses and the reinsurance balance broke down as follows (amounts in ATS thousand):

G ro s s P re m i u m s Ea rn e d Cl a i m s Op e r a t i n g Re i n s u r a n c e w r i t t e n pre m i u m s in c u r red ex p e n s e s ba l a n c e

Amounts in ATS thousand

Direct business

F i re and fire 1 , 0 2 0 , 1 0 1 1 , 0 1 4 , 5 8 4 7 6 1 , 3 7 3 3 2 2 , 0 7 3 1 0 4 , 8 5 5 shutdown insurance Household insurance 7 9 0 , 6 1 4 7 8 8 , 2 0 7 3 8 6 , 1 8 7 2 5 4 , 9 3 2 – 3 , 4 6 8 Other pro p e rty insurance 1 , 0 4 1 , 1 4 5 1 , 0 3 5 , 8 9 4 7 0 9 , 0 7 0 3 4 3 , 9 0 7 – 2 9 , 2 7 4 Auto third party liability insurance 1 , 9 4 8 , 6 1 0 1 , 9 6 1 , 6 5 7 1 , 5 2 2 , 5 7 2 6 4 2 , 3 1 4 – 3 8 , 4 3 8 Other auto insurance 9 7 4 , 3 2 8 9 6 1 , 4 7 1 8 7 6 , 0 8 8 2 9 3 , 9 0 9 – 9 , 2 9 9 Accident insurance 6 7 8 , 7 2 3 6 7 6 , 2 1 3 3 2 8 , 1 2 4 2 3 3 , 4 2 6 – 2 1 , 6 3 6 General liability insurance 7 4 9 , 0 2 6 7 4 3 , 7 1 2 5 5 6 , 9 7 9 2 5 1 , 4 5 5 – 6 6 , 7 0 5 Legal expenses insurance 2 7 1 , 2 2 3 2 7 1 , 1 8 5 1 2 5 , 3 4 2 8 5 , 8 5 4 – 1 2 0 Marine, aviation and transport insurance 2 0 7 , 7 4 7 2 0 2 , 7 4 2 3 2 1 , 2 5 4 5 4 , 0 0 5 1 2 3 , 8 8 0 C redit and guarantee insurance 3 6 2 3 6 2 9 1 7 7 – 3 3 3 Other lines of insurance 5 5 , 1 5 7 5 4 , 2 4 7 6 6 , 8 5 0 2 0 , 1 4 8 8 , 4 7 2 7 , 7 3 7 , 0 3 6 7 , 7 1 0 , 2 7 4 5 , 6 5 3 , 9 3 0 2 , 5 0 2 , 1 0 0 6 7 , 9 3 4 1998 figure s 7 , 6 9 9 , 3 8 4 7 , 7 1 2 , 6 0 6 5 , 5 4 0 , 2 9 1 2 , 4 4 7 , 7 7 9 3 0 5 , 3 1 4

I n d i rect business Marine, aviation and transport insurance 5 , 3 6 3 5 , 2 4 2 8 , 0 7 2 7 5 6 1 , 8 8 9 Other lines of insurance 4 3 6 , 0 9 3 4 3 8 , 4 6 8 2 5 6 , 2 6 9 1 7 1 , 5 6 5 4 , 3 9 5 4 4 1 , 4 5 6 4 4 3 , 7 1 0 2 6 4 , 3 4 1 1 7 2 , 3 2 1 6 , 2 8 4 1998 figure s 6 8 9 , 2 5 3 6 9 3 , 7 5 1 4 7 1 , 1 3 3 1 8 7 , 0 5 5 – 3 2 , 1 7 4

D i rect and indirect business combined 8 , 1 7 8 , 4 9 2 8 , 1 5 3 , 9 8 4 5 , 9 1 8 , 2 7 1 2 , 6 7 4 , 4 2 1 7 4 , 2 1 8 1998 figure s 8 , 3 8 8 , 6 3 7 8 , 4 0 6 , 3 5 7 6 , 0 1 1 , 4 2 4 2 , 6 3 4 , 8 3 4 2 7 3 , 1 4 0

86 99 In 1999, premiums written in health insurance broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

D i rect business Individual insurance 2 , 2 4 7 , 5 9 1 2 , 2 0 1 , 4 6 8 G roup insurance 1 , 0 0 7 , 8 7 2 9 9 5 , 4 9 9 I n d i rect business Individual insurance 3 , 3 0 2 2 7 0 G roup insurance 2 , 4 1 7 4 , 1 2 8 3 , 2 6 1 , 1 8 2 3 , 2 0 1 , 3 6 5

In 1999, premiums written in life insurance broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

D i rect business 6 , 8 3 6 , 7 5 6 5 , 9 0 4 , 9 3 8 I n d i rect business 2 4 2 , 8 7 5 2 0 6 , 6 8 9 7 , 0 7 9 , 6 3 1 6 , 1 1 1 , 6 2 7

In 1999, premiums from direct life insurance operations broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Individual insurance 6 , 2 2 3 , 5 0 0 5 , 4 0 0 , 4 2 2 G roup insurance 6 1 3 , 2 5 6 5 0 4 , 5 1 6 6 , 8 3 6 , 7 5 6 5 , 9 0 4 , 9 3 8 O n e - t i m e - p remium polices 2 , 2 0 4 , 5 0 9 1 , 4 8 9 , 2 7 7 R e g u l a r- p remium polices 4 , 6 3 2 , 2 4 7 4 , 4 1 5 , 6 6 1 6 , 8 3 6 , 7 5 6 5 , 9 0 4 , 9 3 8 Policies featuring profit sharing 6 , 4 8 3 , 9 3 9 5 , 7 6 0 , 7 5 9 Policies with no profit sharing 1 0 6 , 8 4 2 1 2 4 , 6 1 8 Fund-linked life insurance policies 2 4 5 , 9 7 5 1 9 , 5 6 1 6 , 8 3 6 , 7 5 6 5 , 9 0 4 , 9 3 8 In 1999 the reinsurance balance in life insur- miums from i n d i rect business in pro p e rty & a n c e showed a negative balance of ATS thou- casualty were in some cases entered in the in- sand 30,636 (ATS thousand 22,665). In 1999 come statement based on a deferral of one year. reinsurance balance for health insurance Of the ATS thousand 232,453 (ATS thousand showed a positive balance of ATS thousand 203,144) in earned premiums from indirect busi- 4,861 (ATS thousand 5,457). The ATS thousand ness in life insurance, ATS thousand 4,019 443,710 (ATS thousand 693,751) in earned pre- ( ATS thousand 5,332) were entered in the income

99 87 Of the income from participating interests and income from other investments re p o rted in the income statement, affiliated companies accounted for the following:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Income from participating intere s t s P ro p e rty & casualty 8 2 , 9 4 7 6 4 , 1 6 5 H e a l t h 0 0 L i f e 1 , 3 5 5 1 , 3 5 5 To t a l 8 4 , 3 0 2 6 5 , 5 2 0

Income from other investments P ro p e rty & casualty 3 6 , 1 5 9 5 7 , 7 2 3 H e a l t h 1 1 , 2 3 0 1 4 , 2 4 7 L i f e 1 1 , 6 5 6 1 0 , 1 7 5 To t a l 5 9 , 0 4 5 8 2 , 1 4 5

statement based on a deferral of one year. In life is part of underwriting calculations. In pro p e rty & and health insurance, all income from capital c a s u a l t y, only interest earned on retained depo- i n v e s t m e n t s was carried over to the technical sits relating to indirect business was carried over account, as investment income in these two are a s to the technical account.

The items claims incurred, operating expenses, other underwriting expenditures, investment e x p e n d i t u res and other non-technical expenditures include the following:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Salaries and wages 1 , 6 9 3 , 6 4 3 1 , 6 6 9 , 7 7 4 E x p e n d i t u res on severance pay 1 7 0 , 4 1 0 1 5 6 , 4 5 2 E x p e n d i t u res on old-age pro v i s i o n 2 9 8 , 6 8 1 3 8 4 , 9 6 0 E x p e n d i t u res on social contributions re q u i red by law, s a l a ry - related payments and compulsory contributions 5 4 5 , 2 2 2 5 4 4 , 1 1 6 Other staff benefits 2 7 , 5 9 4 2 6 , 6 9 1

In the 1999 business year, in direct insurance business year, losses from the sale of invest- business commissions totaled ATS thousand m e n t s totaled ATS thousand 9,136 (ATS thou- 1,337,014 (ATS thousand 1,188,705). In the 1999 sand 8,681).

88 99 The valuation re s e rves associated with special tax write-downs, and transfers to and withdrawals from those re s e rves (shown in the balance sheet dated 31 December 1999), break down as follows (by fixed asset item): As of Tr a n s f e r s Wi t h d r a w a l s Reallocations As of Amounts in ATS thousand 31 Dec. 1998 31 Dec. 1999

Land and buildings 1 , 0 2 0 , 0 8 3 6 , 6 1 2 - 3 5 , 7 2 31) 0 9 9 0 , 9 7 2 S h a res in affiliated companies 1 1 4 , 3 6 7 0 - 1 8 0 1 1 4 , 3 6 7 P a rticipating intere s t s 4 9 8 , 3 2 8 0 - 2 3 5 , 4 3 0 - 1 5 1 , 4 2 4 1 1 1 , 4 7 4 Bonds issued by loans to companies where there is a p a rt i c i p a t o ry re l a t i o n s h i p 0 0 0 0 0 Bonds and other fixed-income s e c u r i t i e s 0 0 0 0 0 S h a res and other variable-yield s e c u r i t i e s 2 4 1 , 1 5 1 0 - 9 , 5 8 7 1 5 1 , 4 2 4 3 8 2 , 9 8 8 Intangible assets 1 7 , 2 8 8 0 - 1 4 , 4 8 9 0 2 , 7 9 9

1) Including ATS thousand 12,715 in disposals

The other untaxed re s e rves re p o rted in the balance sheet dated 31 December 1999, and transfers to and withdrawals from those re s e rves during the business year, break down as follows: As of Tr a n s f e r s Wi t h d r a w a l s As of Amounts in ATS thousand 31 Dec. 1998 31 Dec. 1999

Investment allowance per § 10 of the Income Tax Act 4 3 4 , 1 5 3 6 0 , 8 7 7 2 2 2 , 8 3 9 2 7 2 , 1 9 1 Rental allowance per § 11 of the Income Tax Act 9 , 2 1 7 0 9 , 2 1 7 0 Transfer re s e rves per § 12 of the Income Tax Act 0 5 2 3 , 7 8 1 0 5 2 3 , 7 8 1

The re s e rves per § 10 of the Income Tax Act re p o rted in the balance sheet dated 31 December 1999 break down by year as follows: In the 1999 business year, expenditures on taxes Investment allowance per § 10 of on the Income Tax Act on profit and income were reduced by ATS thou- F rom 1990 1 , 4 0 3 , 5 5 4 . 0 0 1) sand 63,072 (ATS thousand 52,727), due to the F rom 1991 2 , 7 9 3 , 4 2 6 . 0 0 fact that untaxed re s e rves were established and withdrawals were made from said re s e rv e s . F rom 1992 6 6 8 , 5 0 6 . 0 0 F rom 1993 1 , 9 8 5 , 9 5 3 . 0 0 The amount that may be entered on the assets F rom 1994 2 0 , 8 9 3 , 1 2 3 . 0 0 side per § 198 (10) of the Commercial Code was F rom 1995 2 4 , 8 5 5 , 6 0 1 . 0 0 not entered in the balance sheet. The anticipated F rom 1996 6 0 , 8 1 2 , 0 6 8 . 0 0 tax relief for subsequent financial years is AT S F rom 1997 3 0 , 9 1 2 , 4 2 5 . 0 0 thousand 12,910 (ATS thousand 44,828). F rom 1998 6 6 , 9 8 8 , 7 7 4 . 0 0 1 F rom 1999 6 0 , 8 7 7 , 3 6 8 . 0 0 ) Relates to construction costs at the Mirabell Home for the Aged, completed in 1996

99 89 V. Profit Part i c i p a t i o n Vice Chairm a n : Komm.-Rat Dkfm. Klaus S t a d l e r An overview of the calculations re g a rding pro f i t p a rticipation is provided on pages 97–99. M e m b e r s : Abbot Präses Dr. Clemens Lashofer N o r b e rt G r i n n i n g e r VI. Other D r. Alfred H o l o u b e k Ing. We rner K a s z t l e r The company’s capital stock in the amount of Dipl.-Ing. Guido K l e s t i l EUR 89,655,022.06 consists of 10,986,800 ord i- Dkfm. Helmut M a y r n a ry bearer shares with voting rights and Komm.-Rat Walter N e t t i g 1,350,000 pre f e rred bearer shares without voting Wolfgang R a d l e g g e r rights; each share re p resents an equal portion of D r. Johann S e re i n i g the capital stock. The pre f e rred shares are listed D r. Karl S k y b a on the Vienna Stock Exchange. Employee Repre s e n t a t i v e s : The Board of Management has been authorized to Paul A m b ro z y i n c rease the company’s capital stock (by 31 May Renate D o r i n g e r (until 30 April 2000) 2003 at the latest, and in several tranches if neces- Sylvia F i e d l e r (until 31 January 2000) s a ry) by a nominal amount of EUR 19,354,229.20 Peter G r i m m by issuing 2,663,200 re g i s t e red or bearer shares in Heinz N e u h a u s e r re t u rn for payment in cash or contribution in kind. Egon P i n z g e r (since 1 May 2000) The Board of Management will be responsible for Franz U r b a n decisions re g a rding shareholders rights, exclusion Fritz Z i c k b a u e r (since 1 Febru a ry 2000) of subscription rights and other terms and conditions relating to the share issue. These decisions In 1999 the Board of Management consisted will be subject to approval by the Superv i s o ry of the following members: B o a rd. Non-voting pre f e rred shares having priority over or equal to existing pre f e rred shares may be C h a i rm a n : issued. The issue prices of ord i n a ry and pre f e rre d Dkfm. Dr. Siegfried S e l l i t s c h s h a res may be set at diff e rent levels. M e m b e r s : An overview of p a rticipating interests as of 31 D r. Günter G e y e r December 1999 is provided on pages 122-125. D r. Franz L a u e r Dkfm. Karl F i n k In 1999 the Superv i s o ry Board consisted of Heinz J a i n d l the following members: Dkfm. Hans R a u m a u f (until 30 June 1999) Ing. Mag. Robert L a s s h o f e r (since 1 July 1999) C h a i rm a n : Komm.-Rat Karl S a m s t a g

90 99 The average number of employees ( i n c l u d i n g Stock Corporation Act accounted for ATS thou- cleaning staff) was 4,217 (4,253). Of the on aver- sand 30,725 (ATS 34,855). age 4,063 (4,091) white-collar employees on the In ret u r n for the work they perfo r med for the com- p a y roll, 2,042 (2,036) were field employees and pa n y , in 1999 the members of the Board of i n c u rred ATS thousand 1,274,010 (ATS thousand M a n a g e m e n t received compensation in the 919,065) in personnel costs; 2,021 (2,055) were amount of ATS thousand 29,359 (ATS thousand o ffice employees and incurred ATS thousand 23,864). This is a reduced figure reflecting the fact 1,630,790 (ATS thousand 1,862,928) in personnel that certain amounts were charged to companies c o s t s . wh e r e there is a parti c i p a t o r y relationship. Of this As of 31 December 1999, the members of the reduced figure, remuneration from affiliated compa- B o a rd of Management held loans in the amount nies accounted for ATS thousand 696 (ATS thou- of ATS thousand 938 (ATS thousand 1,068); no sand 683). Total remuneration in the amount of ATS additional loans were taken out in 1999. Intere s t thousand 14,024 (ATS thousand 14,427) was paid on the loans is 6.0% (6.5%) p.a. The loans will in 1999 to former members of the Board of m a t u re in 2005. Management (including their survivors). In 1999, the members of the Supervi s o r y Board received a total Members of the Superv i s o ry Board did not of ATS thousand 1,060 (ATS thousand 1,073) in take out any loans in 1999. ret u r n for the work they perfo r med for the company. As of 31 December 1999, none of the members Wiener Städtische Allgemeine Ver s i c h e r ung Aktien- of the Board of Management or Superv i s o ry gesellschaft is included in the consolidated annual B o a rd was subject to any l i a b i l i t i e s. financial statements of Wiener Städtische Wec h s e l - Of the 1999 expenditures for severance pay and seitige Ve r s i c h e ru n g s a n s t a l t - Ve rm ö g e n s v e rw a l- pensions totaling ATS thousand 469,091 tung, based in Vienna. The published consolidated (ATS thousand 541,412), severance pay and pen- annual financial statements are available for inspec- sions for Board of Management members and tion at the business premises of the latter company senior management per § 80, Section 1 of the at Schottenring 30, 1010 Vienna, Austria.

The Board of Management:

Dr. Geyer Dkfm. Dr. Sellitsch Dr. Lauer

Dkfm. Fink Jaindl Ing. Mag. Lasshofer

Vienna, 3 April 2000

99 91 version of the annual financial statements for Auditor’s the period ending 31 December 1999 o f

Wiener Städtische Allgemeine Ve r s i c h e ru n g Certificate Aktiengesellschaft, Schottenring 30, 1010 Vi e n n a . We have audited the annual financial statements for the year ended 31 December 1999, which “Following our due audit, we hereby cert i f y w e re drawn up by the Board of Management of that the accounting re c o rds and financial state- Wiener Städtische Allgemeine Ve r s i c h e ru n g ments comply with the legal regulations. The Aktiengesellschaft in accordance with Austrian financial statements give a true and fair view of c o m m e rcial law; we observed the principles of the company’s assets, liabilities, financial p roper auditing as customarily applied in the position and earnings, and were drawn up in accounting profession in Austria. Having com- a c c o rdance with accounting principles generally pleted our audit, we hereby grant an u n re s t r i c t- accepted in Austria. The Board of Manage- e d a u d i t o r’s certificate per § 274, Section 1 of m e n t ’s Status Report accords with the financial the Commercial Code to the unabridged Germ a n s t a t e m e n t s . ”

KPMG Austria Wi rtschaftsprüfungs- und S t e u e r b e r a t u n g s - G m b H

D r. Walter Knirsch Mag. Michael Schlenk C PAs and Tax Advisors

Vienna, 10 April 2000

92 99 P rofit Part i c i p a t i o n a) An interest bonus in the amount of 3.5% of the p remium re s e rve at the beginning of the curre n t P a rticipation in profits was calculated based insurance year as set forth in the general busi- on the following principles: ness plan; b) Policies with a valid adjustment note will re- P ro p e rty & Casualty Insurance ceive a sum bonus in the amount of 2.5 per thousand of the sum payable at death; in the case of All types of comprehensive residential building all other policies the figure is 1 per thousand; insurance policy will receive a bonus equivalent c) A terminal bonus if the endowment sum ma- to 10% of the annual premium. The bonus will t u res in 2001; the bonus will take the form of an apply to every annual premium falling due in the i n t e rest bonus (i.e., a percentage of the total sum period between 1 August 2000 and 31 July 2001. due, per the percentages stipulated in Section a F i x e d - p remium policies and policies with pro f i t - a b o v e ) . sharing schemes applicable to two or more insurance lines will not receive a bonus. 2. Per the relevant terms and conditions, all Prof i t Class A policies in Settlement Class 96 (one-time Health Insurance pr emium policies) will receive the following bonuses: a) An interest bonus based on the inception date: Policies involving rates BV 0, 1, 2, 4, 5, 6, 7, GW M a rch ’96 to April ’97 inception date: 3.5% of the 0, 1, 2, 3, 4, 5, 6, 7, HS 1, 7, HV 11, 17, 21, 27, p remium re s e rve at the beginning of the curre n t 31, 37, HZ 11, 12, 13, 14, 15, 16, 17, 26, 36, 119, insurance year as set forth in the general busi- 219, MB 11, 16, 26, ML 1, MO 5, 6, MS 0, 1, 2, 3, ness plan; 4, 5, 6, 7, 9, 77, OS 1, 7, TS 1, 2, 3, 4, 5, 16, 19, May ’97 to December ’97 inception date: 2.25% 119, 219 and VA 3 will receive a special bonus on of the premium re s e rve at the beginning of the 31 December 2000, but only if the premiums in c u rrent insurance year as set forth in the general question were not raised by the actuarially re- business plan. q u i red amount stipulated in the 2000 pre m i u m b) A terminal bonus if the endowment sum ma- adjustment clause. t u res in 2001; the bonus will take the form of an i n t e rest bonus (i.e., a percentage of the total sum The bonus amount will be based on the one-time due, per the percentages stipulated in Section a p remium associated with the premium adjust- a b o v e ) . ment, which is designed to provide financial re l i e f for older holders of health insurance policies. 3. Per the relevant terms and conditions, all Pro f i t Class A policies except those in Settlement Life Insurance Classes 92 and 96 will receive the following b o n u s e s : P rofit Class A a) An interest bonus in the amount of 3.5% of the 1. Per the relevant terms and conditions, all Pro f i t p remium re s e rve at the beginning of the curre n t Class A policies in Settlement Class 92 will reinsurance year as set forth in the general busi- ceive the following bonuses: ness plan;

99 93 b) Policies with a valid adjustment note will re- 2. In the case of Class R insurance policies where ceive a sum bonus in the amount of 3.5 per thou- annuities are already being paid and which are in sand of the sum payable at death; in the case of the second or later year of annuity payments, the all other policies be figure is 2 per thousand; bonus will take the form of a 3.5% increase in the c) A terminal bonus if the endowment sum ma- ongoing annuity payment; in the case of policies t u res in 2001; the bonus will take the form of an that are subject to a bonus annuity agre e m e n t , i n t e rest bonus (i.e., a percentage of the total sum the bonus will take the form of a 1.5% increase in due, per the percentages stipulated in Section a the annuity payment relative to the most re c e n t a b o v e ) . annuity payment, starting 1 January 2001.

P rofit Class B P rofit Class WV Per the relevant terms and conditions, all Pro f i t Per the bonus scheme approved by the re g u l a- Class B policies will receive a bonus in the t o ry authorities responsible for the insurance amount of 15% of the annual pre m i u m . i n d u s t ry, Class WV whole life policies will re c e i v e the following bonuses: Holders of Profit Class B ord i n a ry life insurance a) An interest bonus in the amount of 3.5% of the policies with an insured sum of ATS 10,000 or p remium re s e rve at the beginning of the curre n t m o re and a term of not less than 12 years will insurance year as set forth in the general busi- also receive a terminal bonus of 20% of the in- ness plan; s u red sum if the insured sum matures in 2001. b) Surplus bonuses from the risk result in the The special bonuses stipulated in 1983 and 1984 amount of 5 per thousand of the diff e rence be- will be added to this terminal bonus. tween the contractually insured sum on the key date for allocation of profits and the applicable P rofit Class R p remium re s e rves at the beginning of the curre n t 1. Per the relevant terms and conditions, all Pro f i t insurance year as set forth in the general busi- Class R policies except those where annuities ness plan (risk capital). a re already being paid will receive the following c) In the case of insurance policies with an in- b o n u s e s : s u red sum of ATS 15,000 or more, surplus bo- a) An interest bonus in the amount of 3.5% of the nuses from the expense result in the amount of 3 p remium re s e rve at the beginning of the curre n t per thousand of the risk capital as defined in insurance year as set forth in the general busi- Section b above. ness plan; b) A supplementary bonus in the amount of 1 per P rofit Class WVN thousand of the accumulated annuity amount or Per the relevant terms and conditions, all Pro f i t endowment. Class WVN policies will receive the following c) A terminal bonus if the endowment sum ma- b o n u s e s : t u res in 2001; the bonus will take the form of an a) An interest bonus in the amount of 3.5% of the i n t e rest bonus (i. e., a percentage of the total sum p remium re s e rve at the beginning of the curre n t due, per the percentages stipulated in Section a insurance year as set forth in the general busi- a b o v e ) . ness plan;

94 99 b) A supplementary bonus in the amount of 25% Class FLV policies will receive the following of the risk premium included in the total annual bonuses: p remium for the current insurance year. a) Regular- p remium policies will receive a bonus in the amount of 3% of the premium charged for P rofit Class K the insurance year that begins in 2001; 1. Per the relevant terms and conditions, all Pro f i t b) One-time premium policies will receive a Class K term insurance policies which feature bonus in the amount of 3 per thousand of the constant insured sums and regular premium pay- one-time premium on the original policy at the ments and which belong to Settlement Class 99 s t a rt of the insurance year that begins in 2001. will receive a bonus equal to 65% of the pre m i u m c h a rged for the insurance year that begins in 2 0 0 1 . 2. Per the relevant terms and conditions, all Pro f i t Class K term insurance policies which feature constant insured sums and regular premium payments and which do not belong to Settlement Class 99 will receive a bonus equal to 25% of the p remium charged for the insurance year that begins in 2001.

P rofit Class D Per the relevant terms and conditions, all Pro f i t Class D policies will receive the following bonuses: a) An interest bonus in the amount of 2.5% of the p remium re s e rve at the beginning of the curre n t insurance year as set forth in the general business plan; b) Policies with a valid adjustment note will re - ceive a sum bonus in the amount of 2 per thousand of the sum payable at death; in the case of all other policies the figure is 1 per thousand; c) A terminal bonus if the endowment sum m a t u res in 2001; the bonus will take the form of an interest bonus (i. e., a percentage of the total sum due, per the percentages stipulated in Section a above).

P rofit Class FLV Per the relevant terms and conditions, all Pro f i t

99 95 Consolidated Annual Financial Statements Consolidated Balance Sheet as of 31 December 1999

A s s e t s 1999 ATS 1998 ATS

A. Intangible assets I . Goodwill acquired against payment 0 . 0 0 4 , 7 9 7 , 7 2 8 . 4 2 I I .E x p e n d i t u res on acquisition of in-force business 4 9 , 2 0 4 , 4 7 1 . 0 0 0 . 0 0 III. Other intangible assets 1 1 4 , 0 8 6 , 1 5 9 . 0 9 9 9 , 9 0 2 , 3 4 6 . 8 7 Total intangible assets 1 6 3 , 2 9 0 , 6 3 0 . 0 9 1 0 4 , 7 0 0 , 0 7 5 . 2 9 B. Investments I . Land and buildings 1 4 , 9 5 6 , 9 1 6 , 4 3 2 . 4 9 1 4 , 3 7 8 , 1 6 5 , 3 5 6 . 5 2 I I . Investments in affiliated companies and part i c i p a t i n g i n t e re s t s 1 . S h a res in affiliated companies not included in the consolidated annual financial statements 6 3 4 , 6 9 9 , 2 6 8 . 4 5 2. Loans to affiliated companies 7 2 , 1 9 4 , 3 8 3 . 3 2 3. Participating intere s t s Equity method consolidation 6 7 0 , 9 6 4 , 9 5 1 . 2 8 O t h e r 4 , 3 6 0 , 1 0 1 , 0 2 3 . 5 6 4. Loans to and bonds issued by companies where t h e re is a part i c i p a t o ry re l a t i o n s h i p 4 , 7 9 0 , 6 7 1 , 3 2 0 . 9 7 1 0 , 5 2 8 , 6 3 0 , 9 4 7 . 5 8 1 0 , 3 3 5 , 1 0 4 , 2 6 4 . 9 1 III. Other investments 1. Shares and other variable-yield securities 3 4 , 1 1 1 , 9 7 0 , 6 2 8 . 3 9 2. Bonds and other fixed-income s e c u r i t i e s 2 6 , 9 2 8 , 1 2 6 , 3 2 8 . 0 1 3. Mortgage loans 4 , 9 1 3 , 5 9 0 , 7 4 0 . 4 1 4. Prepayments on policies 3 2 2 , 7 3 3 , 5 7 3 . 1 9 5. Other loans 2 4 , 5 3 9 , 6 0 1 , 2 4 7 . 9 3 6. Balances at banks 1 , 1 2 9 , 0 7 4 , 7 9 7 . 5 8 7. Miscellaneous investments 6 7 , 0 1 2 , 8 0 0 . 5 3 9 2 , 0 1 2 , 1 1 0 , 1 1 6 . 0 4 8 6 , 5 2 8 , 6 0 2 , 1 2 2 . 7 9 I V. Deposits retained associated with inwards re i n s u r a n c e b u s i n e s s 8 3 3 , 1 5 0 , 6 1 3 . 6 3 8 4 9 , 5 4 8 , 2 9 5 . 7 5 Total investments 1 1 8 , 3 3 0 , 8 0 8 , 1 0 9 . 7 4 1 1 2 , 0 9 1 , 4 2 0 , 0 3 9 . 9 7 C. Investments for the benefit of fund-linked life insurance policyholders 1 , 3 9 4 , 5 2 2 , 2 8 4 . 8 4 5 2 0 , 1 2 0 , 3 0 6 . 6 4 D .R e c e i v a b l e s I . Receivables arising from primary insurance operations 1. Receivable from policyholders 1 , 7 0 9 , 5 3 1 , 0 6 1 . 8 0 2. Receivable from interm e d i a r i e s 2 5 3 , 1 9 1 , 0 5 3 . 4 6 3. Receivable from insurance companies 8 1 , 6 6 5 , 7 8 1 . 5 9 2 , 0 4 4 , 3 8 7 , 8 9 6 . 8 5 1 , 9 1 2 , 7 8 6 , 6 0 5 . 5 0 II. Accounts receivable arising from reinsurance business 1 , 2 9 6 , 9 8 8 , 8 2 7 . 6 3 1 , 2 4 3 , 0 9 6 , 4 2 7 . 6 8 III. Other re c e i v a b l e s 1 , 4 0 5 , 6 1 7 , 7 4 0 . 5 9 1 , 0 7 7 , 0 8 2 , 3 3 3 . 9 5 Total re c e i v a b l e s 4 , 7 4 6 , 9 9 4 , 4 6 5 . 0 7 4 , 2 3 2 , 9 6 5 , 3 6 7 . 1 3 E. Accrued interest and re n t 2 , 1 4 5 , 5 8 9 , 3 6 5 . 1 1 2 , 2 4 7 , 3 6 9 , 7 6 6 . 0 2 C a rried forw a rd 1 2 6 , 7 8 1 , 2 0 4 , 8 5 4 . 8 5 1 1 9 , 1 9 6 , 5 7 5 , 5 5 5 . 0 5

98 99 Consolidated Balance Sheet as of 31 December 1999

Assets 1999 ATS 1998 ATS

B rought forw a rd 1 2 6 , 7 8 1 , 2 0 4 , 8 5 4 . 8 5 1 1 9 , 1 9 6 , 5 7 5 , 5 5 5 . 0 5

F. Other assets I . Tangible assets (not including land and buildings) and inventory 7 1 5 , 2 1 7 , 5 3 0 . 1 3 6 5 7 , 0 2 2 , 2 5 5 . 3 6 I I . Cash at banks and cash in hand 1 , 5 1 9 , 3 1 0 , 8 9 5 . 3 3 1 , 5 4 8 , 7 3 2 , 9 9 8 . 7 1 III. Other assets 5 6 2 , 3 6 4 , 3 1 4 . 2 3 3 2 8 , 1 4 9 , 6 5 6 . 0 4 Total other assets 2 , 7 9 6 , 8 9 2 , 7 3 9 . 6 9 2 , 5 3 3 , 9 0 4 , 9 1 0 . 1 1 G. Deferred expenses and accrued income I. Un d e r- a c c r uals per Art. X, Sections 3 and 4, Financial Reporting Act 5 5 2 , 8 0 3 , 5 8 5 . 0 3 6 3 2 , 5 0 4 , 2 6 9 . 7 9 II. Other deferred expenses and accrued income 7 2 6 , 7 0 2 , 0 6 8 . 4 8 5 2 1 , 4 8 9 , 8 3 3 . 9 5 Total deferred expenses and accrued income 1 , 2 7 9 , 5 0 5 , 6 5 3 . 5 1 1 , 1 5 3 , 9 9 4 , 1 0 3 . 7 4 Balance sheet total 130,857,603,248.05 12 2 , 8 8 4 , 4 7 4 , 5 6 8 . 9 0

99 99 L i a b i l i t i e s 1999 ATS 1998 ATS

A. Shareholders’ equity I . Capital stock 1 . Par value: EUR 89,655,022.06 1 , 2 3 3 , 6 8 0 , 0 0 0 . 0 0 I I . Capital re s e rv e s 1. Non-available 3 , 7 5 6 , 7 8 4 , 8 0 1 . 0 0 III. Revenue re s e rv e s 1. Free re s e rv e s 8 0 3 , 9 3 5 , 0 2 7 . 6 3 I V. Unappropriated retained earn i n g s 2 5 5 , 0 1 4 , 3 1 4 . 9 3 of which profit brought forw a rd 2 2 , 3 4 4 , 6 8 4 . 8 3 6 , 0 4 9 , 4 1 4 , 1 4 3 . 5 6 6 , 1 2 2 , 1 0 2 , 4 0 3 . 3 3 V. Adjustment items for shares of other share h o l d e r s 2 3 1 , 9 3 3 , 5 4 3 . 7 3 1 9 9 , 1 0 1 , 1 0 3 . 5 5 Total shareholders’ equity 6 , 2 8 1 , 3 4 7 , 6 8 7 . 2 9 6 , 3 2 1 , 2 0 3 , 5 0 6 . 8 8 B. Untaxed re s e rv e s I. Risk res e r ves per §73a of the Insurance Companies Supervision Act 1 , 0 1 6 , 0 5 8 , 6 5 5 . 3 0 9 6 0 , 8 5 6 , 9 3 3 . 2 0 I I . Valuation re s e rves associated with special write-downs 2 , 0 4 6 , 4 0 3 , 1 8 3 . 7 5 2 , 2 3 0 , 1 4 7 , 8 2 5 . 3 5 I I I .Other untaxed re s e rv e s 1 , 0 0 3 , 2 1 7 , 2 6 6 . 0 6 7 5 5 , 5 9 5 , 6 9 1 . 3 0 Total re s e rv e s 4 , 0 6 5 , 6 7 9 , 1 0 5 . 1 1 3 , 9 4 6 , 6 0 0 , 4 4 9 . 8 5 C. Secondary liabilities 2 4 4 , 3 1 0 , 8 6 6 . 0 0 5 1 , 6 6 6 , 6 6 6 . 0 0 D. Underwriting provisions associated with retained business I. Unearned pre m i u m s 1. Gross amount 3 , 7 0 7 , 3 2 9 , 4 9 8 . 3 2 2. Reinsurers’ share - 5 9 4 , 6 2 2 , 4 3 0 . 4 0 3 , 1 1 2 , 7 0 7 , 0 6 7 . 9 2 3 , 0 7 1 , 6 9 8 , 3 4 5 . 1 9 II. Premium re s e rv e 1. Gross amount 8 0 , 2 8 2 , 5 4 7 , 4 9 5 . 6 9 2. Reinsurers’ share - 1 , 0 9 8 , 0 0 0 , 1 1 4 . 9 6 7 9 , 1 8 4 , 5 4 7 , 3 8 0 . 7 3 7 2 , 7 5 6 , 0 7 6 , 9 8 2 . 2 2 III. Provisions for outstanding claims 1. Gross amount 1 9 , 6 1 8 , 0 2 0 , 9 8 5 . 8 3 2. Reinsurers’ share - 3 , 0 9 2 , 9 7 3 , 5 5 8 . 4 6 1 6 , 5 2 5 , 0 4 7 , 4 2 7 . 3 7 1 6 , 2 2 3 , 4 1 0 , 0 1 5 . 9 1 I V. Provisions for premium re f u n d s 1. Gross amount 3 3 9 , 3 5 4 , 9 7 6 . 7 8 2. Reinsurers’ share - 6 , 7 9 5 , 0 0 0 . 0 0 3 3 2 , 5 5 9 , 9 7 6 . 7 8 3 6 8 , 3 0 5 , 4 5 9 . 2 4 V. Provisions for profit participation bonuses for policyholders 1. Gross amount 3 , 2 6 8 , 9 2 4 , 9 5 6 . 6 8 2. Reinsurers’ share - 3 0 0 , 0 0 0 . 0 0 3 , 2 6 8 , 6 2 4 , 9 5 6 . 6 8 3 , 2 6 0 , 3 4 0 , 1 5 2 . 5 7 VI. Claims equalization pro v i s i o n s 1 , 7 4 4 , 2 1 8 , 5 5 1 . 8 5 1 , 8 3 6 , 5 8 4 , 6 7 8 . 5 6 VII. Other underwriting pro v i s i o n s 1. Gross amount 2 3 3 , 9 7 4 , 9 5 6 . 2 6 2 . R e i n s u rers’ share - 9 , 5 6 1 , 5 1 6 . 7 4 2 2 4 , 4 1 3 , 4 3 9 . 5 2 2 3 0 , 4 8 2 , 7 0 1 . 8 3 Total underwriting pro v i s i o n s 1 0 4 , 3 9 2 , 1 1 8 , 8 0 0 . 8 5 9 7 , 7 4 6 , 8 9 8 , 3 3 5 . 5 2 E. Underwriting provisions associated with fund-linked life insurance policies 1 , 3 9 4 , 4 1 9 , 4 1 0 . 8 5 5 2 0 , 0 7 0 , 7 2 1 . 0 4 C a rried forw a rd 1 1 6 , 3 7 7 , 8 7 5 , 8 7 0 . 1 0 1 0 8 , 5 8 6 , 4 3 9 , 6 7 9 . 2 9

100 99 L i a b i l i t i e s 1999 ATS 1998 ATS

B rought forw a rd 1 1 6 , 3 7 7 , 8 7 5 , 8 7 0 . 1 0 1 0 8 , 5 8 6 , 4 3 9 , 6 7 9 . 2 9

F. Other pro v i s i o n s I . P rovisions for severance payments 1 , 3 5 0 , 9 6 6 , 0 7 0 . 7 1 1 , 3 8 5 , 7 3 1 , 8 7 7 . 6 9 I I .P rovisions for pensions 4 , 5 0 3 , 2 6 6 , 8 8 3 . 9 4 4 , 4 4 9 , 8 3 2 , 1 1 9 . 0 4 III. Provisions for taxation 4 3 9 , 8 6 7 , 8 2 4 . 4 8 3 0 5 , 0 3 8 , 2 1 7 . 3 3 I V. Other pro v i s i o n s 9 7 4 , 6 8 2 , 9 2 5 . 6 4 1 , 0 1 3 , 9 6 3 , 7 7 9 . 1 9 Total other pro v i s i o n s 7 , 2 6 8 , 7 8 3 , 7 0 4 . 7 7 7 , 1 5 4 , 5 6 5 , 9 9 3 . 2 5 G. Deposits associated with ceded reinsurance business 1 , 1 5 5 , 7 8 6 , 3 9 2 . 3 3 1 , 1 3 3 , 1 9 6 , 1 0 7 . 7 1 H. Other liabilities I . Liabilities arising from primary insurance operations 1. Payable to policyholders 1 , 5 3 7 , 7 2 7 , 4 0 9 . 7 7 2. Payable to interm e d i a r i e s 3 0 4 , 1 4 0 , 3 8 6 . 0 5 3. Payable to insurance companies 3 9 , 0 8 3 , 6 2 7 . 4 2 1 , 8 8 0 , 9 5 1 , 4 2 3 . 2 4 1 , 4 6 7 , 1 5 1 , 6 0 4 . 9 3 II. Accounts payable associated with reinsurance business 3 2 9 , 4 3 3 , 4 9 1 . 8 5 1 9 3 , 0 3 8 , 4 0 3 . 9 3 III. Bonds payable (not including supplementary c a p i t a l ) 7 5 0 , 8 9 7 , 3 0 0 . 1 4 7 0 7 , 0 5 7 , 7 0 0 . 0 0 I V. Amounts owed to banks 5 1 7 , 7 2 9 , 7 4 7 . 2 2 2 2 0 , 2 7 6 , 4 9 0 . 1 0 V. Miscellaneous liabilities 2 , 2 6 4 , 2 2 1 , 5 0 1 . 9 2 3 , 0 6 8 , 4 2 1 , 4 4 5 . 3 2 Total other liabilities 5 , 7 4 3 , 2 3 3 , 4 6 4 . 3 7 5 , 6 5 5 , 9 4 5 , 6 4 4 . 2 8 I. Deferred income and accrued expenses 3 1 1 , 9 2 3 , 8 1 6 . 4 8 3 5 4 , 3 2 7 , 1 4 4 . 3 7 Balance sheet total 130,857,603,248.05 12 2 , 8 8 4 , 4 7 4 , 5 6 8 . 9 0

99 101 Consolidated Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999 General Insurance 1999 ATS 1998 ATS (P ro p e r ty & Casualty and Health)

Technical account:

1. Earned pre m i u m s P remiums written G ro s s 1 9 , 8 3 5 , 4 7 1 , 7 7 3 . 8 3 Ceded reinsurance pre m i u m s - 3 , 8 1 1 , 3 7 4 , 9 7 0 . 3 4 1 6 , 0 2 4 , 0 9 6 , 8 0 3 . 4 9 1 6 , 0 8 2 , 7 5 6 , 9 2 6 . 3 3 Change due to premium accru a l s G ro s s 2 0 , 7 4 5 , 4 6 4 . 5 0 R e i n s u rers’ share 1 5 , 8 6 1 , 7 4 7 . 0 4 3 6 , 6 0 7 , 2 1 1 . 5 4 5 5 , 4 6 2 , 2 7 1 . 0 6 Total pre m i u m s 1 6 , 0 6 0 , 7 0 4 , 0 1 5 . 0 3 1 6 , 1 3 8 , 2 1 9 , 1 9 7 . 3 9 2 . Allocated investment income 4 1 5 , 9 8 0 , 4 6 0 . 8 9 3 9 8 , 8 7 0 , 2 3 2 . 7 5 3 . Other underwriting income 2 9 7 , 7 6 3 , 8 0 9 . 7 7 2 5 5 , 8 8 9 , 9 0 4 . 7 6 4 . Claims incurre d Claims paid G ro s s 1 3 , 9 3 0 , 0 3 5 , 5 5 3 . 9 3 R e i n s u rers’ share - 2 , 3 8 2 , 6 0 0 , 4 9 6 . 4 4 1 1 , 5 4 7 , 4 3 5 , 0 5 7 . 4 9 1 0 , 7 9 0 , 0 4 1 , 3 0 6 . 0 9 Change in provisions for outstanding claims G ro s s 6 3 0 , 9 7 3 , 7 2 7 . 3 4 R e i n s u rers’ share - 4 1 1 , 7 4 6 , 1 5 0 . 5 4 2 1 9 , 2 2 7 , 5 7 6 . 8 0 7 2 8 , 7 1 9 , 2 6 0 . 3 6 Total claims - 1 1 , 7 6 6 , 6 6 2 , 6 3 4 . 2 9 - 1 1 , 5 1 8 , 7 6 0 , 5 6 6 . 4 5 5. Increase in other underwriting pro v i s i o n s P remium re s e rv e G ro s s 4 1 9 , 1 3 4 , 7 4 5 . 3 6 R e i n s u rers’ share - 1 , 8 0 4 , 1 6 2 . 0 0 4 1 7 , 3 3 0 , 5 8 3 . 3 6 4 6 9 , 3 1 0 , 6 1 3 . 2 8 Other underwriting pro v i s i o n s G ro s s -2 , 4 8 6 , 7 4 9 . 4 4 R e i n s u rers’ share 4 , 1 1 7 . 1 8 - 2 , 4 8 2 , 6 3 2 . 2 6 1 1 8 , 8 4 4 , 5 9 7 . 8 1 Total increase in other underwriting pro v i s i o n s -4 1 4 , 8 4 7 , 9 5 1 . 1 0 -5 8 8 , 1 5 5 , 2 1 1 . 0 9 6. Expenditures on premium re f u n d s G ro s s 1 8 7 , 3 5 1 , 6 0 4 . 2 1 2 2 6 , 4 5 3 , 2 1 9 . 0 1 R e i n s u rers’ share - 1 , 6 3 0 , 3 0 4 . 0 0 -3 , 4 1 6 , 0 4 1 . 0 0 Total expenditures on premium re f u n d s -1 8 5 , 7 2 1 , 3 0 0 . 2 1 -2 2 3 , 0 3 7 , 1 7 8 . 0 1 7. Ex p e n d i t u r es on profit participation bonuses for policyholders G ro s s 3 1 0 , 7 8 0 . 2 6 3 3 , 0 0 0 , 0 0 0 . 0 0 R e i n s u rers’ share 0 . 0 0 0 . 0 0 Total expenditures on profit participation bonuses for policyholders -3 1 0 , 7 8 0 . 2 6 -3 3 , 0 0 0 , 0 0 0 . 0 0 8. Operating expenses Acquisition costs 3 , 9 9 5 , 6 4 7 , 4 7 9 . 1 1 3 , 8 1 3 , 5 1 8 , 3 6 6 . 8 8 Other operating expenses 2 , 1 5 4 , 4 5 5 , 6 6 7 . 1 5 1 , 9 8 7 , 8 4 8 , 0 3 8 . 5 4 Reinsurance commissions and profit part i c i p a t i o n associated with ceded reinsurance business - 1 , 1 1 8 , 6 0 9 , 5 6 3 . 4 0 - 1 , 0 2 9 , 8 6 8 , 6 1 3 . 2 8 Total operating expenses -5 , 0 3 1 , 4 9 3 , 5 8 2 . 8 6 - 4 , 7 7 1 , 4 9 7 , 7 9 2 . 1 4 9. Other underwriting expenditure s -6 4 4 , 8 9 0 , 0 2 0 . 1 5 - 5 1 2 , 1 3 1 , 9 7 7 . 1 1 1 0 . Change in equalization provisions 8 2 , 9 8 9 , 1 9 5 . 1 4 -3 4 1 , 7 4 0 , 4 5 5 . 3 4 Technical result (carried forw a rd ) -1 , 1 8 6 , 4 8 8 , 7 8 8 . 0 4 -1, 1 9 5 , 3 4 3 , 8 4 5 . 2 4

102 99 1999 ATS 1998 ATS

Technical result (brought forw a rd ) - 1 , 1 8 6 , 4 8 8 , 7 8 8 . 0 4 - 1 , 1 9 5 , 3 4 3 , 8 4 5 . 2 4

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 1 3 4 , 4 8 5 , 9 3 3 . 3 4 9 8 , 6 6 5 , 8 6 3 . 2 8 Income from land and buildings 4 2 8 , 5 4 9 , 0 9 2 . 9 8 3 7 8 , 3 5 0 , 6 7 9 . 2 4 Income from other investments 1 , 3 0 8 , 3 2 2 , 5 9 7 . 6 6 1 , 3 5 6 , 9 7 7 , 4 1 2 . 0 7 P rofit from sale of investments 6 5 4 , 3 1 0 , 3 1 7 . 0 0 1 , 0 0 9 , 9 0 0 , 5 5 3 . 0 3 Other investment income and interest income 1 5 5 , 7 2 0 , 2 2 1 . 7 6 1 8 6 , 1 0 0 , 6 2 4 . 7 3 Total investment income 2 , 6 8 1 , 3 8 8 , 1 6 2 . 7 4 3 , 0 2 9 , 9 9 5 , 1 3 2 . 3 5 2. Investment expenditures and interest paid Asset management expenditure s 8 2 , 1 2 9 , 0 8 3 . 5 7 8 3 , 9 3 7 , 9 4 6 . 9 8 Write-downs on investments 9 4 8 , 7 6 8 , 0 3 4 . 5 9 8 9 5 , 3 2 8 , 8 6 7 . 0 7 I n t e rest paid 7 0 , 2 2 1 , 4 2 2 . 2 3 8 4 , 0 6 5 , 8 2 8 . 6 9 Losses from sale of investments 1 2 , 1 0 9 , 2 9 0 . 5 7 7 , 4 8 3 , 2 0 8 . 0 2 Other investment expenditure s 3 1 , 5 5 7 , 8 5 0 . 2 1 6 3 , 8 9 2 , 1 1 9 . 1 0 Total investment expenditure s - 1 , 1 4 4 , 7 8 5 , 6 8 1 . 1 7 - 1 , 1 3 4 , 7 0 7 , 9 6 9 . 8 6 3. Allocated investment income transferred to the underwriting account - 4 1 5 , 9 8 0 , 4 6 0 . 8 9 - 3 9 8 , 8 7 0 , 2 3 2 . 7 5 4. Other non-technical income 1 4 4 , 5 6 2 , 4 2 3 . 9 4 1 1 9 , 7 0 1 , 5 2 3 . 1 2 5. Other non-technical expenditure s - 1 2 8 , 5 0 9 , 9 7 5 . 0 2 - 1 5 3 , 6 3 6 , 7 1 8 . 7 7 E a rnings from ord i n a ry activities (Pro p e rty & Casualty and Health) - 4 9 , 8 1 4 , 3 1 8 . 4 4 2 6 7 , 1 3 7 , 8 8 8 . 8 5

99 103 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

Life Insurance 1999 ATS 1998 ATS

Technical account:

1. Earned pre m i u m s P remiums written G ro s s 1 2 , 0 0 0 , 2 5 1 , 5 9 6 . 0 9 Ceded reinsurance pre m i u m s -2 6 2 , 4 7 9 , 4 9 8 . 4 2 1 1 , 7 3 7 , 7 7 2 , 0 9 7 . 6 7 9 , 1 3 7 , 9 8 5 , 9 4 9 . 1 9 Change due to premium accru a l s G ro s s -1 5 , 5 9 6 , 8 8 8 . 4 5 R e i n s u rers’ share 3 , 3 3 2 , 9 3 3 . 0 2 - 1 2 , 2 6 3 , 9 5 5 . 4 3 - 3 1 , 4 8 7 , 2 0 7 . 2 4 Total pre m i u m s 1 1 , 7 2 5 , 5 0 8 , 1 4 2 . 2 4 9 , 1 0 6 , 4 9 8 , 7 4 1 . 9 5 2 . Allocated investment income 5 , 7 6 0 , 3 2 9 , 3 0 9 . 0 1 5 , 4 3 4 , 3 7 5 , 2 2 0 . 8 7 3. No n - r ealized profits from investments per Section C of the assets side of the balance sheet (fund-linked life insurance) 1 5 4 , 9 6 8 , 4 8 8 . 8 9 1 , 3 6 7 , 0 2 9 . 6 5 4 . Other underwriting income 2 7 , 6 4 3 , 3 0 6 . 2 7 1 3 , 8 0 9 , 5 9 2 . 9 6 5 . Claims incurre d Claims paid G ro s s 7 , 7 9 6 , 0 3 7 , 6 6 5 . 6 6 R e i n s u rers’ share - 1 4 9 , 4 5 5 , 3 1 2 . 0 9 7 , 6 4 6 , 5 8 2 , 3 5 3 . 5 7 6 , 9 3 6 , 9 6 1 , 0 8 8 . 6 1 Change in provisions for outstanding claims G ro s s - 1 2 , 8 3 7 , 0 1 5 . 5 7 R e i n s u rers’ share 1 , 2 8 9 , 6 9 9 . 3 4 -1 1 , 5 4 7 , 3 1 6 . 2 3 - 3 , 0 2 1 , 9 3 2 . 9 6 Total claims -7 , 6 3 5 , 0 3 5 , 0 3 7 . 3 4 -6 , 9 3 3 , 9 3 9 , 1 5 5 . 6 5 6. Increase in other underwriting pro v i s i o n s P remium re s e rv e G ro s s 4 , 4 0 9 , 3 1 9 , 3 8 2 . 1 6 R e i n s u rers’ share - 5 3 , 5 7 0 , 5 1 2 . 6 2 4 , 3 5 5 , 7 4 8 , 8 6 9 . 5 4 2 , 2 2 5 , 4 8 0 , 5 0 7 . 7 9 Other underwriting pro v i s i o n s G ro s s 0 . 0 0 R e i n s u rers’ share 0 . 0 0 0 . 0 0 - 4 3 , 8 0 7 , 5 5 0 . 3 2 Total increase in other underwriting pro v i s i o n s -4 , 3 5 5 , 7 4 8 , 8 6 9 . 5 4 -2 , 1 8 1 , 6 7 2 , 9 5 7 . 4 7 7. Expenditures on profit participation bonuses and pro f i t p a rticipation schemes for policyholders G ro s s 2 , 5 1 8 , 9 9 7 , 5 2 1 . 2 4 2 , 5 8 3 , 0 0 1 , 8 1 9 . 1 2 R e i n s u rers’ share -3 0 0 , 0 0 0 . 0 0 -3 0 0 , 0 0 0 . 0 0 Total profit participation schemes -2 , 5 1 8 , 6 9 7 , 5 2 1 . 2 4 -2 , 5 8 2 , 7 0 1 , 8 1 9 . 1 2 8. Operating expenses Acquisition costs 1 , 7 7 3 , 1 3 9 , 6 7 8 . 2 1 1 , 4 0 6 , 1 8 8 , 8 3 2 . 9 0 Other operating expenses 6 7 5 , 2 1 5 , 4 6 4 . 9 8 6 0 5 , 8 3 0 , 0 5 9 . 1 0 Reinsurance commissions and profit part i c i p a t i o n associated with ceded reinsurance business - 4 9 , 2 3 9 , 6 3 2 . 7 4 - 3 0 , 1 6 2 , 8 6 4 . 4 1 Total operating expenses -2 , 3 9 9 , 1 1 5 , 5 1 0 . 4 5 -1 , 9 8 1 , 8 5 6 , 0 2 7 . 5 9 9. No n - r ealized losses from investments per Section C of the assets side of the balance sheet (fund-linked life insurance) -4 , 4 9 8 , 0 7 1 . 2 6 -1 4 3 , 8 8 6 . 5 8 1 0 . Other underwriting expenditure s - 1 3 6 , 2 1 3 , 5 0 1 . 0 2 -1 2 5 , 2 4 7 , 9 7 8 . 4 1 Technical result (carried forw a rd ) 6 1 9 , 1 4 0 , 7 3 5 . 5 6 7 5 0 , 4 8 8 , 7 6 0 . 6 1

104 99 1999 ATS 1998 ATS

Technical result (brought forw a rd ) 6 1 9 , 1 4 0 , 7 3 5 . 5 6 7 5 0 , 4 8 8 , 7 6 0 . 6 1

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 5 8 , 9 5 4 , 5 7 2 . 2 3 3 7 , 3 6 2 , 8 3 7 . 6 6 Income from land and buildings 2 7 8 , 6 2 0 , 6 6 2 . 3 9 2 7 1 , 9 1 2 , 1 4 7 . 1 6 Income from other investments 4 , 5 7 7 , 4 4 9 , 3 2 5 . 3 2 4 , 3 6 4 , 2 4 6 , 2 1 5 . 2 0 P rofit from sale of investments 2 , 0 1 9 , 4 3 6 , 8 5 8 . 5 2 1 , 3 6 7 , 5 1 6 , 3 6 1 . 1 6 Other investment income and interest income 2 2 1 , 3 4 5 , 3 2 3 . 8 9 1 3 7 , 9 7 4 , 4 3 0 . 3 1 Total investment income 7 , 1 5 5 , 8 0 6 , 7 4 2 . 3 5 6 , 1 7 9 , 0 1 1 , 9 9 1 . 4 9 2. Investment expenditures and interest paid Asset management expenditure s 6 9 , 3 2 6 , 4 6 6 . 8 5 5 8 , 2 7 6 , 0 8 0 . 1 7 Write-downs on investments 1 , 2 9 1 , 0 7 1 , 6 9 8 . 5 1 5 9 3 , 5 7 6 , 2 5 2 . 0 1 I n t e rest paid 1 9 , 4 4 4 , 5 6 8 . 7 2 9 , 3 5 0 , 8 5 7 . 1 0 Losses from sale of investments 5 , 7 5 6 , 0 3 8 . 2 5 7 , 6 7 1 , 1 5 3 . 5 2 Other investment expenditure s 9 , 8 7 8 , 6 6 1 . 0 1 7 5 , 7 6 2 , 4 2 7 . 8 2 Total investment expenditure s - 1 , 3 9 5 , 4 7 7 , 4 3 3 . 3 4 -7 4 4 , 6 3 6 , 7 7 0 . 6 2 3. Allocated investment income transferred to the underwriting account - 5 , 7 6 0 , 3 2 9 , 3 0 9 . 0 1 - 5 , 4 3 4 , 3 7 5 , 2 2 0 . 8 7 4. Other non-technical income 5 7 , 6 3 4 , 9 6 2 . 0 2 4 8 , 0 7 0 , 8 6 2 . 6 8 5. Other non-technical expenditure s - 3 1 , 7 0 4 , 0 8 2 . 9 0 - 2 8 , 2 9 6 , 8 1 7 . 9 1 E a rnings from ord i n a ry activities (Life) 6 4 5 , 0 7 1 , 6 1 4 . 6 8 7 7 0 , 2 6 2 , 8 0 5 . 3 8

99 105 Income Statement for the Business Year Beginning 1 January and Ending 31 December 1999

General Insurance + L i f e = To t a l 1999 ATS 1998 ATS

Technical result (brought forw a rd ) - 5 6 7 , 3 4 8 , 0 5 2 . 4 8 - 4 4 4 , 8 5 5 , 0 8 4 . 6 3

Non-technical account:

1. Investment income and interest income Income from participating intere s t s 1 9 3 , 4 4 0 , 5 0 5 . 5 7 1 3 6 , 0 2 8 , 7 0 0 . 9 4 Income from land and buildings 7 0 7 , 1 6 9 , 7 5 5 . 3 7 6 5 0 , 2 6 2 , 8 2 6 . 4 0 Income from other investments 5 , 8 8 5 , 7 7 1 , 9 2 2 . 9 8 5 , 7 2 1 , 2 2 3 , 6 2 7 . 2 7 P rofit from sale of investments 2 , 6 7 3 , 7 4 7 , 1 7 5 . 5 2 2 , 3 7 7 , 4 1 6 , 9 1 4 . 1 9 Other investment income and interest income 3 7 7 , 0 6 5 , 5 4 5 . 6 5 3 2 4 , 0 7 5 , 0 5 5 . 0 4 Total investment income 9 , 8 3 7 , 1 9 4 , 9 0 5 . 0 9 9 , 2 0 9 , 0 0 7 , 1 2 3 . 8 4 2. Investment expenditures and interest paid Asset management expenditure s 1 5 1 , 4 5 5 , 5 5 0 . 4 2 1 4 2 , 2 1 4 , 0 2 7 . 1 5 Write-downs on investments 2 , 2 3 9 , 8 3 9 , 7 3 3 . 1 0 1 , 4 8 8 , 9 0 5 , 1 1 9 . 0 8 I n t e rest paid 8 9 , 6 6 5 , 9 9 0 . 9 5 9 3 , 4 1 6 , 6 8 5 . 7 9 Losses from sale of investments 1 7 , 8 6 5 , 3 2 8 . 8 2 1 5 , 1 5 4 , 3 6 1 . 5 4 Other investment expenditure s 4 1 , 4 3 6 , 5 1 1 . 2 2 1 3 9 , 6 5 4 , 5 4 6 . 9 2 Total investment expenditure s -2 , 5 4 0 , 2 6 3 , 1 1 4 . 5 1 - 1 , 8 7 9 , 3 4 4 , 7 4 0 . 4 8 3. Allocated investment income transferred to the underwriting account -6 , 1 7 6 , 3 0 9 , 7 6 9 . 9 0 - 5 , 8 3 3 , 2 4 5 , 4 5 3 . 6 2 4. Other non-technical income 2 0 2 , 1 9 7 , 3 8 5 . 9 5 1 6 7 , 7 7 2 , 3 8 5 . 8 0 5. Other non-technical expenditure s - 1 6 0 , 2 1 4 , 0 5 7 . 9 2 - 1 8 1 , 9 3 3 , 5 3 6 . 6 8 6. Earnings from ord i n a ry activities 5 9 5 , 2 5 7 , 2 9 6 . 2 3 1 , 0 3 7 , 4 0 0 , 6 9 4 . 2 3 7. Extraord i n a ry income 0 . 0 0 3 6 7 , 5 1 2 , 2 9 9 . 0 0 8. Extraord i n a ry expenditure s 0 . 0 0 - 1 5 3 , 1 8 5 , 2 6 6 . 0 0 9. Extraord i n a ry re s u l t 0 . 0 0 2 1 4 , 3 2 7 , 0 3 3 . 0 0 1 0 . Taxes on profit and income - 1 3 5 , 7 7 8 , 8 4 9 . 9 2 - 2 2 9 , 8 6 7 , 1 3 3 . 0 0 1 1 . P rofit for the year 4 5 9 , 4 7 8 , 4 4 6 . 3 1 1 , 0 2 1 , 8 6 0 , 5 9 4 . 2 3 1 2 . N o n - g roup shareholders’ share in the profit for the year -3 6 , 0 7 4 , 3 1 2 . 6 6 -6 2 , 3 0 3 , 2 8 7 . 4 1 1 3 . Withdrawals from re s e rv e s Withdrawals from valuation re s e rves associated with special write-downs 3 1 1 , 1 8 6 , 9 6 0 . 0 6 5 6 , 7 9 5 , 4 4 1 . 7 0 Withdrawals from other untaxed re s e rv e s 3 7 4 , 6 7 3 , 7 0 4 . 0 5 4 2 3 , 8 1 1 , 3 8 7 . 1 0 Withdrawals from capital re s e rves/jubilee bonus 7 0 , 0 0 0 , 0 0 0 . 0 0 0 . 0 0 Withdrawals from free re s e rv e s 1 0 0 , 5 0 0 , 0 0 0 . 0 0 0 . 0 0 Total withdrawals from re s e rv e s 8 5 6 , 3 6 0 , 6 6 4 . 1 1 4 8 0 , 6 0 6 , 8 2 8 . 8 0 1 4 . Transfers to re s e rv e s Transfers to risk reserve per §73a of the Insurance Companies Supervision Act 5 2 , 1 0 5 , 9 8 8 . 3 5 1 2 , 0 0 2 , 5 4 8 . 1 4 Transfers to valuation re s e rves associated with special write-downs 1 0 1 , 0 5 6 , 8 9 3 . 8 9 3 9 0 , 5 3 7 , 5 9 9 . 6 8 Transfers to other untaxed re s e rv e s 6 4 4 , 1 1 9 , 2 2 1 . 4 1 1 6 9 , 0 8 6 , 8 5 2 . 9 5 Transfers to free re s e rv e s 2 4 9 , 8 1 3 , 0 6 4 . 0 1 6 0 0 , 4 4 8 , 5 4 0 . 4 6 Total transfers to re s e rv e s - 1 , 0 4 7 , 0 9 5 , 1 6 7 . 6 6 - 1 , 1 7 2 , 0 7 5 , 5 4 1 . 2 3 1 5 . P rofit for the year 2 3 2 , 6 6 9 , 6 3 0 . 1 0 2 6 8 , 0 8 8 , 5 9 4 . 3 9 1 6 . P rofit brought forw a rd 2 2 , 3 4 4 , 6 8 4 . 8 3 1 7 , 1 9 2 , 0 9 0 . 4 4 Net pro f i t 2 5 5 , 0 1 4 , 3 1 4 . 9 3 2 8 5 , 2 8 0 , 6 8 4 . 8 3

106 99 Appendix II. Consolidated Entity Basically all subsidiaries were included in the consolidated annual financial statements. Along (Group) with Wiener Städtische Allgemeine Ve r s i c h e- rung Aktiengesellschaft, a total of 22 domestic I. General Information Regard i n g companies and nine foreign companies were fully Accounting and Va l u a t i o n consolidated. Four other companies were in- M e t h o d s cluded based on pro-rata consolidation, and 11 companies were included in the annual financial These annual financial statements were drawn up statements at equity. 51 companies in which in accordance with the principles of pro p e r Wiener Städtische holds participating intere s t s accounting and the general re q u i rements that w e re valued at book value only, due to the fact stipulate that a true and fair view of the com- that they are of minor significance in terms of p a n y ’s assets and financial and earnings situa- p resenting a true and fair view of the gro u p ’s tion be pre s e n t e d . assets and financial and earnings situation and have little overall impact. Per § 248 of the In part i c u l a r, we observed the afore m e n t i o n e d C o m m e rcial Code, three companies (non-pro f i t regulations with re g a rd to the companies in- residential construction companies) may not be cluded in the consolidated entity and the re g u l a- included in the consolidated entity as they would tions re g a rding re p o rting of capital, debts, be a hindrance in terms of presenting a true and e x p e n d i t u res and earnings in consolidated fair view of the gro u p ’s assets and financial and financial statements. These consolidated annual e a rnings situation; they have there f o re been financial statements are stru c t u red in accord a n c e valued at book value. In the case of companies with the regulations re g a rding stru c t u re set that were included based on pro-rata consolida- f o rth in the Insurance Companies Superv i s i o n tion, strategic alliance agreements or syndicate A c t . a g reements indicating that these companies’

Changes to the consolidated entity:

Included for the first time R e a s o n

W I E N E R STÄDTISCHE Beteiligungs GmbH, Vi e n n a A c q u i re d C R O W N - W S F, spol. s . r.o., Prague A c q u i re d DBR-Liegenschaften Ve rwaltungs-GmbH, Stuttgart F o u n d e d DBR-Liegenschaften GmbH & CO KG, Stuttgart F o u n d e d Bankowe To w a rzystwo Ubezpieczen i Reasekuracji “Heros” S.A., Wa r s a w A c q u i re d IMPERIAL – Székesfehérv á r, Ingatlankezelési, Kft., Kisterc s a A c q u i re d WIENER STÄDTISCHE osiguranje d. d., Zagre b A c q u i re d UNION Biztosító Rt., Budapest Additional shares purc h a s e d

99 107 operations are conducted jointly by the share- Union Biztosító Rt., Budapest (formerly GLÓRIA- holders have been drawn up. Since the last SWISS LIFE Svájci-Magyar Biztosító Rt., consolidated annual financial statements as Budapest) was acquired (49 % of the stock of 31 December 1998 were pre p a red, one was already held). Accord i n g l y, the full consoli- domestic and six foreign companies have been dation method has been used rather than equity consolidated for the first time. Moravskoslezská method consolidation. K O O P E R AT I VA, Brno, merged with Cˇ e s k á K O O P E R AT I VA, Praha, to form K O O P E R AT I VA Impact of the changes in the consolidated entity pojisˇt’ovna, a.s., Praha. Based on the appropriate consolidation methods, the results of the changes in the consolidated In 1999 the remaining 51% of the stock of entity in net terms are as follows:

1999 Balance Sheet

Impact of the changes in the consolidated entity, in ATS thousand

I n v e s t m e n t s 3 , 6 8 9 , 9 9 8 U n d e rwriting pro v i s i o n s 3 3 8 , 5 1 5

1999 Income Statement

Impact of the changes in the consolidated entity, in ATS thousand

E a rned pre m i u m s G ro s s 1 , 0 7 7 , 4 2 4 N e t 9 6 2 , 3 9 1 Claims incurre d G ro s s 2 8 6 , 8 3 4 N e t 2 1 2 , 4 4 2 Change in the underwriting pro v i s i o n s G ro s s 7 7 4 , 0 0 8 N e t 7 7 3 , 2 5 8 Operating expenses 1 9 7 , 3 1 9 Financial re s u l t 1 7 2 , 9 0 5

III. Principles of consolidation ments of Kapital & Wert Vermögensverwaltung Aktiengesellschaft, Vienna, as of 30 September The consolidated annual financial statements are 1999 were included. All other annual financial based on the annual financial statements of statements that are included are as of 31 Wiener Städtische Allgemeine Ve r s i c h e ru n g December 1999. In cases where a company’s Aktiengesellschaft and the subsidiaries that are financial year is not the calendar year, interim finan- included. The consolidated annual financial state- cial statements were used.

108 99 Capital consolidation was carried out using the s u b s i d i a ry on the date the company was book value method, by offsetting the acquisition a c q u i red/first consolidated. costs against the pro p o rtional capital of the

Companies included in the consolidated annual financial statements were first consolidated on the following dates:

Fully consolidated companies Date first consolidated

DONAU Allgemeine Ve r s i c h e rungs-Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 M o n t a n v e r s i c h e rung Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 Wien Ve rein Bestattungs- und Ve r s i c h e ru n g s s e rvice Gesellschaft m.b .H., Vi e n n a 1 .1 .1 9 9 5 Senioren Residenz Veldidenapark Errichtungs- und Verwaltungs GmbH, Innsbruck 1 .1 .1 9 9 5 R D - B E T E I L I G U N G S - A K T I E N G E S E L L S C H A F T, Vi e n n a 1 .1 .1 9 9 5 LVP Holding GmbH, Vi e n n a 1 .1 .1 9 9 5 V ö s e n d o rf Realbesitz GmbH, Vi e n n a 1 .1 .1 9 9 5 “Grüner Baum” Errichtungs- und Ve rw a l t u n g s g e s .m .b . H., Innsbru c k 1 .1 .1 9 9 5 B runn am Gebirge Realbesitz GmbH, Vi e n n a 1 .1 .1 9 9 5 S e n i o ren Residenz Fultererpark Errichtungs- und Ve rwaltungs GmbH, Innsbru c k 1 .1 .1 9 9 5 Altstadt Hotelbetriebs GmbH, Salzburg 1 .1 .1 9 9 5 HOTEL EUROPA SALZBURG Realbesitz Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 HOTEL EUROPA VIENNA Realbesitz GmbH, Vi e n n a 1 .1 .1 9 9 5 PROGRESS Beteiligungsges. m .b . H., Vi e n n a 1 .1 .1 9 9 6 Center Hotel Holding GmbH, Vi e n n a 1 .1 .1 9 9 5 Center Hotel Betriebs GmbH, Salzburg 1 .1 .1 9 9 5 Neue Heimat Oberösterreich Holding GmbH, Vi e n n a 1 .1 .1 9 9 6 K O O P E R AT I VA, druzˇstevná poist’ovnˇa a .s., Bratislava 3 1 .1 2 .1 9 9 6 K O O P E R AT I VA, pojisˇt’ovna, a. s., Prague 3 1 .1 2 .1 9 9 6 Vltava s. r.o., Prague company founded Securia majetkovosprávna a podielová s. r.o., Bratislava 1 .1 .1 9 9 7 P rojektbau GesmbH, Wa l s 1 .1 .1 9 9 8 PFG Parkflächenbewirtschaftungs GmbH, Salzburg 1 .1 .1 9 9 8 REAL-TECH Immobilienverwaltung GesmbH, Vi e n n a 1 .1 .1 9 9 8 WIENER STÄDTISCHE Beteiligungs GmbH, Vi e n n a 1 .1 .1 9 9 9 Bankowe To w a rzystwo Ubezpieczen i Reasekuracji “Heros” S.A., Wa r s a w 1 .1 .1 9 9 9 WIENER STÄDTISCHE osiguranje d. d., Zagre b 1 .1 .1 9 9 9 UNION Biztosító Rt., Budapest 3 1 .1 2 .1 9 9 9 DBR-Liegenschaften Ve rwaltungs-GmbH, Stuttgart company founded DBR-Liegenschaften GmbH & CO KG, Stuttgart company founded

99 109 Companies included based on pro-rata consolidation Date first consolidated

InterRisk Internationale Ve r s i c h e rungsholding GmbH, Vi e n n a 1 .1 .1 9 9 5 Union Ve r s i c h e rungs-Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 Vo l k s f ü r s o rge-Jupiter Allgemeine Ve r s i c h e rungs-Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 CA Ve r s i c h e rung Aktiengesellschaft, Vi e n n a 3 1 .1 2 .1 9 9 8

Associated companies Date first consolidated

PKB Privatkliniken Beteiligungs-GmbH, Vi e n n a 1 .1 .1 9 9 5 Sparkassen Ve r s i c h e rung Aktiengesellschaft, Vi e n n a 1 .1 .1 9 9 5 Medial Beteiligungs GmbH, Vi e n n a 1 .1 .1 9 9 5 Ve reinigte Pensionskasse AG, Vi e n n a 1 .1 .1 9 9 5 Businesspark Brunn Entwicklungs AG, Vi e n n a 3 1 .1 2 .1 9 9 6 G e w i s t a - Werbegesellschaft m.b . H., Vi e n n a 1 .1 .1 9 9 6 Gesundheitspark Vienna-Oberlaa Gesellschaft m. b . H., Vi e n n a 3 1 .1 2 .1 9 9 6 Kapital & We rt Ve rm ö g e n s v e rwaltung Aktiengesellschaft, Vi e n n a 3 1 .1 2 .1 9 9 8 T E C H - G ATE VIENNA Wissenschafts- und Technologiepark GmbH, Vi e n n a 3 1 .1 2 .1 9 9 8 CROWN-WSF spol. s . r.o., Prague 3 1 .1 2 .1 9 9 9 I M P E R I A L– S z é k e s f e h é rv á r, Ingatlankezelési, Kft., Kisterc s a 3 1 .1 2 .1 9 9 9

Use was made of the conditions ser forth in § 265, Section 3 of the Commercial Code.

Balancing items resulting from first-time consoli- ence between the book values of part i c i p a t i n g dation were offset against revenue re s e rv e s i n t e rests and the pro p o rtionate equity capital unless they were assigned to hidden re s e rves in in question was ATS thousand 45,590 physical assets. In the case of companies first ( ATS thousand 185,296). consolidated on 31 December 1999 based on full or pro-rata consolidation and newly acquire d R e s e rves established at subsidiaries following s h a res in companies already included in pre v i o u s first-time consolidation or acquisition, shares in years, the balancing items were as follows: On subsidiaries’ net income for the year assignable the assets side: ATS thousand 128,375 (AT S to the group, and results from consolidation thousand 506,731); and on the liabilities side: t reated as income were transferred to gro u p ATS 4,766 (ATS thousand 130). re s e rves.

The book value method per § 264, Section 1 of P rofit or loss assignable to other share h o l d e r s the Commercial Code was used for valuation of was determined based on profit for the year/net p a rticipating interests. During the 1999 gro u p loss for the year. business year, the net amount for balancing items on the assets side arising from the diff e r- Accounts receivable and accounts payable betw-

110 99 een companies were offset against each other; ing. Any discounts associated with additional e x p e n d i t u res and earnings from gro u p - i n t e rn a l payments are distributed over the term of the business were basically eliminated. In the 1999 loan and re p o rted under deferred income and business year, interim results from gro u p - i n t e rn a l a c c rued expenses on the liabilities side of the selling of investments were eliminated. balance sheet.

I V. Accounting and Va l u a t i o n Tangible assets (not including land and build- P r i n c i p l e s ings) are valued at acquisition cost, minus scheduled depreciation. Low-value assets are These consolidated annual financial statements completely written off in the year of entry. There a re based on the annual financial statements of w e re no write-ups on assets. Wiener Städtische Allgemeine Ve r s i c h e ru n g Aktiengesellschaft and the subsidiaries that are U n e a rned pre m i u m s in pro p e rty & casualty are included, which were pre p a red according to uni- essentially prorated temporally; a deduction in f o rm accounting and valuation principles, namely the amount of ATS thousand 288,052 (ATS thou- those applied to the Wiener Städtische a n n u a l sand 305,529) was made for costs. In life insur- financial statements. ance, the provisions for unearned premiums are established at the level stipulated in the general F o reign currency amounts in the annual financial business plan; no deduction was made for costs. statements of foreign subsidiaries were convert- In health insurance, unearned premiums are pro- ed based on a modified key-date method: rated temporally, with no deduction for costs. Amounts shown in balance sheets were converted using the key-date exchange rate (average S h a res in non-consolidated affiliated compa- exchange rate on 31 December 1999); amounts nies and participating interests are shown in the shown in the income statements were convert e d balance sheet at acquisition cost, minus sched- using an average exchange rate. uled deprecations if necessary.

Intangible assets a c q u i red in exchange for pay- Securities and share s a re valued at acquisition ment were entered on the assets side at acquisi- cost or the lower of market price or market value tion cost, minus scheduled depre c i a t i o n . as of the balance sheet date. The lower of cost or market principle is strictly applied in the case Basically land, equivalent rights and buildings, of all companies. including buildings on land owned by outside p a rt i e s, are valued at acquisition or constru c t i o n U n d e rwriting pro v i s i o n s w e re basically adopted costs, minus scheduled depreciation. as is from the annual financial statements of the companies included in these consolidated annual M o rtgage loans and other loans, including financial statements. loans to affiliated companies and companies w h e re there is a part i c i p a t o ry relationship, are P rovisions for pensions and severance pay- generally valued at the nominal value outstand- ments w e re basically adopted as is from the indi-

99 111 vidual annual financial statements of subsi- F u rt h e rm o re, Wiener Städtische is jointly and diaries. Liabilities were entered in the balance severally liable for loans raised by Country Inn sheet based on the applicable commercial and VIC Hotelerrichtungs- und Betriebsgesellschaft tax re g u l a t i o n s . m.b.H. up to a total of ATS thousand 143,000 ( ATS thousand 143,000); there is a letter of The ATS thousand 4,503,266 (ATS thousand u n d e rtaking with respect to Züblin Pro j e k t- 4,449,832) in p rovisions for pensions re p o rt e d entwicklung GmbH re g a rding the acquisition of in the balance sheet as of 31 December 1999 two buildings for the Friedrichscarreé Berlin- consist of the provisions for pensions in the Mitte project with a purchase price of about DEM amount of ATS thousand 3,921,814 (ATS thou- thousand 115,000 (DEM thousand 0); and there is sand 3,787,726), which were calculated in accord- a declaration of liability with respect to ance with § 14 and § 116 of the Income Tax Act; a Technopark Grundstück GmbH & Co. KG re- taxed amount of ATS thousand 28,649 (ATS thou- g a rding the acquisition of the Technopark II sand 29,602); and an under-accrual of ATS thou- G r a s b runn München Ost land parcel (the port i o n sand 552,803 (ATS 632,504) per Art. X, Sections 3 of the purchase price is DEM thousand 69,500 and 4 of the Financial Reporting Act, which is [DEM thousand 0]). Furt h e rm o re, Wi e n e r reported separately under deferred expenses and Städtische is liable for loan repayments made by accrued income on the assets side of the balance its employees to Spar- und Vorschuss-Kasse der sheet. In 1999 the under-accrual fell by ATS thou- Angestellten der Wiener Städtische Allgemeine sand 79,701 (ATS thousand 84,490). Ve r s i c h e rung Aktiengesellschaft reg. Gen. m.b.H. in the amount of ATS thousand 2,782 (ATS thou- Liabilities with respect to financial authorities sand 2,570). w e re adopted as is from the annual financial statements of subsidiaries. V. Substantial Share h o l d i n g s

Accounts re c e i v a b l e and accounts payable The list of participating interests and inform a t i o n w e re valued at the nominal amount or re p a y a b l e re g a rding the consolidated entity are to be found a m o u n t . on pages 122–125.

Other pro v i s i o n s w e re established based on anticipated necessary amounts.

Please note the following with re g a rd to c o n t i n- g e n c i e s not shown in the balance sheet: There is a letter of comfort in favor of Business Park B runn Entwicklungs GmbH in the amount of AT S thousand 32,000 (ATS thousand 32,000) and a guarantee letter in favor of APC-Geschäftscenter Betriebsgesellschaft m. b . H. in the amount of ATS thousand 11,000 (ATS thousand 13,000).

112 99 VI. Notes Regarding Balance Sheet Items

The balance sheet figures for intangible assets, land and buildings, and investments and part i- cipating interests changed as follows during the year (amounts in ATS thousand):

I n t a n g i b l e Land and S h a res in P a rt i c i p a t i n g Loans to and Loans to and Shares in a s s e t s b u i l d i n g s a s s o c i a t e d i n t e re s t s bonds issued bonds issued by affiliated by affiliated companies companies c o m p a n i e s companies where a participatory rela- Amounts in TS tionship exists

Status as of 31 Dec. 1998 1 0 4 , 7 0 0 1 4 , 3 7 8 , 1 6 5 7 0 7 , 8 7 4 4 , 3 7 6 , 8 4 7 2 4 4 , 7 2 5 4 , 3 3 9 , 9 8 2 6 6 5 , 6 7 8 A d d i t i o n s 1 1 8 , 5 6 9 1 , 6 7 5 , 3 1 3 3 , 4 9 4 , 8 5 8 1 1 , 3 1 7 1 , 0 1 9 , 5 5 0 1 7 7 , 3 6 7 D i s p o s a l s - 1 4 , 6 7 5 - 5 3 , 4 7 4 - 5 2 , 0 1 7 - 2 , 4 3 8 , 1 6 1 - 2 , 9 4 2 - 5 6 1 , 6 7 6 -5 0 0 Transferred to another account 2 , 5 9 2 - 3 9 , 2 6 9 1 5 , 1 0 8 - 1 , 0 6 5 , 2 2 5 - 1 7 9 , 0 0 0 - 6 , 0 3 3 - 1 9 7 , 7 6 8 De p re c i a t i o n - 4 7 , 8 9 5 - 1 , 0 0 3 , 8 1 9 - 8 , 2 1 8 - 1 , 9 0 6 - 1 , 1 5 2 - 1 0 , 0 7 8 Status as of 31 Dec. 1999 1 6 3 , 2 9 1 1 4 , 9 5 6 , 9 1 6 6 7 0 , 9 6 5 4 , 3 6 0 , 1 0 1 7 2 , 1 9 4 4 , 7 9 0 , 6 7 1 6 3 4 , 6 9 9

As of 31 December 1999, the land value of The current market value of investments is as follows: developed and undeveloped land was AT S Items per § 81 c, Section 2 of the Current value Current value thousand 2,965,854 (ATS thousand 2,703,239). Insurance Companies Supervision Act as of 31 Dec. 99 as of 31 Dec. 98 The balance-sheet value of land used by Land and buildings 18,210,558 – Wiener Städtische was ATS thousand Shares in affiliated companies 638,003 710,058 2,168,769 (ATS 1,941,688). Loans to affiliated companies 72,194 244,725 Other loans not covered by an insurance con- Participating interests (other) 4,628,989 4,583,768 tract include the following: loans to the Republic Bonds issued by and loans to of Austria in the amount of ATS thousand companies where there is a 18,988,445 (ATS thousand 20,697,254); loans to pa rt i c i p a t o r y rel a t i o n s h i p 4,842,234 4,482,110 other public corporations in the amount of AT S Shares and other variable-yield thousand 2,491,173 (ATS 2,413,948); and loans securities 36,144,124 28,456,026 to other borrowers in the amount of ATS thou- Bonds and other fixed-income sand 3,059,983 (ATS thousand 3,241,549). securities 27,636,857 27,998,212 Mortgage loans 4,913,591 5,053,787 The c u rrent market values of land and build- Prepayments on policies 322,734 251,014 i n g s w e re determined in accordance with the Other loans 24,539,601 26,352,751 recommendations of the Austrian Association of Insurance Companies. Valuations were larg e l y Balance at banks 1,129,075 1,066,639 based on appraisals conducted in 1999. Other investments 67,576 57,726

99 113 By valuation year, the market values re s u l t i n g Liabilities-side balancing items in the amount of f rom appraisals are as follows: 1999: ATS thou- ATS thousand 98,191 (ATS thousand 98,166) sand 15,623,017; 1998: ATS thousand 2,115,126; resulting from capital consolidation were trans- 1997: ATS thousand 160,942; 1996: ATS thou- f e rred to revenue re s e rv e s . sand 108,473; 1995: ATS thousand 203,000. Net assets-side balancing items in the amount of S h a res in affiliated companies and part i c i p a- ATS thousand 318,073 (ATS thousand 272,474) ting interests are valued at market prices. In resulting from equity method consolidation were cases where this does not apply, they are valued o ffset against revenue re s e rv e s . at the higher of acquisition cost (minus non- scheduled depreciation, if any), or the appro p r i a- te pro p o rtion of equity shown in the most re c e n t financial statements.

S h a res and other securities a re valued at market prices or, if this does not apply, at acquisition cost minus non-scheduled depreciation, if any. Other investments are valued at the nominal value minus non-scheduled depreciation, if any.

Other investments a re valued at nominal value, minus scheduled depreciation where applicable.

Of the bonds payable in the amount of ATS thousand 750,897 (ATS thousand 707,058), ATS thousand 707,071 (ATS thousand 707,058) are con- v e rtible bonds. Under other liabilities, tax l i a b i l i t i e s accounted for ATS thousand 412,794 ( ATS thousand 562,458) and social security lia- b i l i t i e s accounted for ATS thousand 92,206 ( ATS thousand 87,839).

Assets-side balancing items in the amount of AT S thousand 1,352,223 (ATS thousand 1,228,588) resulting from capital consolidation were off s e t against revenue re s e rves.

In 1999, assets-side balancing items assigned to hidden re s e rves in land and buildings fell by ATS thousand 7,287, to ATS thousand 181,536.

114 99 VII. Notes Regarding the Income Statement

In 1999, in Pro p e rty & Casualty the premiums written broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

D i rect business F i re and fire shutdown insurance 2 , 2 1 7 , 8 0 5 2 , 2 1 1 , 1 8 4 Household insurance 1 , 2 3 1 , 3 6 3 1 , 1 5 6 , 1 4 5 Other pro p e rty insurance 2 , 4 7 3 , 5 9 6 2 , 1 2 2 , 9 4 0 Auto third party liability insurance 3 , 5 0 9 , 8 9 4 3 , 7 1 6 , 2 1 3 Other auto insurance 2 , 8 5 9 , 9 9 9 3 , 0 2 9 , 7 5 3 Accident insurance 1 , 4 6 7 , 7 2 4 1 , 4 0 4 , 6 0 9 General liability insurance 1 , 3 0 7 , 6 9 6 1 , 2 8 2 , 1 4 4 Legal expenses insurance 5 2 5 , 1 1 8 5 1 3 , 2 4 2 Marine, aviation and transport insurance 2 9 1 , 6 2 7 2 4 6 , 7 2 6 C redit and guarantee insurance 8 2 , 9 1 8 6 , 6 4 0 Other lines of insurance 2 8 2 , 2 3 6 2 2 6 , 1 8 0 1 6 , 2 4 9 , 9 7 6 1 5 , 9 1 5 , 7 7 5 I n d i rect business Marine, aviation and transport insurance 1 0 , 3 0 9 3 4 , 7 7 1 Other lines of insurance 2 7 3 , 8 2 1 5 1 9 , 4 0 8 2 8 4 , 1 3 0 5 5 4 , 1 7 9 D i rect and indirect business combined 1 6 , 5 3 4 , 1 0 6 1 6 , 4 6 9 , 9 5 4

Premiums written in primary business broke down as follows:

Amounts in ATS thousand P & C H e a l t h L i f e To t a l

D o m e s t i c 1 2 , 6 2 5 , 4 5 0 3 , 2 9 5 , 6 4 0 1 1 , 4 1 7 , 1 3 7 2 7 , 3 3 8 , 2 2 7 E u ropean Economic Area member states 3 9 2 , 1 8 4 7 1 0 , 7 2 4 4 0 2 , 9 1 5 A b ro a d 3 , 2 3 2 , 3 4 2 0 3 6 8 , 6 8 4 3 , 6 0 1 , 0 2 6 1 6 , 2 4 9 , 9 7 6 3 , 2 9 5 , 6 4 7 1 1 , 7 9 6 , 5 4 5 3 1 , 3 4 2 , 1 6 8

99 115 In 1999, premiums written in Health Insurance broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Direct business Individual insurance 2 , 2 8 7 , 7 7 5 2,241,675 Group insurance 1,007,872 995,499 3,295,647 3,237,174

Indirect business Group insurance 5,719 4,398 3,301,366 3,241,572

In 1999, premiums written in Life Insurance broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Direct business 1 1 , 7 9 6 , 5 4 5 9 , 1 7 8 , 4 3 1 Indirect business 2 0 3 , 7 0 7 1 7 4 , 6 9 6 1 2 , 0 0 0 , 2 5 2 9 , 3 5 3 , 1 2 7

In 1999, premiums from direct insurance operations broke down as follows:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Individual insurance 1 1 , 1 4 3 , 1 5 8 8 , 6 4 9 , 4 5 1 G roup insurance 6 5 3 , 3 8 7 5 2 8 , 9 8 0 1 1 , 7 9 6 , 5 4 5 9 , 1 7 8 , 4 3 1 O n e - t i m e - p remium policies 4 , 5 5 7 , 7 0 5 2 , 4 8 3 , 4 5 2 R e g u l a r- p remium policies 7 , 2 3 8 , 8 4 0 6 , 6 9 4 , 9 7 9 1 1 , 7 9 6 , 5 4 5 9 , 1 7 8 , 4 3 1 Policies featuring profit sharing 1 0 , 0 6 1 , 1 3 3 8 , 9 1 0 , 1 9 8 Policies with no profit sharing 9 6 1 , 5 7 0 2 4 7 , 0 2 3 Fund-linked life insurance policies 7 7 3 , 8 4 2 2 1 , 2 1 0 1 1 , 7 9 6 , 5 4 5 9 , 1 7 8 , 4 3 1

In fund-linked life insurance, investments were P o rtfolio,” BA Master Fonds “Tr a d i t i o n e l l e s made in the following funds: P o rtfolio,” CA PensionInvest II, CA-Fonds A4, A6, BA Master Fonds “Dynamische B a s k e t 1, CA-Fonds Basket 2, CA-Fonds Basket P o rtfolio,” BA Master Fonds “Konserv a t i v e s 3, CA-Fonds Basket 4, Cash Euro Fonds, P o rtfolio,” BA Master Fonds “Pro g re s s i v e s Constantia Euor Bond EUR Fonds, C-Quadrat

116 99 L e o n a rdo Jogging Fonds, C-Quadrat Leonard o Trust Gold & Mining, Merc u ry ST. Emerg i n g Walking Fonds, CS Bond Fund (LUX) Euro, CS Markets USD Fund, Merc u ry ST. European EUR Bond Fund (LUX) USD, CS EF (LUX) Small Cap Bond Fund, Merc u ry ST. European Opport. USD USD Fund, Dekarent Internat. DEM Fonds, Dollar Fund, Merc u ry ST. Japan Opport. USD Fund, Bond, Dollar Rent EUR Fonds, Dollar Stock, M e rc u ry ST. North American USD Fund, Morg a n DONAU Star-Fonds, EU-Bond EUR Fonds, Euro Stanley EM. MKTS. Debt. USD Fund, Morg a n Basket I, Euro Basket II, Euro Basket III, Euro Stanley Emerging MKTS USD Fund, Morg a n Basket IV, Eurohedge, Europa Top EUR Fund, Stanley Global Equity, Morgan Stanley Japan E u ro rent Neu, Euro Stock, Fidelity Europ. Gro w t h Equity Fund, Morgan Stanley US-Small Comp. EUR-Fund, Fidelity Funds Europe, Fidelity Fund Fund, Mündelfonds, Ost-Aktiv Miteigen- I n t e rnational, Fidelity Funds South East Asia, tumsfonds, Österreichische Renten-Fonds, Fidelity Global FPS USD Fund, Fidelity Moderate Pensions-Invest, Plus Invest EUR Fonds, FPS DEM Fund, Fidelity Japan JPY Fund, Fidelity P o rtfolio 3, Portfolio 5, Portfolio 7, Portfolio 9, Japan Small Comp. JPY Fund, Fidelity Gro w t h P o rtfolio 11, Puma, Selecta, Templeton Global FPS DEM Fund, Fleming FF American Fledgeling Markets, Ti g e r, Top Amerika EUR Fonds, To p USD Funds, Fleming FF American USD Fund, I n t e rnational, Trade Rent, Vienna Top, VIF Fleming FF Emerging USD MKTS. Debt. Fund, Ve r s i c h e rung International Fonds, Vontobel USD Fleming FF European SM. Comp. EUR Fund, Bond Fund, Vontobel USD Fund Emerg i n g Fleming FF Latin American Fund, Fondis MKTS., Vo r s o rge-Rentenfonds and Vo r s o rg e - Investment DEM Fonds, Gamax Funds FCP, Rentenfonds Euro . Global Markets Umbrella, Global Rent Plus, GT Bond Fund Austria, GT Investment Fund, GT In life and health insurance, all income fro m World Bond Fund Shares, Intert rend, Invesco GT capital investments was carried over to the E m e rging Markets Bond, Invesco GT Japan technical account, as investment income in these Enterprise USD Fund, Invesco GT Japan USD two areas is part of underwriting calculations. In Fund, Invesco GT Pan Europ. Enterprise EUR p ro p e rty & casualty, only interest earned on re- Fund, Invesco GT Pan European EUR Fund, tained deposits relating to indirect business was Julius Baer Swiss Stock Fund, Merc u ry Selected c a rried over to the technical account.

The items claims incurred, operating expenses, other underwriting expenditures, investment e x p e n d i t u res and other non-technical expenditures include the following:

Amounts in ATS thousand 1 9 9 9 1 9 9 8

Salaries and wages 2 , 9 1 5 , 8 4 7 2 , 7 7 4 , 7 9 7 E x p e n d i t u res on severance pay 2 4 1 , 6 8 4 2 1 9 , 0 1 3 E x p e n d i t u res on old-age pro v i s i o n 4 2 1 , 0 9 5 5 0 0 , 5 0 1 E x p e n d i t u res on social security contributions re q u i red by law, s a l a ry - related payments and compulsory contributions 9 2 5 , 3 0 6 8 9 8 , 3 7 4 Other staff benefits 5 8 , 7 7 2 5 6 , 4 0 4

99 117 The valuation reserves shown in the balance sheet dated 31 December 1999, and transfers to and withdrawals from those reserves, break down as follows (by fixed asset item):

As of Tr a n s f e r Wit h - Re a l l o - As of Amounts in ATS thousand 31 Dec. 98 dr a w a l s ca t i o n s 31 Dec. 99 Land and buildings 1 , 2 5 1 , 5 4 4 1 3 2 , 2 2 0 5 4 , 9 3 2 0 1 , 3 2 8 , 8 3 2 S h a res in affiliated companies 1 1 4 , 3 8 5 0 1 8 6 1 5 1 1 4 , 9 8 2 P a rticipating intere s t s 5 4 4 , 3 9 9 0 2 3 5 , 4 3 5 - 1 5 2 , 0 3 9 1 5 6 , 9 2 5 Bonds and other fixed-income s e c u r i t i e s 5 4 , 6 7 0 0 9 3 4 - 2 0 1 5 3 , 5 3 5 Bonds issued by and loans to companies w h e re there is a part i c i p a t o ry re l a t i o n s h i p 4 , 9 8 1 0 1 2 2 0 1 5 , 1 7 0 S h a res and other variable-yield s e c u r i t i e s 2 4 1 , 1 5 1 0 9 , 5 8 7 1 5 1 , 4 2 4 3 8 2 , 9 8 8 Tangible assets 9 3 4 0 0 0 9 3 4 Intangible assets 1 8 , 0 8 4 0 1 5 , 0 4 7 0 3 , 0 3 7

The other untaxed reserves reported in the balance sheet dated 31 December 1999, and transfers to and withdrawals from those reserves during the business year, break down as follows:

As of Tr a n s f e r Wit h - Re a l l o - As of Amounts in ATS thousand 31 Dec. 98 dr a w a l s ca t i o n s 31 Dec. 99

Investment allowance per § 10 of the Income Tax Act 6 2 6 , 5 5 2 1 0 3 , 4 3 8 2 8 5 , 9 1 4 6 , 8 5 1 4 5 0 , 9 2 7 Rental income res e r ves per § 11 of the Income Tax Act 7 8 , 9 9 1 0 7 8 , 9 9 1 0 0 Transfer res e r ves per § 12 of the Income Tax Act 5 0 , 0 5 3 5 5 2 , 2 9 0 5 0 , 0 5 3 0 5 5 2 , 2 9 0

The reserves per § 10 of the Income Tax Act reported in the balance sheet dated 31 December 1999 break down by year as follows: In the 1999 business year, in direct insurance Investment allowance per § 10 of the Income Tax Act business c o m m i s s i o n s totaled ATS thousand 2,666,762 (ATS thousand 2,323,938). In the F rom 1990 1 , 4 0 3 , 5 5 4 . 0 0 1999 business year, losses from the sale of F rom 1991 2 , 7 9 3 , 4 2 6 . 0 0 i n v e s t m e n t s totaled ATS thousand 17,865 F rom 1992 6 6 8 , 5 0 6 . 0 0 ( ATS thousand 15,154). F rom 1993 1 , 9 8 5 , 9 5 3 . 0 0 F rom 1994 2 0 , 8 9 3 , 1 2 3 . 0 0 In the 1999 business year, expenditures on taxes F rom 1995 2 6 , 6 0 0 , 9 4 4 . 0 0 on profit and income were reduced by ATS thou- F rom 1996 8 1 , 2 0 9 , 1 7 0 . 8 6 sand 37,883 (ATS thousand 31,976), thanks to F rom 1997 6 8 , 1 4 9 , 9 2 3 . 7 3 the fact that more untaxed re s e rves were estab- F rom 1998 1 4 3 , 7 8 1 , 6 9 0 . 1 2 lished than was withdrawn from said re s e rv e s . F rom 1999 1 0 3 , 4 3 9 , 8 4 5 . 5 6 The amount that may be entered on the assets side per § 198 (10) of the Commercial Code was not entered in the balance sheet. The anticipated tax relief for subsequent financial years is ATS thousand 18,075 (ATS thousand 44,828).

118 99 VIII. Other M e m b e r s : D r. Günter G e y e r In 1999 the Superv i s o ry Board consisted of D r. Franz L a u e r the following members: Dkfm. Karl F i n k Heinz J a i n d l C h a i rman: Dkfm. Hans R a u m a u f (until 30 June 1999) Komm.-Rat Karl S a m s t a g Ing. Mag. Robert L a s s h o f e r (since 1 July 1999)

Vice Chairman: The average number of employees (including Komm.-Rat Dkfm. Klaus S t a d l e r cleaning staff) at fully consolidated companies was 9,032 (8,440). Of this figure, 3,834 (3,668) M e m b e r s : w e re field employees and incurred ATS thousand Abbot Präses Dr. Clemens L a s h o f e r 1,528,267 (ATS thousand 1,445,447) in personnel N o r b e rt G r i n n i n g e r costs; 5,198 (4,772) were office employees and D r. Alfred H o l o u b e k i n c u rred ATS thousand 2,737,084 (ATS thousand Ing. We rner K a s z t l e r 2,737,426) in personnel costs. Dipl.-Ing. Guido K l e s t i l Dkfm. Helmut M a y r The average number of employees (including Komm.-Rat Walter N e t t i g cleaning staff) at p ro-rata consolidated compa- Wolfgang R a d l e g g e r n i e s was 940 (886). Of this figure, 298 (305) were D r. Johann S e re i n i g field employees and incurred ATS thousand D r. Karl S k y b a 203,986 (ATS thousand 208,216) in personnel costs; 642 (581) were office employees and Employee Repre s e n t a t i v e s : i n c u rred ATS thousand 434,672 (ATS thousand Paul A m b ro z y 366,763) in personnel costs. Renate D o r i n g e r (until 30 April 2000) Sylvia F i e d l e r (until 31 January 2000) As of 31 December 1999, the members of the Peter G r i m m B o a rd of Management held loans in the amount Heinz N e u h a u s e r of ATS thousand 938 (ATS thousand 1,068); no Egon P i n z g e r (since 1 May 2000) additional loans were taken out in 1999. Intere s t Franz U r b a n on the loans is 6.0% (6.5% ) p.a. Repayments in Fritz Z i c k b a u e r (since 1 Febru a ry 2000) the amount of ATS thousand 130 (ATS thousand 120) were made. The loans will mature in 2005. In 1999 the Board of Management consisted of the following members: Members of the Superv i s o ry Board did not take out any loans in 1999. C h a i rm a n : Dkfm. Dr. Siegfried S e l l i t s c h As of 31 December 1999, none of the members of the Board of Management or Superv i s o ry B o a rd was subject to any l i a b i l i t i e s.

99 119 Of the 1999 expenditures for severance pay and amount of ATS thousand 32,711 (ATS thousand pensions totaling ATS thousand 469,091 26,113). Total remuneration in the amount ( ATS thousand 541,412), severance pay and of ATS thousand 14,024 (ATS thousand 14,427) pensions for Board of Management members was paid to former members of the Board and senior management per § 80, Section 1 of of Management (including their survivors) in the Stock Corporation Act accounted for AT S 1 9 9 9 . thousand 30,725 (ATS 34,855). In 1999, the members of the Superv i s o ry In re t u rn for the work they perf o rmed for the B o a rd received a total of ATS thousand 1,060 c o m p a n y, in 1999 the members of the Board of ( ATS 1,073) in re t u rn for the work they perf o rm e d Management received compensation in the for the company,

The Board of Management:

Dkfm. Dr. Sellitsch

Dr. Geyer Dr. Lauer

Dkfm. Fink Jaindl Ing. Mag. Lasshofer

Vienna, 9 April 2000

120 99 version of the annual financial statements for Auditor’s the period ending 31 December 1999 o f

Wiener Städtische Allgemeine Ve r s i c h e ru n g Certificate Aktiengesellschaft, Schottenring 30, 1010 Vi e n n a . We have audited the annual financial statements for the year ended 31 December 1999, which Following our due audit, we hereby certify that w e re drawn up by the Board of Management of the accounting re c o rds and financial statements Wiener Städtische Allgemeine Ve r s i c h e ru n g comply with the legal regulations. The financial Aktiengesellschaft in accordance with Austrian statements give a true and fair view of the c o m m e rcial law; we observed the principles of c o m p a n y ’s assets, liabilities, financial position p roper auditing as customarily applied in the and earnings, and were drawn up in accord a n c e accounting profession in Austria. Having com- with accounting principles generally accepted pleted our audit, we hereby grant an u n re s t r i c t- in Austria. The Board of Management’s e d a u d i t o r’s certificate per § 274, Section 1 of Status Report accords with the financial state- the Commercial Code to the unabridged Germ a n m e n t s .

KPMG Austria Wi rtschaftsprüfungs- und S t e u e r b e r a t u n g s - G m b H

D r. Walter Knirsch Mag. Michael Schlenk C PAs and Tax Advisors

Vienna, 18 April 2000

99 121 Sh a r e of the capital Capital Net income/Net loss Last annual Co n - O v e rview of participating intere s t s res o u rc e s for the year fi n a n c i a l so l i - Total Direc t In 1,000 In 1,000 st a t e m e n t s da t i o n

1. Affiliated companies

Bankowe To w a rzystwo Ubezpieczen i Reasekuracji “Heros” S.A., Wa r s a w 7 1 . 0 7 % 7 1 . 0 7 % 1 0 6 , 4 3 2 - 3 3 , 6 0 1 1 9 9 9 V K Center Hotel Holding GmbH, Vi e n n a 7 5 . 0 0 % 5 5 . 0 0 % - 1 6 1 - 4 7 0 1 9 9 9 V K Center Hotelbetriebs GmbH, Wa l s 1 0 0 . 0 0 % 1 0 0 . 0 0 % 1 0 1 9 5 9 1 9 9 9 V K DBR-Liegenschaften Ve rwaltungs GmbH, Stuttgart 1 0 0 . 0 0 % 1 0 0 . 0 0 % 3 2 6 - 1 8 1 9 9 9 V K DBR-Liegenschaften GmbH & Co KG, Stuttgart 1 0 0 . 0 0 % 1 0 0 . 0 0 % - 1 , 3 9 7 1 9 9 9 V K D I R E C T-LINE Dire k t v e rtriebs-GmbH, Vienna 1 0 0 . 0 0 % 1 0 0 . 0 0 % 6 0 8 3 1 9 9 9 A 1 DONAU Allgemeine Ve r s i c h e ru n g s - Aktiengesellschaft, Vienna 7 5 . 0 0 % 7 5 . 0 0 % 1 , 2 3 2 , 3 7 3 1 3 4 , 8 3 7 1 9 9 9 V K DVS Donau-Ve r s i c h e rung Ve rmittlungs- und Service-Gesellschaft m.b . H., Vi e n n a 1 0 0 . 0 0 % A 1 E X P E RTA Schadenre g u l i e ru n g s Gesellschaft m.b .H., Vi e n n a 1 0 0 . 0 0 % 2 5 . 0 0 % 4 , 9 2 2 1 , 4 0 9 1 9 9 9 A 1 R D - B E T E I L I G U N G S - A K T I E N G E S E L L S C H A F T, Vi e n n a 8 0 . 0 0 % 3 0 , 1 7 4 4 , 4 4 1 1 9 9 9 V K HORIZONT Personal-, Team- und O rganisationsentwicklung GmbH, Vi e n n a 7 6 . 0 0 % 5 2 . 0 0 % 1 , 6 2 1 2 5 5 1 9 9 8 A 1 HOTEL EUROPA VIENNA Realbesitz GmbH, Vi e n n a 1 0 0 . 0 0 % 9 9 . 5 5 % 1 1 1 , 7 0 7 - 2 , 8 1 4 1 9 9 9 V K H u m a n o c a re Betriebsgesellschaft m.b . H., Vi e n n a 7 5 . 0 0 % 7 5 . 0 0 % 5 9 , 1 2 8 2 5 , 8 8 7 1 9 9 8 A 1 Kapital & We rt Ve rm ö g e n s v e rw a l t u n g Aktiengesellschaft, Vi e n n a 5 0 . 4 3 % 5 0 . 3 4 % 3 4 0 , 7 1 9 4 1 , 8 7 3 1 9 9 9 E K K O O P E R AT I VA poist’ovnˇ a, a . s., Bratislava 9 2 . 5 4 % 8 5 . 4 5 % 2 7 5 , 4 6 1 1 4 , 7 9 3 1 9 9 9 V K K O O P E R AT I VA pojisˇt’ovna, a.s., Prague 9 6 . 6 8 % 4 9 . 9 5 % 5 6 5 , 0 7 1 3 8 , 0 0 9 1 9 9 9 V K Celetná, s. r.o . 1 0 0 . 0 0 % A 1 Pragueo-Immobilien, a.s., Prague 5 1 . 0 0 % A 1 Sanatorium Astoria, a.s., Karlovy Va ry 7 5 . 0 6 % A 1 LVP Holding GmbH, Vi e n n a 1 0 0 . 0 0 % 1 0 0 . 0 0 % 3 , 3 4 9 , 0 3 1 6 0 7 1 9 9 9 V K “Grüner Baum” Errichtungs- und Ve rw a l t u n g s g e s .m .b .H., Innsbru c k 6 6 . 6 0 % - 4 8 , 4 6 7 - 8 , 0 8 6 1 9 9 9 V K B runn am Gebirge Realbesitz GmbH, Vi e n n a 8 5 . 0 0 % 2 2 , 5 3 9 - 7 5 8 1 9 9 9 V K HOTEL EUROPA SALZBURG Realbesitz Aktiengesellschaft, Vi e n n a 1 0 0 . 0 0 % 4 7 , 4 0 8 - 1 , 2 0 9 1 9 9 9 V K Neue Heimat Oberösterreich Holding GmbH, Vi e n n a 1 0 0 . 0 0 % 2 7 6 , 5 1 6 1 2 , 9 6 4 1 9 9 9 V K “Neue Heimat” Gemeinnützige Wohnungs- und Siedlungsgesellschaft in Oberösterre i c h Gesellschaft mit beschränkter Haftung, Linz 9 9 . 8 1 % A 3 Alpenländische Heimstätte Gemeinnützige Wo h n u n g s - bau- und Siedlungsgesellschaft m.b .H., Innsbru c k 9 4 . 0 0 % A 3 Erste Gemeinnützige Wo h n u n g s g e s e l l s c h a f t “Heimstätte” Gesellschaft m.b . H., Vi e n n a 9 9 . 4 5 % A 3 REAL-TECH Immobilienverwaltung Gesell- schaft m.b . H., Vi e n n a 7 4 . 0 0 % 6 9 , 5 6 0 1 , 7 7 5 1 9 9 9 V K S e n i o ren Residenz Fultererpark E rrichtungs- und Ve rwaltungs GmbH, Innsbruck 7 0 . 5 4 % - 2 7 , 0 8 8 - 9 , 8 3 8 1 9 9 9 V K TECH GATE VIENNA Wissenschafts- und Technologiepark GmbH, Vi e n n a 6 0 . 0 0 % 2 9 7 , 5 7 3 - 3 , 5 8 5 1 9 9 9 E K V ö s e n d o rf Realbesitz GmbH, Vienna 1 0 0 . 0 0 % 5 , 9 5 6 6 1 5 1 9 9 9 V K Altstadt Hotelbetriebs GmbH, Salzburg 1 0 0 . 0 0 % 4 3 3 2 , 2 1 1 1 9 9 9 V K Wiener Städtische Beteiligungs GmbH, Vi e n n a 1 0 0 . 0 0 % 2 , 8 1 7 , 5 9 5 - 9 3 1 9 9 9 V K M e t ropolitan Datenserv i c e - gesellschaft m.b . H., Vi e n n a 1 0 0 . 0 0 % 1 0 0 . 0 0 % 4 0 , 5 6 3 4 , 1 3 9 1 9 9 8 A 1 M e t ropolitan Rechenzentrum-Betriebs-GmbH, Vi e n n a 1 0 0 . 0 0 % A 1

Use was made of the conditions set forth in § 241, Section 2, and § 265, Section 3, of the Commercial Code.

122 99 Sh a r e of the capital Capital Net income/Net loss Last annual Co n - O v e rview of participating intere s t s res o u rc e s for the year fi n a n c i a l so l i - Total Direc t In 1,000 In 1,000 st a t e m e n t s da t i o n

M o n t a n v e r s i c h e rung Aktiengesellschaft, Vienna 8 6 . 4 0 % 8 6 . 4 0 % 1 7 8 , 2 8 1 - 1 6 , 4 1 9 1 9 9 9 V K PFG Parkflächenbewirtschaftungs GesmbH, Salzburg 8 5 . 0 0 % 6 0 . 0 0 % 1 2 , 0 2 4 7 , 8 3 1 1 9 9 9 V K P R O D U K T I VA Ve r s i c h e ru n g s v e rm i t t l u n g s - und Finanzierungsberatungs GmbH, Vi e n n a 1 0 0 . 0 0 % 1 0 0 . 0 0 % 2 7 0 - 4 , 4 1 5 1 9 9 8 A 1 PROGRESS Beteiligungsges.m .b . H., Vi e n n a 6 0 . 0 0 % 6 0 . 0 0 % 4 7 , 5 6 1 1 3 , 0 2 1 1 9 9 9 V K P rojektbau Ges. m .b .H., Wa l s 8 5 . 0 0 % 6 0 . 0 0 % 9 0 6 3 , 9 6 0 1 9 9 9 V K R e a l i t ä t e n v e rwaltungs- und Restaurantbetriebs- Gesellschaft m. b. H., Vi e n n a 9 6 . 0 0 % 9 4 . 0 0 % 7 , 8 3 5 1 , 6 9 4 1 9 9 9 A 1 R i n g t u rm Kapitalanlagegesellschaft m. b . H., Vienna 5 1 . 0 0 % 5 1 . 0 0 % 1 8 , 4 4 4 4 , 8 1 3 1 9 9 9 A 1 RISK CONSULT Sicherheits- und Risiko- Managementberatung Gesellschaft m.b .H., Vienna 1 0 0 . 0 0 % 6 0 . 0 0 % 2 , 0 4 3 2 5 1 1 9 9 9 A 1 R I S K - S E RVICE Ve r s i c h e rungsmakler und - b e t reuungsgesellschaft m. b . H., Vienna 1 0 0 . 0 0 % 1 0 0 . 0 0 % 2 9 3 - 8 3 7 1 9 9 9 A 1 SECURIA majetkovosprávna a podielová s . r.o., Bratislava 1 0 0 . 0 0 % 1 0 0 . 0 0 % 3 1 , 3 8 5 - 1 6 1 9 9 9 V K S e n i o ren Residenzen Gemeinnützige Betriebs GmbH, Vi e n n a 1 0 0 . 0 0 % 1 0 0 . 0 0 % 9 6 4 1 , 1 9 1 1 9 9 8 A 1 S e n i o ren Residenz Veldidenapark Errichtungs- und Ve rwaltungs GmbH, Innsbru c k 6 6 . 7 0 % 6 6 . 7 0 % - 4 5 , 7 9 4 - 5 , 5 3 9 1 9 9 9 V K Union Biztosító Rt., Budapest 1 0 0 . 0 0 % 1 0 0 . 0 0 % 9 8 , 3 3 8 - 4 4 , 6 4 4 1 9 9 9 V K Vienna-Life Lebensversicherung AG, Schaan 1 0 0 . 0 0 % 1 0 0 . 0 0 % A 4 V LTAVA majetkovosprávní a podílová s p o l .s . r.o., Prague 1 0 0 . 0 0 % 1 0 0 . 0 0 % 2 8 , 0 4 7 - 8 1 9 9 9 V K Wiener Städtische Osiguranje dionicko drusˇtvo, Zagre b 9 0 . 0 0 % 9 0 . 0 0 % 7 1 , 6 1 9 - 6 , 1 9 4 1 9 9 9 V K Wien Ve rein Bestattungs- und Ve r s i c h e ru n g s - s e rvice Gesellschaft m. b . H., Vi e n n a 1 0 0 . 0 0 % 1 0 0 . 0 0 % 1 4 , 4 1 1 6 4 2 1 9 9 9 V K

2. Direct participating interests of 20% or more

Audatex Österreich Gesellschaft m.b.H., Vi e n n a 4 9 . 0 0 % 3 9 . 0 0 % 1 3 , 3 6 2 9 , 7 3 7 1 9 9 9 A 2 Bank Austria-Wien Städtische KFZ Leasing GmbH, Vi e n n a 5 0 . 0 0 % 5 0 . 0 0 % - 4 3 , 2 3 8 - 1 4 , 1 8 8 1 9 9 9 A 2 Business Park Brunn Entwicklungs AG, Vi e n n a 5 0 . 0 0 % 5 0 . 0 0 % 7 8 , 6 6 2 2 7 , 6 4 6 1 9 9 9 E K CA Ve r s i c h e rung Aktiengesellschaft, Vi e n n a 5 0 . 0 0 % 5 0 . 0 0 % 1 7 5 , 1 6 2 2 2 , 3 9 9 1 9 9 9 Q K CROWN-WSF spol.s . r.o., Prague 3 0 . 0 0 % 3 0 . 0 0 % 3 7 , 4 5 7 - 1 1 , 0 1 7 1 9 9 8 E K Humanomed Krankenhaus Management Gesellschaft m.b . H., Vi e n n a 2 5 . 0 0 % 2 5 . 0 0 % 4 , 3 6 5 3 , 0 7 4 1 9 9 8 A 2 I M P E R I A L - S z é k e s f e h é rv á r, Ingatlankezelési, Kft. K i s t a rc s a 2 5 . 0 0 % 2 5 . 0 0 % 1 5 , 1 4 1 - 1 4 , 4 3 7 1 9 9 8 E K InterRisk Internationale Ve r s i c h e rungsholding GmbH, Vi e n n a 5 0 . 0 0 % 3 3 . 3 3 % 3 5 8 , 8 3 8 6 4 , 2 9 4 1 9 9 9 Q K Ö B V-DIREKT Ve r s i c h e ru n g s s e rvice GmbH, Vi e n n a 3 3 . 3 3 % 3 3 . 3 3 % - 3 , 3 2 6 - 1 , 9 6 8 1 9 9 8 A 2 PKB Privatkliniken Beteiligungs-GmbH, Vi e n n a 2 5 . 0 0 % 2 5 . 0 0 % 2 2 9 , 8 5 0 2 0 , 9 4 9 1 9 9 8 E K Privatklinik Wehrle Gesellschaft m.b . H., Salzburg 2 5 . 0 0 % 2 5 . 0 0 % 1 1 , 9 9 7 - 2 , 9 2 4 1 9 9 8 A 2 Ruster Hotel Bau- und Betriebs- gesellschaft m.b . H. & Co KG, Vienna 4 7 . 8 6 % 4 7 . 8 6 % - 6 2 , 0 1 0 - 3 , 6 6 4 1 9 9 9 A 2 Union Ve r s i c h e rungs- Aktiengesellschaft, Vienna 3 3 . 3 3 % 3 3 . 3 3 % 5 7 3 , 6 2 3 7 8 , 2 0 0 1 9 9 9 Q K Ve reinigte Pensionskasse Aktiengesellschaft, Vienna 3 0 . 1 1 % 3 0 . 1 1 % 2 0 8 , 4 5 7 9 , 9 7 0 1 9 9 9 E K Vo l k s f ü r s o rge-Jupiter Allgemeine Ve r s i c h e rungs- Aktiengesellschaft, Vienna 4 7 . 6 7 % 4 7 . 6 7 % 6 0 5 , 3 9 7 3 9 , 1 8 8 1 9 9 9 Q K Wiener Porzellanmanufaktur Augart e n - B e t e i l i g u n g s - v e rwaltungsgesellschaft m. b .H., Vi e n n a 5 0 . 0 0 % 5 0 . 0 0 % 2 , 2 9 5 - 2 8 1 9 9 8 A 2

Use was made of the conditions set forth in § 241, Section 2, and § 265, Section 3, of the Commercial Code.

99 123 Sh a r e of the capital Capital Net income/Net loss Last annual Co n - O v e rview of participating intere s t s res o u rc e s for the year fi n a n c i a l so l i - Total Direc t In 1,000 In 1,000 st a t e m e n t s da t i o n

3. Other participating interests in insurance companies and financial institutions

A L L N ATIONS, INC., Columbus, Ohio 0 . 0 1 % 0 . 0 1 % Bank Austria Aktiengesellschaft, Vi e n n a 1) 5 . 2 6 % 0 . 0 0 % Bausparkasse Wüstenrot Aktiengesellschaft, Salzburg 3 . 0 0 % 3 . 0 0 % Horizonte Enterprise Development Company B . V., ED Heiloo 1 4 . 0 3 % 1 4 . 0 3 % InterRisk Ve r s i c h e rungs-Aktiengesellschaft, Wiesbaden 4 5 . 8 3 % I n v e s t k redit Bank AG, Vi e n n a 7 . 4 2 % 7 . 4 2 % Kapital-Beteiligungs AG, Vi e n n a 1 0 . 0 0 % 1 0 . 0 0 % Kölnische Rück Vi e n n a R ü c k v e r s i c h e rungs-Aktiengesellschaft, Vi e n n a 1 5 . 0 0 % 1 5 . 0 0 % OESTERREICHISCHE NATIONALBANK, Vi e n n a 0 . 4 7 % 0 . 4 7 % Ö s t e rreichische Kre d i t v e r s i c h e rungs- Aktiengesellschaft, Vienna 1 4 . 8 3 % 1 4 . 8 3 % PRISMA Kre d i t v e r s i c h e rungs-Aktiengesellschaft, Vi e n n a 2 . 8 0 % 2 . 8 0 % Sparkassen Ve r s i c h e rung Aktiengesellschaft, Vienna 2 5 . 0 1 % E K Ve n t u re Finanzierungsgesellschaft m. b .H., Vi e n n a 1 . 1 6 % 1 . 1 6 % W ü s t e n rot Ve r s i c h e rungs-Aktiengesellschaft, Salzburg 1 5 . 0 0 % 1 5 . 0 0 % W ü s t e n rot Wo h n u n g s w i rtschaft re g i s t r i e rte Genossen- schaft mit beschränkter Haftung, Salzburg 0 . 4 5 % 0 . 4 5 % W ü s t e n rot a.s., Prague 6 . 1 4 %

4. Other participating interests in other companies

“TBG” Therm e n z e n t rum Geinberg Betriebsgesellschaft m.b.H., Linz 9 . 5 2 % 9 . 5 2 % “THG” Therm e n z e n t rum Geinberg E rrichtungs-GmbH, Linz 9 . 5 2 % 9 . 5 2 % 92,9 RTL Radio Vienna GmbH, Vi e n n a 7 . 4 0 % A RWAG Holding-Aktiengesellschaft, Vi e n n a 4 . 3 0 % 4 . 3 0 % Austrian Airlines Österreichische Luftverkehrs-AG, Vi e n n a 1 . 1 5 % Avance Hotel GmbH, Bad Ta t z m a n n s d o rf 1 0 . 0 0 % D ATATRAK Austria Telematik GmbH, Vi e n n a 2 5 . 0 0 % Casinos Austria Aktiengesellschaft, Vi e n n a 6 . 6 4 % C O U N T RY INN VIC H o t e l e rrichtungs- und Betriebsgesellschaft, Vi e n n a 5 0 . 0 0 % Gemeinnützige Industrie-Wo h n u n g s a k t i e n g e s e l l - schaft, Linz 3 9 . 8 5 % Gesundheitspark Vi e n n a - O b e r l a a Gesellschaft m.b .H., Vi e n n a 4 0 . 0 0 % E K G e w i s t a - Werbegesellschaft m.b . H., Vi e n n a 1 9 . 8 0 % E K Golf re s o rt Karlovy Va ry, a.s., Karlovy Va ry 9 . 3 7 % Hausgarage Brigittenauerlände Betriebsgesellschaft m. b . H., Vi e n n a 1 0 . 0 0 % 1 0 . 0 0 % Hausgarage Wohnen am Donaupark Betriebsgesellschaft m. b . H., Vi e n n a 1 0 . 0 0 % 1 0 . 0 0 % KDAG Data GmbH, Vi e n n a 3 9 . 5 2 %

Use was made of the conditions set forth in § 241, Section 2, and § 265, Section 3, of the Commercial Code. 1) Cross holdings.

124 99 Sh a r e of the capital Capital Net income/Net loss Last annual Co n - O v e rview of participating intere s t s res o u rc e s for the year fi n a n c i a l so l i - Total Direc t In 1,000 In 1,000 st a t e m e n t s da t i o n

Medial Beteiligungs-Gesellschaft m. b . H., Vi e n n a 2 2 . 2 2 % E K New Europe Insurance Ve n t u res, Edinburg h 2 . 3 3 % 2 . 3 3 % Ö s t e rreichisches Ve r k e h r s b ü ro Aktiengesellschaft, Vi e n n a 5 . 3 5 % 5 . 3 5 % Privatklinik Josefstadt GmbH, Vi e n n a 2 5 . 0 0 % Privatklinik Villach Gesellschaft m.b . H., Klagenfurt 1 3 . 0 0 % 1 3 . 0 0 % Privatklinik Villach Gesellschaft m.b . H.& Co. KG, K l a g e n f u rt 2 3 . 5 1 % 2 3 . 5 1 % Privatklinik Wehrle Realbesitz GmbH, Vi e n n a 2 5 . 0 0 % Sanatorium Döbling Betriebsführu n g s GmbH Nfg KEG, Vi e n n a 2 5 . 0 0 % Sanatorium Maria Hilf GmbH, Vi e n n a 2 5 . 0 0 % Sanatorium Maria Hilf Realbesitz GmbH, Klagenfurt 2 5 . 0 0 % Semperit Aktiengesellschaft Holding, Vi e n n a 1 0 . 0 0 % VV Immobilien GmbH & CO GB II KG, Munich 1 1 . 0 5 % 1 1 . 0 5 % Wagramer Straße Hotel-Betriebs-GmbH, Vi e n n a 5 0 . 0 0 % WED Donau-City Gesellschaft m. b . H., Vi e n n a 5 . 0 7 % WED Holding Gesellschaft mbH, Vi e n n a 5 . 7 7 % 5 . 7 7 % WED Kastor Liegenschaftsbesitz GmbH, Vi e n n a 5 . 0 7 % WED Orion Liegenschaftsbesitz GmbH, Vi e n n a 5 . 0 7 % W E D Planungs- und Errichtungsgesellschaft mbH, Vienna 5 . 0 7 % WED Saturn Liegenschaftsbesitz GmbH, Vi e n n a 5 . 0 7 % WED Wiener Entwicklungsgesellschaft für den Donauraum Aktiengesellschaft, Vienna 5 . 0 7 % Wiener Börse AG, Vi e n n a 0 . 2 9 % 0 . 2 9 % Wiener Holding Aktiengesellschaft, Vi e n n a 8 . 3 2 % 8 . 3 2 % Wiener Messen & Congreß Gesellschaft m. b .H., Vi e n n a 1 . 1 6 % 1 . 1 6 % Wiener Porzellanmanufaktur Augarten Gesellschaft m.b . H., Vi e n n a 1 8 . 4 7 %

Use was made of the conditions set forth in § 241, Section 2, and § 265, Section 3, of the Commercial Code.

Note: The abbreviations in the Consolidation column mean the following:

V K Fully consolidated company Q K P ro-rata consolidated company E K Company consolidated based on the equity method A 1 Non-consolidated company per § 249, Section 2 of the Commercial Code A 2 Non-consolidated company per § 263, Section 2 of the Commercial Code A 3 Non-consolidated company per § 248 of the Commercial Code A 4 Non-consolidated company per § 249, Section 1, Paragraph 2 of the Commercial Code

99 125 Your Worries Are Our Concern Get in Touch with the Right Person

General Secre t a r i a t S e rvice team for industrial insurance Mag. Gerald H a s l e r, General Secre t a ry Viktor G re i t n e r, Managing Clerk

P ro p e rty & Casualty S e rvice team for transport insurance Auto insurance Ronald P l a n k, Assistant Manager Heinz M a n d l, Department Head Helmut L a s s l, P ro k u r i s t S e rvice team for industrial and key account b e n e f i t s Liability and legal expenses insurance Dipl.-Ing. Karl R o h r i n g e r, P ro k u r i s t D r. Alfred B i e g l, P ro k u r i s t Health Insurance Homeowners’, residential, office building, D r. Walter L e o n h a rt s b e rg e r- S c h ro t t, household and burg l a ry/theft insurance D e p a rtment Head Heinrich H e r b s t, P ro k u r i s t Life and Accident Insurance L i a b i l i t y, pro p e rty and auto benefits depart m e n t G e rh a rd E rn s t, Department Head D r. Wolfgang R e i s i n g e r, Senior P ro k u r i s t Funeral Services Insurance Industrial & commercial business, brokerage Peter S k y b a, Dire c t o r and sales management Rudolf D u r s t m ü l l e r, Head of Sales Hans Wo l f, Head of Sales R e i n s u r a n c e P roduct & risk management D r. Peter H a g e n, P ro k u r i s t Dipl,-Ing. Gerh a rt E b n e r, P ro k u r i s t ( p ro p e rty insurance) I n t e rnational Business D r. René K e m p f, P ro k u r i s t D r. Peter H a g e n, P ro k u r i s t (Liability insurance) S a l e s S e rvice team for international programs A l t e rnative sales channels and key accounts Mag. Gerh a rd - Walter J e i d l e r, Friedrich M ü l l e r, P ro k u r i s t Head of Sales

128 99 Asset Management Head Physician, Personal Insurance and Equity holdings management, loans Outpatients’ Clinic D r. Martin S i m h a n d l, Department Head D r. med. Alfred H e i t e r

P roject and real estate holdings Head Actuary Mag. Anton We rn e r, P ro k u r i s t Heinz J a i n d l, Dire c t o r, Board of Management, Life and Health Securities and investment funds, investor relations, Ringturm - K a p i t a l a n l a g e g e s .m .b .H . D r. Peter S t ro b l, Dire c t o r

General Company Functions Finance and accounting Dieter L e i c h t f r i e d, Dire c t o r

L a w, taxes and associations D r. Sven Te i c h m e i s t e r, Dire c t o r

I n t e rnal auditing Leopold Tu m a, Department Dire c t o r

S p o n s o r i n g Elfriede To z z e r, Dire c t o r

Human Resourc e s R o b e rt B i l e k

Operations management Peter S a n d h o ff, Assistant Manager

M e t ropolitan Rechenzentrum Betriebsges. m .b .H . M e t ropolitan Datenservice Ges. m .b .H . B o a rd of Management: Mag. Robert H a i d e r D r. Franz K o s y n a Franz S c h n e e b e rg e r Walter S e y b a l Emmerich We b e r

99 129 In v e s t o r Hotline Re l a t i o n s 0800/201800

Regularly updated information available E v e n t Date 24 hours a day. Q1/2000 re s u l t s Calendar week 22

Accounts press confere n c e 23 May 2000 Information for Investors

IR roadshow Zurich 25 May 2000 A re you interested in further information about IR roadshow Klagenfurt 29 May 2000 Wiener Städtische? IR roadshow Graz 29 May 2000 Would you like to be put on our mailing list to IR roadshow Linz 31 May 2000 receive regular updates for share h o l d e r s ? IR roadshow Innsbru c k 5 June 2000

IR roadshow Frankfurt 6 June 2000 Please let us know!

IR roadshow Salzburg 13 June 2000 Our investor relations team is looking forw a rd to 1) Ord i n a r y general shareholders’ meeting 16 June 2000 hearing from you. E x - d i v i d e n d 19 June 2000 You can contact us at: Results for 1st six months of 2000 Calendar week 38 Wiener Städtische Allgemeine Versicherung Results for Q1-Q3/2000 Calendar week 51 Aktiengesellschaft

1 ) Time and place of general shareholders’ meeting: 10 a.m., Palais Ferstel Investor Relations Schottenring 30 1010 Vi e n n a Facts and figures regarding Wiener Städtische Telefon: +43/1/531 39-1151 shares: Fax: +43/1/531 39-3121 10,986,800 ord i n a ry share s E-mail: [email protected] 1,350,000 pre f e rrred share s I n t e rnet: www. w i e n e r s t a e d t i s c h e . a t Capital stock: ATS 1,233,680,000 Ö s t e rreichische Kontrollbank security number: 0 9 0 8 5 2 ISIN: AT 0 0 0 0 9 0 8 5 2 0 S h a re h o lder stru c t u re: Wiener Städtische Wechselseitige Ve r s i c h e rungsanstalt Ve r- mögensverwaltung 81%, Bank Austria AG 8%, F ree float 11% Listed on the Vienna, Munich and Berlin stock e x c h a n g e s Symbols: Bloomberg: WSTV AV; Reuters: W I S V p r. V I

99 131 Published by: Wiener Städtische Allgemeine Ve r s i c h e rung Aktiengesellschaft, Schottenring 30, A-1010 Vienna, Austria Contact person: Mag. Gerald Hasler, Tel.: +43/1/531 39-1060, E-mail: [email protected] Design: Huber und Schönburg Photos: Wolfgang Zajc

Printed on environmentally friendly paper made from 100% chlorine-free bleached pulp.