Annual Report 2012 Table of Content

ANNUAL REPORT 2012 TABLE OF CONTENT 01 02 03 MESSAGE CORPORATE CREDINS BANK FROM CEO GOVERNMENT ACTIVITIES IN 2012 2 annual report 2012 CREDINS bank 04 05 06 STRATEGIC OUR FinAnciAL StATEMEnt OBJECTIVES FOR 2013 LOCAtiONS FOR THE YEAR EndED 31 DECEmbER 2012 And AUditOR’S REPORT annual report 2012 CREDINS bank 3 MESSAGE FROM CHIEF EXECUTIVE OFFICER 4 annual report 2012 CREDINS bank Dear readers, 2012 was another important year for us. Our financial results for 2012 show both the progress we have made and the challenges that remain. In 2012, the Bank revenues, net of interest expense rose to Lek 4,7 billion or increased by 16% comparing to 2011. The net profit of Lek 669 million showed a decline comparing to 2011 but that was a reflection of increased reserve for loans loss. Obviously, our net profit does not yet reflect the work we are doing to strengthen capital, reduce risk and attract more business from our customers. There are many issues weighing not only on us, but on the entire financial services sector. These include concerns about the global economy, the implementation of new regulations and capital requirements, how these new rules may affect our ability to deliver for our customers and clients, and the time it will take to resolve collateral issues. There is more work to do, but today we are better organized to serve our customers and clients, to offer customers more reasons to do more business with us, to earn the Artan SAntO, CEO profits our shareholders expect, and to contribute to economic growth in all of the communities we serve. We are pleased to announce that the Bank, by the end of 2012 continued to be ranked among the 4 largest banks in terms of assets, loan to customers and deposits. Today we are better organized to serve our customers and clients,to offer customers more reasons to do more business with us. annual report 2012 CREDINS bank 5 TOTAL ASSETS TOTAL DEPOSitS (in billions, at year end) (in billions, at year end) 91,825 77,715 84,217 71,395 71,020 62,165 2010 2011 2012 2010 2011 2012 During the past year, we made an intensive effort in the Bank to adapt our business to the complex and rapidly changing market environment. We started by setting our priorities, reviewing our objectives, and being aware of what it means to be one of the most important banks in Albania. In November 2012, we developed a new strategy (2013-2015) which aspires to transform Credins into the leading client-centric universal bank. During the strategy definition meetings, we recognized that we operate in an environment of tighter regulation, more rigorous capital requirements, pressure on margins and business volumes, and historically low interest margins. We are preparing ourselves for a more complex relationship with the economy and with society, fiercer competition, additional regulation and tighter supervision. There are four main elements to the strategy to build a more valuable Bank: From a focus on corporate to serving the whole market equally; High emphasis on diversification and development on the basis of: Further strengthening of Retail business; Offering additional services not reliant on balance sheet; Continuing to keep strong relationships with the customers; Continuing product innovation. Build international reputation; From exclusively internal development to a consideration of acquisitions and joint ventures. I am pleased to say that we are making good progress in each area. 6 annual report 2012 CREDINS bank RETURN ON EQUITY LOANS TO CUSTOMERS, NET (at year end) (in billions, at year end) 25.4% 65,265 17,0% 58,632 8.1% 40,258 2010 2011 2012 2010 2011 2012 OUR CUSTOMERS Two years ago, we started on a path to make Credins Bank a less complex and stronger company. At the heart of our plan was a greater focus on the three groups of customers we serve — individuals, companies and public institutions — and to become their primary financial services partner. Today, the network coverage couldn’t be better: Credins Bank has more than 47 branches in Albania. We learned that proximity to our customers is the key to a close partnership, and to shared success. For individuals, we have worked hard to launch a new e-banking solution and we believe this will further enhance their satisfaction as it will offer much more services that it offers now and they will transact in a more secure way and with very competitive prices. We also increased our specialized sales force which helped providing customers improved access to bank specialists. As a result, deposits continue to grow nearly 10 % in 2012 from a year ago. After successfully launching the unique prepaid, re loadable Visa cards for the Albanian market, we enhanced customer satisfaction by increasing their benefits and fulfilling their needs in terms of managing their cash as well as their expectations on secure online shopping. For companies, we are connecting them with our expertise and capabilities so they can do more and get the solutions they need. We continued to help our companies to transact, manage their cash and the risk of currency and interest fluctuations as we believe this creates value for our customers. Our relations with public institutions have been strengthening from year to year as well. During 2012, the number of salary accounts increased by roughly 14000 employees to whom we served with additional value added services such as combined benefits of banking products and insurance services for free. annual report 2012 CREDINS bank 7 OUR PEOPLE I am proud to say every year that our people all around the country are absolutely committed to serving our customers and are often the difference between Credins Bank and our competitors. We believe that by being the best place to work for our employees they can better serve our customers, which in turn will drive better returns for our shareholders. Every day I hear from customers and clients about how our employees have made a difference — helping a small business get up and running, advising a family on a financial plan for university, or bringing a large deal to a successful close. We are firmly committed to our corporate social responsibility too. In 2012, we have started to integrate more decisively social responsibility in our business policies and the underlying processes. As we are aware that we cannot continue to do business successfully in the long run without the acceptance of the society of which Credins Bank is a part. An extensive cultural change is one of the key levers of the new bank strategy. Building on our strengths and achievements to date, we intend to create added value in accordance with society’s values. Success in business must incorporate social criteria and be sustainable, not just in the economic sense, but also from an environment and social perspective. LOOKING AHEAD As we think about what the future holds, with the team we have and the company we’ve built, there is good reason to be optimistic and excited about what lies ahead. We have leading capabilities and expertise that enable us to outdistance the competition and win in the marketplace. We are focused on the horizon and committed to being better every day for those we serve, for the communities where we live and for each other. We will continue to improve advice, service and products for our clients. We will increase operational efficiency, strengthen our capital base and manage our capital more efficiently. We will consistently fulfill regulatory requirements. 8 annual report 2012 CREDINS bank Our new strategy (2013-2015) aims to position Credins Bank as a winner in the changing environment. Developments of the past years reinforce our conviction that this strategy is the right course, and we will continue to devote ourselves to the interest of our clients, shareholders, employees and the wider society in which we operate. Naturally, my colleagues and I are well aware that we will face many challenges and uncertainties this year, too. However, barring unforeseen obstacles, we will be able to reach our target by drawing on last year’s hard work and the momentum gained from our accomplishments. We look forward to continuing to serve the interests of our stakeholder! Artan SAntO Chief Executive Officer annual report 2012 CREDINS bank 9 CORPORATE GOVERNMENT 10 annual report 2012 CREDINS bank A MESSAGE FROM THE BOARD OF DIRECTORS The Board of Directors of Credins Bank, during its periodic meetings has focused on important issues, such as the adoption of the business strategy, risk management and regulatory issues. Issues related to business performance and the control committee have been monitored as an important part of the topics reviewed by the Board members, having in mind not only on the progress but also setting directives for further improvement. Additionally, during 2012 the Recovery Department has followed up the reporting on the progress of the portfolio at risk, as well as the Special attention has alignment of bank policies with the amendments to been given to the the legislation regarding prevention and money approval of investments laundering. in new technological products of the bank as an important part of the competitive advantages in the market. annual report 2012 CREDINS bank 11 BOARD OF DIRECTORS 12 annual report 2012 CREDINS bank SAJMIR SALLAKU Chairman MAltin KORKUti MOnikA milO clivE MOODY Member Member Member BOARD OF DIRECTORS AndON DAKA ELONA GjikA GAËL DE POntbRIAnd Member Member Member annual report 2012 CREDINS bank 13 HUMAN RESOURCES ORGANISATIONAL CHART SHAREHOLDERS ASSEMBLY INTERNAL AUDIT

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