INNOVATIONS TEAM aimed at innovations EXCELLENT OF EXPERTS and excellence SERVICE 25 REASONS WE ARE PROUD OF know-how truly individual high and experience quality service

FAMILY BANK a bank owned SUPPORT by family TRUST TO START UPS and devoted we appreciate we believe in future to families trust of clients of start-ups and employees ESG JOY OF 25 YEAR Environmental. WORKING EXPERIENCE GOOD Social. TOGETHER Let’s celebrate RESOURCE BASE Government. we love to work 25th anniversary strong resource base together! on May 3 and OUR WAY and sound development entire year 2018! OF SUCCESS,

CHALLENGES RELIABILITY SUSTAINABILITY we are reliable, AND gold level open and honest in Sustainability index long-term business VICTORIES partner

PATRONS SUPPORT OF CULTURE TO LITERATURE WINNERS SUCCESSION AND ART we believe in power #WinnersBorninLatvia we believe in importance care for succession of literature of families and succession of national values

SMART EXPERTISE INVESTMENTS helps to find OFFICE we invest with our clients the best solutions IN THE HEART in a smart way OF OLD for our customers working in the rhythm of the heartbeats of Riga

RESPECTFUL SHAREHOLDERS we trust our shareholders, RESPONSIBILITY STRONG TEAM GREEN SPORTIVE AND COMPETITIVE and they trust us responsible for wealth good team of energetic THINKING ENTHUSIASTIC PRODUCTS management of our clients and loyal experts care for nature we enjoy working wide spectrum and ourselves and sporting together and competitive features Business review 2017 CONTENTS 3 Valeri Belokon, Chairman of Supervisory Board

5 Viktor Bolbat, Deputy Chairman of Management Board

7 Bank financial results review

10 Overall review of Latvian economy

13 Developments on global financial markets

15 Baltic International Bank: support to the society, environment, and the world

19 Baltic International Bank — 25! VALERI BELOKON e Chairperson of the Supervisory Board of Baltic International Bank

Whatever you do in life, do it with all your heart. Living by this motto, we’ve spent each of the 9132 days or 25 years since the foundation of Baltic International Bank on 3 March 1993. Throughout the entire period, we had enriched our life with new opportunities and unforgettable impressions as well as boosted the prosperity of your families of today and generations of tomorrow.

Looking back at our accomplishments over the past 25 years, I can say that our vision has consistently revolved around the following core pillars: — True job commitment — Genuine respect towards our customers and partners — Mutual trust and confidence.

As we have based our vision on the three pillars, I am firmly of the opinion that this approach has enabled us to build a really good and competitive bank, celebrate our shared achievements, tackle various challenges, tide over economic shocks, and pave our own path. Meanwhile, we have always provided you with the most valuable thing, namely the opportunity to grow and sustain your family wealth for future generations, while simultaneously contributing to the betterment of the world our children and grandchildren will inherit. My heartfelt thanks to all of our customers: those who joined us on this journey 25 years ago and those who had recently entrusted us with managing their wealth and finding the most appropriate financial solutions. I wish to thank you for all the wonderful moments you’ve spent and you’ll spend together with Baltic Sincerely, International Bank! Valeri Belokon

3 4 VIKTOR BOLBAT Deputy Chairperson of the Management Board of Baltic International Bank

Baltic International Bank is a bank became already apparent in the second founded and operating in . 2018 half of 2017. Then, Bank substantially is a momentous year both for Bank and reinforced its customer service team for our country. Latvia will be celebrating and actively focused on new customer its centennial anniversary, and we’ll be acquisition (NCA) and on taking the marking Bank’s 25-year milestone. business relationship with the current In 2017, while continuing its sustainable customers on an entirely new level. All development and preparing to cross financial indicators related to the the threshold into its jubilee year, Bank customers’ funds saw growth. actively embarked on delivering its In 2017, Baltic International Bank also strategy adopted in the autumn of 2016 focused in particular on Bank’s overall and implementing its business model. performance effectiveness, investments Concurrently, Bank put major emphasis in further enhancement of the internal on wealth management solutions and control system, development of new sustainable investments. In 2017, we technology solutions, and development devoted significant attention to diversi- of new financial products and services. fication of Bank’s target markets and Our customers highly appreciate Bank’s acquisition of new customers (individuals new modern website launched in the gies, production of renewable energy, for changes, trust and readiness to task and corporates) from the European beginning of 2017 and giving the and saving of energy. To provide our just Baltic International Bank with man- Economic Area and the CIS. Last year, customers a plenty of interactive web current and potential customers with aging their own wealth and the wealth we also paid special attention to our elements. The customers also highly new investment opportunities and of their family members! A word customers based in Latvia and the Baltic appreciate Bank’s improved electronic never-seen-before finance-raising of thanks is also due to all of Bank’s staff States. And we clearly see that our trading platform. We’ve embarked solutions, we also concentrated our members for their professionalism, financial services and service level on developing a new modern version efforts on designing a corporate bond dedication and love towards work, is in high demand among domestic of Internet Banking system designed issuance service in 2017. and readiness to work so that Baltic enterprises and private individuals. to offer customer convenience. That is why I can confidently say that International Bank becomes the best The reinvention of Bank’s business to fit To deliver our strategy geared on the eve of its 25th anniversary, Bank’s bank for its customers! in with the new business model entailed towards socially responsible investing team is stronger than it has ever been. drastic changes in the customer struc- (SRI), we’ve obtained the licence I know that our accomplishments will ture in 2017. The reshaping of the busi- to operate as a fund manager. BIB serve as a solid basis for further devel- ness model has affected Bank’s financial Alternative Investment Management opment of Baltic International Bank! variables. However, I would like to will invest of Bank and of other I wish to express my heartfelt grati- emphasize that the positive results of our investors in promising projects launched tude to Bank’s customers, business Best regards, intense efforts aimed at implementing in the Baltic States and other countries partners and shareholders for their the new strategy and business model and aimed at developing new technolo in-depth understanding of the necessity Viktor Bolbat

5 6 BANK FINANCIAL 14,4 MILLION RESULTS REVIEW operating income

By the end of 2017, Bank’s operating By the end of 2017, Bank's liquidity In 2017, Bank’s activities were geared income totalled EUR 14.4 million. The net fee ratios exceeded the regulatory thresh- towards reshaping Bank’s business model 25,5% and commission income, as a percentage olds. As of 31 December 2017, the liquidi- to be aligned around Bank’s new strategy of the total operating income, increased ty ratio was 92.28%. Bank maintains a whose key aspects are wealth manage- Increase of deposits up to 24.5% showing a robust growth com- well-diversified structure of liquid assets ment solutions and sustainable invest- in the second half of 2017 pared to the same period last year when represented by bonds (19.92%), balances ments, acquisition of new customers the income accounted for 17.7%. During due from credit institutions (13.21%), on the diversified target markets the reporting period, the percentage balances due from the Bank of Latvia those financial resources to implement and enhancement of professional compe- of the net interest income increased (65.87%), and vault cash (1%). sustainable investment projects and 19%19% Other Другие countries страны tencies of Bank’s staff. up to 13.8% compared to the same The liquidity coverage ratio (LCR) to provide funding to Bank’s Implementation of the new business period last year when the reached 375.45%. Bank’s net stable customers, both individuals model entailed drastic changes in the income was 11.3%. funding ratio (NSFR) reached 158.08% and corporates, in Latvia and structure and quantity of Bank’s custom- By the end of 2017, Bank’s at the end of December of 2017. NSFR other countries. ers in 2017, and those changes fostered administrative expenses requires banks to maintain a stable By the end of December decline in deposits on Bank’s balance reached EUR 13.73 million, funding profile in relation to the compo- 2017, Bank’s assets sheet. In the second half of 2017, Baltic down 5.9% on sition of their assets and off-balance reached EUR 297.95 4% CyprusКипр International Bank substantially strength- GermanyГермания 32% 32% a year-over-year basis. sheet activities. million as they grew ened its customer service team and took The reshaping of Bank’s As of 31 December 2017, Bank’s own by 11.5% during the an active concern in new customer acqui- business model, funds totalled EUR 24.85 million. Bank’s year. Bank’s loan portfo- 4% RussiaРоссия sition and taking the business relationship the rearrangement Tier 1 capital ratio was 9.39%. The total lio reached EUR 62.73 with the current customers to the new of the asset structure, SREP ratio (TSCR ratio) reached 13%. million or 21.1% of Bank’s level. Thus, all financials related the resulting changes total assets as of 31 to the customers’ funds saw growth 8% UkraineУкраина in the customer structure, in the second half of 2017. December 2017. LatviaЛатвия 23% 23% and operations associated By the end of 2017, the with evaluation of the € 6 000 000 structure of Bank’s financial quality of certain historical- assets was predominantly MILLION ly-formed assets exerted increase of share capital represented by investments 12% 12%Великобритания Great Britain the planned short-term negative 444 in available-for-sale financial assets: impact on Bank’s financial results. In the light of Bank’s 2017 financial EUR 42.19 million or 14.2% of the total Bank ended the year 2017 with loss of EUR results and while actively supporting and assets. High quality liquid assets (assets Total volume of customer funds 8.09 million). The financial results were also upholding Bank’s development under- carrying investment-grade rating and impacted by Bank’s investments in its inter- pinned by the new business model, balances due from the Bank of Latvia) GEOGRAPHY nal control system that required further shareholders at their meeting held in totalled EUR 159.44 million or 53.5% OF CLIENTS The total volume of customer funds enhancement, information technologies January 2018 made the decision to of the total assets. Investments in govern- OF THE BANK reached EUR 444 million by the end of and infrastructure, Bank’s team of employ- increase Bank’s share capital by EUR 6 ment bonds totalled EUR 26.87 million 2017. By the end of 2017, assets under ees in an effort to increase their professional million. We believe that the capital-in- or 9% of the total assets. management reached EUR 68.17 million. competencies. crease will provide a more solid basis for The value of financial instruments in the expansion of Bank’s business both brokerage service totalled EUR 120.71 domestically and internationally. The million. 11,5% 92,28% bottom line is that Bank’s current and By the end of December 2017, the potential customers will all be winners. volume of term deposits made up 33% of the aggregate deposit portfolio. Bank uses increase of assets liquidity ratio

7 8 BALTIC INTERNATIONAL BANK: OVERALL REVIEW A TEAM OF EXPERIENCED OF LATVIAN ECONOMY PROFESSIONALS

Year 2017 showed The economic outlook for Latvia is stable. The forecasts of European Commission show that the the highest economic growth economy is expected to grow by 3.5% in 2018, and 3.2% in 2019. over the past five years Strong global demand, expanding construction sector, and private in the (EU) consumption support future growth. Local expenditure will continue to grow, as this year and Latvia. GDP of Latvia the Economic sentiment index reached an all-time high since grew by 4.5% y-o-y, which the financial crisis. One of the future concerns is tightening of the labor market, is almost twice as in the EU which together with relatively high (average of 2.7% in 2017) Latvia’s and the global banking sectors are high-level professionals joined Bank’s (2.4%). The growth was has raised concerns of overheating. changing at a very fast pace in recent years. team. The new-comers possess custom- Unemployment has been swiftly Bank customers become increasingly er-service experience gained in the driven by favorable decreasing since the end of finan- seasoned and increasingly demanding. Digital Scandinavian market, the EEA and cial crisis and reached 8.1% communication with Bank’s specialist is now Latvia. in the end of 2017, which an integral part of our daily life. But when it We firmly believe that the inflow of international and domestic is the lowest since Q3 2008. comes to making important wealth manage- the new team members enables us to Nevertheless, with shortage ment and investment decisions, an important amalgamate Bank’s own customer-ser- conditions and inflow of skilled labor, and stable wage lesson learned is that our customers highly vice experience accumulated over 25 growth, overheating is not expec- evaluate the opportunity to meet their years with the experience and expertise ted in the near future. personal banker, investment manager or acquired in other markets, thus creating of EU structural funds. broker face-to-face to discuss their financial a unique blend of knowledge, experi- needs and goals. For our customers, listening ence and professional skills. And we are to the voice of Bank’s specialist is therefore glad that you, our customers and busi- very vital. They prefer to choose, together ness partners, will all be winners! with Bank’s specialist, financial solutions best It is obvious that not only Bank’s senior suited and perfectly attuned to their finan- management, customer service team cial goals. We’re proud that professional and investment managers are shaping skills, knowledge and long experience of our Bank’s success. Baltic International Bank specialists enable us to roll out top-level has 250+ employees. They are true solutions and superb customer service! professionals. Every single employee is We are committed to creating new oppor- working enthusiastically to make sure tunities for you. In 2017, Baltic International that all of us are providing the best Bank has therefore made an important stride financial services and are delivering towards building a highly competent great customer service! customer service team. Last year, several 9 10 5

% % 25 3.8 70

60 20 2.5 Estonia 50 15 40

30 10 1.3 Latvia 20 5 Lithuania 10 0 0 0

2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017

Dynamics of GDP in the Baltic Countries, 2013-2017 Liquidity ratio in Latvian banking sector Capital ratio in Latvian banking sector

Sectoral Growth at year end 2017, which is twice as much Bombardier CS300 aircrafts in 2017, only for the profit that is distributed as the required minimum of 30%. and it expects to receive additional six or deemed distributed (dividends, excessive The fastest growing sector in 2017 was Manufacturing experienced the highest aircrafts per year in 2018 and 2019, which interest payments, transfer pricing adjust- construction, which grew by 21% y-o-y. The growth since year 2011. The highest growth means of continued contribution to imports ments, etc.). Income from capital gains sector’s growth is driven by demand arising was for such sectors as production of chemi- of goods. is taxed at 20 % according to personal from EU structural projects and increase cals and electric equipment (21%); produc- Investments grew by 16%, mainly in real income tax (PIT). of private segment projects. According tion of metal products (14%); computers, estate and construction (16%), and machin- To sum up, year 2017 has been a year to businesses from production sector, there electronics and optic machinery (14%); ery and vehicles (14%). Investments in intel- of the highest economic growth over is a sizable pipeline for the upcoming five and others. Conventional production sectors lectual property products, like research the past five years. Unemployment has been years. Nevertheless, the rapid increase like food and wood products grew by 8%, and development, licensing, copyrights, etc. the lowest since the financial crisis. is partly attributable to low activity in 2017 and 2%, respectively. Manufacturing will increased by 25%. The fastest growing sectors were construc- and the output was lower than in the continue the stable and moderate growth tion and manufacturing, whilst financial respective period in year 2015 and 2014. based on strong external and local demand. Fiscal Policy sector experienced transitory decrease due Due to changes of global and local politics to high base year in year 2016 and changes concerning financial sector, several banks Government spending experienced Exports, Imports of business models of banks. Outlook is stable in 2017 worked on changing their business an upward trend on each quarter, which and positive with expected growth of GDP models, reducing the amount and volume and Investments summed up to yearly increase of 4%. There of 3.5% in year 2018. of USD transactions and improving was an increase of wages and salaries Export of goods increased by 5%, whilst the quality of their assets and customer for teacher, employees from defense sector, export of services by 3%, making the total base. Consequently, the financial results police staff, and judicial staff and an increase growth of exports 4%. Wood products, of the banking sector demonstrated transi- in the minimum wage. Year 2018 planned electric equipment and machinery maintains tional decrease in comparison to 2016. The budget deficit is 0.9% of GDP, however, as the main export products. There has been result was influenced also by the fact that based on the economic growth and govern- increased activity to Asian countries, EU year 2016 was a high base year, when ment consumption below the projected level countries, and thanks’ to stabilizing econom- the sector experienced unprecedented the balance is expected to be more positive. ic growth in 2017, Russia. growth due to sale of “Visa Europe” shares. In 2017 the government approved a tax Imports grew by 9%. Growth of value Capital ratio of commercial banks of Latvia reform, which is in force starting from of imported goods is outpacing growth remained at last year’s level, whilst the first January 1 2018. Corporate income tax (CIT) of export of goods. Influx of EU funds, tier capital (CET1) grew by 80 basis points, has been increased from 15% to 20%, how- increasing private consumption, and renewal attaining 21.4% and 19.0%, respectively. ever, reinvested profit is non-tax deductible, of AirBaltic fleet explain the growth Liquidity ratio remained high, reaching 59.9% i.e. from now on companies have to pay tax of Imports. The airline purchased eight new 11 12 DEVELOPMENTS ON GLOBAL FINANCIAL MARKETS

2017 was a positive year for the global political events. 2017 proved to be another led by Prime Minister Theresa May suffered a gural issue of Latvia’s 30-year Eurobonds. The financial markets. The value of assets contin- eventful year. 2017 started with the inaugu- major setback in a tumultuous election, 30-year Eurobonds represent the longest ued to grow, and their prices reached new ration of Donald Trump as the 45th president losing its overall majority in Parliament. At tenor ever set by Latvia. The 30-year tranche records. During the year, the MSCI ACWI (a of the United States of America. Throughout the end of March 2017, Theresa May sent an was priced at a coupon of 2.250% (yield market capitalization weighted index) surged 2017, the highlights of the year were increas- official letter to European Council President 2.330%), in a new benchmark issue size 21.62 percent. The Bloomberg Barclays Global ingly associated with President Donald Donald Tusk triggering Article 50 of the EU’s of € 500 million. Demand for the 30-year Aggregate index (a flagship measure of Trump and his decisions, such as the decision Lisbon Treaty, the formal start of the process Eurobonds exceeded issue size by 1.6 times. In global investment grade debt from twen- to withdraw the United States from the by which Britain will leave the European the corporate bond segment, the total issues ty-four local currency markets) increased by landmark Paris climate agreement (Accord Union. But only in the beginning of Decem- by Latvia’s issuers reached € 661 million, up 7.39 percent. The U.S. equity market experi- de Paris), Trump’s criticism of the Iran nuclear ber 2017, Britain and the European Union 29% from 2016. JSC ALTUM (Attīstības finanšu enced a bullish run. The S&P 500 Index (S&P deal (Trump’s announcement that he plans reached a deal on the crucial Brexit issue in institūcija Altum), which is a specifically 500), an index of 500 stocks seen as a lead- to decertify the Iran nuclear agreement), the first round of Brexit talks. A number of designated institution (SDI), a financial ing indicator of U.S. equities and a reflection and long-awaited US Corporate Tax Reform paramount Brexit-specific issues remained institution specifically designated to promote of the performance of the large cap (the GOP Tax Plan). The reform involved a unresolved. Latvia’s economic development and to universe, rose by 19.42%. The Dow Jones large number of changes. For business: a In 2017, the European (ECB) finance the priority sectors, issued its inaugu- Industrial Average (DJIA), a stock market permanent reduction of the U.S. federal kept its benchmark interest rates unchanged ral green bonds € 20 million worth. The bond index, an index of 30 large companies that corporate income tax rate from 35% to 20%. while cutting its bond buying program to € issue was 6.5 times oversubscribed. Maturity are integral to the U.S. economy, surged For the wealthy: the top personal income tax 30 billion per month from € 80 billion. of ALTUM green bonds has been set at 7 25.08%. 2017 turned out also to be bullish for rate applies to taxable income at $500k for According to the ECB, the wind is back in years with a fixed (coupon rate) the Japanese equity market. The Nikkei 225 single individuals and $600k for married euro zone’s sails. But the 2% inflation objec- 1.3% per annum. The companies in the Baltic Stock Average (a price-weighted average of couples filing jointly. These are only some of tive has not yet been achieved to enable the States actively seized the opportunity to 225 top-rated Japanese companies listed on Trump’s crucial decisions that affected the ECB to discuss the interest rate hikes. The place the bonds on the secondary market, the Tokyo Stock Exchange) grew by 19.1% dynamics of global financial markets ECB also intends to continue its quantitative i.e. on the First North Alternative Market (an during the year. The European and the UK throughout the entire 2017 season. easing (QE). Depending on the pace of the alternative marketplace operated by the equity markets climbed to new highs at a In 2017, Europe witnessed several signifi- euro zone’s economic growth, the ECB may different exchanges within Nasdaq Nordic comparatively slower pace. The EURO STOXX cant developments as well. The 2017 French continue the QE program also after the end and Nasdaq Baltic). JSC mogo included its € 50 Index, Europe’s leading blue-chip index Presidential election was held. Although of 2018. In 2017, the FOMC (the Federal Open 10 million worth 3-year bonds with an 8% for the euro zone, surged 6.49%. The United before Emmanuel Macron (Emmanuel Market Committee, a committee within the coupon on the First North list. Two Estonian Kingdom’s FTSE 100 Index (mirrors the UK Jean-Michel Frédéric Macron) won the Federal Reserve System) raised its benchmark real estate management and development stock market, is a share index of the largest French Presidential election, the world had interest rate 4 times, from a range between companies and a Lithuanian grain processing 100 companies listed on the London Stock seen wide-ranging debates on potential risks 0.5% and 0.75%t to a range between 1.5% company are listed on First North. Exchange with the highest market capitaliza- associated with the election of Emmanuel and 1.75%. The total capitalisation of the Baltic market tion) was up by 7.63%. Macron. But the risks have not materialized. Like the global financial market, Bank’s reached EUR 4 billion in the beginning of The value of the US dollar has fallen steadi- Emmanuel Macron’s party La République En investment portfolios have also showed 2018. Corporate bond issuance, as a new ly since 2Q 2017. The Euro rose 12.7% against Marche (LREM) together with the Democrat- robust rates of return. In 2017, USD-denomi- finance-raising instrument, is expected to the greenback. British Pound rose by 7.71% ic Movement (Mouvement démocrate, nated portfolios grew as follows: conserva- continue developing. Thus, in an effort to against the dollar. In 2017, oil prices contin- MoDem), a centrist political party in France tive portfolio (9.2%), balanced portfolio provide its current and potential customers ued to rise. The price for Brent crude oil was that is characterised by a strong pro-Europe- (15.4%), and aggressive portfolio (20.5%). with diverse finance-raising opportunities, up 16.5% per barrel (by the end of the year, an stance, established a strong pro-EU EUR-denominated portfolios have also Baltic International Bank developed in 2017 the price reached US$65 per barrel). West centrist platform. German federal election performed positively and demonstrated and rolled out in spring of 2018 a new service, Texas Intermediate (WTI) crude oil rose by 2017 proved to be fairly free from surprises trend-like growth as follows: conservative namely the arrangement of debut bond 12% (by the end of the year, the price Angela Merkel’s party, the Christian Demo- portfolio (7%), balanced portfolio (9.7%), issue. reached US$60 per barrel). cratic Union (CDU) remained the largest and aggressive portfolio (12.6%). As financial markets are globally entwined, party in Parliament. Minor post-election In 2017, the domestic bond market contin- developments on global financial markets changes occurred in the UK Parliament (aka ued to skyrocket, in line with a trend were substantially affected by international British Parliament). The Conservative Party observed in past years. 2017 marks an inau-

13 14 BALTIC INTERNATIONAL BANK: Literature and arts SUPPORT TO THE SOCIETY,

ENVIRONMENT, AND THE WORLD and arts and their devel- Lifetime Contribution Award to recognise opment have been subject to the attention contribution to Latvian literature! of Baltic International Bank for a quarter of In 2017, the unique book „Kā gūt panāku- the century. In 2017, a series of publications, mus Latvijā” (How to Prosper in Latvia) came which are important for Latvia’s culture and under the spotlight. The book talks about 14 history, saw the light of day with our outstanding Latvians who have accom- support. plished great things in their life and their During the past 25 years, Baltic We are confident that development of success stories. One of the fourteen success each nation and of each country is under- stories is a story of Danila Belokon, a busi- pinned by the knowledge of their culture nessman and a motor sportsman and the son and history. And we are so pleased to have of a co-owner of Baltic International Bank International Bank focused supported publication of the books com- Vilori Belokon. In his story, Danila Belokon prised within the series of historical novels focuses on the family values that are passed „Mēs. Latvija, XX gadsimts” ((We. Latvia, down from one generation to another and increasingly on supporting Latvian 20th Century). In 2017, a book-celebration on the way of how to achieve even the most event was held to celebrate the publication ambitious goals. Every country needs profes- of the book „Duna” („The Rumble”) by Inga sional, enthusiastic and ambitious people. literature, arts, culture, Ābele. This year, Bank-supported series of And we are confident that this book will help books will continue its way to reaching the enrich Latvia’s culture, art and business with readers. young people. The book will encourage We are proud to have supported the them to set their sights on even more environment and the general Annual Latvian Literary Award (LALIGABA) ambitious horizons and to conquer new presentation for several years. In 2017, Baltic pinnacles. public. And in 2017 we continued International Bank presented its special Support provided by Baltic International Bank to the Annual Latvian Literary Award (LALIGABA) pre- to contribute to these significant sentation is a signicant investment aimed at develop- ing and enhancing the quality of Latvian literature. areas by investing more than EUR e support is also viewed as the indicator of growing exports of Latvian literature to foreign countries. e London Book Fair is the global marketplace for rights 130 thousand! negotiation and the sale and distribution of content. When Latvia prepared for its participation at the London Book Fair as the Market Focus country (from 2016 to 2018), more than 70 rights to publish Latvian literary works predominantly comprised of the works nominated for LALIGABA, award-winning literary Andra Konste works, and Bank-supported series of historical novels Director of Ventspils „Mēs. Latvija, XX gadsimts” (We. Latvia, 20th Cen- International Writers’ tury) which became powerful ice breakers in the Latvia and Translators’ House

15 literature class abroad. 16 Education, science and business Environment and society

Latvia and the world a better place. Sustain- Bank knows that nowadays technolo- students, representatives of public bodies Throughout 2017, Baltic International Bank ability activities are one of the criteria consid- gy-based ideas and acquisition of new and municipalities, businesspeople, mass continued to implement social responsibility ered by Baltic International Bank when choos- investments required to turn the ideas into media and the general public actively use activities by conserving natural resources, ing its business partners and suppliers and reality are decisive factors for the national the survey results. supporting projects of great importance for when evaluating loan projects and alternative economies of all countries. Baltic Interna- the entire society, and upholding the princi- investment projects. tional Bank therefore is a long-time support- ples of good governance on a daily basis. Our employees also actively support differ- er of start-ups. Moreover, we are thinking and acting sustain- ent socially important projects and events. Also in 2017, Bank supported an event titled ably, and we call on our customers and Annual participation in the Big Cleanup Investors’ and Partners’ Day annually held by business partners to work in an environmen- Campaign (Latvia-wide environmental clean- Commercialization Reactor. During the tally sustainable way! up), regular visits to the local animal shelter event, presentation of 25 science-based Demola Latvia is a platform designed to Being committed to take care of our Ulubele, active participation in the Blood start-ups was arranged for the attendees. surrounding environment, in our daily activi- establish and maintain cooperation with Donation Campaign, and participation in Being committed to fostering innovative ties we place special emphasis on improve- the leading companies and students from Bank’s yearly charity campaign represent only and business-oriented thinking among ment of water and energy efficiency. We a small part of the full range of sizeable social Latvia’s students, Baltic International Bank dierent countries and universities, thus promote the activities associated with the 3Rs support projects in which Bank’s employees commenced its cooperation with Demola (reducing, reusing and recycling waste). We fostering the generation of innovative participate. Bank’s team actively participates Latvia in 2017. Demola Latvia is an interna- also reduce consumption of paper and other ideas and inhibiting the ideas into real in various sporting events, such as the Lattele- tional innovation platform designed to stuff whose inefficient use leads to the com Riga Marathon, an annual road marathon establish and maintain cooperation with the business. I’m happy that this year Baltic depletion of natural resources. held in Riga, and different football, indoor leading companies and students from International Bank joined the group of our It should be emphasized that in 2017 we not football and volleyball tournaments. different countries and universities, thus only specifically focused on environmental business partners. I strongly believe that We are convinced that together we can do promoting creative thinking and idea-gener- sustainability and compliance with the key Bank’s projects will deliver a unique a lot of good and we can make the world, in ation and inhibiting the new ideas into principles of good governance. We also called which we’ re living and in which our children business environment. experience to the students and innovative on our customers and partners to think about the measures each of us can take to make will live, a better place! In 2017, Baltic International Bank continued solutions to Bank!” to conduct Baltic International Bank Latvian Mikus Losans Barometer, a unique monthly survey of the Head of the LU Business Incubator public opinions and attitudes (sociological -37% -17% -1,7% -5% and a representative of Demola Latvia survey). We are pleased that Latvian Paper Co2 Water Energy consumption emissions consumption consumption “As a many-year participant of the per employee per employee per employee „Long-term survey gauging population sentiment Sustainability Index, Baltic and opinion is an essential element of strategic planning International Bank consistently demonstrates courage, openness and in every country. e results of the opinion poll The Gold Award from the commitment to enhance its are valuable and interesting for public bodies performance. Its success is always built Sustainability Index! and municipalities, students and university sta, upon the executive understanding and and the general public. I’m very pleased that this support. Baltic International Bank devotes special one-of-a-kind long-term survey Baltic International Bank’s accomplishments and efforts to socially significant projects and Bank Latvian Barometer is conducted in Latvia with achievements also is a testimony to the projects aimed at environmental protection, the support of Baltic International Bank already since Dace Helmane fact that the senior management fully to enhancement of corporate governance understands the signi cance of socially June 2016 and several survey indicators are used month- Chief Executive Ocer and improvement of workplace environ- responsible business. Every year, the ly for measuring public opinion”. of Institute for ment. As the Gold Award holder, we are management not only improes its Arnis Kaktiņš Corporate Sustainability extremely proud to have been awarded performance but also contributes to the and Responsibility Director of SKDS (Latvia-based Centre development of the industry and of the by the Sustainability Index for our perfor- for Marketing and Public Opinion Research) country.” mance in 2017!

17 18 BALTIC INTERNATIONAL BANK25! 25 MAIN SUPPORT PROJECTS TO LATVIA AND THE WORLD

We keep waiting with emotion The Annual Latvian Literary Mobile app for the Latvian Award National Museum of Art and joy for Latvia and Baltic The presentation of the Annual Latvian We are confident that modern and accessible to the Literary Award (LALIGABA) is the most public museum of art makes every country feel notable event in the country’s literary world. national pride. Joint efforts of Baltic International International Bank to have a pivotal The event is arranged to evaluate the literary Bank and the Latvian National Museum of Art (LNMA) works, which have been published during the have borne fruit. We are proud of having contributed respective year, from a professional point of to developing a modern interactive mobile applica- 2018 year. We’ll be celebrating view and to provide recognition of excel- tion for the LNMA which is one of most cutting-edge lence. Baltic International Bank is also a applications of art museums across Europe and allows the centennial of the country’s steadfast supporter of the Annual Latvian each visitor to interactively and in a fun way to Literary Award. familiarise themselves with the museum’s exhibitions, statehood. For Baltic International objects, environment and unique architecture. Bank, the year will mark the 25th anniversary of its foundation. We have worked a lot during these 25 years. We have celebrated our own achievements and those of our customers in Latvia and worldwide. “” album Mikhail Baryshnikov’s performance Baltic International Bank puts in the spot- at Latvian National Opera and ballet During this period, we have also light the transmission of both Latvia’s and Celebrated artists Robert Wilson and Mikhail the world’s cultural and historic heritage Baryshnikov joined forces to step inside across generations. In 1888, Pope Leo XIII the shattered mind of one of the greatest actively supported Latvia’s society, received, as a gift from Riga, a marvellous dancers in history, Vaslav Nijinsky. The world- album “Terra Mariana. 1186 - 1888”. The famous ballet dancer Baryshnikov brought album tells us about the spread of Christiani- Letter to a Man, a solo theatrical work, to culture, arts and science. We’ll give ty in Latvia and Estonia, the lands once Latvia. The production is based on Nijinsky’s known as Livonia. Terra Mariana (Land of diaries. We’re so proud that just we, Baltic you a slight insight into our Mary) was the official name for Medieval International Bank, have co-sponsored the Livonia. 1 000 copies of this exclusive and one-person show starring Mikhail Baryshnikov! valuable book saw the light of day with the accomplishments! support of Baltic International Bank. 19 20 Cooperation with the Latvian Support to Baltic International artist Ilmars Blumberg Bank Latvian Barometer, a unique Latvia is rich in world-famous artists, and monthly survey of public opinions Ilmars Blumberg is considered as the most and attitudes powerful representative of mythological thinking in Latvian art. Baltic International A survey gauging population sentiment and opinion Bank sponsored Blumberg’s solo exhibition is an integral part of strategic planning in every titled “I Will Not Die“, the presentation of country. And Baltic International Bank Latvian eponymously-named book, and the docu- Oleg Auzer’s silver goblet Cooperation with Latvia’s Barometer is a nationally significant project that enables the stakeholders to trace the changes mentary film about the artist’s life. Since olden days and at all times, Latvia has carpenters and woodcarvers in Latvia’s population sentiment and studies and been renowned for its excellent artistic In Latvia, wood is a sacred material that analyses the economic and social processes in Latvia. craftspeople, such as blacksmiths, woodcut- accompanies humans from the cradle to the ters and other professionals. A silver goblet grave. Artworks exhibited at Bank’s premises „The 21st Century Renaissance”, a unique are an amazing showcase of talents of artwork custom-made for Bank by a legend- Latvia’s carpenters and woodcarvers. ary Latvian silversmith Oleg Auzer, is a great The artworks include a broad spectrum of testimony to the fact that the talented eye-catching furniture pieces and a very silversmith employing ancient techniques is special woodcarving above the fireplace. able to transform 35 kg of silver into the The most famous painting „Likteņa zirgs” unique artwork. (The Horse of Destiny) of A. Baumanis (1887) is at the heart of the pictorial narrative of the woodcarving. The legend tells us that the Horse of Destiny was three times re-ques- tioned as to whether it would be possible to Celebration of the Latvian National live while bringing faith to the world without Opera and Ballet’s 90th anniversary wars. And the Divine Power that had instilled We firmly believe that opera plays a vital role in itself into a white horse three times in a row every culturally ambitious nation’s life. The Latvian replied „Yes!” The painting reflects Valeri National Opera and Ballet has not only attached a Belokon’s credo: humans are capable of living special value to the art but has also boosted in harmony, peace and concord without wars. Latvia’s image and name awareness worldwide. Baltic International Bank financially supported a Cooperation with Latvia’s grand celebratory performance in honour the 90th Anniversary of the Latvian National Opera and craftspeople — stained-glass artists Ballet House. The gala featured ballet and vocal To honour talents and the stunning level soloists, orchestra, choir and special guests – of artistry and skill of Latvia’s stained-glass worldwide-renowned composers and performers Baltic International Bank Tennis artists, we invited the most professional Exhibition „Riga at the Cross- from Latvia. The program included popular bits of Cup masters and tasked them with creating roads of 18th Century Europe” famous ballets and arias from the best operas ever, While giving the gifted young Latvian stained-glass windows depicting the coun- at the Museum of the History as well as Raimond Pauls’ music arranged by Arturs tennis players the opportunity to evaluate try’s most notable events and daily life of the of Riga and Navigation Maskats. their own performance and that of their time. The hidden colour symbolism and Exhibition „Riga at the Crossroads of 18th peers, Bank supported the international colour-and-light plays are pleasing the eyes Century Europe” held at the Museum of the tournament “Baltic International Bank Tennis of Bank’s customers and other visitors. History of Riga and Navigation enables both Cup”. More than 300 players from 26 coun- inhabitants and visitors of Riga to familiarise tries participated in the tournament. 12 themselves with Riga’s history and develop- young players from Latvia played in the main ment against the background of Russia’s and tournament in a fierce competition against Europe’s history. We are confident that after very strong players from Lithuania, Estonia, attending the exhibition every single inhabi- Germany, Romania, Belarus and Russia. tant of Riga will feel proud to call Riga their home! 21 Trilogy “The Glass Mountain” by Vilis Inde Blackpool Football Club The publication of the trilogy known as “The Glass In 2006, Valeri Belokon became a co-owner Mountain” is one of the most recent Bank-supported of Blackpool, English Premier League Football projects. An English translation of Rainis’ play The Club. The history of Blackpool Football Club Golden Horse (Latvia’s literary treasure), is at the dates back to 1877. Mr Belokon’s investments heart of the trilogy. Miķeļis Fišers, one of Latvia’s and active focused actions aimed at devel- most important contemporary artists, created the oping the Club enabled BFC to rejoin the illustrations. The play is supplemented by a book English Premier League. The biographical encyclopedia Books „Trejādas saules. Metere- about Latvia’s history and a book that explains how oloģiskā saule. Gaišā saule” Latvians understand the metaphors and symbols of Who is Who in Latvia the Castle of Light and the Glass Mountain in the Valeri Belokon supported several publications and „Kultūra un latvietība” architectural design of the new library. of the unique biographical encyclopedia written Vaira Vīķe-Freiberga Who is Who in Latvia. The encyclopedia Latvia is broadly renowned for the unique contains information about many thousands folklore heritage. Dr. Vaira Vīķe-Freiberga, of most popular people in Latvia who signifi- Former President of the Republic of Latvia, cantly contribute to Latvia’s development in interdisciplinary scholar and doctor emerita diverse areas and boost Latvia’s image of several universities is one of distinguished internationally. professionals in the field of folklore studies. Bank sponsored the publication of the Ex-President’s book „Trejādas saules. Metere- oloģiskā saule. Gaišā saule” (The Threefold Sun. The Meteorological Sun. The Bright Sun) dedicated specifically to Latvian folksongs Cooperation with the Roman based on traditional poetry called dainas. The author addresses the Sun and the Catholic Archdiocese of Riga sunlight as visual phenomena rich in symbolic Committed to promoting spiritual values semantic associations which the sunlight and in Latvia’s society, we have been supporting radiance evoked in folk song singers. Bank the Roman Catholic Archdiocese of Riga over also sponsored the publication of Vike- a number of years. We are confident that Freiberga’s collection of essays titled „Cul- reinforcement of spirituality of people ture and Latvianity” („Kultūra un latvietība”). worldwide nowadays becomes increasingly important. And we’re happy to support Giuseppe Verdi’s opera „Aida” Church-related activities in Latvia. Baltic International Bank sponsored a trium- phant return of Giuseppe Verdi’s epic AIDA The Encyclopedia of Latvia to Latvian National Opera’s repertoire. Ilmars Book „Kā gūt panākumus Latvijā” in 5 volumes Blumberg presented a splendid visual inter- The book „Kā gūt panākumus Latvijā” (How to pretation of the performance, with its grand Prosper in Latvia) tells us about 14 outstanding A patron of arts, a shareholder and the sets and costuming. Latvians who have accomplished great things in their Chairperson of the Supervisory Board life and their success stories which inspire other of Baltic International Bank Valeri Belokon people and urges them to take real steps towards also supported the publication of the Ency- achieving personal growth. One of the fourteen clopedia of Latvia in five volumes. This is the success stories is a story of Danila Belokon, a busi- first encyclopedia, as dedicated to Latvia, nessman and a motor sportsman and the son published after the country has regained its of a co-owner of Baltic International Bank Vilori independence. The five-volume encyclope- Belokon. In his story, Danila Belokon focuses on the dia comprises more than 24 000 articles family values that are passed down from one gener- about Latvia’s nature, economy, population, ation to another and on the courage required to set history, science, religion, culture and sports. and attain even the most ambitious goals.

23 24 Participation in charity campaigns Bank’s employees actively and enthusiasti- cally participate in different charity cam- paigns. They regularly visit the local animal “I wish to express my heartfelt shelter Ulubele and annually take part in the Big Cleanup Campaign (Latvia-wide environ- mental cleanup). Over a number of years, gratitude to Bank’s customers, during Christmas charity campaign we provide the students of a special boarding school in Latvia with the needful stuff. We business partners and shareholders enjoy joining our efforts to make good things Bank’s collection happen! of commemorative medals for their in-depth understanding Baltic International Bank started a tradition of commemorating important culture- and of the necessity for changes, trust art- specific projects as well as events of national importance in the collection of Bank’s commemorative coins. The first and readiness to task just Baltic commemorative medal shows a Bowing Servant, an artwork created by a famous International Bank with managing Latvian artist Ilmars Blumberg. The second commemorative medal is devoted to a Support provided unique album Terra Mariana. 1186-1888. their own wealth and the wealth to Commercialization Reactor At the end of 2017, Bank issued the third coin added to Bank’s collection. The coin of their family members! A word We’re driven by the conviction that innova- symbolically reflects the two notable events: tive ideas and start-ups play a vital role in Latvia’s centenary and the 25th anniversary shaping and developing the country’s of Baltic International Bank. The medal was of thanks is also due to all of Bank’s sustainable economy. By supporting Com- designed by Laimonis Šēnbergs, one of the mercialization Reactor (international plat- most outstanding graphic designers in Latvia. sta members for their form founded in Latvia with the aim of We feel happy to eagerly wait for these promoting technologies and launching great occasions together with you! start-ups based on scientific and technologi- professionalism, dedication and love cal achievements), Baltic International Bank establishes a good basis for creation and functioning of successful and knowl- towards work, and readiness to work edge-based hi-techs. so that Baltic International Bank The series of historical novels A long-term supporter „Mēs. Latvija. XX gadsimts” of Latvian literature becomes the best bank for its Guided by the conviction that the national Latvian literature and its development is identity of each nation is underpinned by the one of Bank’s focus areas into which Bank’s knowledge of their culture and history, Baltic long-term support is channelled. We’re customers!” International Bank supports the publication happy that the broad range of Bank-sup- of the books comprised within the series of ported books includes a plenty of publica- historical novels „Mēs. Latvija. XX gadsimts”. tions of crucial importance for Latvia’s Thirteen books of the Latvian writers saw the literature, culture and history! Valeri Belokon light of day. Each of the novels is devoted to a specific period of the 20th century in Latvia.

25 Zbignev Stankevich Nora Ikstena Andris Vilks Dr. Vaira Vike-Freiberga His Excellency Metropolitan Archbishop Latvian writer Director of the National Library Former President of the Republic of the Roman Catholic Archdiocese We often use the word “bank” in a figurative of Latvia of Latvia (1999-2007) sense. Language bank, life bank. For many years, A number of projects in Latvia’s book publishing As Baltic International Bank marks its 25 years of Riga Baltic International Bank and a patron of arts Valeri industry had been supported within quite a short of successful activities in the complicated banking On behalf of the Roman Catholic Archdiocese Belokon altruistically and with interest supported amount of time. Books published with the support sector, I should like to underscore its generous of Riga, I extend my heartfelt congratulations on the book publication and literature in Latvia, thus of Mr Belokon are proudly labelled as the most support for cultural activities, especially the the 25th anniversary of Baltic International Bank! contributing to the future of our country’s outstanding publications in recent years. publication of books in the . Many You’ve contributed not only to the culture but also culture. Bank promotes preservation of the The National Library of Latvia was twice honoured a book might have never seen the light of day, to the development of the entire society. Much literary heritage of Dzintars Sodums, (Latvia-born to experience the fullness of Mr Belokon’s generos- or have been published with just a minimal print can be learnt from you, and you are leading your writer in exile and translator), supports publication ity. He sponsored the “Terra Mariana” publication run without the personal interest and broad peers by example. I would like to thank you of the series of historical novels “Mēs. Latvija.XX project at a point in time when the project seemed cultural interests of Valeri Belokon. for your openness to close cooperation with the gadsimts (We. Latvia, 20th Century) and is an doomed to failure. Due to the Mr Belokon’s As a keen gardener myself, I have enormous Church. This clearly shows that you understand unstinting supporter of the Annual Latvian Literary philanthropic efforts, all of the full-size facsimile admiration for the dream garden and park that the importance of and adhere to spiritual values. Award (LALIGABA). These are just a couple of copies have been delivered to the respective Valery has developed on his property, not I would particularly like to mention Bank’s support examples of smart and forward-looking invest- institutions in Latvia and its neighbouring countries. to mention his business interest in entire commu- of publication of full-size facsimile copies of the ments made by Bank. I extend my congratulations 1 000 reduced-size facsimile copies of the album nities that are ecologically sound as well album „Terra Mariana. 1186-1888”. At the Book on the occasion of Bank’s 25th jubilee and hope (together with scholarly commentaries) have been as beautiful to behold. Design Competition “The Golden Apple Tree 2015” that you will keep your commitment to our successfully delivered to book storage facilities and (Zelta ābele), the book was rightly awarded as the Latvia’s culture and language, the unique values to individual stakeholders both in Latvia and best-designed book in the nomination „Scientific that set us apart from the rest of the world. Dace Melbārde Book”. abroad. The trilogy known as “The Glass Mountain” The second book published in 2011 with Bank’s (“Stikla kalns”) published by the Support Founda- tion of the National Library of Latvia also is very Minister of support is also worth mentioning. I mean the book Karina Pētersone I would like to express my sincere gratitude to significant and artistically outstanding. During titled Light of the World: The Pope, The Church Baltic International Bank for the long-term support Director of the Support these years, Mr Belokon has proved to be one of and the Signs Of The Times. A Conversation With to Latvian literature and to the Annual Latvian the most refined persons who greatly respect our Peter Seewald which is the Latvian-language Foundation of the Latvian Literary Award which encourages the emergence common heritage. I extend my hearty congratula- edition of German journalist Peter Seewald’s National Library of outstanding literary works and provides recogni- book-length interview with Pope Benedict XVI, tions on Bank’s 25th anniversary! On the eve of Bank’s tion of excellence from a professional point of view! the head of the Roman Catholic Church. jubilee I should also like In these tough political and economic times, I wish to thank personally you all of Heavenly Father’s blessing and guidance Valeri Belokon and his Ramona Umblija in every single area, be it carrying financial activi- team for their support ties or fostering multifaceted development Mg. Art., Art Historian to the publications of of Latvia’s society. 25 is a protective number! paramount importance It’s crucial to seek God’s blessing and guidance. According to popular belief, the for Latvia’s culture. I’m Psalm 127 says: „Unless the Lord builds the house, number 25 consists of sacred sure you have many the builders labour in vain. Unless the Lord watches figures – 1,3,5,7, and 9. Once the fruitful years ahead of over the city, the guards stand watch in vain. 25 point has been reached, you! Happy Birthday! In vain you rise early and stay up late, toiling for threat ceases. May each new food to eat, for he grants sleep to those he loves.” day bring income and success! Wishing you creative and 27 powerful vision for the future! 28