AB BANKAS SNORAS Unaudited interim condensed separate and consolidated financial statements 30 June 2011

AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

CONSOLIDATED AND SEPARATE INCOME STATEMENTS For the six months ended 30 June

Group 2010 2009 2010 2009 Interest income On loans to customers 212,991 205,704 154,535 144,079 On debt securities acquired 26,936 23,195 16,081 13,913 On loans and placements with credit institutions 8,729 9,197 4,988 6,091 248,656 238,096 175,604 164,083 Interest expense On deposits (121,051) (176,804) (88,067) (117,582) On placements from credit institutions (10,825) (6,006) (5,680) (3,510) On debt securities issued (8,034) (16,090) (7,872) (16,199) On subordinated loans (5,061) (5,112) (1,598) (1,570) (144,971) (204,012) (103,217) (138,861)

Net interest income 103,685 34,084 72,387 25,222

Fee and commission income 82,088 86,232 44,006 57,548 Fee and commission expenses (19,496) (16,196) (8,037) (6,294) Net fee and commission income 62,592 70,036 35,969 51,254

Trading income and Net gain on financial assets and liabilities designated at fair value through profit or loss 18,537 53,998 11,114 37,828 Net gain on financial assets and liabilities not measured at fair value through profit loss (19,898) (28) (20,026) (71) Impairment (12,985) (42,077) (23,413) (47,843) Dividend revenue 31 47 855 4 Other income 29,056 3,152 1,357 270 Net operating income 181,018 119,212 78,243 66,664

Salaries and benefits (78,057) (62,268) (29,490) (27,791) Depreciation and amortisation (16,711) (15,305) (9,237) (8,465) Other operating expenses (72,619) (65,314) (32,342) (27,080) Operating expenses (167,387) (142,887) (71,069) (63,336)

Profit before income tax 13,631 (23,675) 7,174 3,328 Income tax expense (805) (2,006) - 1,709 Profit for the year 14,436 (21,669) 7,174 5,037 Attributable to: Minority interest (477) (5,690) Equity holders of the parent 14,913 (15,979) 14,436 (21,669)

4 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

CONSOLIDATED AND SEPARATE INCOME STATEMENTS For the April-June (II quarter)

Group Bank 2011 2010 2011 2010 II Q II Q II Q II Q Interest income On loans to customers 102,267 98,079 76,057 69,101 On debt securities acquired 13,881 9,413 8,643 5,834 On loans and placements with credit institutions 5,127 5,656 3,025 3,628 121,275 113,148 87,725 78,563 Interest expense On deposits (58,109) (82,229) (41,844) (55,018) On placements from credit institutions (6,586) (3,021) (3,022) (1,876) On debt securities issued (4,383) (7,081) (4,295) (7,081) On subordinated loans (2,531) (2,586) (803) (790) (71,609) (94,917) (49,964) (64,765)

Net interest income 49,666 18,231 37,761 13,798

Fee and commission income 50,414 30,277 23,086 17,438 Fee and commission expenses (12,257) (8,820) (4,433) (4,422) Net fee and commission income 38,157 21,457 18,653 13,016

Trading income and Net gain on financial assets and liabilities designated at fair value through profit or loss 12,572 33,261 6,616 26,087 Net gain on financial assets and liabilities not measured at fair value through profit loss (19,909) 57 (20,026) - Impairment 9,894 (13,120) 153 (21,330) Dividend revenue 23 47 854 4 Other income 17,325 2,155 716 261 Net operating income 107,728 62,088 44,727 31,836

Salaries and benefits (44,680) (30,923) (14,991) (13,400) Depreciation and amortisation (9,269) (7,802) (4,669) (4,519) Other operating expenses (41,765) (37,645) (18,390) (14,713) Operating expenses (95,714) (76,370) (38,050) (32,632)

Profit before income tax 12,014 (14,282) 6,677 (796) Income tax expense (926) (2,471) - 1,709 Profit for the year 12,940 (11,811) 6,677 913 Attributable to: Minority interest (503) (2,702) Equity holders of the parent 13,443 (9,109)

5 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

STATEMENTS OF CASH FLOWS For the six months ended 30 June

Group Bank Operating activities 2011 2010 2011 2010 Net result for the year 14,436 (21,669) 7,174 5,037 Adjustments to reconcile net profit or loss to net cash provided by operating activities 13,477 (29,028) 14,256 (14,618) Income tax expenses 805 (2,006) - (1,709) Unrealized foreign currency gains and losses (6,310) (51,031) (10,906) (28,535) Revaluation of derivatives (12,088) (7,260) (7,569) (5,544) Depreciation / amortization 16,711 15,305 9,237 8,465 Impairment of loans 14,141 40,079 23,276 45,845 Impairment of assets held to maturity 218 1,998 218 1,998 Accrued Fee and commission revenue - (25,535) - (25,535) Other cash flows - (578) - (9,603) 27,913 (50,697) 21,430 (9,581) (Increase) decrease in balances with (Increase) decrease in loans and receivables (5,692) 65,085 722 27,667 (Acquisition) sale of held for trading securities 62,905 (600,939) 187,831 (599,636) Sale (Acquisition) of financial assets designated at fair value through profit or loss (593,177) (501,786) (511,577) (437,323) (Increase) decrease in other assets (16,398) (36,567) 24,646 (10,590) Increase (decrease) in deposits from credit institutions 217,892 49,406 275,636 109,159 Increase (decrease) in deposits (other than from credit institutions) (262,582) 920,351 (214,583) 642,850 (Decrease) increase in other liabilities 10,345 2,339 16,530 (2,865) Income tax (paid) (1,795) - - Cash flows (to) from operating activities (558,794) (154,603) (199,365) (280,319) Investing activities Cash (payments) to acquire tangible assets and investment property (46,254) (8,369) (59,591) (6,303) Cash (payments) to acquire intangible assets (3,996) (7,500) (2,560) (805) Cash receipts from the sale of intangible assets - - (17,267) - Cash (payments) to acquire subsidiary companies 14,929 138,350 3,265 138,350 Cash (payments) to acquire held-to-maturity investments (292,463) (19,071) (220,604) - Net cash flow from (to) investing activities (327,785) 103,410 (296,757) 131,242 Financing activities Paid, but not register share capital 186,726 82,294 186,726 82,294 Issue of debt certificates (including bonds) 195,187 28,823 192,055 29,201 (Repayments) of debt certificates (including bonds) (29,319) (410,152) (24,832) (392,891) Net cash flow from (to) financing activities 352,594 (299,035) 353,949 (281,396) Net (decrease) increase in cash and cash equivalents (533,985) (350,228) (142,173) (430,473) Net foreign exchange difference (37,401) 75,744 (16,919) 38,584 Cash and cash equivalents at beginning of the period 2,547,294 2,050,754 1,399,785 1,356,577 Cash and cash equivalents at end of the period 1,975,908 1,776,270 1,240,693 964,688

6 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY For the six months ended 30 June

Group

Attributable to the equity holders of the parent

Revaluation Revaluation Reserve of reserve of reserve of foreign Other Share Share Reserve property and financial currency general Retained Minority Total capital surplus capital equipment assets translation reserves earnings interest equity

As of 31 December 2009 411,922 22,657 37,341 - - 13,320 5,631 110,553 601,424

Total comprehensive income/expenses for the reporting year - - - 2,223 53 - - (16,132) (5,319) (19,175) Merger of subsidiary companies - - 2,592 14,749 - - 25,734 36,298 (79,373) - Transfer to reserve capital - 1,998 - - - - (1,998) - - Transfer to other reserves - - - - - 1,278 (1,278) -

As of 30 June 2010 411,922 - 27,247 54,313 53 - 40,332 22,521 25,861 582,249

As of 31 December 2010 494,217 27,671 27,365 54,985 - (307) 14,906 28,333 18,379 665,549

Total comprehensive income/expenses for the reporting year ------14,913 (477) 14,436) Acquisition of interest in subsidiaries - (4,877) 162 1,433 - 6 - (83) (14,791) (18,150) Transfer to reserve capital - 4,705 - - - - (4,705) - - Transfer to other reserves - - - - - 1,611 (1,611) - -

As of 30 June 2011 494,217 22,794 32,232 56,418 - (301) 16,517 36,847 3,111 661,835

7 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

SEPARATE STATEMENT OF CHANGES IN EQUITY For the six months ended 30 June

Bank

Revaluation Revaluation reserve of reserve of Other Share Share Reserve property and financial general Retained Total Capital surplus capital equipment assets reserves earnings equity

As of 31 December 2009 411,922 - 22,657 32,352 - 12,530 25,548 505,009

Total comprehensive income/expenses for the reporting year - - - 328 - - 5,038 5,366

Transfer to reserve capital - - 1,998 - - - (1,998) - Transfer to other reserves - - - - - 1,278 (1,278) -

As of 30 June 2010 411,922 - 24,655 32,680 - 13,808 27,310 510,375

As of 31 December 2010 494,217 - 24,655 32,337 - 13,810 32,234 597,253

Total comprehensive income/expenses for the reporting year ------7,174 7,174

Transfer to reserve capital - - 4,705 - - - (4,705) - Transfer to other reserves - - - - - 1,611 (1,611) -

As of 30 June 2011 494,217 - 29,360 32,337 - 15,421 33,091 604,426

8 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

Principal Activities

AB bankas SNORAS (hereinafter the Bank) was formed on 17 March 1992 under the laws of the Republic of . The Bank operates under a general banking license issued by the Bank of Lithuania. The Banks main office is in Vivulskio Str. 7, , Lithuania and it has 12 branches in Vilnius, Kaunas, Klaipėda, Šiauliai, Panevėžys, Utena, Marijampolė, Mažeikiai, Alytus, Tauragė, Tallin, Ryga and 257operating outlets.

The Bank offers the following banking services: accepts deposits from individuals, issues loans and provides short-term trade financing and consults clients, processes payments in Litas and other currencies, issues and services magnetic and microchip cards, collects payments, exchanges currency and provides other services. The Group companies provide the banking, real estate management, construction and renovation, asset and investment management, consumer financing and securities fund management services to the participants of the markets of Lithuania, Baltic States and Russia.

The authorized and issued share capital of the Bank consists of 474.217.107 ordinary shares with the par value of LTL 1 each and 2.000 thousand preference shares with the par value of LTL 10 each. As of 30 June 2011 and 31 December 2010 all shares were fully paid.

The Bank has the following subsidiaries: Ownership % 30 June 31 December Subsidiary 2011 2010 Country Industry UAB Snoro Lizingas (sub-group) 100% 100% Lithuania Consumer financing UAB SNORAS Development 50% 50% Lithuania Real estate UAB SNORAS Investment Management 100% 100% Lithuania (sub-group) Venture capital projects UAB SNORAS Media 100% 100% Lithuania Investment AB Finasta Holding (sub-group) 100% 100% Lithuania Investment OU Real Estate Investment Management 85% 85% Real estate UAB SNORAS Valda 100% 100% Lithuania Real estate UAB Dieveris 100% 100% Lithuania Real estate AS Latvijas Krājbanka (sub-group) 94% 85,07% Latvia Banking SNORO paramos fondas 100% - Lithuania Charity

In the consolidated financial statements all inter-company balances and transactions were eliminated. Consolidated financial statements were prepared using the same accounting principles for similar transactions and events.

Basis of preparation

The accounting policies adopted in the preparation of the interim condensed financial statements is consistent with those followed in the preparation of the Bank’s annual financial statements for the year ended 31 December 2010.

The interim condensed financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Bank’s annual financial statements as at 31 December 2010.

9 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

1. Cash and Cash Equivalents

Cash and cash equivalents comprise:

Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Cash at hand 222,368 183,807 159,326 132,786 Current accounts with the Central Banks 463,539 1,337,418 327,980 700,093 Current accounts with other credit institutions 990,009 767,885 651,288 436,985 Time deposits with credit institutions up to 90 days 299,992 258,184 102,099 129,921 Cash and cash equivalents 1,975,908 2,547,294 1,240,693 1,399,785

2. Financial Assets and Liabilities at Fair Value through Profit or Loss

Financial assets at fair value through profit or loss are held for trading or designated as financial assets at fair value through profit or loss upon initial recognition.

Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Trading assets 355,798 260,322 87,191 74,524 Financial assets designated as at fair value through profit and loss upon initial recognition 1,775,812 1,381,757 1,719,441 1,217,048 Derivative financial instruments 13,820 13,061 8,072 5,953 Total financial assets and liabilities at fair value from Profit or Loss 2,145,430 1,655,140 1,814,704 1,297,525

3. Loans to Customers, net

Loans to customers comprise:

Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Loans to customers 4,884,000 5,123,362 3,783,867 4,095,279 Credit lines 246,316 264,496 219,733 242,743 Leasing 291,879 280,565 - - Promissory notes 163,655 61,710 2,089 29,242 Reverse repurchase agreements 16,295 18,260 16,295 18,163 Factoring 9,195 6,973 9,195 6,973 5,611,340 5,755,366 4,031,179 4,392,400 Less: allowance for loan impairment (257,470) (258,567) (193,514) (171,971) Loans to customers, net 5,353,870 5,496,799 3,837,665 4,220,429

10 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

Loans have been issued to the following types of customers: Group Bank

30 June 31 December 30 June 31 December 2011 2010 2010 2009 Corporate clients 3,767,594 3,873,755 2,962,352 3,373,885 Individuals 1,392,762 1,500,333 703,540 740,386 State budget or municipal authorities 98,489 41,849 98,136 41,565 State or municipal companies 41,378 34,545 41,262 34,515 Other 53,647 46,317 32,375 30,078 Loans to customers, net 5,353,870 5,496,799 3,837,665 4,220,429

Loans are issued within the following industry sectors: Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Individuals 1,392,762 1,500,333 703,540 740,386 Real estate 753,828 975,358 456,753 732,641 Services Manufacturing 808,295 672,837 784,572 665,260 Transport 414,899 478,623 231,776 235,825 Trading 603,766 468,600 420,033 411,960 Manufacturing 504,349 459,871 352,919 322,480 Construction 269,488 394,372 203,612 195,700 225,892 262,359 430,181 761,530 Agriculture and food processing 141,810 89,429 96,292 63,018 Electricity 44,374 43,856 20,975 22,286 Government and municipalities 93,014 32,363 90,216 32,012 Fuel 9,073 6,723 778 778 Other 92,320 112,075 46,018 36,553 Loans to customers, net 5,353,870 5,496,799 3,837,665 4,220,429

4. Amounts Due to Credit Institutions

Amounts due to credit institutions comprise:

Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Time deposits and loans 575,727 401,939 479,372 249,924 Current accounts 159,328 115,224 161,931 115,743 Amounts due to credit institutions 735,055 517,163 641,303 365,667

5. Amounts Due to Customers

The amounts due to customers include the following:

Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Time deposits 5,737,352 6,019,575 3,909,375 4,141,671 Current accounts 3,371,920 3,352,279 2,222,604 2,204,891 Amounts due to customers 9,109,272 9,371,854 6,131,979 6,346,562

11 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

Amounts due to customers include accounts with the following types of customers:

Financial Group Bank 30 June 31 December 30 June 31 December 2011 2010 2011 2010 Individuals 5,858,861 5,903,787 4,143,747 4,201,984 Corporate clients 2,336,330 2,766,103 1,560,841 1,860,164 State budget or municipal authorities 257,664 492,196 184,538 114,713 State or municipal companies 589,059 164,023 209,180 144,392 Other 67,358 45,745 33,673 25,309 Amounts due to customers 9,109,272 9,371,854 6,131,979 6,346,562

6. Debt Securities Issued

As of 30 June the Bank had the debt securities issued with the amortized cost in amount of LTL 372,398 thousand (31 December 2010 – LTL 205,175 thousand), out of which Bank’s issued debt securities amounted LTL 159,847 thousand (31 December 2010 – LTL 84,911 thousand) and certificates of deposits – LTL 212,551 thousand (31 December 2010 – LTL 120,264 thousand). For detalisation of debt securities issued refer to the table below:

Title ISIN code Issue date Maturity Fixed Currency Amortized cost date interest (LTL rate thousand) Banko SNORAS Fiksuotų palūkanų LT0000410326 2011.03.21 2012.03.22 4.0 % LTL 24,707 obligacijos Nr.1 SNORAS Energetika1 LT1000403808 2008.07.14 2011.07.27 - EUR 1,216 Banko SNORAS Fiksuotų palūkanų LT0000410342 2011.04.26 2012.04.27 4.0 % LTL 29,390 obligacijos Nr.2 Banko SNORAS Fiksuotų palūkanų LT0000410383 2011.05.30 2012.06.01 4.0 % LTL 24,283 obligacijos Nr.3 SNORAS Energetika1 Plius LT1000403816 2008.07.14 2011.07.27 - EUR 1,718 SNORAS Energetika2 LT1000403824 2008.07.14 2011.07.27 - USD 697 SNORAS Energetika2 Plius LT1000403832 2008.07.14 2011.07.27 - USD 1,462 SNORAS Energetika3 LT0000430605 2008.07.14 2011.07.27 - LTL 745 SNORAS Energetika3 Plius LT0000430613 2008.07.14 2011.07.27 - LTL 1,674 SNORAS Neterminuoti skolos VP* LT1000410019 2009.08.31 - 8.0 % EUR 73,955 Debt securities issued 159,847

As of 30 June 2011 the Group had the debt securities issued with the amortised cost in amount of LTL 383,349 thousand (as of 31 December 2010 - LTL 217,481 thousand).

7. Financial Risk Management

Capital Adequacy

The Bank of Lithuania and Latvian Financial and Capital Market Commission (FCMC) require banks in Lithuania and Latvia respectively to maintain a capital adequacy ratio of 8%, computed based on requirements of respective regulator. Financial Group’s capital adequacy is calculated based on Bank of Lithuania requirements. As of 30 June 2011, the Financial Group’s capital adequacy ratio on this basis exceeded the statutory minimum and amounted 10.9 % and 10.39 % respectively:

Compliance with the benchmark ratios set by the Bank of Lithuania 30 June 2011:

Financial Group Bank Liquidity, % 47.45 46.57 Open currency position, % 1.89 1.10 Maximum exposure requirement to one borrower, % 24.42 24.21 Large exposure ratio, % 152.60 304.95 *Excluding loans to subsidiary companies

12 AB bankas SNORAS Interim financial statements for the 6-month period ended 30 June 2011 (LTL thousand)

8. Ratings

Ratings of AB Bank SNORAS assigned or affirmed by the international rating company Fitch Ratings Ltd:

Rating type Rating Long-term B+ Short-term B Individual D/E Support 4 Rating outlook stabili

Last rating review date – 1th of April 2011.

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