Financing in Serbia15th European Annual MeetingEuropean Consultants Unit

Development of Banking Sector Banking and Economy Development of Raiffeisenbank a.d. Precondition of Financing & LimitationsOutlookTABLE OF CONTENTS

Steady deterioration in the past 12 years prior to political changes:Large number of banksMajority of banks undercapitalizedMost banks overstaffedBanking sector small and not active enoughPolitically directed loans dominate the marketOnly basic banking products offeredLack of public trust in the banking sectorDEVELOPMENT OF BANKING SECTOR Prior to Political Changes in October 2000

NBS creates the basis for healthy development of financing sectorSignificant reduction in number of banks through mergers & closures: Beobanka, Beogradska banka, Jugobanka, Investbanka..Increased demand in terms of capital and quality Level of trust increasedIncrease in deposits volume:June 2001 total retail deposits reached EUR 31 mio September 2006 total retail deposits over EUR 2,74 bn Increase in loans volume:Until 2001 loans to customers were very modestDuring the last 3 years loans volume is increasing Payment system transferred to commercial banksOwnership structure of banks changed

After Political ChangesDEVELOPMENT OF BANKING SECTOR

Development of Banking Sector Banking and Economy Development of Raiffeisenbank a.d. Precondition of Financing & LimitationsOutlookTABLE OF CONTENTS

BANKING AND ECONOMY CONCLUSION:Due to the closure of large banks and restructuring process undergoing in state-owned banks in Serbia the banks asstets participation in Serbian GDP has declined. Nevertheless, result of new entrants into Serbian banking sector, this ratio is expected to increase.Banks Assets - Share in GDP

Chart4

0.8067035932

1.2538

1.216

0.3871

0.3218

0.38

0.43

Total Banks Assets as % of Serbian GDP

Chart13

0.780.420.360.361999

0.810.4150.380.340.21

0.80.490.440.350.23

0.750.520.420.390.3

0.760.570.440.420.35

CEE Banks Assets - Share in GDP

NMC 8

CC 3

SEEC 3

Russia

FSR 2

15 EU Countries' Average - 201%

Sheet1

Total assets of the banking sector, in EUR bn20032004

BANKARSKA AKTIVA4.956.15

NMC 8 (PL, HU, CZ, SK, SL, ES, LT, LI)312.6

Rusija152.5

CC3 (RO, BG, HR)50.6

FSR 2 (UA, BY)18.8

SEEC 3 (SR, BIH, AL)15.0

Share of majority owned state-owned, in % of total assets

NMC 8PL26%

HU0%

CZ3%

SK3%

SL20%

ES0%

LT5%

LI0%

CC 3RO40%

BG2%

HR4%

SEEC 3SR45%

BH6%

AL55%

.RU32%

FSR 2UA9%

BY78%

Share of majority owned state-owned, in % of total assets in Serbia

20022003Sep-04

4649%37%

Share of majority foreign-owned banks, in % of total assets

NMC 8PL72%

HU83%

CZ97%

SK98%

SL33%

ES99%

LT55%

LI88%

CC 3RO51%

BG82%

HR91%

SEEC 3SR20%

BH75%

AL46%

.RU4%

FSR 2UA8%

BY10%

Share of majority foreign owned state-owned, in % of total assets in Serbia

2003Sep-04Sep-04

20%32%50%

200320%

Sep-0432%

Sep-0450%with sales/privatization in Q4 and '05

Market concetration - 5 najvecih igraca na trzistu

NMC 8PL49%

HU52%

CZ66%

SK68%

SL69%

ES99%

LT62%

LI82%

CC 3RO49%

BG57%

HR70%

SEEC 3SR48%

BH64%

AL80%

.RU43%

FSR 2UA38%

BY88%

200348%

Sep-0447%

Total assets of the banking sector in % of GDP

NMC 8CC 3SEEC 3RussiaFSR 2

199978%42%36%36%

200081%42%38%34%21%

200180%49%44%35%23%

200275%52%42%39%30%

200376%57%44%42%35%

2004

Total assets of the banking sector in % of GDP u Srbiji

199981%

2000125%

2001122%

200239%

200332%

200438%

200543%

Total credits of the banking sector in % of GDP

PL, HU, CZ, SK, SL, ES, LT, LIRO, BG, HRSR, BH, AL, RU, KO, MDRusijaUA, BY

199932%18%13%14%

200033%18%13%14%12%

200131%20%17%17%15%

200232%25%19%18%18%

200334%29%22%22%24%

year

199927%

200040%

200132%

200218%

200316%

200421%

Retail credits in % of GDP

PL, HU, CZ, SK, SL, ES, LT, LIRO, BG, HRSR, BH, AL, RU, KO, MDRusijaUA, BY

19997%2%1%

20008%5%3%2%1%

20018%6%4%2%1%

20029%8%6%3%2%

200311%11%9%3%4%

year

19991%

20001%

20011%

20022%

20033%

20045%

Mortage loans in % of GDP

19992000200120022003

Poljska1.95%2.10%2.70%3.70%4.80%

Slovaka0.00%0.40%0.90%1.00%2.00%

Maarska0.00%1.00%2.00%5.20%8.00%

Hrvatska3.20%4.00%4.20%7.00%9.80%

eka0.80%1.20%1.70%2.10%3.80%

Market shares in CEE 6 countries

Raiffeisen Int.11%

Hypo Alpe Adria7%

BACA (HVB Group)2%

Societe Generale2%

Ostali79%

TOTAL ASSETS OF INTERNATIONAL BANK IN CEE, 2003 IN EUR bn

KBC29

Erste27

UniCredito24

HVB/BACA23

Raiffeisen22

SocGen18.5

Banca Intesa13.5

Citibank12.5

OTP12

ING8

Commerzbank7

Allied Irish5

Hypo Alpe Adria3.5

ABN Amro3.3

GE Capital3.2

Volksbank3

Market shares in CEEC 20

Raiffeisen Int4%

HVB/BACA5%

Erste bank4%

KBC5%

UniCredito4%

SocGen6%

Banca Intesa3%

Citigroup2%

OTP3%

ING2%

GE Capital1%

Hypo Alpe1%

Commerzbank1%

Other63%

Sheet1

0

0

0

0

0

Sheet2

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

Sheet3

0

0

uee banaka u dravnom vlasnitvu u ukupnoj aktivi u Srbiji

00

00

00

00

00

00

00

00

00

00

00

00

00

00

00

00

0

NMC 8

0

0

0

uee banaka u stranom vlasni. u ukupnoj aktivi u Srbiji

sa prodajama/privatizacijom u Q4 i 2005

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

Uee 5 najveih banaka u ukupnoj aktivi u Srbiji

00000

00000

00000

00000

00000

NMC 8

CC 3

SEEC 3

Russia

FSR 2

Eurozone 201%

0

0

0

0

0

0

0

Uee bankarske aktive u BDP Srbije

00000

00000

00000

00000

00000

PL, HU, CZ, SK, SL, ES, LT, LI

RO, BG, HR

SR, BH, AL, RU, KO, MD

Rusija

UA, BY

0

0

0

0

0

0

Uee ukupnih kredita u BDP u Srbiji

00000

00000

00000

00000

00000

PL, HU, CZ, SK, SL, ES, LT, LI

RO, BG, HR

SR, BH, AL, RU, KO, MD

Rusija

UA, BY

Eurozone 49%

0

0

0

0

0

0

Uee kredita stanovnitva u BDP u Srbiji

00000

00000

00000

00000

00000

Poljska

Slovaka

Maarska

Hrvatska

eka

0

0

0

0

0

u % od neto kredita

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

na Rusiju se odnosi 30% neto kredita

PLHUCZSKSLESLTLIBGROHRRUUABYALSRBIHUKUPNO

Raiffeisen Int58504110313371902981463921758773

HVB/BACA51937232410121579823433904

ING3383515N.A.2911401

Citi16020741661205

Volksbank2819349101348125

UniCredit80126689128128651207

SocGen53385563181321666

Erste1946643421181318

KBC35915520873795

OTP4405116316670

Intesa451229200475

Hypo Alpe543259109

Commerzbank4513150

Swedb9266122280

Allied Irish432432

u % od neto kredita

BANKARSKA AKTIVA

Bankarska aktiva Srbije - mld EUR

0

0

0

0

u mil EUR% kapitala prodat/na prodajikupacpotencijalni kupcicena

stanje 30/09/2004

Jubanka a.d. Beograd88.64%Alpha bank152

Izbor kupca u toku

Novosadska banka a.d. Novi Sad82.79%Erste bank, UniCredito, EFG Eurobankn.a.

Continental banka a.d. Novi Sad98.01%GE Capital, Nova Ljubljanska banka, EFG Eurobankn.a.

Tender o prodaji akcija objavljen

Nika banka a.d. Ni100.00%

Izbor privatizacionog savetnika u tokun.a.

Vojvoanska banka a.d. Novi Sad98.65%OTP??

Panonska banka a.d. Novi Sad87.31%

u EUR milKupac% vlasnitvacena

Delta banka a.d. BeogradIntesa BCI75% + 1 akcija277.5

Eksim banka a.d. BoegradBACA98%n.a.

Atlas banka a.d. BeogradPiraeus bank80%n.a.

20032004

ukupni krediti$2,507$3,400

krediti privredi$2,013$2,535

krediti stanovnistvu$418$817

2004/20032004/2003

total credits35.64%$893

corporate credits25.93%$522

retail credits95.45%$399

20032004

ukupni depoziti$2,955$3,530

depoziti privrede$1,473$1,615

depoziti stanovnitva$1,217$1,565

19.46%

9.64%

28.56%

20032004

krediti stanovnistvu$418$817

depoziti stanovnitva$1,217$1,565

191.2%91.5%

MARKET SHARE TOP 10 BANKS

ukupna aktivaukupni krediti

Raiffeisenbank13%15%

Delta banka11%10%

Komercijalna banka10%9%

Vojvodjanska banka8%8%

Soc Gen5%4%

Hypo Alpe adria4%6%

Jubanka4%4%

AIK bank3%3%

HVB bank3%3%

ProCredit bank2%3%

ASSETS

Raiffeisenbank$802

Delta$676

Komercijalna$602

Vojvodjanska$496

SocGen$287

Hypo Alpe adria$265

Jubanka$228

AIK bank Nis$183

HVB bank$179

ProCredit bank$152

LOANS

Raiffeisenbank$521

Delta$341

Komercijalna$303

Vojvodjanska$263

SocGen$209

Hypo Alpe adria$140

Jubanka$139

AIK bank Nis$118

HVB bank$107

ProCredit bank$87

Raiffeisenbank$718

Delta$535

Komercijalna$464

Vojvodjanska$324

SocGen$260

Hypo Alpe adria$203

Jubanka$120

AIK bank Nis$119

HVB bank$97

ProCredit bank$41

00

00

00

35%

26%

95%

2003

2004

in mio of EUR

00

00

00

10%

2003

2004

u mil EUR

0

0

0

0

0

0

0

0

0

0

19%

29%

krediti stanovnistvu

depoziti stanovnitva

u mil EUR

0

0

0

0

0

0

0

0

ukupni krediti

Hypo Alpe adria4%

SG5%

vojvodjanska8%

Raiffeisenbank 13%

Delta11%

Komercijalna10%

Jubank4%

AIK bank Nis3%

HVB bank3%

ProCredit bank2%

0

0

0

0

0

0

0

0

0

0

HVB bank3%

ProCredit bank3%

AIK bank Nis3%

Jubank4%

Raiffeisenbank15%

Delta10%

Komercijalna9%

Vojvodjanska8%

SG4%

Hypo Alpe adria6%

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

CONCLUSION:Evident decrease of this indicator is a result of assets restructuring of state-owned banks (i.e. Write-offs of bad loans). Following the resructuring of banking sector and presence of foreign banks, participation of total credits in GDP has begun to increase (126 % YoY 2003/04)

Total Credits - Share in GDPBANKING AND ECONOMY

Chart2

0.2672290868

0.4

0.32

0.18

0.16

0.21

0.23

Total Credits as % Serbian GDP

Chart13

0.320.180.1250.1351999

0.330.1750.130.140.12

0.310.20.170.1650.15

0.3150.250.1850.180.175

0.340.290.220.220.24

Total Credits - Share in GDP

NCM8

CC3

SEEC3

Russia

FSR2

15 EU Countries Average - 110%

Sheet1

Total assets of the banking sector, in EUR bn20032004

BANKARSKA AKTIVA4.956.15

NMC 8 (PL, HU, CZ, SK, SL, ES, LT, LI)312.6

Rusija152.5

CC3 (RO, BG, HR)50.6

FSR 2 (UA, BY)18.8

SEEC 3 (SR, BIH, AL)15.0

Share of majority owned state-owned, in % of total assets

NMC 8PL26%

HU0%

CZ3%

SK3%

SL20%

ES0%

LT5%

LI0%

CC 3RO40%

BG2%

HR4%

SEEC 3SR45%

BH6%

AL55%

.RU32%

FSR 2UA9%

BY78%

Share of majority owned state-owned, in % of total assets in Serbia

20022003Sep-04

4649%37%

Share of majority foreign-owned banks, in % of total assets

NMC 8PL72%

HU83%

CZ97%

SK98%

SL33%

ES99%

LT55%

LI88%

CC 3RO51%

BG82%

HR91%

SEEC 3SR20%

BH75%

AL46%

.RU4%

FSR 2UA8%

BY10%

Share of majority foreign owned state-owned, in % of total assets in Serbia

2003Sep-04Sep-04

20%32%50%

200320%

Sep-0432%

Sep-0450%with sales/privatization in Q4 and '05

Market concetration - 5 najvecih igraca na trzistu

NMC 8PL49%

HU52%

CZ66%

SK68%

SL69%

ES99%

LT62%

LI82%

CC 3RO49%

BG57%

HR70%

SEEC 3SR48%

BH64%

AL80%

.RU43%

FSR 2UA38%

BY88%

200348%

Sep-0447%

Total assets of the banking sector in % of GDP

NMC 8CC 3SEEC 3RusijaFSR 2

199978%42%36%36%

200081%42%38%34%21%

200180%49%44%35%23%

200275%52%42%39%30%

200376%57%44%42%35%

Total assets of the banking sector in % of GDP u Srbiji

199981%

2000125%

2001122%

200239%

200332%

200438%

Total credits of the banking sector in % of GDP

NCM8CC3SEEC3RussiaFSR2

199932%18%13%14%

200033%18%13%14%12%

200131%20%17%17%15%

200232%25%19%18%18%

200334%29%22%22%24%

year

199927%

200040%

200132%

200218%

200316%

200421%

200523%

Retail credits in % of GDP

PL, HU, CZ, SK, SL, ES, LT, LIRO, BG, HRSR, BH, AL, RU, KO, MDRusijaUA, BY

19997%2%1%

20008%5%3%2%1%

20018%6%4%2%1%

20029%8%6%3%2%

200311%11%9%3%4%

year

19991%

20001%

20011%

20022%

20033%

20045%

Mortage loans in % of GDP

19992000200120022003

Poljska1.95%2.10%2.70%3.70%4.80%

Slovaka0.00%0.40%0.90%1.00%2.00%

Maarska0.00%1.00%2.00%5.20%8.00%

Hrvatska3.20%4.00%4.20%7.00%9.80%

eka0.80%1.20%1.70%2.10%3.80%

Market shares in CEE 6 countries

Raiffeisen Int.11%

Hypo Alpe Adria7%

BACA (HVB Group)2%

Societe Generale2%

Ostali79%

TOTAL ASSETS OF INTERNATIONAL BANK IN CEE, 2003 IN EUR bn

KBC29

Erste27

UniCredito24

HVB/BACA23

Raiffeisen22

SocGen18.5

Banca Intesa13.5

Citibank12.5

OTP12

ING8

Commerzbank7

Allied Irish5

Hypo Alpe Adria3.5

ABN Amro3.3

GE Capital3.2

Volksbank3

Market shares in CEEC 20

Raiffeisen Int4%

HVB/BACA5%

Erste bank4%

KBC5%

UniCredito4%

SocGen6%

Banca Intesa3%

Citigroup2%

OTP3%

ING2%

GE Capital1%

Hypo Alpe1%

Commerzbank1%

Other63%

Sheet1

312.6

152.5

50.6

18.8

15

Sheet2

0.26

0

0.03

0.025

0.2

0

0.05

0

0.4

0.015

0.035

0.45

0.06

0.55

0.32

0.085

0.78

Sheet3

0.49

0.37

uee banaka u dravnom vlasnitvu u ukupnoj aktivi u Srbiji

0.72PLNMC 8

0.83HU

0.97CZ

0.98SK

0.33SL

0.99ES

0.55LT

0.880

0.51ROCC 3

0.82BG

0.910

0.2SRSEEC 3

0.75BH

0.460

0.040

0.08UAFSR 2

0.1BY

NMC 8

0.2

0.32

0.5

uee banaka u stranom vlasni. u ukupnoj aktivi u Srbiji

sa prodajama/privatizacijom u Q4 i 2005

0.49

0.52

0.66

0.68

0.69

0.99

0.62

0.82

0.49

0.57

0.7

0.48

0.64

0.8

0.43

0.38

0.88

0

0

Uee 5 najveih banaka u ukupnoj aktivi u Srbiji

0.780.420.360.361999

0.810.4150.380.340.21

0.80.490.440.350.23

0.750.520.420.390.3

0.760.570.440.420.35

NMC 8 (PL, HU, CZ, SK, SL, ES, LT, LI)

CC 3 (RO, BG, HR)

SEEC 3 (SR, BIH, AL

Rusija

FSR 2 (UA, BY))

Eurozone 201%

0

0

0

0

0

0

Uee bankarske aktive u BDP Srbije

00000

00000

00000

00000

00000

NCM8

CC3

SEEC3

Russia

FSR2

0

0

0

0

0

0

0

Uee ukupnih kredita u BDP u Srbiji

00000

00000

00000

00000

00000

PL, HU, CZ, SK, SL, ES, LT, LI

RO, BG, HR

SR, BH, AL, RU, KO, MD

Rusija

UA, BY

Eurozone 49%

0.0093339014

0.0051

0.0146

0.0186

0.0272

0.0502

Uee kredita stanovnitva u BDP u Srbiji

00000

00000

00000

00000

00000

Poljska

Slovaka

Maarska

Hrvatska

eka

0

0

0

0

0

u % od neto kredita

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

na Rusiju se odnosi 30% neto kredita

PLHUCZSKSLESLTLIBGROHRRUUABYALSRBIHUKUPNO

Raiffeisen Int58504110313371902981463921758773

HVB/BACA51937232410121579823433904

ING3383515N.A.2911401

Citi16020741661205

Volksbank2819349101348125

UniCredit80126689128128651207

SocGen53385563181321666

Erste1946643421181318

KBC35915520873795

OTP4405116316670

Intesa451229200475

Hypo Alpe543259109

Commerzbank4513150

Swedb9266122280

Allied Irish432432

u % od neto kredita

BANKARSKA AKTIVA

Bankarska aktiva Srbije - mld EUR

2003

2004

4.95

6.152

u mil EUR% kapitala prodat/na prodajikupacpotencijalni kupcicena

stanje 30/09/2004

Jubanka a.d. Beograd88.64%Alpha bank152

Izbor kupca u toku

Novosadska banka a.d. Novi Sad82.79%Erste bank, UniCredito, EFG Eurobankn.a.

Continental banka a.d. Novi Sad98.01%GE Capital, Nova Ljubljanska banka, EFG Eurobankn.a.

Tender o prodaji akcija objavljen

Nika banka a.d. Ni100.00%

Izbor privatizacionog savetnika u tokun.a.

Vojvoanska banka a.d. Novi Sad98.65%OTP??

Panonska banka a.d. Novi Sad87.31%

u EUR milKupac% vlasnitvacena

Delta banka a.d. BeogradIntesa BCI75% + 1 akcija277.5

Eksim banka a.d. BoegradBACA98%n.a.

Atlas banka a.d. BeogradPiraeus bank80%n.a.

20032004

ukupni krediti$2,507$3,400

krediti privredi$2,013$2,535

krediti stanovnistvu$418$817

2004/20032004/2003

total credits35.64%$893

corporate credits25.93%$522

retail credits95.45%$399

20032004

ukupni depoziti$2,955$3,530

depoziti privrede$1,473$1,615

depoziti stanovnitva$1,217$1,565

19.46%

9.64%

28.56%

20032004

krediti stanovnistvu$418$817

depoziti stanovnitva$1,217$1,565

191.2%91.5%

MARKET SHARE TOP 10 BANKS

ukupna aktivaukupni krediti

Raiffeisenbank13%15%

Delta banka11%10%

Komercijalna banka10%9%

Vojvodjanska banka8%8%

Soc Gen5%4%

Hypo Alpe adria4%6%

Jubanka4%4%

AIK bank3%3%

HVB bank3%3%

ProCredit bank2%3%

ASSETS

Raiffeisenbank$802

Delta$676

Komercijalna$602

Vojvodjanska$496

SocGen$287

Hypo Alpe adria$265

Jubanka$228

AIK bank Nis$183

HVB bank$179

ProCredit bank$152

LOANS

Raiffeisenbank$521

Delta$341

Komercijalna$303

Vojvodjanska$263

SocGen$209

Hypo Alpe adria$140

Jubanka$139

AIK bank Nis$118

HVB bank$107

ProCredit bank$87

Raiffeisenbank$718

Delta$535

Komercijalna$464

Vojvodjanska$324

SocGen$260

Hypo Alpe adria$203

Jubanka$120

AIK bank Nis$119

HVB bank$97

ProCredit bank$41

00

00

00

35%

26%

95%

2003

2004

in mio of EUR

00

00

00

10%

2003

2004

u mil EUR

0

0

0

0

0

0

0

0

0

0

19%

29%

krediti stanovnistvu

depoziti stanovnitva

u mil EUR

0

0

0

0

0

0

0

0

ukupni krediti

Hypo Alpe adria4%

SG5%

vojvodjanska8%

Raiffeisenbank 13%

Delta11%

Komercijalna10%

Jubank4%

AIK bank Nis3%

HVB bank3%

ProCredit bank2%

0

0

0

0

0

0

0

0

0

0

HVB bank3%

ProCredit bank3%

AIK bank Nis3%

Jubank4%

Raiffeisenbank15%

Delta10%

Komercijalna9%

Vojvodjanska8%

SG4%

Hypo Alpe adria6%

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

CONCLUSION:Retail market segment is the most dynamic in term of growth rates. The large increase is primarily generated through much larger supply of retail loans in recent years. There is still enough scope for further growth.Retail Loans - Share in GDPBANKING AND ECONOMY

Chart2

0.0093339014

0.0051

0.0146

0.0186

0.0272

0.0502

0.07

Retail Loans as % of Serbian GDP

Sheet1

Sheet1

0.0093339014

0.0051

0.0146

0.0186

0.0272

0.0502

0.07

Retail Loans as % of Serbian GDP

Sheet2

Sheet3

MBD00006A61.xls

Chart2

0.2672290868

0.4

0.32

0.18

0.16

0.21

0.23

Total Credits as % Serbian GDP

Chart13

0.320.180.1250.1351999

0.330.1750.130.140.12

0.310.20.170.1650.15

0.3150.250.1850.180.175

0.340.290.220.220.24

Total Credits - Share in GDP

NCM8

CC3

SEEC3

Russia

FSR2

15 EU Countries Average - 110%

Sheet1

Total assets of the banking sector, in EUR bn20032004

BANKARSKA AKTIVA4.956.15

NMC 8 (PL, HU, CZ, SK, SL, ES, LT, LI)312.6

Rusija152.5

CC3 (RO, BG, HR)50.6

FSR 2 (UA, BY)18.8

SEEC 3 (SR, BIH, AL)15.0

Share of majority owned state-owned, in % of total assets

NMC 8PL26%

HU0%

CZ3%

SK3%

SL20%

ES0%

LT5%

LI0%

CC 3RO40%

BG2%

HR4%

SEEC 3SR45%

BH6%

AL55%

.RU32%

FSR 2UA9%

BY78%

Share of majority owned state-owned, in % of total assets in Serbia

20022003Sep-04

4649%37%

Share of majority foreign-owned banks, in % of total assets

NMC 8PL72%

HU83%

CZ97%

SK98%

SL33%

ES99%

LT55%

LI88%

CC 3RO51%

BG82%

HR91%

SEEC 3SR20%

BH75%

AL46%

.RU4%

FSR 2UA8%

BY10%

Share of majority foreign owned state-owned, in % of total assets in Serbia

2003Sep-04Sep-04

20%32%50%

200320%

Sep-0432%

Sep-0450%with sales/privatization in Q4 and '05

Market concetration - 5 najvecih igraca na trzistu

NMC 8PL49%

HU52%

CZ66%

SK68%

SL69%

ES99%

LT62%

LI82%

CC 3RO49%

BG57%

HR70%

SEEC 3SR48%

BH64%

AL80%

.RU43%

FSR 2UA38%

BY88%

200348%

Sep-0447%

Total assets of the banking sector in % of GDP

NMC 8CC 3SEEC 3RusijaFSR 2

199978%42%36%36%

200081%42%38%34%21%

200180%49%44%35%23%

200275%52%42%39%30%

200376%57%44%42%35%

Total assets of the banking sector in % of GDP u Srbiji

199981%

2000125%

2001122%

200239%

200332%

200438%

Total credits of the banking sector in % of GDP

NCM8CC3SEEC3RussiaFSR2

199932%18%13%14%

200033%18%13%14%12%

200131%20%17%17%15%

200232%25%19%18%18%

200334%29%22%22%24%

year

199927%

200040%

200132%

200218%

200316%

200421%

200523%

Retail credits in % of GDP

PL, HU, CZ, SK, SL, ES, LT, LIRO, BG, HRSR, BH, AL, RU, KO, MDRusijaUA, BY

19997%2%1%

20008%5%3%2%1%

20018%6%4%2%1%

20029%8%6%3%2%

200311%11%9%3%4%

year

19991%

20001%

20011%

20022%

20033%

20045%

Mortage loans in % of GDP

19992000200120022003

Poljska1.95%2.10%2.70%3.70%4.80%

Slovaka0.00%0.40%0.90%1.00%2.00%

Maarska0.00%1.00%2.00%5.20%8.00%

Hrvatska3.20%4.00%4.20%7.00%9.80%

eka0.80%1.20%1.70%2.10%3.80%

Market shares in CEE 6 countries

Raiffeisen Int.11%

Hypo Alpe Adria7%

BACA (HVB Group)2%

Societe Generale2%

Ostali79%

TOTAL ASSETS OF INTERNATIONAL BANK IN CEE, 2003 IN EUR bn

KBC29

Erste27

UniCredito24

HVB/BACA23

Raiffeisen22

SocGen18.5

Banca Intesa13.5

Citibank12.5

OTP12

ING8

Commerzbank7

Allied Irish5

Hypo Alpe Adria3.5

ABN Amro3.3

GE Capital3.2

Volksbank3

Market shares in CEEC 20

Raiffeisen Int4%

HVB/BACA5%

Erste bank4%

KBC5%

UniCredito4%

SocGen6%

Banca Intesa3%

Citigroup2%

OTP3%

ING2%

GE Capital1%

Hypo Alpe1%

Commerzbank1%

Other63%

Sheet1

312.6

152.5

50.6

18.8

15

Sheet2

0.26

0

0.03

0.025

0.2

0

0.05

0

0.4

0.015

0.035

0.45

0.06

0.55

0.32

0.085

0.78

Sheet3

0.49

0.37

uee banaka u dravnom vlasnitvu u ukupnoj aktivi u Srbiji

0.72PLNMC 8

0.83HU

0.97CZ

0.98SK

0.33SL

0.99ES

0.55LT

0.880

0.51ROCC 3

0.82BG

0.910

0.2SRSEEC 3

0.75BH

0.460

0.040

0.08UAFSR 2

0.1BY

NMC 8

0.2

0.32

0.5

uee banaka u stranom vlasni. u ukupnoj aktivi u Srbiji

sa prodajama/privatizacijom u Q4 i 2005

0.49

0.52

0.66

0.68

0.69

0.99

0.62

0.82

0.49

0.57

0.7

0.48

0.64

0.8

0.43

0.38

0.88

0

0

Uee 5 najveih banaka u ukupnoj aktivi u Srbiji

0.780.420.360.361999

0.810.4150.380.340.21

0.80.490.440.350.23

0.750.520.420.390.3

0.760.570.440.420.35

NMC 8 (PL, HU, CZ, SK, SL, ES, LT, LI)

CC 3 (RO, BG, HR)

SEEC 3 (SR, BIH, AL

Rusija

FSR 2 (UA, BY))

Eurozone 201%

0

0

0

0

0

0

Uee bankarske aktive u BDP Srbije

00000

00000

00000

00000

00000

NCM8

CC3

SEEC3

Russia

FSR2

0

0

0

0

0

0

0

Uee ukupnih kredita u BDP u Srbiji

00000

00000

00000

00000

00000

PL, HU, CZ, SK, SL, ES, LT, LI

RO, BG, HR

SR, BH, AL, RU, KO, MD

Rusija

UA, BY

Eurozone 49%

0.0093339014

0.0051

0.0146

0.0186

0.0272

0.0502

Uee kredita stanovnitva u BDP u Srbiji

00000

00000

00000

00000

00000

Poljska

Slovaka

Maarska

Hrvatska

eka

0

0

0

0

0

u % od neto kredita

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

0

na Rusiju se odnosi 30% neto kredita

PLHUCZSKSLESLTLIBGROHRRUUABYALSRBIHUKUPNO

Raiffeisen Int58504110313371902981463921758773

HVB/BACA51937232410121579823433904

ING3383515N.A.2911401

Citi16020741661205

Volksbank2819349101348125

UniCredit80126689128128651207

SocGen53385563181321666

Erste1946643421181318

KBC35915520873795

OTP4405116316670

Intesa451229200475

Hypo Alpe543259109

Commerzbank4513150

Swedb9266122280

Allied Irish432432

u % od neto kredita

BANKARSKA AKTIVA

Bankarska aktiva Srbije - mld EUR

2003

2004

4.95

6.152

u mil EUR% kapitala prodat/na prodajikupacpotencijalni kupcicena

stanje 30/09/2004

Jubanka a.d. Beograd88.64%Alpha bank152

Izbor kupca u toku

Novosadska banka a.d. Novi Sad82.79%Erste bank, UniCredito, EFG Eurobankn.a.

Continental banka a.d. Novi Sad98.01%GE Capital, Nova Ljubljanska banka, EFG Eurobankn.a.

Tender o prodaji akcija objavljen

Nika banka a.d. Ni100.00%

Izbor privatizacionog savetnika u tokun.a.

Vojvoanska banka a.d. Novi Sad98.65%OTP??

Panonska banka a.d. Novi Sad87.31%

u EUR milKupac% vlasnitvacena

Delta banka a.d. BeogradIntesa BCI75% + 1 akcija277.5

Eksim banka a.d. BoegradBACA98%n.a.

Atlas banka a.d. BeogradPiraeus bank80%n.a.

20032004

ukupni krediti$2,507$3,400

krediti privredi$2,013$2,535

krediti stanovnistvu$418$817

2004/20032004/2003

total credits35.64%$893

corporate credits25.93%$522

retail credits95.45%$399

20032004

ukupni depoziti$2,955$3,530

depoziti privrede$1,473$1,615

depoziti stanovnitva$1,217$1,565

19.46%

9.64%

28.56%

20032004

krediti stanovnistvu$418$817

depoziti stanovnitva$1,217$1,565

191.2%91.5%

MARKET SHARE TOP 10 BANKS

ukupna aktivaukupni krediti

Raiffeisenbank13%15%

Delta banka11%10%

Komercijalna banka10%9%

Vojvodjanska banka8%8%

Soc Gen5%4%

Hypo Alpe adria4%6%

Jubanka4%4%

AIK bank3%3%

HVB bank3%3%

ProCredit bank2%3%

ASSETS

Raiffeisenbank$802

Delta$676

Komercijalna$602

Vojvodjanska$496

SocGen$287

Hypo Alpe adria$265

Jubanka$228

AIK bank Nis$183

HVB bank$179

ProCredit bank$152

LOANS

Raiffeisenbank$521

Delta$341

Komercijalna$303

Vojvodjanska$263

SocGen$209

Hypo Alpe adria$140

Jubanka$139

AIK bank Nis$118

HVB bank$107

ProCredit bank$87

Raiffeisenbank$718

Delta$535

Komercijalna$464

Vojvodjanska$324

SocGen$260

Hypo Alpe adria$203

Jubanka$120

AIK bank Nis$119

HVB bank$97

ProCredit bank$41

00

00

00

35%

26%

95%

2003

2004

in mio of EUR

00

00

00

10%

2003

2004

u mil EUR

0

0

0

0

0

0

0

0

0

0

19%

29%

krediti stanovnistvu

depoziti stanovnitva

u mil EUR

0

0

0

0

0

0

0

0

ukupni krediti

Hypo Alpe adria4%

SG5%

vojvodjanska8%

Raiffeisenbank 13%

Delta11%

Komercijalna10%

Jubank4%

AIK bank Nis3%

HVB bank3%

ProCredit bank2%

0

0

0

0

0

0

0

0

0

0

HVB bank3%

ProCredit bank3%

AIK bank Nis3%

Jubank4%

Raiffeisenbank15%

Delta10%

Komercijalna9%

Vojvodjanska8%

SG4%

Hypo Alpe adria6%

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

0

0

0

0

0

0

0

0

0

0

u mil EUR

BANKING AND ECONOMY1M BELIBOR

This commentary is for information only and the comments and forecasts are intended to be of a general nature and are current as at the date of issue. Issued by Raiffeisenbank A.D., Belgrade who takes no responsibility for any individual investment decisions based thereon. This documentation is not intended as an offer, solicitation or recommendation to buy or sell currency. Information is obtained from sources that are believed to be reliable but their accuracy cannot be guaranteed. Relevant economic data has been taken from Statistical gazette of NBS, Economical gazette of NBS, Ministry of finance of Serbia internet page, NBS internet page, Republic of Serbia statistic department. In 2005 CSD nominal depreciation towards EUR was 8.4%, effective depreciation was amounting to 7% In 2006 up to now CSD depreciated for 1.29% It is expected that the EUR/CSD would be around 87.5-88.5 level at the end of 2006 Expectations are that CPI would be in range 9.5%-13.5%BANKING AND ECONOMYEUR/CSD ANALYSIS AND FORECAST

Sheet1

Trend EUR/CSD

HistoryForecast

12/31/053/31/065/31/068/31/069/30/0612/31/06

85.586.900587.638084.400085.831788.0039

Sheet2

Sheet3

Market position and growth rates____________________(1)av. nom. GDP-growth 2004e-2007e (p.a.): 19,0 %(2) av. nom. GDP-growth 2004e-2007e (p.a.): 14,0 %(3) av. nom. GDP-growth 2004e-2007e (p.a.): 14,4 %Bosnia and HerzegovinaCroatiaSlovakiaSerbia KosovoAlbaniaRomaniaBelarus(1)BulgariaHungaryCzech Rep.Russia(3)PolandUkraine(2)Slovenia0%2%4%6%8%10%12%Market-position-Average nominal GDP-growth 2004e 2007 p.a.Top 1 -3>6 EU-123,6% p.a.No. of NWBs834Top 4 -6>

Development of Banking Sector Banking and Economy Development of Raiffeisenbank a.d. Precondition of Financing & LimitationsOutlookTABLE OF CONTENTS

RZB Group in CEE

First bank established with 100% foreign capital in the country The Banks shareholders: Raiffeisen International IFC, World Bank Group Equity EUR 200 mio More than 365,000 clients 54 branches Universal bank for 4 main business segments: Corporate Banking Retail Banking Private individuals Retail Banking SMEs (small & micro enterprises and professionals)Treasury & Investment BankingRAIFFEISENBANK a.d. Belgrade

TOP 15 BANKS -by total assetsAs at: 30/06/2006 in million EURSource: NBS, under local statutary requirements, prepared by: Raiffeisenbank

Chart2

Raiffeisenbank1664

Banca Intesa1118

Hypo Alpe-Adria1077

Komercijalna1061

HVB Bank943

Societe Generale533

Vojvodjanska511

Alpha446

Pro Credit Bank390

AIK banka313

NBG280

EFG Eurobank276

Volksbank238

Meridian - CA231

Erste228

1,664

chartovi (2)

64.2679374,684

1Raiffeisenbank18,357,0701,664

2Banca Intesa1,118

3Hypo Alpe-Adria1,077

4Komercijalna1,061

5HVB Bank943

6Societe Generale533

7Vojvodjanska511

8Alpha446

9Pro Credit Bank390

10AIK banka313

11NBG280

12EFG Eurobank276

13Volksbank238

14Meridian - CA231

15Erste228

chartovi (2)

0

0

0

0

Retail savings - in mio of USD

Vojvodjanska764249

Delta694923

Komercijalna626111

Raiffeisenbank421153

Jubank277764

AIK bank191397

Novosadska163676

Srpska Banka159594

Postanska Sted.149419

Societe Generale147825

421,153

0

0

0

0

0

0

0

0

0

0

465

11

Retail savings as of 31 August 2003 - (in mio of EUR)

11

Total deposits as of 30 June 2003 - in mio of EUR

303

11

Total equity as of 30 June 2003 - in mio of EUR

24

111

#REF!

#REF!

#REF!

Kreditni Portfolio Raiffeisenbank a.d., Beograd - 2003

Development of Banking Sector Banking and Economy Development of Raiffeisenbank a.d. Precondition of Financing & LimitationsOutlookTABLE OF CONTENTS

Profile of the borrower: Privately owned companies with undisputable ownership rights Subsidiaries of Multinationals State owned and mixed companies with good prospects of privatization Track record of at least 2-3 years

Credit profile Purpose:working capital financing, financing of investments, project/trade financing Amounts:up to EUR 50 mio (current legal lending limit)

Tenors:working capital financing: up to 2y investments/project financing: up to 10y

Collateral:Mortgage, pledge on equipment and inventory, bank/corporate guarantees and cash deposits, assignment of receivables, unsecured etc Preconditions for financing-limitations

LimitationsCountry risk: maximum tenor, costs of refinancing, maximum country limitLack of country-wide land registerLack of available construction/industrial land in towns Legal restrictions: Law on Foreign Credit Transactions, necessity of registration of international financing with National Bank of Serbia (reduction of flexibility)Costs of refinancing: mandatory reserve costs (60%), costs for political risk Still limited transparency of balance sheets but strongly improving

ImprovementsSignificance of balance sheet, International Accounting StandardsPositive track record with the bank, willingness and capability to repayIncreasing of competition in the banking areaPreconditions for financing-limitations

TOP 15 BANKS -by total loansAs at: 30/06/2006 in million EURSource: NBS, under local statutary requirements, prepared by: Raiffeisenbank

Chart2

Raiffeisenbank917

Banca Intesa609

Hypo-Alpe-Adria Bank599

Komercijalna banka501

HVB Bank396

Societe Generale253

Pro Credit Bank238

AIK banka209

Meridian - CA134

EFG Eurobank124

NBG123

Continental114

Agrobanka111

Volksbank109

Panonska95

917

chartovi (2)

64.2679374,684

1Raiffeisenbank18,357,070917

2Banca Intesa609

3Hypo-Alpe-Adria Bank599

4Komercijalna banka501

5HVB Bank396

6Societe Generale253

7Pro Credit Bank238

8AIK banka209

9Meridian - CA134

10EFG Eurobank124

NBG123

Continental114

Agrobanka111

Volksbank109

Panonska95

chartovi (2)

0

0

0

0

Retail savings - in mio of USD

Vojvodjanska764249

Delta694923

Komercijalna626111

Raiffeisenbank421153

Jubank277764

AIK bank191397

Novosadska163676

Srpska Banka159594

Postanska Sted.149419

Societe Generale147825

421,153

Raiffeisenbank917

Banca Intesa609

Hypo-Alpe-Adria Bank599

Komercijalna banka501

HVB Bank396

Societe Generale253

Pro Credit Bank238

AIK banka209

Meridian - CA134

EFG Eurobank124

465

11

Retail savings as of 31 August 2003 - (in mio of EUR)

11

Total deposits as of 30 June 2003 - in mio of EUR

303

11

Total equity as of 30 June 2003 - in mio of EUR

24

111

#REF!

#REF!

#REF!

Kreditni Portfolio Raiffeisenbank a.d., Beograd - 2003

Development of Banking Sector Banking and Economy Development of Raiffeisenbank a.d. Precondition of Financing & LimitationsOutlookTABLE OF CONTENTS

Outlook

Increased competition due to entrance of new banks into the marketIncreased mandatory reserve requirementsPositive development of the country current country rating: Standard & Poors BB-More foreign Greenfield investments expectedEU entry and further stabilization expected on mid term

SummarySerbia is no longer a high risk country, currently ideal proportion between opportunity and risk

Outlook - Plans

Thank you for your attention!