HANSAPANKs

1
HANSAPANKs 1999 FINANCIAL RESULTS Indrek
Neivelt, Erkki Raasuke January 28, 2000
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1999 Highlights
Group Total revenues increased by 68.1 in 1999
compared to 1998. Expenses grew by 42.2.EEK
60.5 loss was replaced with an EEK 818.1 million
profit.Groups number of employees decreased
from 3,822 to 3,059 in 1999. Hansapank Largest
growth of net profit in absolute terms from EEK
31.1 million to EEK 540.2 million.Cost-income
ratio improved from 59.4 to 47.4. Hansa
Capital Total revenues increased by 25.2
compared to 1998.NPL ratio to total loans halved.
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1999 Highlights
Hansabanka Loan growth 42.3 (Latvian market 16)
and deposit growth 49.0 (Latvian market
19).The 6th largest bank in 1996 has become the
3rd largest bank in 1999 with a deposit market
share of 13. Hansabankas Started operations as a
fully licensed bank in July 1999.In just 6
months deposits have grown to EEK 202.6 million
and loans to EEK 145.6 million.
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Income Statement
EEK in millions 1999 1998 Change Net interest
income 1,536.6 1,023.7 50.1 Non-interest
income 1,222.6 617.8 97.9 Total revenue
2,759.3 1,641.5 68.1 Operating
expenses 1,627.9 1,144.8 42.2 Net
provisions 396.0 545.3 -27.4 Profit before tax
and appropriations 819.3 -59.3 Net
profit 818.1 -60.5 ROE 17.9 -2.8 Cost-income
ratio 51.6 63.5
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Revenues
EEK in millions 1999 1998 Change Net interest
income 1,536.6 1,023.7 50.1 Trading
income 491.8 127.8 284.8 Net fees and
commissions 555.7 354.5 56.8Other
income 175.1 135.5 29.2 Total revenue 2,759.3 1,6
41.5 68.1 Income from subs. and affil.
cos 109.1 -10.7 Extraordinary
income/(expense) -25.2 -
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Expenses
EEK in millions 1999 1998 Change Personnel
expenses 577.0 422.3 36.6 IT expenses 109.1 42.0
159.8 Administrative expenses 395.2 342.2 15.5 O
ther expenses 340.8 195.3 74.5 Depreciation 205.8
143.0 43.9 Total operating expenses 1,627.9 1,14
4.8 42.2Net provisions 396.0 545.3 -27.4 Income
tax -2.4 -6.5 Income/(loss) attributable to
minority owners 3.6 7.7 Net profit 818.1 -60.5
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Extraordinary income/expense
EEK in millions 1999 Sale of subsidiaries 109.1 Ta
x dispute in Latvia 25.1 Change in tax law in
Estonia -22.5 Employee share options -25.6 Total 8
6.1

• Sale of Eesti Kindlustus resulted in an income of
  EEK 84.5 million
• Tax dispute from 1998 was resolved in Latvia
  resulting in an income of EEK 25.1 million
• Pre-paid income tax paid in Estonia was written
  off expense of EEK 22.5 million
• Part of the share options given to employees were
  purchased back expense of EEK 25.6 million

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Net profit by business units
818.1
33.5
29.8
-14.8
217.6
552.0
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Balance sheet
EEK in millions 1999 1998 Change Loans 19,462 16,7
93 15.9 Deposits 19,783 14,746 34.2 Shareholders
equity 4,953 4,195 18.1 Total
assets 34,258 27,690 23.7 Assets under
management 1,083 285 280 Risk-weighted
assets 23,482 20,448 15 Tier 1 capital
adequacy 18.8 16.9 Total capital
adequacy 20.7 19.1 ROA 2.7 -0.3
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Risk management
EEK in millions 1999 1998 Change Loans 19,462 16,7
93 15.9 Loan loss reserve (LLR) 643 740 -13.1 LL
R / Loans 3.30 4.41 Loan losses 562 212 165.1
Recoveries 87 49 76.5 Non-performing loans
(NPL) 195 483 -59.6NPL / Loans 1.00 2.91
Loans with an overdue payment of more than 60 days
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Shareholder value statement
1999 1998 Change Share price (EEK) 98.8 49.9 98.0
Market capitalisation (EEK in
mil) 7,781.9 3,930.3 3,851.6 EPS
(EEK) 10.4 -1.3 PE 9.5 -38.4 P/B 1.6 0.9 HP
share in TSE total turnover 34.3 44.2 HP
shares outperformance of TALSE 58.7 1.6
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Market capitalisation of the Baltic banks
As of 31.12.1999 SEB Group includes Ühispank,
Unibanka and Vilniaus Bankas