HANSAPANK

COMMENTARY TO FINANCIAL RESULTS



LATVIAN SUBSIDIARY'S AUDITED RESULTS 1999



Hansabank’s Latvian subsidiary, Hansabanka finished last year with a

net income of LVL 1.05 million according to audited results. On

December 31, 1999 the bank’s total assets amounted to LVL 200.78

million.

1999 was positive for Hansabanka. Amidst economic slowdown the bank

managed to increase its clientele by 67% to more than 100,000

customers at the end of the year. Hansabank’s total assets increased

by 38.9% to LVL 200.78 million during the year. The rapid growth of

the balance sheet originated from a 49.1% growth in customer deposits.

At the end of December deposits already amounted to LVL 165.3 million.

Inside deposits particularly fast growth was recorded by time

deposits, which increased by 65.1% to LVL 54.0 million. Demand

deposits at the same time grew to LVL 111.3 million. Bank’s

shareholders’ equity increased by 64.2% during the year to LVL 18.0

million, boosted by a LVL 6 million share issue and the net profit of

the year.

On the asset side the loan portfolio increased by 42.3% to LVL 88.4

million during the year. At the end of December the allowance for

credit losses amounted to LVL 2.84 million, forming 3.2% of the loan

portfolio.



Hansabanka’s 1999 audited net profit was LVL 1.05 million. During the

year the bank’s total revenues amounted to LVL 14.95 million and

operating expenses (incl. depreciation) to LVL 14.06 million. Revenue

distribution was the following: net interest income after provisions

30.7%, trading income 26.8%, fees 41.0%, other income and dividends

1.5%. The largest cost items were personnel expense with LVL 4,3

million, administrative expense with LVL 3,7 million and depreciation

with LVL 3,1 million.



31.12.99  1 LVL = 26.57416





Mart Tõevere

Analyst

+372 6131 569