HANSAPANK

COMMENTARY TO FINANCIAL RESULTS



LATVIAN HANSABANKA'S AUDITED FINANCIAL RESULTS, 2001



Hansabank  Group’s Latvian subsidiary, Hansabanka finished  last  year

with  a  net income of LVL 6.17 million according to audited  results.

The bank’s ROE was 16.2% and ROA 1.4%. On December 31, 2001 the bank’s

total assets amounted to LVL 556.7 million.

In  November  2001  Hansa  Capital’s  Latvian  subsidiary,  SIA  Hanza

Lizings,  was  sold to Hansabanka to improve the funding structure  of

the  Group’s  leasing  and factoring activities and  hence  SIA  Hanza

Lizings is fully consolidated into Hansabanka’s financial results.



Hansabanka  strengthened its position as one of the two leading  banks

in  Latvia  and became the largest bank for resident retail  customers

during  the  year  2001.  Hansabanka continued its  rapid  development

throughout  the year - its clientele increased by 53% to 258  thousand

while  its customer deposits grew by 48% to LVL 424.0 million  at  the

end  of December. Supported by rapid deposit growth, the Bank’s  total

assets  increased  by  55% to LVL 556.7 million. Bank’s  shareholders’

equity  increased by 60% during the year to LVL 48.6 million,  boosted

by a LVL 12 million share issue and the net profit of the year.

On  the asset side the loan portfolio increased by 93.7% to LVL  326.4

million  during the year. LVL 103 million of that was  formed  by  SIA

Hanza  Lizings  portfolio. At the end of December  the  allowance  for

credit losses amounted to LVL 4.32 million, forming 1.32% of the  loan

portfolio.



During  the  year  Hansabanka significantly expanded its  distribution

channels.  The number of branches increased by 9 to 57 and  number  of

ATM’s  rose by 40 to a total of 180. Another pleasant development  was

the  growing popularity of Internet banking. In 2001 Hansabanka became

the leading Internet bank in Latvia with 74,000 customers, or 28.7% of

the customer base, using hanza.net.



Hansabanka’s 2001 unaudited net profit was LVL 6.17 million, exceeding

last  year’s result by 27%. During the year the bank’s total  revenues

amounted  to LVL 32.6 million (+28% from 2000) and operating  expenses

(incl.  depreciation) to LVL 21.4 million (+20%). Revenue distribution

was  the  following: net interest income 49%, net  fees  26%,  trading

income  23%,  other income 2%. The largest cost items  were  personnel

expense  with  LVL 7.1 million, administrative expense  with  LVL  5.9

million and depreciation with LVL 4.8 million.



31.12.01  1 LVL = 1.783 EUR





Mart Tõevere

Head of investor relations

+372 6131 569