Hansapank                     FINANCIAL RESULTS                 04/26/2002



GROUP'S RESULTS, Q1 2002



CONSOLIDATED FINANCIAL RESULTS, Q1 2002



-    Significant decrease in interest margins – NIM 4.01% in Q1 2002

     (4.38% excl. Hansa-LTB), 4.22% in Q4 2001 and 4.91% in Q1 2001

-    ROE 20.1%

-    Continuing rapid growth of operating volumes (excl. Hansa-LTB)

      o    Loans +29%

      o    Deposits +32%

-    LTB integration successful

      o    84 branches out of 188 are on-line

      o    Number of cards increased by 50,000 to 244,000

      o    Number of ATMs increased by 25 to 230

      o    Number of hanza.net customers increased by 16,700 to 25,500

      o    Number of employees decreased by 8% to 2,869

-    A2 rating from Moody’s and A- rating from Fitch



All figures in this announcement are in euros. The EEK/EUR exchange

rate is 15.64664.



Hansabank Group’s net profit for the first quarter of 2002 was EUR

24.9 million. The result in the first quarter of 2001 was EUR 26.2

million. Both periods include a number of one-off items affecting the

results. The Q1 2001 result includes one larger recovery of EUR 3

million and a EUR 0.7 million write-back from the HTAS provision. This

year’s first quarter result was increased by EUR 1.9 million from net

revenues (extraordinary revenues – expenses) from restructuring Hansa-

LTB and by EUR 1.0 million from write-backs and recoveries of one

client group.

The Group’s earnings per share (annualised) were at 1.26 euros in Q1

2002. Return on equity was 20.1% and return on assets was 2.11%. The

Group EVA result for the first 3 months of the year was EUR 14.0

million, which is 1.2% less than in the respective period last year.

Hansapank  Group’s EUR 24.9 million net profit can be divided  between

the three countries as follows: EUR 22.4 million from Estonia, EUR 3.3

million  from  Latvia,  EUR 2.6 million from Lithuania  and  EUR  –3.4

million from support functions (group management and IT servers).



Despite good loan growth, loan interest revenues increased only by

9.7% yoy (excl. Hansa-LTB) and total interest income decreased by

0.8%. 0-growth was caused by increased competition and lower Euro and

US interest rates. The latter also had an effect on the cost of

liabilities as interest expense decreased from last year’s first

quarter result by 14.6% (excl. Hansa-LTB). Nevertheless, the Group’s

net interest margin decreased to 4.01% from 4.21% in Q4 2001. NIM was

4.38% in Q1 excluding Hansa-LTB, which is 58bp less than the

comparable figure a year ago.

Non-interest income growth was 2% (excl. Hansa-LTB) compared to the

first quarter of 2001. The main reason behind the slow growth was an

18% decrease in trading revenues. The decrease was caused by a EUR 0.7

million write-back from HTAS provisions last year, and a EUR 0.3

million loss from FX positions in Hansa Capital and a EUR 0.2 million

accounting loss from Hansabanka’s hedging positions this year. The

latter will be reversed in Q2. At the same time, net fees increased by

19% yoy, making it the fastest growing revenue item. The Group’s total

revenues totalled EUR 78.1 million in the first quarter of 2002, an

increase of 6.6% from last year’s same period (excl. Hansa-LTB).

Revenue distribution was the following: 61% net interest income, 24%

net fee income, 10% financial income, and 5% other income.

Operating expenses totalled EUR 52.0 million for the period,

increasing from previous year's same period by 16.6% (excl. Hansa-

LTB). 46% of total expenses (41% a year ago) was formed by personnel

expense, 19% (20%) by other expenses (incl. goodwill amortisation) 16%

(19%) by administrative expenses, 12% (15%) by depreciation, and 6%

(6%) by IT expenses. In Q1 2001 the bank made less bonus reserve

provisions than the targeted 20% of positive EVA in the amount of EUR

1.4 million, which is one of the main reasons for the increased share

of personnel expenses. Additionally, the first quarter costs also

include EUR 1.9 million worth of redundancy charges in Hansa-LTB.



The Group’s cost-income ratio (before provisions) was 60.3% (50.5%

excl. Hansa-LTB) and the ratio of operating expenses to total assets

was 4.0% (3.6% excl. Hansa-LTB).



The Group’s loan and guarantee losses totalled EUR 5.0 million in Q1

2002, which is 35.7% less than a year ago. Recoveries totalled EUR 4.7

million (EUR 5.7 million during Q1 2001), of which EUR 2.7 million

originated from Hansa-LTB. During the period the Group wrote off loans

worth EUR 8.8 million (EUR 5.7 million during Q1 2001). The Group’s

net risk cost during the 3 months of 2002 was 0.63%.



The Group’s total assets amounted to EUR 4.85 billion at the end of

March 2002 and clients’ deposits to EUR 3.45 million. Deposit growth

continues to be robust, reaching 32% at the end of March (excl. Hansa-

LTB). Deposits increased by EUR 0.19 billion in the first quarter, of

which 58% came from Latvia, 25% from Lithuania and 17% from Estonia.

The loan portfolio increased by 0.14 billion during the first quarter

to EUR 2.71 billion. 44% of the growth originated from Estonia, 30%

from Lithuania, 23% from Latvia and 3% from other countries. The

annual growth was 29% (excl. Hansa-LTB) at the end of March and the

loan to deposit ratio stood at 78.6% (78.8% in the beginning of the

year). Loans overdue totalled EUR 201.1 million at the end of the

period, while non-performing loans (overdue more than 60 days)

amounted to EUR 27.9 million or 1.0% of total loans.



During the coming period, the Group’s management will focus on three

main areas. The bank is targeting to improve the cost-income ratio in

its Estonian operations through higher internal efficiency. Secondly,

the successful restructuring and development of distribution channels

in Hansa-LTB, enables the bank to focus on increasing non-interest

revenues in Lithuania. The Group also sees shortcomings in its

interest rate management in all three countries.





Mart Tõevere

Head of investor relations

Tel. +372 6131 569





Consolidated Balance                EEK                     EUR        

Sheets

(in millions,           31.03.0 31.12.0 31.03.0 31.03.0 31.12.0 31.03.0

unaudited)                    2       0       1       2       0       1

                                                                       

Assets                                                                 

Cash                    2,062.0 2,404.3 1,132.4   131.8   153.7    72.4

Due from Central Bank   4,471.0 4,393.6 2,796.5   285.7   280.8   178.7

Due from other          8,097.8 7,466.9 3,823.2   517.5   477.2   244.3

financial institutions

Treasury securities     5,386.8 4,247.5 4,279.8   344.3   271.5   273.5

Trading securities        440.6   437.9   384.3    28.2    28.0    24.6

Investment securities   5,328.4 5,128.2 1,109.4   340.5   327.8    70.9

Securities purchased    2,406.4 2,508.4 2,377.4   153.8   160.3   151.9

under resale agreements

Loans                   42,414. 40,243. 29,011. 2,710.8 2,572.0 1,854.1

                              7       9       0

  - Allowances for       -790.6  -859.7  -697.2   -50.5   -54.9   -44.6

credit losses

Net loans               41,624. 39,384. 28,313. 2,660.3 2,517.1 1,809.5

                              1       2       8

Tangible assets         2,181.6 2,178.3 1,314.8   139.4   139.2    84.0

Intangible assets         556.9   621.8   376.9    35.6    39.7    24.1

Prepayments and accrued 2,493.0 2,562.8 2,255.7   159.3   163.8   144.2

interest

Other assets              834.9   684.5   377.3    53.4    43.7    24.1

Total assets            75,883. 72,018. 48,541. 4,849.8 4,602.8 3,102.2

                              5       4       5

                                                                       

Liabilities                                                            

Due to Central Bank and   104.3   109.3   131.2     6.7     7.0     8.4

government

Due to other financial  4,267.8 4,198.0 4,201.8   272.8   268.3   268.5

institutions

Deposits                53,961. 51,063. 30,444. 3,448.7 3,263.6 1,945.7

                              6       4       8

   Demand deposits      32,993. 32,480. 18,934. 2,108.6 2,075.9 1,210.1

                              2       2       5

   Time deposits        20,968. 18,583. 11,510. 1,340.1 1,187.7   735.6

                              4       2       3

Securities sold under         -     0.1   218.1       -       -    13.9

repurchase agreements

Debt securities issued  4,318.5 3,815.3 4,055.4   276.0   243.8   259.2

to the public

Accrued liabilities     1,766.2 1,865.1 1,324.9   112.9   119.2    84.7

Appropriations            509.9   474.3   400.3    32.6    30.3    25.6

Deferred tax liability     20.1    14.2     7.6     1.3     0.9     0.5

Other liabilities       2,213.5 2,221.9 1,020.5   141.5   142.0    65.2

Total liabilities       67,161. 63,761. 41,804. 4,292.5 4,075.1 2,671.7

                              9       6       6

Minority ownership         15.7    15.2    25.3     1.0     1.0     1.6

                                                      -               -

Subordinated              722.8   721.9   371.8    46.2    46.1    23.8

liabilities

Shareholders' equity                                  -               -

Common stock              788.6   788.6   788.6    50.4    50.4    50.4

Share premium           2,765.2 2,762.1 2,761.4   176.7   176.5   176.5

Treasury stock            -20.7   -37.5   -36.6    -1.3    -2.4    -2.3

Reserves                  450.9   450.9   441.5    28.8    28.8    28.2

Other restricted equity   100.5   100.5   100.5     6.4     6.4     6.4

Currency translation      142.5    88.2   112.0     9.1     5.7     7.2

reserve

Retained earnings       3,756.1 3,366.9 2,172.4   240.1   215.2   138.8

Total shareholders'     7,983.1 7,519.7 6,339.8   510.2   480.6   405.2

equity

Total liabilities and   75,883. 72,018. 48,541. 4,849.9 4,602.8 3,102.3

shareholders' equity          5       4       5











Consolidated Income                 EEK                   EUR        

Statement

(in millions, unaudited) 3m 2002    2001 3m 2001 3m 2002   2001 3m 2001

                                                                 

Interest income          1,193.0 4,604.9 1,009.8    76.3  294.3    64.5

Interest expense         -452.0       - -432.8   -28.9 -124.2   -27.6

                                1,943.3

Interest income, net      741.0 2,661.6  577.0    47.4  170.1    36.9

                                                                     

Fee and commission        391.1 1,395.1  272.7    25.0   89.2    17.4

income

Fee and commission        -93.4  -306.5  -58.6    -6.0  -19.6    -3.7

expense

Fees and commissions,     297.7 1,088.6  214.1    19.0   69.6    13.7

net

                                                                     

Net result from           123.2   559.2  118.7     7.9   35.7     7.6

financial operations

Dividends                   0.2    12.5      -       -    0.8       -

Net income from             6.8    45.6   11.5     0.4    2.9     0.7

insurance activities

Other income               52.8   150.9   35.5     3.4    9.6     2.3

Total income             1,221.7 4,518.4  956.8    78.1  288.7    61.2

                                                                     

Operating expenses                                                   

Personnel expenses        377.8 1,163.7  204.6    24.1   74.4    13.1

Data network expenses      47.8   150.0   30.1     3.1    9.6     1.9

Administrative expenses   131.3   478.5   93.3     8.4   30.6     6.0

Other expenses            156.2   557.8   98.3    10.0   35.6     6.3

 incl. goodwill            75.9   265.9   53.8     4.9   17.0     3.4

amortisation

Depreciation               99.7   348.1   74.3     6.4   22.2     4.7

Total operating expenses  812.8 2,698.1  500.6    52.0  172.4    32.0

Operating profit before   408.9 1,820.3  456.2    26.1  116.3    29.2

provisions

Losses on loans and       -78.6  -340.9 -122.1    -5.0  -21.8    -7.8

guarantees

Recovered loans            73.7   262.5   89.6     4.7   16.8     5.7

Profit from associates        -     8.8    1.0       -    0.6     0.1

under the equity method

Operating profit          404.0 1,750.7  424.7    25.8  111.9    27.2

Extraordinary                 -       -      -       -      -       -

income/(expense)

Profit before income tax  404.0 1,750.7  424.7    25.8  111.9    27.2

Income tax                -14.5   -57.5  -13.8    -0.9   -3.7    -0.9

Profit after income tax   389.5 1,693.2  410.9    24.9  108.2    26.3

Minority interest          -0.3       -   -0.8       -      -    -0.1

Net profit                389.2 1,693.2  410.1    24.9  108.2    26.2





Mart Tõevere

Head of investor relations

+372 6131 569