Hansapank                     FINANCIAL RESULTS           04/29/2003 09:00



CONSOLIDATED FINANCIAL RESULTS, Q1 2003



- Net profit EUR 34.6 million in Q1 2003, +10% qoq and +39% yoy

- Operating profit before provisions +12% qoq and +57% yoy

- Revenues EUR 84.8 million -4% qoq and +9% yoy

- Expenses EUR 43.6 million -15% qoq and -16% yoy

- Return on equity (ROE) 23.3% and return on assets (ROA) 2.6%

- Significant improvement in cost efficiency:

     - Cost-income ratio decreased to 49.7% (60.2% in Q1 2002)

     - Cost to assets ratio decreased to 3.1% (4.0% in Q1 2002)

- Deposit (+5%) and loan (+4%) growth in balance in Q1 2003

- EUR 300 million eurobond issue for refinancing maturing debt

- Successful start to Russian leasing operations

     - leasing and trade finance risk assets at EUR 117 million at the

end of the quarter (quarterly growth 43%)



The Group earned a net profit of EUR 34.6 million in the first quarter

of 2003, up 39.0% from last year’s same period. Operating profit

increased by 57.5%. The Group earnings per share (annualised) were

1.75 euros in the first quarter of 2003. The Group’s return on equity

was 23.3%, while return on assets was 2.6%. The EVA result was EUR

17.1 million, which is 35.8% more than in the same period last year.

Hansapank Group’s EUR 34.6 million net profit can be divided between

the three countries as follows: EUR 25.4 million from Estonia, EUR 4.2

million from Latvia, EUR 4.7 million from Lithuania and EUR 0.3

million from Russia.



The Group’s total revenues amounted to EUR 84.8 million in Q1 2003,

decreasing by 3.8% qoq, but increasing by 8.9% yoy. Revenue

distribution was the following: 60% net interest income, 27% net fee

income, 9% financial income, and 4% other income. Operating expenses

totalled EUR 43.6 million during the quarter. 47% of total expenses

was formed by personnel expense, 19% by administrative expenses, 14%

by depreciation, 13% by other expenses (incl. goodwill amortisation)

and 7% by IT expenses.

On the cost side the biggest changes were in the structure of Other

expenses, which decreased by 42.7% qoq and 44.7% yoy. The annual

decrease was caused by the completion of the goodwill amortisation

from the Estonian Savings Bank merger, which reduced the respective

quarterly expense from EUR 4.8 million to EUR 1.5 million. The

quarterly reduction was caused by a higher level of marketing and

advertising expenses as well as a EUR 1.9 million one-off tax

provision related to employee options in the fourth quarter of 2002.

The actual tax expense totalled EUR 1.54 million, which the bank paid

in the first quarter of 2003.



The Group’s cost-income ratio (before provisions) improved to 49.7%

from 56.4% in Q3 2002. The ratio of operating expenses to total assets

improved to 3.14% from 3.93% in the previous quarter.



The Group’s loan and guarantee provisions totalled EUR 8.7 million in

the first quarter of 2003. Provisions increased by 72.8% from the same

period last year and by 8.5% form the previous quarter. Recoveries

totalled EUR 3.4 million (EUR 4.7 million in Q1 2002 and EUR 3.6

million in Q4 2002), including EUR 2.0 million from Hansa-LTB. Loan

write-offs totalled EUR 2.9 million during the quarter (EUR 8.8

million in Q1 2002 and EUR 5.5 million in Q4 2002). The Group’s net

risk cost was -0.1% during the period.



The Group’s total assets amounted to EUR 5.68 billion at the end of

March 2003. Total assets increased by 8% during the first quarter on

the back of a 5% increase in deposits and a EUR 300 million bond

issue. At the end of March interest-earning assets totalled EUR 5.25

billion, 92.4% of total assets (91.0% at the end of December 2002).

Interest-bearing liabilities amounted to EUR 4.75 billion, forming

83.7% of total liabilities and shareholders’ equity (83.0% at the end

of December 2002).



The Group’s loan portfolio increased by 4% during the first quarter

and 28% during last 12 months. During the last year loan growth has

constantly been around 30%, increasing the share of net loans in total

assets from 55% to 60%. Latvia and Lithuania are forming an increasing

part of total growth. Of the first quarter growth 35% came from

Estonia, 27% from other countries (mainly Russian leasing), 21% from

Latvia and 18% from Lithuania. In terms of sectors, lending to

construction and real estate management and other business services

formed 40% of the growth, lending to private individuals formed 30% of

the growth, and retail and wholesale contributed another 28%.



The Group’s liabilities increased mainly on the account of a EUR 300

million bond issue launched in March. However, most of these funds

will be used to repay a EUR 220 million bond maturing in April 2003,

thus considerably reducing the volume of liabilities in the second

quarter.

Customer deposits increased by 5% during the quarter, annual growth

was at 8%. 82% of the growth in the first quarter came from Estonia,

16% from Latvia and 2% from Lithuania. The loan to deposit ratio has

risen from 79% to 93% during one year. At the same time, during the

past 6 months, loan and deposit growth has been fairly equal, keeping

the said ratio slightly above 90%.



1 EUR = 15.64664 EEK





Consolidated Balance Sheets      EEK                      EUR        

(in millions,                                                         

unaudited)

                    31.03.03 31.12.02 31.03.02 31.03.0 31.12.0 31.03.0

                                                     3       2       2

Assets                                                                

Cash                 2,039.9  2,436.5  2,062.0   130.4   155.7   131.8

Due from Central     4,897.5  3,185.4  4,471.0   313.0   203.6   285.7

Bank

Due from other       7,487.3  6,067.0  8,097.8   478.5   387.8   517.5

financial

institutions

Treasury securities  4,744.4  5,059.1  5,386.8   303.2   323.3   344.3

Trading securities   1,535.7  1,439.3    440.6    98.2    92.0    28.2

Investment           3,290.8  3,731.5  5,328.4   210.3   238.5   340.5

securities

Securities           5,932.4  3,010.5  2,406.4   379.1   192.4   153.8

purchased under

resale agreements

Loans               54,192.2 52,086.4 42,414.7 3,463.5 3,328.9 2,710.8

  - Allowances for    -838.9   -754.7   -790.6   -53.6   -48.2   -50.5

credit losses

Net loans           53,353.3 51,331.7 41,624.1 3,409.9 3,280.7 2,660.3

Tangible assets      1,865.4  1,897.8  2,181.6   119.2   121.3   139.4

Intangible assets      371.1    406.5    556.9    23.7    26.0    35.6

Prepayments and      2,417.1  2,556.4  2,493.0   154.5   163.4   159.3

accrued interest

Other assets           887.9    862.4    834.9    56.8    55.0    53.4

Total assets        88,822.8 81,984.1 75,883.5 5,676.8 5,239.7 4,849.8

                                                                      

Liabilities                                                           

Due to Central Bank    103.5    139.5    104.3     6.6     8.9     6.7

and government

Due to other         4,664.3  5,670.8  4,267.8   298.1   362.4   272.8

financial

institutions

Deposits            58,473.3 55,821.4 53,961.6 3,737.1 3,567.6 3,448.7

   Demand deposits  37,976.8 37,499.8 32,993.2 2,427.1 2,396.6 2,108.6

   Time deposits    20,496.5 18,321.6 20,968.4 1,310.0 1,171.0 1,340.1

Securities sold            -     86.1        -       -     5.5       -

under repurchase

agreements

Debt securities     10,362.3  5,656.4  4,318.5   662.3   361.5   276.0

issued to the

public

Accrued liabilities  1,892.7  2,020.9  1,766.2   121.0   129.2   112.9

Appropriations         611.7    593.7    509.9    39.1    37.9    32.6

Deferred tax            24.1     26.6     20.1     1.5     1.7     1.3

liability

Other liabilities    2,404.9  2,213.1  2,213.5   153.7   141.5   141.4

Total liabilities   78,536.8 72,228.5 67,161.9 5,019.4 4,616.2 4,292.4

Minority ownership      59.4     16.5     15.7     3.8     1.1     1.0

                                                                      

Subordinated           697.7    709.7    722.8    44.6    45.3    46.2

liabilities

Shareholders'                                                        -

equity

Common stock           793.4    793.4    788.6    50.7    50.7    50.4

Share premium        2,825.3  2,824.7  2,765.2   180.5   180.5   176.7

Treasury stock         -48.9    -26.9    -20.7    -3.1    -1.7    -1.3

Reserves               455.9    453.8    450.9    29.1    29.0    28.8

Other restricted       100.5    100.5    100.5     6.4     6.4     6.4

equity

Currency               -59.2    -38.7    142.5    -3.7    -2.4     9.1

translation reserve

Retained earnings    5,461.9  4,922.6  3,756.1   349.1   314.6   240.1

Total shareholders'  9,528.9  9,029.4  7,983.1   609.0   577.1   510.2

equity

Total liabilities   88,822.8 81,984.1 75,883.5 5,676.8 5,239.7 4,849.8

and shareholders'

equity





Consolidated Income Statement       EEK                    EUR        

(in millions,          Q1 2003     2002  Q1 2002 Q1 2003   2002 Q1 2002

unaudited)

                                                                      

Interest income        1,242.0  4,906.1  1,193.0   79.4  313.6    76.3

Interest expense        -443.5 -1,758.3   -452.0  -28.4 -112.4   -28.9

Interest income, net     798.5  3,147.8    741.0   51.0  201.2    47.4

                                                                      

Fee and commission       455.6  1,766.7    391.1   29.1  112.9    25.0

income

Fee and commission       -96.9   -420.4    -93.4   -6.2  -26.9    -6.0

expense

Fees and commissions,    358.7  1,346.3    297.7   22.9   86.0    19.0

net

                                                                      

Net result from          122.7    463.7    123.4    7.9   29.7     7.9

financial operations

Net income from            9.6     29.8      6.8    0.6    1.9     0.4

insurance activities

Other income              36.7    186.5     52.8    2.4   11.9     3.4

Total income           1,326.2  5,174.1  1,221.7   84.8  330.7    78.1

                                                                      

Operating expenses                                                    

Personnel expenses       321.2  1,427.7    377.8   20.5   91.2    24.1

Data network expenses     52.0    217.5     47.8    3.3   13.9     3.1

Administrative           128.0    530.6    131.3    8.2   33.9     8.4

expenses

Other expenses            85.4    562.7    156.2    5.5   36.0    10.0

 incl. goodwill           24.0    217.6     75.9    1.5   13.9     4.8

amortisation

Depreciation              95.9    392.8     99.7    6.1   25.1     6.4

Total operating          682.5  3,131.3    812.8   43.6  200.1    52.0

expenses

Operating profit         643.7  2,042.8    408.9   41.2  130.6    26.1

before provisions

Losses on loans and     -135.7   -313.6    -78.6   -8.7  -20.0    -5.0

guarantees

Recovered loans           53.9    265.3     73.7    3.4   16.9     4.7

Profit from associates     0.5      5.9        -    0.1    0.3       -

under the equity

method

Operating profit         562.4  2,000.4    404.0   36.0  127.8    25.8

Extraordinary                -        -        -      -      -       -

income/(expense)

Profit before income     562.4  2,000.4    404.0   36.0  127.8    25.8

tax

Income tax               -20.3   -124.6    -14.5   -1.3   -7.9    -0.9

Profit after income      542.1  1,875.8    389.5   34.7  119.9    24.9

tax

Minority interest         -1.2     -1.9     -0.3   -0.1   -0.1       -

Net profit               540.9  1,873.9    389.2   34.6  119.8    24.9





Consolidated Income Statement                                     

(in millions of euros,     Q1     Q4     Q3    Q2     Q1     Q4     Q3

unaudited)               2003   2002   2002  2002   2002   2001   2001

                                                                      

Interest income          79.4   80.8   78.5  78.0   76.3   77.5   80.3

Interest expense        -28.4  -28.1  -27.0 -28.4  -28.9  -30.5  -34.9

Interest income, net     51.0   52.7   51.5  49.6   47.4   47.0   45.4

                                                                      

Fee and commission       29.1   31.3   28.6  28.0   25.0   26.2   24.2

income

Fee and commission       -6.2   -7.0   -6.6  -7.3   -6.0   -6.4   -5.1

expense

Fees and commissions,    22.9   24.3   22.0  20.7   19.0   19.8   19.1

net

                                                                      

Net result from           7.9    8.2    7.4   6.2    7.9   11.7    8.0

financial operations

Net income from           0.6    0.4    0.6   0.5    0.4      -    1.4

insurance activities

Other income              2.4    2.4    3.0   3.1    3.4    2.4    2.5

Total income             84.8   88.0   84.5  80.1   78.1   80.9   76.4

                                                                      

Operating expenses                                                    

Personnel expenses       20.5   22.7   21.8  22.6   24.1   23.2   21.1

Data network expenses     3.3    3.8    3.6   3.4    3.1    3.2    2.1

Administrative expenses   8.2    9.5    8.0   8.0    8.4    9.6    8.4

Other expenses            5.5    9.6    6.3  10.1   10.0   11.4   10.0

 incl. goodwill           1.5    1.6    2.6   4.8    4.9    5.0    4.8

amortisation

Depreciation              6.1    5.5    6.6   6.6    6.4    5.9    6.2

Total operating          43.6   51.1   46.3  50.7   52.0   53.3   47.8

expenses

Operating profit before  41.2   36.9   38.2  29.4   26.1   27.6   28.6

provisions

Losses on loans and      -8.7   -7.9   -3.6  -3.5   -5.0   -9.0   -5.1

guarantees

Recovered loans           3.4    3.6    3.3   5.3    4.7    4.3    4.5

Profit from associates    0.1    0.2    0.1     -      -    0.4    0.1

under the equity method

Operating profit         36.0   32.8   38.0  31.2   25.8   23.3   28.1

Extraordinary               -      -      -     -      -      -      -

income/(expense)

Profit before income     36.0   32.8   38.0  31.2   25.8   23.3   28.1

tax

Income tax               -1.3   -1.3   -1.4  -4.3   -0.9   -0.9   -0.8

Profit after income tax  34.7   31.5   36.6  26.9   24.9   22.4   27.3

Minority interest        -0.1      -      -  -0.1      -      -    0.1

Net profit               34.6   31.5   36.6  26.8   24.9   22.4   27.4





Mart Tõevere

Head of investor relations

+ 372 6131 569