EESTI ÜHISPANK

ANNOUNCEMENT

01.04.99

 

On the purchase of Leks Elukindlustuse AS (Leks Life Insurance AS)

 

Eesti  Ühispank  affiliated    company  Leks   Kindlustuse  AS   (Leks

Insurance Company) Supervisory Council  decided on March 31,  1999, to

give principal  consent for  dispossession of  Leks Elukindlustuse  AS

shares to Ühispank's  Elukindlustuse AS.

 

Ühispanga  Elukindlustuse  AS  has  made  the  urchase  tender to Leks

Kindlustuse AS for purchasing 2 000 000 Leks Elukindlustuse AS  shares

(shares nominal value being EEK 10). According to the purchase  tender

and the  prepared shares  purchase contract,  the negotiated  purchase

price is EEK 24 000 000.

 

As  the  particular  transaction  is  treated  as a transaction with a

related  party,  then  according  to  the  Stock  Exchange   ordinance

(liabilities  to  the  issuer,  p.  6.10)  the transaction needs to be

affirmed also  by Leks  Kindlustuse AS  Shareholders' General Meeting,

which is to be held on April 28, 1999.

 

Eesti  Ühispank  plans  to  present  to  the  Shareholders' Meeting to

resolve on the increase of  the share capital of Leks  Kindlustuse AS.

After the purchase  transaction of Leks  Elukindlustuse AS shares  and

the increase of its share  capital, the improved capital base  of Leks

Kindlustuse AS  will enable  the company  to further  concentrate on a

more active market share growth  in Estonia, after having reduced  its

exposure in other Baltic States.

 

According  to   Indrek  Holst,    Chairman  of   Board  of   Ühispanga

Elukindlustus, it is  beneficial to   all parties   to consolidate the

bank  and  insurance  sales  networks.  "We have worked several months

already in  the name  of this,  and we  consider it  very realistic to

achieve  the  market  leadership  position  with  consolidated   sales

networks."  Besides  life  insurance,   also  the  cross  selling   of

non-life insurance  products are  included in  co- operation  plans of

Leks Kindlustuse and Ühispank's Group.

 

Ühispanga Elukindlustuse AS  is 100% owned  by AS Eesti  Ühispank.  AS

Eesti Ühispank owns 44,7%  of Leks Kindlustuse AS share capital.

 

Eero Raun

Eesti Ühispank

Head of Public Relations Department

Tel.: + 372 6655 25