onbehalf of the General Manager

Transcription

1 BALANCE SHEET For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) ASSETS A Cash and cash resources 570, ,381 Cash 78,496 43,797 Financial institutions and correspondents (Note 3.2.) 491, ,584 - Central Bank of the Republic of Argentina (B.C.R.A.) 239,767 81,558 - Other, domestic institutions 10,751 4,093 - other foreign institutions 240, ,933 B Government and Corporate Securities (Schedule A and Note 3.4.) 1,438,388 1,969,037 Holding in investment accounts 619,707 1,378,194 Holding of trading securities 150, ,845 Unlisted government securities 209, ,051 Investments in listed corporate securities 169, ,168 Securities issued by the BCRA 289,759 65,779 C Loans (Schedules B, C and D and Notes 3.3. and 3.5.) 3,969,803 2,998,095 To the non-financial public sector 108, ,721 To the financial sector 70,782 62,255 Interfinancial (calls granted) - 58,580 Other loans to domestic financial entities 66,263 3,580 Accrued interest, adjustments and quotation differences receivable 4, To the non-financial private sector and residents abroad 3,954,533 2,876,698 Overdraft facilities 199, ,913 Promissory notes 52,347 56,217 Mortgage loans 2,136,896 1,633,353 Pledge loans 998 4,095 Consumer loans 671, ,580 Credit cards 553, ,587 Unallocated collections (6,498) (13,945) Other 305, ,869 Accrued interest and quotation differences receivable 41,789 30,761 Documented interest (1,248) (732) Allowances (Schedule J and Notes 8 and 9) (163,532) (135,579) D Other receivables for financial transactions (Schedules B, C and D and Notes 3.3. and 3.6. ) 3,811,955 3,280,808 Central Bank of the Republic of Argentina 22,090 7,204 Amounts receivable for spot and forward sales to be settled 11,436 26,762 Securities to be received under spot and forward purchases to be settled 2,756,321 2,167,288 Unsettled balances from forward operations without delivery of underlying asset 76,977 60,602 Other not included in debtors classification regulations (Note 12) 710, ,205 Other included in debtors classification regulations (Notes 12 and 13) 244, ,327 Interest accrued and pending collection covered by debtors classification regulations (Note 13) 9,712 9,561 Allowances (Schedule J) (19,527) (33,141) onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

2 BALANCE SHEET For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) F Investment in other companies (Schedule E and Notes 3.7. and 29.) 101, ,714 In financial institutions 79,623 75,624 Other 21,816 38,090 G Miscellaneous Receivables (Note 3.8.) 485, ,562 Minimum deemed income tax - fiscal credit 84,314 62,457 Other (Note 14) 404, ,809 Other accrued interest receivable Allowances (Schedule J) (3,252) (3,705) H Bank Premises and Equipment (Schedule F and Note 3.9.) 110,631 92,154 I Miscellaneous Assets (Schedule F and Note 3.9.) 16,452 26,028 J Intangible Assets (Schedule G and Note 3.11.) 46,493 12,756 Organization and development expenses 46,493 12,756 K Items pending allocation TOTAL ASSETS 10,551,045 9,126,817 onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

3 BALANCE SHEET For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) LIABILITIES L Deposits (Schedules H and I and Notes 3.3., and 28.) 1,348, ,786 Non-financial public sector 153,152 80,062 Financial Sector 5,481 3,753 Non-financial private sector and residents abroad 1,189, ,971 Current accounts 33,477 17,807 Savings Accounts 190, ,541 Time deposits 909, ,253 Investment accounts 30, Other 16,808 11,971 Accrued interest and quotation differences receivable 8,634 2,950 M Other liabilities for financial trading transactions (Schedule I and Notes 3.3., 3,13. and 3.14.) 6,260,624 5,587,558 Central Bank of the Republic of Argentina 188, ,611 Other 188, ,611 Unsubordinated negotiable obligations (Note 16) 3,520,932 3,231,105 Amounts payable under spot and forward purchases to be settled 1,051, ,026 Securities to be received under spot and forward purchases to be settled 1,132,121 1,060,717 Loans received from domestic financial institutions 120, ,538 Interfinancial (calls received) 120, ,400 Accrued interest payable Unsettled balances from forward operations without delivery of underlying asset 5,315 4,779 Other (Note 19) 174,022 86,012 Accrued interest and quotation differences receivable 67,219 83,770 N Miscellaneous Liabilities 69,879 66,984 Fees 4,264 13,404 Other (Note 20) 65,615 53,580 O Provisions (Schedule J and Notes 3.10., 3,15. and 21.) 226, ,191 Q Items pending allocation 2,845 3,844 TOTAL LIABILITIES 7,908,821 6,565,363 SHAREHOLDERS' EQUITY (per related statement) (Note 3.20.) 2,642,224 2,561,454 TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 10,551,045 9,126,817 Notes and Schedules are an integral part of these financial statements. onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

4 STATEMENT OF INCOME For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) A Financial income 772, ,382 Interest on cash and cash resources 4,624 3,954 Interest on loans to the financial sector 9,084 2,642 Interest on overdraft facilities 28,231 24,962 Interest on promissory notes 8,523 3,171 Interest on mortgage loans 182, ,195 Interest on pledge loans Interest on credit card loans 53,075 16,903 Interest on other loans 150,557 79,470 Interest on other receivables for financial transactions 16,997 21,196 Net income from government and corporate securities 207, ,142 Net loss on options Net income from secured loans Decree 1387/01 1,466 4,978 Adjustment from application of CER (coefficient for reference stabilization) clause 67,783 98,663 Adjustment from application of CVS (salary variation coefficient) clause 149 1,344 Gold and foreign currency quotation difference 14,432 21,533 Other (Note 22) 26,008 89,323 B Financial Expenses 502, ,386 Interest on current account deposits Interest on savings account deposits 2,210 3,721 Interest on time deposits 54,158 26,978 Interest on interfinancial loans received 13,410 8,083 Interest on other financing from financial institutions 79 14,306 Interest on other liabilities resulting from financial transactions 311, ,231 Other interest 3,034 4,752 Adjustment from application of CER clause 14,128 20,446 Contribution to the deposits security fund 1, Other (Note 22) 102,535 66,703 GROSS INTERMEDIATION MARGIN 269, ,996 C Loan Loss Provision 82,207 12,172 D Income from services 238, ,731 Linked with lending transactions 77,725 26,793 Linked with borrowing transactions 10,645 5,802 Other (Note 23) 150,199 94,136 E Expenses for Services 109,889 72,605 Commissions 15,876 15,459 Others (Note 24) 94,013 57,146 onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

5 STATEMENT OF INCOME For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) G Administrative expenses 307, ,031 Personnel expenses 155, ,396 Directors and syndics fees 3,348 12,893 Other fees 53,499 21,294 Advertising and publicity 17,634 19,091 Taxes 19,154 11,250 Depreciation of bank premises and equipment 8,875 5,261 Amortization of organization and development expenses 3,174 3,885 Other operating expenses (Note 25) 35,829 20,548 Other 11,041 6,413 NET INCOME FROM financial transactions 8, ,919 I Miscellaneous income 141, ,980 Penalty interests 6,436 5,902 Loans recovered and allowances reversed 126, ,701 Others (Note 26) 8,300 41,377 J Miscellaneous losses 68, ,560 Net income from long term equity investments 2, Penalty interest and charges in favor of the BCRA 156 1,523 Loan loss provision for miscellaneous receivables and other provisions 45,619 99,852 Depreciation and loss of miscellaneous assets Other (Note 27) 20,344 39,318 NET INCOME BEFORE INCOME TAX 80, ,339 NET INCOME FOR THE YEAR - INCOME 80, ,339 Notes and Schedules are an integral part of these financial statements. onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

6 1. Opening balances 2. Subtotal Changes Capital Stock STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) Non- Capitalized Contributions Profit reserves Share issuance premiums Irrevocable contributions Equity Legal Other Retained Total for the Total for the premiums for future capital Adjustments balances balances increases earnings 12/31/07 12/31/2006 1,500, ,115-1,500, ,115-3, Distribution of profits (Shareholders' Meeting dated 4/12/07) ,868 - (68,868) ,339 2,561,454 2,217, ,339 2,561,454 2,217, Net income for the fiscal year 5. Closing balances ,500, ,115 68,868-80,770 80, , ,241 2,642,224 2,561,454 onbehalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

7 STATEMENT OF CASH FLOW AND CASH EQUIVALENT For the fiscal year ended on Changes of cash and cash equivalent In thousands of Argentine Pesos (ARS) 2007 Cash at the beginning of the fiscal year (Note 34) 263,197 Cash at the end of the fiscal year (Note 34) 490,967 Net increase of cash(in uniform currency) 227,770 Causes of cash changes (in uniform currency) Operating activities Net collection(payment)on: Government and corporate securities 530,649 Loans To the Financial Sector 89,827 To the Non-financial Public Sector (4,007) To the Non-financial Private Sector and Foreign Res. (1,121,061) Other receivables for financial transactions: (1,104,705) Deposits To the Financial Sector 71,698 To the Non-financial Public Sector 1,609 To the Non-financial Private Sector and Foreign Res. 614,230 Other (except for liabilities under Financing activities) 784,291 Collection linked with revenues from services 238,569 Payments linked with expenses for services (109,889) Administrative expenses paid (295,792) Payment of organization and development expenses (33,737) Collection /(payment) net of penalty interest 6,436 Other collection/ (payment) linked to miscellaneous profits and losses 106,552 Net collection (payment) from other operating activities (75,945) Payment of Income Tax/Minimum notional income tax (33,029) Net cash flow originated from (used for) operating activities (334,304) Investment Activities Net collection/payment on bank premises and equipment (18,245) Net collection/payment on miscellaneous assets 9,587 Net cash flow originated from (used for) investment activities (8,658) Financing Activities Net collection(payment)on: Unsubordinated negotiable obligations 289,827 Loans received from domestic financial institutions (17,900) Net cash flow originated from (used for) investment activities 271,927 Financial gain (loss) holding of cash and cash equivalent (including interest and monetary results) 298,805 Net increase (decrease) of cash 227,770 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

8 MEMORANDUM ACCOUNTS For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) DEBIT 14,917,639 12,212,469 Contingencies 8,179,627 6,760,633 Loans obtained (unused balances) 80,683 80,683 Guarantees received 2,211,861 1,737,440 Others not included in the debtor classification regulations 541,291 3,079,411 Contingencies re. contra items 5,345,792 1,863,099 Control 3,858,652 3,746,068 Loans classified as non-recoverable 832, ,424 Other 2,170,619 1,990,722 Control re. contra items 855, ,922 Derivatives 2,879,360 1,705,768 "Notional" value of forward forward operations without delivery of underlying asset 1,258, ,170 Interest rate swap 1,112, ,950 Derivatives - re. contra items 508,874 1,060,648 CREDIT 14,917,639 12,212,469 Contingencies 8,179,627 6,760,633 Loans granted (unused balances) included in the debtor classification regulations (Schedules B, C, and D) 103, ,243 Guarantees provided to the BCRA 84, ,685 Other guarantees not included in the debtor classification regulations 128,315 97,116 Contingencies re. contra items 7,863,142 6,353,589 Control 3,858,652 3,746,068 Amounts to be credited 607, ,495 Other 196, ,733 Control re. contra items 3,054,975 2,961,840 Derivatives 2,879,360 1,705,768 "Notional" value of forward transactions without delivery of the underlying asset 368, ,170 Derivatives re. contra items 2,510, ,598 Notes and Schedules are an integral part of these financial statements. on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

9 GOVERNMENT AND CORPORATE SECURITIES For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) Description Identification Market value Holding Book value 12/31/2007 Book value 12/31/2006 SCHEDULE A Position without options Options Final position LISTED GOVERNMENT SECURITIES - Holdings of investment accounts Argentina 554, ,707 1,378, , ,707 In foreign currency 554, ,707 1,378, , ,707 Boden 2012 Compensating Bond ARR6123=BA 554, ,707 1,378, , ,707 Subtotal investment accounts 554, ,707 1,378, , ,707 - Holdings of trading securities Argentina 150, , , , ,037 In Argentine Pesos 150, , , , ,037 National Government Bonds in Argentine Pesos 2 % BODEN , National Government Bonds in Argentine Pesos 2 % BODEN ,707 2,707 1,848 2,707-2,707 BOCON PR XII 2,654 2,654-2,654 2,654 Social Security Debt Consolidation Bond in Argentine Pesos Series 3 PRE VIII 113, ,734 37, , ,734 Social Security Debt Consolidation Bond in Argentine Pesos Series 3 PRE V Social Security Debt Consolidation Bond in Argentine Pesos PRE IX Social Security Debt Consolidation Bond in Argentine Pesos Series 4 PRO VII Peso Suppliers Bond PRO XII , Par Bond in Argentine Pesos PARP Bonar V ARS AJ 12 BONAR V 30,000 30,000-30,000-30,000 Discount Bond in Argentine Pesos DICP GDP-Linked Negotiable Securities in Argentine Pesos TVPP Argentina In foreign currency Subtotal trading securities 150, , , , ,037 TOTAL LISTED GOVERNMENT SECURITIES 704, ,744 1,497, , ,744 UNLISTED GOVERNMENT SECURITIES - - Argentina - 209, , , ,634 In Argentine Pesos - 209, , , ,634 National Government Secured Bonds BOGAR - 184, , , ,511 BOGAR RIO NEGRO RNG Discount Bond in Argentine Pesos DICP - 24, ,615-24,615 BOCON PRE V BOCON PRO VII BOCON PRO VIII TOTAL UNLISTED GOVERNMENT SECURITIES - 209, , , ,634 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

10 Description INVESTMENTS IN LISTED CORPORATE SECURITIES - Other equity securities Argentina In Argentine Pesos CHA 1st. Series CHA 2nd. Series CHA 3rd. Series CHA 4th. Series CHA 5th. Series CHA 6th. Series CHA 7th. Series CHA 8th. Series CONSUBONO 1 Class A PMOS PERSONALES CHUBUT 1 TARJETA SHOPPING 30 Class A TARJETA SHOPPING 28 Class A SECUBONO 15 Class A CONFIBONO 17 Class A Banco Francés Arte Gráfico Editorial Argentino SA Tarjeta Naranja Banco Macro Banco Comafi Acindar S.A. Siderar S.A. Telecom S.A. Transener S.A. Pampa Holding SA Edenor SA Banco Santander Rio SA Petrobras Energía Garbarino 35 Class A In foreign currency Negotiable obligations Bco. Galicia 2010 Transportadora Gas del Sur S.A. Telecom Argentina SA Transener SA Edenor S.A. Banco Macro SA FOREIGN In foreign currency ADR Banco Macro ADR Banco Francés GOVERNMENT AND CORPORATE SECURITIES For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) Identification Market value Holding Book value 12/31/07 Book value 12/31/2006 SCHEDULE A (Continued) Position without options Options 154, , , , , , , , ,032 1, ,032-1,517 1, ,517-1,298 1,298 1,372 1,298-1,975 1,975-1, ,142 5,142-5, , , ,430 17,430 18,484 17,430-15,054 15,054 14,310 15,054-15,413 15,413 30,827 15, , ,746 21,746-21, , , ,313 1,313 1,737 1, ,130 1,130-1, ,058 27,058 27, , ,620 41,620 94,896 41, , , ,670 2,670 6,018 2, , , ,950 38,950-38,950-14,809 14,809-14,809-14,809 14,809-14, ,809 14,809-14,809 - Final position TOTAL INVESTMENTS IN LISTED CORPORATE SECURITIES 169, , , , ,251 SECURITIES ISSUED BY THE BCRA - Securities issued by the BCRA 289, ,759 65, , ,759 BCRA Bills ARVEY 43=BA BCRA notes 289, ,759 65, , ,759 TOTAL SECURITIES ISSUED BY THE BCRA 289, ,759 65, , ,759 TOTAL 1,163,137 1,438,388 1,969,037 1,438, , , ,032 1,517 1,298 1, , ,430 15,054 15, , ,313-1,130-27, , , ,950 14,809 14,809-14,809 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

11 For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE B CLASSIFICATION OF FINANCING ACCORDING TO LOANS AND GUARANTEES RECEIVED COMMERCIAL PORTFOLIO Normal situation 1,024,615 1,152,352 With "B" preferred collateral and counter-guarantees 210,664 44,571 Without any preferred collateral or counter-guarantees 813,951 1,107,781 Potential risk 8,971 7,500 With "B" preferred collateral and counter-guarantees - - Without any preferred collateral or counter-guarantees 8,971 7,500 Problematic 6,970 6,073 With "B" preferred collateral and counter-guarantees - - Without any preferred collateral or counter-guarantees 6,970 6,073 High risk of insolvency 1,856 1,212 With "B" preferred collateral and counter-guarantees - - Without any preferred collateral or counter-guarantees 1,856 1,212 Uncollectible 1, With "B" preferred collateral and counter-guarantees - - Without any preferred collateral or counter-guarantees 1, Uncollectible for technical reasons - - With "B" preferred collateral and counter-guarantees - - Without any preferred collateral or counter-guarantees - - TOTAL COMMERCIAL PORTFOLIO 1,043,675 1,167,301 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

12 For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) (Continued) SCHEDULE B CLASSIFICATION OF FINANCING ACCORDING TO LOANS AND GUARANTEES RECEIVED CONSUMER AND HOUSING PORTFOLIO Normal Situation 3,132,298 2,231,783 With "B" preferred collateral and counter-guarantees 1,882,931 1,563,870 Without any preferred collateral or counter-guarantees 1,249, ,913 Low Risk 116,572 82,382 With "B" preferred collateral and counter-guarantees 46,926 53,044 Without any preferred collateral or counter-guarantees 69,646 29,338 Mid Risk 59,143 39,117 With "B" preferred collateral and counter-guarantees 17,114 21,163 Without any preferred collateral or counter-guarantees 42,029 17,954 High Risk 85,867 61,451 With "B" preferred collateral and counter-guarantees 23,799 24,871 Without any preferred collateral or counter-guarantees 62,068 36,580 Uncollectible 30,980 33,282 With "B" preferred collateral and counter-guarantees 14,197 10,503 Without any preferred collateral or counter-guarantees 16,783 22,779 Uncollectible for technical reasons 22,440 24,489 With "B" preferred collateral and counter-guarantees 16,230 19,418 Without any preferred collateral or counter-guarantees 6,210 5,071 TOTAL CONSUMER AND HOUSING PORTFOLIO 3,447,300 2,472,504 GENERAL TOTAL 4,490,975 3,639,805 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

13 CONCENTRATION OF FINANCING For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE C Number of customers FINANCING Debt balance % of total portfolio Amount % of total portfolio 10 largest customers 529, % 707, % 50 following largest customers 363, % 388, % 100 following largest customers 86, % 55, % Rest of customers 3,511, % 2,487, % Total 4,490, % 3,639, % on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

14 BREAKDOWN OF FINANCING ACCORDING TO MATURITY DATES For the fiscal year ended on In thousands of Argentine Pesos (ARS) SCHEDULE D Item Non-financial public sector Remaining terms to maturity Past due portfolio 1 month 3 months 6 months 12 months 24 months More than 24 months 2, , ,020 Total Financial sector - 39,049 7,584 4,710 8,530 8,865 2,044 70,782 Non-financial private sector and 38, , , , , ,011 1,915,607 4,312,173 residents abroad Total 40, , , , , ,876 1,917,651 4,490,975 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

15 Item Shares and/or units BREAKDOWN OF INVESTMENTS IN OTHER COMPANIES For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) Information on the issuer SCHEDULE E Description Class Face value per unit Votes per share Number Amount at 12/31/07 Amount at 12/31/2006 Principal line of business End of period/year Data on latest fin. statements Capital Stock Shareholders' Equity Result for the period/year - In Financial Institutions, supplementary and authorized activities Controlled - Argentina - BACS Banco de Crédito y Securitización S.A. ordinary ,750,000 79,623 75,624 Banking 12/31/07 62, ,748 5,714 - BHN Sociedad de Inversión S.A. ordinary ,127,849 21,805 38,079 Investments 12/31/07 39,132 21,807 (885) Subtotal controlled - Argentina 101, ,703 - In Other Companies Non-controlled - Argentina (*) - BHN Vida S.A. ordinary Insurance 12/31/07 5,112 10, (*) - BHN Seguros Generales S.A. ordinary Insurance 12/31/07 5,112 9,793 (552) - Mercado Abierto Electrónico S.A. ordinary 1, Securities open market 03/31/2007 2,991 9,520 1,448 - ACH S.A. ordinary 1 1 2, Electronic Payment Company 12/31/ , Subtotal Non-controlled - Argentina Total participation in other companies 101, ,714 (*) TOTAL EQUITY INVESTMENT in Argentine Pesos - BHN Vida S.A BHN Seguros Generales S.A. 120 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

16 BANK PREMISES AND EQUIPMENT AND MISCELLANEOUS ASSETS For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE F Item Net book value at beginning of fiscal year Additions Transfers Deletions Losses due to impairment of value Depreciation for the period Useful life (years) Amount Net book value at the end of the fiscal period 12/31/07 Net book value at 12/31/2006 BANK PREMISES AND EQUIPMENT - Real estate properties 79, ,066 (113) ,338 82,635 79,477 - Furniture and facilities 5,411 4, (1) ,251 9,089 5,411 - Machinery and equipment 1,562 7, ,772 1,562 - Computer equipment 5,113 9, ,140 10,539 5,113 - Vehicles (2) (25) Sundry (25) Total 92,154 22,425 5,066 (139) 0 8, ,631 92,154 MISCELLANEOUS ASSETS - Construction in progress 3,371 2,926 (5,900) ,371 - Works of art and collectors items Leased assets 3, ,520 3,590 - Assets acquired through foreclosures 12,747 4,569 - (10,661) ,551 12,747 - Other miscellaneous assets 6, (48) ,789 6,125 Total 26,028 7,508 (5,900) (10,709) ,452 26,028 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

17 INTANGIBLE ASSETS For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE G Item Net book value at beginning of fiscal year Additions Transfers Deletions Losses due to impairment of value Amortization for the period Useful life (years) Amount Net book value at the end of the fiscal period 12/31/07 Net book value at 12/31/2006 Organization and development expenses 12,756 36, ,174 46,493 12,756 Total 12,756 36, ,174 46,493 12,756 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

18 CONCENTRATION OF DEPOSITS For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE H Number of customers Debt balance % of total portfolio Debt balance % of total portfolio 10 largest customers 256, % 106, % 50 following largest customers 336, % 121, % 100 following largest customers 97, % 43, % Rest of customers 658, % 380, % Total 1,348, % 651, % on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

19 BREAKDOWN OF DEPOSITS, OTHER LIABILITIES FOR FINANCIAL TRANSACTIONS AND SUBORDINATED NEGOTIABLE OBLIGATIONS ACCORDING TO MATURITY DATE For the fiscal year ended on In thousands of Argentine Pesos (ARS) SCHEDULE I Remaining terms to maturity Item 1 month 3 months 6 months 12 months 24 months More than 24 Total (*) (*) (*) (*) (*) months (*) Deposits 524, , ,160 22,730 13, ,348,524 - Time deposits - Investment account - Savings accounts - Current accounts - Other deposits 223, , ,160 22,730 13, ,047,454 31,249 31, , ,882 42,903 42,903 29,036 29,036 Other liabilities for financial transactions 396,487-22, , ,093 3,127,854 4,071,463 - Argentine Central Bank , ,646 Other , ,646 - Banks and international entities Short-term facilities in US dollars - Unsubordinated negotiable obligations EMTN Series III GMTN Series I GMTN Series VI GMTN Series XVI GMTN Series XXII GMTN Series XXIII GMTN Series XXIV ,604-22, , ,093 2,939,208 3,587, , , , ,338 4, ,505 21, ,536 9, ,110 GMTN Series XXV 7, ,699 Long-term Bond denominated in US dollars - - 2,803 93,456 93, , ,538 Long-term Bond denominated in euros Newly Issued Bond Loans from domestic financial institutions - - 5, , , ,548 1,016,859 8,065-15, ,890,837 1,913, , ,860 Domestic institutions 120, ,860 - Others 174, ,023 Other 174, ,023 Total 920, , , , ,095 3,127,891 5,419,987 (*) These figures are exposed pursuant to contract clauses. on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

20 ALLOWANCES AND PROVISIONS For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE J Breakdown Opening balances Increases in uniform currency Decreases in uniform currency Reversals Allocations Balances at fiscal year end12/31/07 Balances at fiscal year end 12/31/2006 ASSET OFFSETTING ACCOUNTS Loans For uncollectibility risk and loss of value (a) Other receivables for financial transactions For uncollectibility risk and loss of value (b) Miscellaneous receivables For uncollectibility risk and loss of value (c) 135,579 82,207-54, , ,579 33, ,614 19,527 33,141 3, ,252 3,705 Total 172,425 82,207-68, , ,425 LIABILITIES OFFSETTING ACCOUNTS Other contingencies (d) 255,191 45,619 7,576 66, , ,191 Total 255,191 45,619 7,576 66, , ,191 a) FOR UNCOLLECTIBILITY RISKS OF LOANS: Stems from the analysis covering uncollectibility risks of the loan portfolio performed by the Bank, which considers the regulations laid down by the Argentine Central Bank and estimates for the period, as mentioned in Notes 8 and 9. b) FOR UNCOLLECTIBILITY RISKS OF OTHER RECEIVABLES FOR FINANCIAL TRANSACTIONS: Reflects the potential uncollectibility of mortgage loans transferred in trust, but not yet securitized. c) FOR UNCOLLECTIBILITY RISKS OF SUNDRY RECEIVABLES: Set up to cover any possible uncollectibility of miscellaneous receivables. d) FOR OTHER CONTINGENCIES: This provision was set up to cover contingencies involving lawsuits, attorneys fees and certain expenses related to the administrative restructuring process. undertaken by the Bank, and possible contingencies arising from the Stock Appreciation Right -StARS (Note 15), Profit Sharing and Stock Appreciation regime (Note 21). Moreover, balances as of 12/31/07 and 12/31/06 include reserves for pending insurance claims, as established by the National Insurance Superintendence regulations. on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

21 CAPITAL STOCK For the fiscal year ended on In thousands of Argentine Pesos (ARS) SCHEDULE K Shares Capital Stock Class Number (1) Votes per share Outstanding Issued Treasury Stock Pending issuance or distribution Allotted Paid-in Not yet paid-in Ordinary Book-entry shares 1,500,000,000 (1) 1,500, ,500,000 - Total 1,500, ,500,000 - (1) See Note 2 to the financial statements. on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book 1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

22 FOREIGN CURRENCY BALANCES For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE (L) CAPTIONS ASSETS Head office and branches in Argentina Total for the fiscal period at 12/31/07 US$ Total for the fiscal period EUROS YENS Total for the fiscal period at 12/31/2006 Cash and cash resources 376, , ,394 12, ,656 Government and corporate securities 676, , , ,473,091 Loans 200, , , ,619 Other receivables resulting from financial activities 3,094,514 3,094,514 1,903,486 1,191,028-2,602,613 Miscellaneous receivables 264, , , ,707 Unallocated items Total 4,612,474 4,612,474 3,408,995 1,203,479-4,716,686 LIABILITIES Deposits 241, , , ,625 Other liabilities for financial transactions 5,025,920 5,025,920 3,836,946 1,188,974-4,897,781 Miscellaneous liabilities Unallocated items Total 5,268,033 5,268,033 4,079,057 1,188,976-5,001,203 MEMORANDUM ACCOUNTS DEBIT (Except for contra items) 773, , , ,327 Contingencies 426, , , Control 31,952 31,952 31, ,845 Derivatives 315, , , ,950 CREDIT (Except for contra items) 324, , , ,293 Contingencies 128, , , ,116 Control 196, , , ,733 Derivatives ,444 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

23 FINANCIAL ASSISTANCE OF RELATED PARTIES For the fiscal year ended on as compared with the previous fiscal year In thousands of Argentine Pesos (ARS) SCHEDULE N Situation Normal Potential risk / inadequate performance With problems / deficient performance High risk of insolvency / difficult collection Uncollectible Uncollectible for technical reasons Total Item Not yet due Past due Not yet due Past due 12/31/07 12/31/ Loans - Mortgage and pledge loans With "B" preferred collateral and counter-guarantees 1, , , , Equity investments in other companies 101, , ,703 Total 103, , ,501 Allowances on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

24 Kind of agreement Purpose of transactions Underlying assets Kind of settlement Swap (Note 18.1.) Brokerage own account Private securities Foreign currency Swap (Note 18.2.) coverage Foreign currency Foreign currency Swap (Note 18.2.) coverage Foreign currency DERIVATIVE FINANCIAL INSTRUMENTS For the fiscal year ended on In thousands of Argentine Pesos (ARS) Trading environment or counterpart Average weighted term originally agreed upon Average residual weighted term Average weighted term for the settlement of differences Amount With delivery of the underlying asset Residents abroad ,975 With delivery of the underlying asset Residents abroad ,147,180 With delivery of the underlying asset Residents abroad ,591 SCHEDULE O Swap (Note 18.3.) Brokerage own account Other Upon maturity of differences Residents abroad ,587 Swap (Note 18.4.) Brokerage own account Other Upon maturity of differences Residents abroad ,100 Swap (Note 18.5.) Brokerage own account Other Upon maturity of differences Residents abroad ,100 Swap (Note 18.6.) Brokerage own account Other Upon maturity of differences Residents abroad ,496 Swap (Note 18.5.) Brokerage own account Other Upon maturity of differences Domestic residents- Financial sector ,000 Futures (Note 18.9.) Brokerage own account Foreign currency Daily difference MAE ,302 Other (Note 18.8.) Brokerage own account Domestic government securities With delivery of the underlying asset Residents abroad ,114,955 Other (Note 18.9.) Brokerage own account Domestic government securities With delivery of the underlying asset MAE ,151 on behalf of the General Banco Hipotecario S.A. Banco Hipotecario S.A. PRICE WATERHOUSE Co. S.R.L. C.P.C.E.C.A.B.A. Book1 - Page 17 Diego Sisto On account of Chartered Public Accountant (U.C.A.) Banco Hipotecario S.A. the Syndics' Committee C.P.C.E. City of Buenos Aires Book 274 Page 12

25 PROFIT DISTRIBUTION PROJECT For the fiscal year ended December 31, 2007 In thousands of pesos RETAINED EARNINGS 80,770 Distribution: To profit reserves: - Legal (20%) 16,154 To retained earnings 64,616

26 1. ECONOMIC AND SOCIAL SITUATION PREVAILING IN ARGENTINA The argentine economy continues to undergo a sustained economic growth accompanied by an important fiscal and commercial surplus. Within this context, there is an important recovery of the financial system, supported by more stable exchange rates, longer terms for new transactions, lower exposure to the public sector and higher levels of consumer loans. Within this framework, the Bank has achieved a significant capital strengthening, mainly based on the increase in financial brokerage, the consolidation of its financial margin and a continuing improvement of all financial indicators, as well as an important expansion in their business network. The Bank is currently one of the strongest contributors to credit growth in the financial system, being the most important aspects the increase in consumer loans and the expansion in the credit card financing market. Also, the Bank continues to lead the mortgage loans segment. The situation described above has left behind the crisis during the 2001/2002 period, when the National Government adopted measures that had effect upon the banking activities and particularly upon the Bank, including among others: i) the creation of a single, exchange free market, ii) the conversion to pesos of US dollar-denominated Deposits and Loans granted by Argentina financial system, iii) compensations to the Financial System for the effect of asymmetric pesification (Note 5.1), iv) certain adjustments to the Reorganization and Bankruptcy Acts and v) conversion of provincial public debt (Note 42). 2. Pursuant to Law enacted on July 2, 1997 and promulgated by the National Executive Branch through Decree 677 dated July 22, 1997, and decree 924/97 Banco Hipotecario Nacional was declared "subject to privatization" under the terms of Law and the National Executive Branch should proceed to its transformation into a corporation ("sociedad anónima"). The new entity arising from this transformation will do business under the denomination of "Banco Hipotecario Sociedad Anónima", and as a commercial bank in accordance with Law and complementary rules, as amended, with the scope envisaged by the regulations, and with the rights and obligations of its predecessor. Law and its regulatory decree provide that for ten years as from the promulgation of the Law, Banco Hipotecario Sociedad Anónima should, among other things, finance the construction and/or acquisition of dwellings throughout the national territory. Banco Hipotecario Sociedad Anónima should also offer credit lines for an amount equivalent to 10% of the total loans it grants for housing construction, to finance the construction of dwellings in small towns. Banco Hipotecario Sociedad Anónima has a corporate capital of ARS 1,500,000 thousand, fully subscribed and paid-in, represented by 1,500,000,000 ordinary book-entry Class A, B, C and D shares, with a face value of ARS 1 each and one vote per share (according to the decision made by the General and On behalf of the General 26

27 Extraordinary Shareholder's Meeting held on July 21, 2006), except for the special multiple vote right for the Class D shares envisaged by the Bank's by-laws. On February 2, 1999, Banco de la Nación Argentina, as trustee of the Assistance to the Federal Trust Fund for Regional Infrastructure Trust Fund, made the combined public offering of 42,000,000 ordinary Class D shares and 270,000 options, each of the latter representing the right to purchase 100 shares, and the investors are required to acquire a minimum quantity of Class D shares so as to be awardees of the options. This right expired on February 2, With the authorization of the National Securities Commission of Argentina, the Bank placed 13,616,606 Class D shares and 61,289 options on the local capital market, and 28,383,394 ADSs (Shares Deposited in Custody), each representing one Class D share and 208,711 options, on the international capital market in compliance with Rule 144A of the Securities Act of 1933 of the United States of America. As a result of the expiration of the time frame for exercising the options indicated above, on February 2, 2004 certain holders of those options acquired 17,909,500 class D shares. The following table shows capital status, including a detail of classes of shares and their face value as of December 31, Class Shares Face value Capital Stock A 658,530, ,530,880 B 75,000, ,000,000 C 75,000, ,000,000 D 691,469, ,469,120 1,500,000,000 1,500,000,000 On behalf of the General 27

28 3. BASIS FOR PRESENTATION OF THE FINANCIAL STATEMENTS These financial statements have been prepared in line with accounting standards established by the Argentine Central Bank through CONAU 1 Circular, supplementary rules and amendments. The financial statements of the predecessor entity, Banco Hipotecario Nacional, have been adjusted for inflation in conformity with the guidelines set in Communication "A" 551 of the Argentine Central Bank up to the financial year ended December 31, 1994, and prepared in accordance with the standards laid down by CONAU 1 Circular. As from January 1, 1995, and according to the authorization accorded by Technical Pronouncement No. 388 of the Argentine Central Bank's Superintendence of Financial and Exchange Institutions, the Bank discontinued the adjustment for inflation of its financial statements until December 31, As from January 1, 2002, as a result of the application of Communication "A" 3702 which established the repeal of any legal and regulatory rule that did not allow companies to restate their accounting balances at period-end currency values, the Bank resumed the application of the adjustment for inflation. To this end, it followed the restatement method established by Technical Pronouncement No. 6 of the Argentine Federation of Professional Councils in Economic Sciences (FACPCE), using the domestic wholesale price index published by the National Statistics and Census Institute (INDEC). Furthermore, it has been considered that the accounting measurements derived from the changes in the purchasing power of the currency between December 31, 1994 and 2001 are stated in the currency value as of the latter date. On March 25, 2003, the Executive Branch issued Decree 664 establishing that the financial statements for years ending as from that date are to be stated in nominal currency. Consequently, in accordance with Communication "A" 3921 of the BCRA, restatement of the financial statements was discontinued as from March 1, The Professional Council in Economic Sciences of the Autonomous City of Buenos Aires approved Technical Pronouncements No. 16 "Conceptual Framework of professional accounting standards"; No. 17 "Professional accounting standards: development of general application issues"; No. 18 "Professional accounting standards:development of particular application issues" and No. 19 "Amendments to Technical Pronouncements Nos. 4, 5, 6, 8, 9, 11 and 14", No. 20 "Financial derivatives and hedge operations" and No. 21 "Proportional equity value Consolidation of financial statements Information to be disclosed in connection with related parties", through Resolutions C 238/01, C 243/01, C 261/01, C 262/01, C 187/02 and M 5/03, respectively. Those Technical Pronouncements and amendments became effective in fiscal years commencing as from July 1, 2002, except for the latter pronouncement, the effective date of which is April 1, On August 10, 2005, CPCECABA passed CD Technical Pronouncement No. 93/2005, effective for fiscal years commencing as from January 1, 2006, which adopts Technical Resolutions 6 to 22 issued by FACPCE as the Argentine GAAP; said resolutions were amended with the purpose of unifying the Argentine GAAP and the interpretation of the accounting and auditing standards 1 to 4. On June 26, 2006, the CPCECABA passed Technical Pronouncement CD42/2006, effective for fiscal years commenced as from July 1, Technical Pronouncement No. 23 Personnel benefits after termination of employment and other long-term benefits. The CNV has passed certain amendments to CD 93/2005 of the CPCECABA on December 29, 2005 and January 26, 2006; however, section 2 of Schedule I of RG 434/03 sets forth that On behalf of the General 28

29 financial institutions financial statements be submitted in accordance with the BCRA accounting standards. Through RG 494/2006 of December 14, 2006, the CNV approved RT No. 23 of the FAPCE. As of the date of these financial statements, BCRA had not adopted these technical pronouncements. The principal disclosure and valuation criteria followed for preparing these financial statements is described below: 3.1. Foreign currency assets and liabilities Foreign currency assets and liabilities have been valued at the rate of exchange between the Argentine peso and the US dollar published by the Central Bank of the Republic of Argentina (BCRA) in force at the close of BCRA operations on the last business day of the fiscal years ended December 31, 2007 y Gold and other precious metals Holdings of gold and silver were valued at the latest closing offer exchange rate in the London market, in US dollars, net of direct selling expenses and converted into Argentine pesos at the term rate of exchange between the Argentine peso and the US dollar published by the BCRA in force at the close of the operations on the last business day of December 31, 2007 y Interest accruals and adjustments of principal amounts (CER and CVS) Interest accruals were determined using the exponential method for all lending and certain borrowing transactions in local and foreign currency the total term of which was more than 92 days, and interest accruals for loans overdue more than ninety days were discontinued. Adjustments of principal amounts from application of the CER and CVS were accrued as established by Argentine Central Bank regulations, and interest accruals on loans overdue more than ninety days were discontinued Government and corporate securities Listed - In Argentina and abroad: The securities classified as "Holdings of trading securities", "Investment in listed corporate securities" and "Securities issued by the BCRA" have been valued at fiscal year-end market quotation. The BODEN 2012 Government securities in US$ classified as "Holdings in investment accounts" have been recognized at their technical value, in accordance with the whereas clauses of Communication "A"3785, supplementary rules and amendments. Such technical values increase based on interest accrued under the issue terms and conditions at the end of each fiscal year. The On behalf of the General 29