Notes to the consolidated financial statements

Notes to the consolidated financial statements Consolidated group The consolidated group at December 31, 2006 comprises credit institutions, financial institutions and other companies. In addition to Raiffeisen Bausparkasse Ges.m.b.H., Vienna, the following companies are fully consolidated: Raiffeisen stavební spořitelna, a.s., Prague (Raiffeisen Bausparkasse AG, Prague) Konevova s.r.o., Prague (Konevova Ges.m.b.H., Prague) Raiffeisen stambena štedionica d.d., Zagreb (Raiffeisen Bausparkasse AG, Zagreb) Raiffeisen nekretnine i financijsko savjetovanje d.o.o., Zagreb (Raiffeisen Immobilien- und Finanzberatungsges.m.b.H., Zagreb) Raiffeisen Bausparkassen Holding GmbH, Vienna (formerly: Raiffeisen Bausparkassen Managementservice und Beteiligungsges.m.b.H., Vienna) The following companies are consolidated using the equity method in accordance with 264 (1) 2 of the Austrian Commercial Code (UGB): Prvá stavebná sporitel ňa, a.s., Bratislava (Erste Bausparkasse AG, Bratislava) Raiffeisen Banca pentru Locuinţe, S.A., Bucharest (Raiffeisen Bausparkasse AG, Bucharest) Raiffeisen Wohnbaubank AG, Vienna Raiffeisen Wohnbauleasing Ges.m.b.H, Vienna Four companies were not included in the consolidated financial statements in accordance with 249 (2) UGB, as these companies are deemed not to be of material importance in presenting fairly in all material respects the company's net worth, financial and earnings position. These companies are: RBM Wohnbau Ges.m.b.H., Vienna RGS Wohnbau Ges.m.b.H., Vienna Raffeisen financni poradenstvi s.r.o, Prague (Raiffeisen Finanzberatungsges.m.b.H., Prague) Dobre Byvanie s.r.o., Bratislava Principles of consolidation The balance sheet date for the financial statements of fully consolidated companies is December 31, 2006. The latest available financial statements are taken for associated companies consolidated in accordance with the equity method. This was December 31, 2006 in all cases. The book value was used in accordance with 254 (1) 1 and 264 (1) 1 UGB for consolidation of investments and consolidation at equity. The book value of the share in each of the companies included in consolidation is offset against the subsidiary's equity at an amount corresponding to the share. Initial inclusion in the consolidated financial statements was chosen as the accounting date of initial consolidation. By shareholder resolution as of December 20, 2005, Raiffeisen Bausparkassen Managementservice und Beteiligungsges.m.b.H. was renamed Raiffeisen Bausparkassen Holding GmbH and was entered in the Register of Firms on December 30, 2005. 24

In accordance with the Austrian Banking Act (BWG), the following balance sheet items constitute subsidiaries equity: Subscribed capital Additional paid-in capital Retained earnings Bauspar-reserves Accumulated income/loss Negative goodwill resulting from the consolidation of investments relates to retained earnings prior to initial consolidation and is shown under reserves from retained earnings. There is no additional unrealized negative goodwill from the valuation of associated companies. The assets, liabilities, accruals and deferrals of the companies included in consolidation are consolidated using uniform principles of accounting and valuation. Loans and other claims, accruals and payables relating to transactions between consolidated companies including accrued and deferred items are offset in the course of debt consolidation. Intra-group income and expenditure are also offset in the course of consolidation of income and expenditure. The financial statements of foreign group companies are adjusted to Austrian accounting principles. Individual financial statements denominated in foreign currencies are translated at the reference rates published by the ECB at the consolidated balance sheet date. Income statements are translated at the monthly average reference rates for the financial year. Differences resulting from translating capital are offset against retained earnings without affecting income. Differences resulting from translating income are recognized and recorded in the consolidated income statement. Principles of accounting and valuation The consolidated financial statements of Raiffeisen Bausparkasse Ges.m.b.H. are drawn up in accordance with the provisions of 244ff UGB and with 12 of the Austrian Bausparkasse Act in compliance with the relevant provisions of the Austrian Banking Act (BWG). All consolidated balance sheet items denominated in foreign currencies were translated at ECB reference rates prevailing on the balance sheet date, income statement items are translated at monthly average reference rates for the financial year. Claims on credit institutions are stated at their nominal value plus prorated interest. Writedowns are made and accruals set up for all identifiable risks associated with loans and other claims. Securities held as current assets are valued at the lower of cost or market. Securities held as long-term investments are recorded under non-current assets and are valued at the diluted lower of cost or market. Non-consolidated equity interests are stated at historical cost. Property, plant and equipment (land, buildings, office furniture and equipment) are stated at acquisition or production cost less scheduled depreciation. Rates of depreciation range between 2.0 % and 2.5 % for permanent plant and 10 % to 25 % for movable assets. 25

Additions in the financial year are depreciated at full or half annual rates depending on whether the assets are acquired in the first or second half of the year, unless national regulations specify depreciation pro-rata-temporis. Liabilities are stated at their nominal amount or at the amount repayable, if higher. Accruals are set up for statutory and contractual severance payment obligations. The accruals generally amount to 80 % of the claims and are in line with actuarial computations. The accrual for current pension commitments is set up in accordance with actuarial principles using the current value method and in line with the accounting guidelines of the Austrian Institute of Actuaries 1999-P, Pagler & Pagler, applying an interest rate of 3.5 %. There is no shortfall. Future obligations arising from pension commitments are covered by a pension fund. Other accruals take into account all identifiable risks and pending liabilities, the amount of which is not yet known. Notes to the consolidated financial statements The item cash on hand, balances with central banks consists of a cash total of T EUR 421 (2005: T EUR 280), balances with central banks at T EUR 29,927 (2005: T EUR 23,021). The development ot the value of property, plant and equipment in 2006 is illustrated in the schedule of fixed assets in accordance with 226 (1) UGB. Acquisition/ Exchange Additions production costs differences at Jan. 1, 2006 EUR EUR EUR I) INTANGIBLE ASSETS 1. Concessions, industrial property rights and similar rights and benefits as well as licenses derived therefrom 18,411,497 203,525 3,772,812 2. Goodwill 246,848 0 0 18,658,345 203,525 3,772,812 II) PROPERTY, PLANT AND EQUIPMENT 1. Land, leasehold rights and buildings including buildings on non-owned land 22,294,260 950,368 111,256 2. Office furniture and equipment 11,613,260 368,470 706,963 3. Prepayments made and work in progress 2,995 171 0 33,910,515 1,319,009 818,219 III) FINANCIAL ASSETS 1. Shares in group companies 108,081 0 0 2. Equity interests in associated companies valued at equity 72,615,413 0 10,010,595 3. Equity interests in other companies 46,717 0 34,810 4. Long-term securities 752,959,227 39,425,712 613,786,563 825,729,438 39,425,712 623,831,968 TOTAL FIXED ASSETS 878,298,298 40,948,246 628,422,999 1) 1) Transfer of share in accumulated net income at equity 26

Other claims on credit institutions consist of fixed-rate deposits with the following maturities: Dec. 31, 2006 Dec. 31, 2005 up to 3 months 101,068 223,560 3 months to 1 year 0 10,483 1 to 5 years 71,654 20,669 over 5 years 0 38,009 172,722 292,721 In the year 2006, a claim of T EUR 55,392 was ceded by way of security. Listed bonds and other fixed-interest securities contain own issues amounting to T EUR 494 (2005: T EUR 494); bonds totalling T EUR 25,350 (2005: T EUR 32,067) will mature in the following year. The bonds and other fixed-interest securities include securities with a balance sheet value of T EUR 6,942 (2005: T EUR 6,960) that are listed on Vienna Stock Exchange. The listed securities have a difference of T EUR 18 (2005: T EUR 85) between balance sheet value and higher market value. Securities with a nominal value of T EUR 10,000 (2005: T EUR 17,000) and a book value of T EUR 9,873 recorded under bonds and other fixed-interest securities were loaned short-term. The securities loan transactions began on Nov. 6, 2003 and Nov. 10, 2006. The transactions of Dec. 18, 2002 and of the year 2006 were closed out in the course of the financial year. Disposals Acquisition/ Cumulative Book value Book value Depreciation production costs depreciation 2006 at Dec. 31, 2006 Dec. 31, 2006 Dec. 31, 2005 EUR EUR EUR EUR EUR EUR 522,704 21,865,130 16,117,366 5,747,764 4,715,624 2,795,362 0 246,848 246,848 0 0 0 522,704 22,111,978 16,364,214 5,747,764 4,715,624 2,795,362 5,538,165 17,817,719 3,260,329 14,557,390 15,226,275 574,335 1,080,052 11,608,641 8,228,192 3,380,449 3,854,258 1,239,828 3,165 0 0 0 2,995 0 6,621,383 29,426,360 11,488,521 17,937,839 19,083,527 1,814,163 0 108,081 0 108,081 108,081 0 0 82,626,008 0 82,626,008 72,615,413 0 0 81,527 5,173 76,354 41,544 0 518,936,930 887,234,572 2,139,785 885,094,788 750,766,705 45,320 518,936,930 970,050,188 2,144,958 967,905,230 823,531,742 45,320 526,081,016 1,021,588,526 29,997,694 991,590,833 847,330,894 4,654,845 Arithmetic differences may arise when totalling amounts rounded off due to automatic calculation. 27

Securities recorded under financial assets include securities with a book value amounting to T EUR 79,491 (2005: T EUR 21,900) and a present value amounting to T EUR 73,194 (2005: T EUR 20,952). As there is no permanent impairment of value, no depreciation was applied. Securities with a nominal value of T EUR 37,280 (2005: T EUR 40,280) were pledged as securities for liabilities to other credit institutions. Shares in investment funds are recorded under shares and other non-fixed-interest securities. The real estate value of developed land is T EUR 612 (2005: T EUR 944). Other assets mainly consist of claims on revenue authorities relating to government subsidies amounting to T EUR 96,170 (2005: T EUR 106,030). Interest rate swaps were concluded by the parent company with a total value of T EUR 883,000 (2005: T EUR 1,598,000) to hedge the interest rate risk. Interest rate swaps are denominated entirely in euros and were concluded with Raiffeisen Zentralbank Österreich AG (RZB) and with Raiffeisenlandesbank Niederösterreich-Wien AG (RLB NÖ-Wien). Both payer (P) and receiver (R) swaps were concluded. Interest rate swaps were concluded by Raiffeisen stambena štedionica d.d., Zagreb, with a total value of T EUR 40,000 (2005: T EUR 40,000) to hedge the interest rate risk. Interest rate swaps are denominated entirely in euros and were only concluded with Raiffeisenbank Austria d.d. (RBA). Only payer (P) swaps were concluded. All swaps were valued using internal valuation models, particularly present value models. The value of an interest rate swap is expressed as the difference between the value of the fixed obligation and the uncertain variable obligation. The bonds issued in 1997, 2001, 2002, 2004 and 2005 constitute supplementary capital in accordance with 23 (7) BWG or subordinated capital pursuant to 23 (14) 5 BWG. Raiffeisen Wohn Bauspar bonds Issue 1997 2007/1 2001 2011/1 2002 2012/1 Securities number 0443528 0443536 0443544 Interest rate 6.3 % 6.375 % 5.75 % Total volume of issue EUR 36.3 m EUR 22.0 m EUR 40.0 m Issue price 100.00 100.90 100.65 Denomination EUR 726.73 EUR 1,000.00 EUR 100.00 Coupon date, annually June 11 August 21 August 20 Maturity 10 years 10 years 10 years Redemption at nominal value (premature redemption not permitted) Jun. 11, 2007 Aug. 21, 2011 Aug. 20, 2012*) Stock market price at December 31, 2006 99.80 107.80 103.00 *) Redemption by issuer possible at August 20, 2009 T EUR 36,336 (2006: T EUR 0) of the bonds issued will mature in 2007. Expenditure for supplementary capital and subordinated capital amounts to T EUR 10,646 (2005: T EUR 12,115). 28

The following swaps exist at Dec. 31, 2006: P/ R volume maturity present value EUR EUR Raiffeisen Bausparkasse Ges.m.b.H. 883,000,000.00 3 21 years 7,191,163.45 Raiffeisen stambena štedionica d.d. 40,000,000.00 5 6 years 596,480.00 Total 923,000,000.00 6,594,683.45 On the balance sheet date, asset items in foreign currencies amount to T EUR 1,747,383 (2005: T EUR 1,554,484). Liabilities to credit institutions include refinancing loans for loans with the following residual maturities: Dec. 31, 2006 Dec. 31, 2005 repayable on demand 28,006 0 up to 3 months 3,634 3,001 3 months to 1 year 6,060 10,901 1 to 5 years 7,267 16,961 over 5 years 164,536 125,549 209,503 156,412 2004 2014 2004 2016 2005 2017 0443569 0443551 0443577 5.25 % 5.3 % 4.625 % EUR 34.5 m EUR 5.5 m EUR 30.0 m 100.35 99.50 99.90 EUR 100.00 EUR 50,000.00 EUR 100.00 August 17 July 23 March 31 10 years 12 years 12 years Aug. 17, 2014 Jul. 23, 2016 March 31, 2017 103.75 103.90 98.60 29

The valuation reserve due to special depreciation under 12 of the Austrian Income Tax Act (EStG) developed in 2006 as follows: Balance at Balance at January 1, Allocation Adjustment for December 31, 2006 scheduled depreciation 2006 EUR EUR EUR EUR Office furniture and equipment 433,118.00 0.00 108,606.00 324,512.00 Contingent liabilities arising from loan commitments are summarized under credit risks. On the balance sheet date, liability items in foreign currencies amount to T EUR 1,691,950 (2005: T EUR 1,504,995). Other financial liabilities amount to T EUR 4,397 (2005: T EUR 4,355) for the next year and to T EUR 21,985 (2005: T EUR 21,775) for the following five years. As the contracts were concluded for an indefinite period, the overall liabilities cannot be determined. Other disclosures The average number of salaried employees in 2006 is 579 (2005: 647). The average number of employees in part-consolidated companies is 486 (2005: 473). The composition of the Board of Managing Directors and the Supervisory Board is identical to that of Raiffeisen Bausparkasse Ges.m.b.H. The amount of Bauspar-loans granted to Managing Directors and Supervisory Board members outstanding at December 31, 2006 after annual repayments of T EUR 119 (2005: T EUR 40) is T EUR 189 (2005: T EUR 299). Emoluments paid to Supervisory Board members amounted to T EUR 31 as for the previous year. Expenses for severance payments and pensions amounted to T EUR 123 (2005: T EUR 82) for the Board of Managing Directors and executives and to T EUR 325 (2005: T EUR 2,295) for other employees. Managing Directors received EUR 891,829.39 (2005: T EUR 852) in total remuneration. 30