ANNUAL REPORT FOR SLATINSKA BANKA d.d. SLATINA · DEVELOPMENT OF SLATINSKA BANKA d.d. SLATINA SLATINSKA BANKA d.d. was founded 9 October 1992 and is the only banking institution seated

ANNUAL REPORT FOR

SLATINSKA BANKA d.d. SLATINAFOR 2012

SLATINSKA BANKA d.d.Vladimira Nazora 2, 33520 SlatinaTel: 033/ 840 400Fax: 033/ 551-566, 840 429URL: www.slatinska-banka.hrE-mail: slatinska-banka slatinska-banka.hr@

ANNUAL REPORT

FOR 2012.

3

4

5

12

55

64

67

68

70

71

CONTENT

REPORT OF THE MANAGEMENT ON THE BANK'S FINANCIAL

POSITION AND ANALYSIS OF BUSINESS RESULTS

DEVELOPMENT OF SLATINSKA BANKA d.d. SLATINA

BANK BUSINESS ANALYSIS IN 2012

INDEPENDENT AUDITORS' REPORT AND FINANCIAL STATEMENTS

ANNUAL FINANCIAL STATEMENTS ACCORDING TO

THE DECISION ON THE CONTENTS STRUCTURE OF THE ANNUAL

FINANCIAL STATEMENTS OF THE CROATIAN NATIONAL BANK

CORPORATE MANAGEMENT CODEX

ORGANISATIONAL STRUCTURE OF SLATINSKA BANKA d.d.

SLATINSKA BANKA d.d. - CONTACTS

SLATINSKA BANKA d.d. - BUSINESS NETWORK

CORRESPONDENTS

MANAGEMENT REPORT ON THE BANK'S FINANCIAL POSITIONAND BUSINESS RESULT ANALYSIS

The entire finances sector was still beset with very complex business conditions in 2012. Non-liquidity of thebusiness sector, rise in unemployment, drop in business activities and insufficient investments had as itsconsequence further stagnation of the real business sector, and thereby a decrease of general standard of living ofCroatians.

2012 marked 20 years of successful Bank business. Through that period, the Bank gained a reputation as a stableregional financial institution.

Despite high challenges of today's business conditions and environment, Slatinska banka d.d realized its continuityof positive business performance in 2012. It realized HRK 4.997 million net profit and the increase of its Balance forapproximately HRK 111 million, which is a rise of 8.34%, and brings us to the balance of HRK 1,442 million. Alongwith the above described growth, the Bank kept a satisfactory level of capital adequacy, 16.84% .

The increase of net operative result was realized through a pro-active approach toward clients and better assetallocation in 2012 in relation to 2011.

Results were realised in conditions of lowered placements to the retail sector, since that segment, due to increasinginsecurity of future receivables due to increased unemployment, meant less interest in bank loans in 2012.

However, through a higher-quality approach to clients, redesign of loan conditions and improvement of placementapproval techniques we managed to realize the sought-after dynamic of placements to clients-individuals by theend of 2012, which is a trend continuing in 2013.

Following the above trends, the Bank then centred its efforts on SME's, where high placement rates were achieved;loans to legal entities at the end of the year amounted to approx. HRK 372.8 million, or 25.85% of total assets.

During 2012, business of Slatinska banka d.d. enjoyed stable liquidity all year round, without any new domestic orforeign debts, which, in turn, allowed us to finance other financial institutions.

As far as Bank asset sources are concerned, deposits totalled HRK 1,056 mil., showing our clients trusted our safe,stable business. Through collection of primary asset sources, mainly in retail, the Bank made a base forplacements in retail and company business, keeping an eye on business risks and client credit rating.

During 2012, the bank also accented rising profitability of its organizational units (branches).The new branch office Molve allowed new clients from that region to use the Bank services in new, modern businesspremises.

Significant investments were placed in the expansion of the ATM network, raising internet banking security,development of credit- and card-based business, as well as continual education of Bank staff.

Development in 2012 targeted financial centres in Osijek, Zagreb and Rijeka, where activities of raising the level ofbusiness and profitability will be performed during 2013.

Results achieved so far, as well as the continuity of business are proof of the clients' and business partners' trust instable, safe and profitable functioning of the Bank, bearing in mind at all times its solvency, which is a good base forfurther growth and development in the coming period.

3

DEVELOPMENT OF SLATINSKA BANKA d.d. SLATINA

SLATINSKA BANKA d.d. was founded 9 October 1992 and is the only banking institution seated in the County ofVirovitica and Podravina. The seat of the Bank is at Vladimira Nazora 2, Slatina.

2012 was the 20th consecutive year of successful business and presence on the financial market of the Republic ofCroatia for the Bank.In 2012 the Bank activities were also centred around retain banking, both with respect to placements and inreceiving deposits, and in offering other banking services. However, a more significant portion of activities of theBank is being allocated to the economic/business segment – especially that of financial monitoring of clients.

The Bank is continually investing in development and improvement of its current services, working to satisfy asmuch as possible the ever more dynamic needs of the market and the Bank’s clients.

The Bank offers its services in 3 financial centres, 13 branches and 12 branch offices: (in counties:) Virovitičko –podravska, Osječko – baranjska, Požeško – slavonska, Brodsko – posavska, Bjelovarsko – bilogorska, Koprivničko– križevačka, Primorsko – goranska, Vukovarsko - srijemska and the City of Zagreb.In addition to the business network of bank offices, banking services can be enjoyed through other distributionchannels such as Internet banking and the EFTPOS network of bank machines.

In 2012 we opened a branch office in Molve, whereby the Banka further stepped into that particular region, alongwith the branch in Koprivnica.

During 2012 the Bank installed ATM's in Slavonski brod and Pitomača, in addition to the ones already present inSlatina, Virovitica, Našice, Požega, Daruvar, Osijek, Ilok, Koprivnica, Valpovo, Rijeka, Donji Miholjac, akovo,Zagreb and Orahovica.ATM’s in Našice, Požega, Osijek, Ilok, Slatina and Virovitica have day-and-night vaults that can be used 24 hours aday, 7 days a week, without having to wait in queues in the Bank itself.

Activities in connection with the conformance to legal and other regulations have continued. The project of makingthe CNB report software has been completed, a new project of conforming with the PCI DSS standard has beeninitiated, as well as the project of migration of the Bank credit card data to DDA chip technology.

Within the cark sector, the Bank received its VISA membership, thereby allowing VISA cards on the Bank’s ATM’sand EFTPOS devices.

4

Despite very difficult business conditions in 2012, the continuity of the Bank’s positive business resultscontinued, primarily reflecting in the increased Bank balance and positive active business results.

2012 saw the balance grow for HRK 111,056, or 8.34%, whereby the value of the balance reached HRK1,442,257 thousands.

The growth of the balance is mainly due to the increase in retail deposits, which have nominally grown for HRK38,612,000 in 2012, and which make up 62.46% of the Bank’s total asset sources.

The largest increase in placements was in the segment of loan placement to companies, with the nominalgrowth of HRK 106,129,000.

Profit after taxes for the period from 1 Jan. to 31 Dec. 2012 amounted to HRK 4.997.000, or 50.18% morethat during the same period in 2011.

Interest income make up 79.44% of total income, growing 0.65% with respect to 2011, while interest expenses(making up 47.93% of total expenses) grew 2.07%.

Growth of assets per employee was realized in 2012, being a precondition for Bank productivity increase.

The following is the structure of asset sources and placement structure by sector.

BANK BUSINESS ANALYSIS IN 2012

5

BANK BUSINESS INDICATORS

2012. 2011.

(u 000 kuna)

ASSETSGROSS PROFITNET PROFITNET INTEREST INCOMENET INCOME FROMCOMMISSIONS AND FEES

TOTAL CAPITALGUARANTEE CAPITALCAPITAL ADEQUACY

RETURN ON ASSETSRETURN ON CAPITALEXPENSE TO INCOME RATIOASSETS/EMPLOYEESNUMBER OF EMPLOYEES

1.442.2576.4034.997

36.581

10.077

175.294166.10716,84%

0,44%2,85%

79,49%8.013

180

1.331.2014.5773.327

37.010

10.104

173.469168.23418,86%

0,34%1,91%

85,54%7.651

174

6

ASSET SOURCE STURCTURE BY SECTOR

2012. % 2011. %

(in thousands of Kuna)

61.61755.610

199.398900.80549.533

175.294

1.442.257

4,273,86

13,8362,463,43

12,15

100

89.52760.81296.889

862.19348.311

173.469

1.331.201

6,734,577,28

64,773,62

13,03

100

ECONOMYNON-ECONOMYBANKSRETAILOTHER SOURCESCAPITAL AND RESERVES

TOTAL

SPLACEMENT STRUCTURE BY SECTOR

2012. % 2011. %


372.84823.641

128.514382.039257.884

431276.900

1.442.257

25,851,648,91

26,4917,880,03

19,20

100

266.71917.342

196.659384.099231.386

431234.565

1.331.201

20,041,3

14,7728,8517,380,03

17,62

100

ECONOMYNON-ECONOMYBUSINESS BANKSRETAILDEBT SECURITIES

OTHER PLACEMENTS

TOTAL

EQUITY (OWNERSHIP) SECURITIES

ASSET SOURCE STURCTURE 31 DEC. 2012

PLACEMENT STRUCTURE 31 DEC. 2012

Slatinska banka d.d. continues to retain its position in the retail banking segment, thanks to its continueddevelopment of business and product/service quality, coupled with continual market monitoring.Through following market trends and increasing the number of its services and introducing new technologies, theBank is able to offer to its clients traditional and accepted forms of savings, (primarily) non-purpose loans andvarious transaction services.The confirmation of the brand and confidence in Slatinska bank services is the increase in retail sources, whichmake up high 62.46% of all Bank sources.In total retail deposits, term deposits comprise 86.87%, which allows the Bank manageable liquidity.Deposits are constantly on the rise, growing 4.48% or HRK 38 mil. in 2012 in relation to the previous year.Despite the decrease in retail placements in 2012 across the entire banking sector, this decrease was minimal withSlatinska banka d.d. In addition to re-designing our credit lines and adjusting them in accordance with thedemands of more competitive surroundings, technology of credit lines for individuals has been significantlyupgraded, and our business policy has turned toward targeted groups - all aimed at increasing retail placements.This new approach resulted in positive trends toward the end of 2012, which also continued in 2013.Retail placements are still a major part of total Bank placements with 26.49% of total placement structure.In addition to investing in our business network, the Bank is continually developing and improving direct distributionchannels. Following market demands and new trends in technology, the Bank also incorporated new servicesthrough its branch network, such as SMS banking for users of current and company accounts, Mastercard, Internetbanking, standing orders for payment of utility bills, loan repayment, etc., and the clients will soon be able to useMBplus instalment plan.During 2012, we continued to invest in our ATM network, installing new machines in Pitomača and Slavonski brod.The Bank is continually adapting to the market in order to offer its clients sufficient financial backing in order toconstruct stable, long-term partnerships built on client trust and satisfaction.Special care is given to training our staff in sales techniques and product & service knowledge through organisingseminars, lectures and workshops.

RETAIL BANKING

7

RETAIL DEPOSITS

31 DEC. 2012 % 31 DEC. 2011 %


118.265

782.540

900.805

64.64653.619

189.369593.171

13,13

86,87

100

7,185,95

21,0265,85

110.650

751.543

862.193

55.25255.398

180.769570.774

12,83

87,17

100

6,406,43

20,9766,20

SIGHT DEPOSITS

TERM DEPOSITS

TOTAL:

in HRKIn foreign currency

in HRKIn foreign currency

Due to tougher conditions in the retail loans/credits sector, the Bank made a significant turn in 2012 in the segmentof business loans/credits.Legal entity placements, i.e. loan placements in 2012 were approximately HRK 396 mil., or 27.46% of total Bankplacements. This represents a nominal increase of loan placements of HRK 112 mil.In accordance with market demands, legal entity business primarily concerns financial crediting of SME's andtradesmen/craftsmen, both from own sources and from assets put up by the Croatian Bank for Reconstruction andDevelopment (CBRD) and through credit lines in cooperation with local governments.In addition to better cooperation with HBOR, allowing the Bank greater freedom in using HBOR credit sources, in2012 the Bank also concluded an agreement with Hamag Invest, aimed at constructing a financial model whichwill in a best way offer a full, high-quality financial service suited for dynamic market conditions.In addition to SMEs and trades, the Bank actively credits local government institutions through CBRD credit lines,solving developmental and infrastructural financial problems and laying quality foundations for further economicgrowth of certain areas.The Bank allocated a significant portion of its assets to placements into debt securities through discounting bills ofexchange issued by companies with good credit rating.The Bank also offers all types of guarantees, in Kuna and foreign currencies, for offers, active and paymentguarantees, letters of credit and other types of guarantee demanded by today's business climate.Credit rating, quality development programmes and professional management are the main conditions forfinancial crediting of clients.Further developing its business, we are offering other services to legal entities allowing faster, simpler and moreefficient business - MBCARD/MAESTRO cards, MasterCard Business cards, SMS services and Internet banking.Core Bank activities with companies will still be aimed at developing services which the Bank can offer to all legalentities, and at further development of business trust and partnership.In 2012, the business environment was hit with a sharp decrease of economic activities and liquidity of legalentities. Extreme care and plentiful resources are placed in finding the optimal solution for clients in overcomingthese tough business conditions.

LEGAL ENTITY TRANSACTIONS

8

LEGAL ENTITY (COMPANY) DEPOSITS

31 DEC. 2012 % 31 DEC. 2011 %


40.725

20.893

61.618

36.5414.184

20.267626

66,09

33,91

100

59,306,79

32,891,02

42.372

47.154

89.526

35.3207.052

22.95624.198

47,33

52,67

100

39,457,88

25,6427,03

SIGHT DEPOSITS

TERM DEPOSITS

TOTAL

In HRKIn foreign currency

In HRKIn foreign currency

Payment transactions are a crucial segment of our offer. We are striving to be competitive in our tariffs and for speed andquality of payment transactions.

The Bank has wide authorizations as far as quality performance of foreign currency transactions is concerned; it has amembership in the SWIFT network programme, essential for retaining correspondence relations with domestic andforeign banks and high quality transactions.

The Bank has been a member of the National Clearing System (NKS) from the start. NKS membership allowsperformance of independent domestic payment transactions.The Bank uses its own software for payment transaction, which is the technical basis for high-quality domestic paymenttransaction operations .Following market trends and favouring business clients, the Bank also offers Internet banking, speeding up andsimplifying financial transactions regardless of time and place of business, saving time and money through morefavourable fees.Login and verification is done through the token for private entities and through USB PKI for legal entities.

Transactions can be made in any of the Bank's offices, regardless of the location in which the client opened his/her/itsaccount; to further make our clients' lives easier, transactions are also possible in any Financial Agency (FINA) outlet.

The Bank will continue to develop its payment transaction services in order to offer current and future users of suchservices a cost-effective, efficient, high-quality offer of products and services.

The primary function of the Bank's information system is to ensure to business users and Bank clients approach toinformation and services necessary for their everyday business. It ensures confidentiality, accessibility and integrity ofinformation, as well as continual development of the Bank's business.

The technological base of the Bank IS are servers for banking and non-banking applications. The server for bankingapplications if IBM Power6 520, while non-banking applications use two IBM x3650 servers with installed VMwareinfrastructure. External locations (financial centres, branches and branch offices) are connected through the virtualprivate network (VPN).The Bank also has a backup system, which includes a backup location with redundant hardware, software and data to beused in case of catastrophic events or some other emergency; the entire production system can be started during therecovery time, all in accordance with legal provisions.

Numerous activities concerning the upgrade of the IS of the Bank and expanding services according to the operationsplan were performed in 2012. 2 (two) ATMs were installed in branch offices in Pitomača and Sl.Brod, one part of thecomputer and communication equipment in financial centres/branches and the Bank seat was replaced, and mobileEFTPOS devices were introduced.

The project of increasing Internet banking security was completed. Authentication changes for Internet banking userswere made; private entities received tokens, and legal entities USB PKI devices with FINA certificates. Business usershave access to the B2G (Business to Goverment) service.

In the area of regulator reports, the Bank successfully fulfilled all legal and other regulatory obligations. CNB reportingproject support was also successfully introduced (statistical and credit standing PLA reports, payment transactionstatistics). Support was also introduced in accordance with the Salary Contribution Regulation. The IS was adjusted tonew formats, in accordance with the Payment Transactions Act.Support for bills of exchange, treasury notes, inter-bank loans and deposits was introduced as part of internalprogramming improvements. Also improved was support for estimation of credit rating of legal entities.

During to process of introducing new products or developing present ones, the Bank Management performs the analysisof its own technical, organizational and staff readiness, as well as planned profitability and market. These activities arebeing performed in accordance with the Project Management Regulations.

TRANSACTIONS

THE BANK'S INFORMATION SYSTEM AND IT

LIQUIDITY RISK

CREDIT RISK

CURRENCY RISK

Liquidity risk is the risk of the Bank's ability to fulfil all its obligations according to their maturity on time and withinarranged time frames, without causing any undue losses or jeopardising the Bank's capital. The Bank sets itsliquidity by constructing preconditions for long-term maintenance of liquidity in HRK and foreign currencies whichwould ensure the Bank unhindered and timely fulfilment of all its obligations, thereby ensuring permanent Bankliquidity and fulfilling preconditions for safe, stable and profitable business.In order to maintain the planned level of liquidity, the Bank must attempt to meet the following criteria: Regularmaintenance of the planned level of "daily liquid assets", maintenance of time-adjusted assets and liabilities, andattaining surplus of foreign currency receivables over foreign currency liabilities, in accordance with the Decisionon minimum necessary foreign currency receivables.

Ever more complex business conditions and high level of non-liquidity/insolvency both in the business sector andthe retail sector are a constant challenge before the Bank, with the goal being retention of the wanted level ofsolvency/liquidity.To that end, solvency/liquidity levels are being constantly monitored, and stress tests performed in order tooptimise the Bank’s solvency/liquidity.

Credit risk is the risk of an undesirable event taking place due to which the debtor cannot or does not wish to returnthe money placed to him or fulfil his financial obligation according to agreed upon dynamic or set conditions.The Bank manages credit risk through regular analysis of the ability of existing and potential borrowers to pay backtheir obligations (equity and interest) and to change credit limits as necessary. In addition, exposure to this risk isalso partially regulated through acquiring collateral and corporate/private guarantees.The Bank ensures control over crediting procedures - approval, monitoring and collection - through performanceof activities of detailed and thorough check of credit rating of clients.The Bank monitors exposure toward individual clients based on client classification, type of exposure andprovisioning of individual clients; it also controls the allocation of placements and off-balance potential items intorisk groups.

The bank evaluates credits/loans and other placements through the internal placement allocation system, basedon client regularity in making their payments, based on repeated inspection of client credit ability and based on thequality of insurance instruments.In accordance with Bank policies, which in turn are run in accordance with pertinent valid legal provisions, the Banksets aside reserves for non-identified grouped losses. The amount of so determined reserves may not be lower than0.85% - 1% of no-risk assets and 0.85%-1% non-risk potential liabilities and those taken over.Since credit risk is the risk that can have the most serious consequences for the Bank, we are continually improvingthe credit/loan process and are adding new staff to the Risk Department.

Currency risk is the risk emerging pursuant to changes in currency relations and the change in value of the domesticcurrency with respect to foreign currencies in which the Bank has positions.Currency risk stems from non-adjusted asset and liability items in the balance sheet and off-balance in currencieswhere more significant changes in currency rates may have an effect on the profit and loss account.Monitoring and measuring of the currency risk is performed on a monthly and daily basis using the followingmethods, i.e. approaches: monitoring the currency structure of assets and liabilities and the currency structure ofoff-balance items, daily monitoring of Bank's exposure to currency risk according to the Decision on limiting theexposure of banks to currency risk, the credit and deposit plan, analysis of currency rate trends. Management ofcurrency risk is performed through planning of the currency structure of the Bank's assets and liabilities andcontinued monitoring of the exchange rate of certain currencies and forecasting their trends and effects on theBank's business.

In order to minimise this type of risk, the Bank’s assets and liabilities are constantly optimised in order to neutralisethis type of risk as much as possible.

BUSINESS RISKS

INTEREST RISK

Interest risk is the risk arising from changes in active and passive interest rates, influencing profitability of businessand earnings, and thereby the Bank's capital. Interest risk originates from non-adjusted interest rates, in scope andmaturity of the parts of assets and liabilities sensitive to interest changes.The Bank uses the following methods for measuring the risk of change of interest rates: analysis of interest ratetrends on the market, analysis of interest margins, analysis of net interest income, analysis of the static gap model.

Risk tied to holding and trading securities; it is a consequence of possible decrease of the value of securities in theBank's portfolio. Therefore, management of this portfolio includes the need for constant monitoring of marketprices of certain securities and maintaining the portfolio structure which supports the optimal profit to risk ratio.Sectors investing in securities are the ones furnishing data for monitoring price risks.

PRICE RISK

BUSINESS RISKS

SHARES-RELATED INFORMATION

In 2012, the Bank purchased its own shares twice.- on 1 February it purchased 3.26% shares- on 6 November it purchased 3.64% shares- From before, the Bank had 0.86% shares

Therefore, the total of purchased own shares in capital stock is 7.77%.

The Chairwoman of the Management Board Angelina Horvat has a0.02% stake in the capital stock of the Bank.

BANK MANAGEMENT BOARD:

Chairwoman:Angelina Horvat

Board member:Marko Krajina

Board member:Marko Brnić

SLATINSKA BANKA d.d., SlatinaVladimira Nazora 2, Slatina

AUDITOR'S REPORT

AND FINANCIAL STATEMENTS

FOR THE YEAR ENDED

31 DECEMBER 2012

12

13

14

15 - 16

17

18

19

20

21 – 54

56 – 63

CONTENTSAUDITOR'S REPORTAND FINANCIALSTATEMENTSFOR THE YEAR ENDED31 DECEMBER 2012

RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

INDEPENDENT AUDITOR’S REPORT

STATEMENT OF INCOME / STATEMENT OFCOMPREHENSIVE INCOME

BALANCE SHEET / STATEMENT OF FINANCIAL POSITION

STATEMENT OF CHANGES IN EQUITY

CASH FLOWS STATEMENT –INDIRECT METHOD

NOTES TO THE FINANCIAL STATEMENTS

APPENDIX - OTHER LEGAL AND REGULATORY REQUIREMENTS

14

RESPONSIBILITY FOR THE FINANCIAL STATEMENTS

Management Board of the Slatinska banka d.d., Vladimira Nazora 2, Slatina (hereinafter: ‘’theBank’’) is responsible for ensuring that the annual financial statements for the year 2012 areprepared in accordance with the Accounting Law (National gazette No 109/07) and theInternational Financial Reporting Standards (National gazette No 136/09, 8/10, 18/10, 27/10,65/10, 120/10, 58/11, 140/11, 15/12, 118/12) issued by the Committee for Financial ReportingStandards, nominated by Government of the Republic of Croatia, to give a true and fair viewof the financial position, the results of operations, the changes in equity and the cash flows ofthe Bank for that period.After making enquiries, the Board has a reasonable expectation that the Bank has adequateresources to continue in operational existence for the foreseeable future. Accordingly, theBoard has adopted the going concern basis in preparing the financial statements of the Bank.In preparing those financial statements, the responsibilities of the Board include ensuring that:• suitable accounting policies are selected and then applied consistently;• judgments and estimates are reasonable and prudent;• applicable financial reporting standards are followed, subject to any materialdepartures disclosed and explained in the financial statements; and• the financial statements are prepared on the going concern basis unless suchassumption is not appropriate.The Board is responsible for keeping proper accounting records, which disclose withreasonable accuracy at any time the financial position and the results of operations of theBank and their compliance with the Accounting Law (National gazette No 109/07) and theInternational Financial Reporting Standards (National gazette No 136/09, 8/10, 18/10, 27/10,65/10, 120/10, 58/11, 140/11, 15/12, 118/12) issued by the Committee for Financial ReportingStandards. The Board is also responsible for safeguarding the assets of the Bank and hencefor taking reasonable steps for the prevention and detection of fraud and other irregularities.

Signed on behalf of the Board:

Angelina Horvat,President of the Management Board

Marko Krajina,Member of the Management Board

Marko Brnić,Member of the Management Board

Slatinska banka d.d.Vladimira Nazora 233520 SlatinaThe Republic of Croatia

Slatina, 29 March 2013

15

INDEPENDENT AUDITOR’S REPORT

To the shareholders of the Slatinska banka d.d., Slatina

Responsibility of the Bank’s Management

Responsibility of Auditor

1. We have audited the accompanying annual financial statements of the Slatinska bankad.d., Vladimira Nazora 2, Slatina (hereinafter: ‘’the Bank’’) for the year ended 31 December2012, which comprise of the Balance Sheet/Statement of Financial Position as of 31 December2012; the Statement of Income/Statement of Comprehensive Income; the Statement ofChanges in Equity; the Cash Flows Statement for the year then ended; and the accompanyingNotes to the financial statements which concisely set out the principal accounting policies andother disclosures.

2. The preparation and a fair presentation of the enclosed financial statements accordingto the International Financial Reporting Standards effective in the Republic of Croatia and alsothose internal controls which are determined by the Bank's management as necessary toenable preparation of the financial statements free from material misstatements whether due tofraud or error are the responsibility of the Bank's management.

3. Our responsibility is to express an opinion on the enclosed financial statements basedon the audit performed. We conducted our audit in accordance with International Standards onAuditing. Those standards require that we comply with ethical requirements and plan andperform the audit to obtain reasonable assurance that the financial statements are free frommaterial misstatements.

An audit includes performing of procedures to obtain audit evidence supporting the amountsand disclosures in the financial statements. The procedures selected depend on the auditor’sjudgment, including the assessment of the risks of material misstatements in the financialstatements, whether due to fraud or error. In making those risk assessments, the auditorconsiders internal controls relevant to the entity’s preparation and fair presentation of thefinancial statements in order to design audit procedures that are appropriate in thecircumstances, but not for the purpose of expressing an opinion on the effectiveness of theentity’s internal controls. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of accounting estimates made by Bank’s management,as well as evaluating the overall presentation of the financial statements.

We believe that auditing proof and evidence being collected by us are sufficient and suitable asthe basis for our opinion.

16

Member of theManagement Board

Authorized auditor

Opinion4. In our opinion, the enclosed financial statements, in all material respects, truly andfairly present the financial position of the Slatinska banka d.d., Slatina as of 31 December2012 and the results of operations and the cash flows of the Bank for the year 2012 inaccordance with the Accounting Law and International Financial Reporting Standards effectivein the Republic of Croatia.

Emphasis of matter

5. Without qualifying our opinion stated in paragraph 4 above, we draw your attention tothe Note V to the financial statements where it is described contigent liability by court disputein progress.

Other legal and regulatory obligations

6. Based on the Decision on the form and content of annual financial statements ofbanks (Official Gazette 62/08, hereinafter ''the Decision''), the Management Board of the Bankprepared forms which include statement of financial position as of 31 December 2012,statement of comprehensive income, statement of changes in equity and cash flows statementfor the year then ended, as well as the notes on reconciliations with basic financialstatements.These Forms and accompanying Reconciliations are the responsibility of theBank’s Management Board and do not represent an integral part of financial statements, butare prescribed by the Decision. Financial information in the Forms stated on pages 44 to 53are correctly derived from the basic financial statements of the Bank which are prepared inaccordance with the International Financial Reporting Standards and shown on pages 5 to 43.

In Zagreb, 15 April 2013

POSITION Note


20112012

84.459

(47.812)

13.011

(2.934)

3.189

5.654

(43.642)

(5.522)

3.022

36.647

10.077

8.843

(49.164)

6.403

(1.406)

4.997

5,44

8.019

83.940

(46.567)

13.460

(3.356)

3.839

909

(41.196)

(6.452)

(1.257)

37.373

10.104

4.748

(47.648)

4.577

(1.250)

3.327

3,62

2.070

4

5

6

7

8

9

10

13

14

33

Interest income

Interest expense

Income from fees and commissions

Expenses from fees and provisions

Net foreign exchange gains

Other income

Other expenses

Impairments and provisions

Unrealized profit/loss from valuationof financial assets available for sale

Net interest income

Net income from fees and provisions

Total other income

Total other expenses

Profit before tax

Corporate income tax

Profit for the year

Earnings per share

TOTAL COMPREHENSIVE PROFIT OF THE CURRENT YEAR

Supplementary notes under number I to VI form an integral part of these financial statements.

17

STATEMENT OF INCOME / STATEMENT OF COMPREHENSIVE INCOMEFor the year ended 31 December 2012

At 31 Dec 2011At 31 Dec 2012

159.495

42.065

174.422

83.098

776.819

5.679

27.315

6.273

13.741

19.993

2.617

196.482

859.810

159.030

46.088

2.936

91.897

(6.592)

1.799

149

14.357

68.687

4.997

133.357

1.442.257

1.266.963

175.294

1.442.257

125.816

118.269

129.085

143.365

87.582

662.473

5.759

27.173

4.649

8.354

18.676

2.596

202.713

848.538

56.158

45.115

2.612

91.897

(398)

(1.223)

149

14.357

65.360

3.327

1.331.201

1.157.732

173.469

1.331.201

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

32

ASSETS

Total assets

LIABILITIES

CAPITAL

Total capital

Cash assets

Receivables from Croatian National Bank

Placements with banks

Financial assets available for sale

Financial assets held to maturity

Loans and prepayments to customers

Investment in Affiliate

Property, plant and equipment

Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits

Liabilities for received loans

Other liabilities

Provisions

Total liabilities

Subscribed capital

Own shares

Revaluation resesrves

Capital gains

Reserves

Retained earnings

Profit of the current year

TOTAL LIABILITIES AND CAPITAL


18


POSITION Note


STA

TEM

EN

T O

F I

NC

OM

E /

STA

TEM

EN

T O

F C

OM

PREH

EN

SIV

E I

NC

OM

EFor

the y

ea

r en

ded

31

Dece

mb

er

20

12

Supple

menta

ry n

ote

s under

num

ber

I to

VI fo

rm a

n inte

gra

l part o

f th

ese

fin

anci

al st

ate

ments

.

Shar

eca

pita

lO

wn

shar

es

Unr

ealiz

edpr

ofit

/ fa

irva

lue

Cap

ital

gain

s

RESE

RVES

Rese

rves

for o

wn

shar

esLe

gal

rese

rves

Oth

erre

serv

esRe

tain

edea

rnin

gs

Prof

it fo

rth

e cu

rren

tye

ar

(in th

ousa

nds

of K

una)

0 0 0 0

91

.89

7

91

.89

7

(39

8)

(6.5

92

)0

(6.1

94) 0 0

0 0

3.02

2 0

(1.2

23

)

1.7

99

0 0 0 0

14

9

14

9

4.7

29

4.7

290 0 0 0

0 0 0 0

6.6

00

6.6

00

3.0

28

3.0

280 0 0 0

65

.36

0

68

.68

7

3.32

7 0 0 0

3.3

27

4.9

97

(3.3

27) 0 0

4.99

7

173.

469 0

(6.1

94)

3.02

2

4.99

7

175.

294

Bala

nce

at

31 D

ec. 2

011

Allo

catio

n of

pro

fit

for

the

2011

Purc

hase

of o

wn

shar

es

Unr

ealiz

ed p

rofit

Prof

it fo

r th

e cu

rren

t

peri

od

Bala

nce

at 3

1 D

ec. 2

012

Tota

l

1919

NET CASH FLOW FROM OPERATING ACTIVITIESProfit before taxAdjustment to net cash assetsfrom operating activities

CASH FLOW FROM INVESTING ACTIVITIES

Net cash flow from investing activities

CASH FLOW FROM FINANCIAL ACTIVITIES

Net cash flow from financial activities

Net change in cash and cash equivalentsCash and cash equivalents at the beginning of the yearCash and cash equivalents at the end of the year

Depreciation

Loan impairments

Impairments of other assets

Provisions for court disputes

Imperments of assets held-to-maturity

Other impairments and provisions (net)

Changes on assets and liabilities from operating activities

Increase in receivables from CNB

Decrease / increase in placements with banks

Increase in loans and prepayments to customers

Increase in other assets

Increase in due to banks

Decrease in demand deposits

Increase in term deposits

Increase/decrease in other liabilities

Corporate income tax

Net cash flow from operating activities

Decrease/increase in available-for-sale financial assets

Increase in financial assets held to maturity

Purchase of property, plant, equipment and intangible assets

Increase in foreclosed assets

Increase in loan liabilities

Other changes in equity (net)

Purchase of own shares

20112012


3.937

5.074

573

185

1.128

139

(41.226)

418

(119.420)

(1.891)

21

(6.231)

11.272

973

(1.406)

4.825

(3.242)

(5.703)

(5.388)

102.872

3.022

(6.194)

6.403

(140.048)

(9.508)

99.700

(49.856)

385.261

335.405

3.777

2.932

745

2.705

33

(33.817)

(152)

(28.881)

(5.084)

111

(7.794)

98.838

(2.119)

(1.250)

(25.421)

(12.968)

(5.620)

(3.294)

8.665

999

0

4.577

34.588

(47.303)

9.664

(3.051)

388.312

385.261

20


POSITION


I GENERAL

II BASIS FOR PREPARATION OF THE FINANCIAL STATEMENTS

1.1. Legal framework and activities

1.2. Company Bodies

2.1. Statement of adjustment and basis of presentation

SLATINSKA BANKA d.d. SLATINA is registered at the Commercial Court in Bjelovar. The Bank’sheadquarter is in Slatina, Vladimira Nazora 2.

The Bank is registered for the following services: domestic payment transaction in foreign currencies,cash services, all types of deposits, all types of loans, opening of documented letters of credit, issuingguarantees and bank warranties, bills of exchange and check activities, borrowings, purchase on own accountor on behalf of its clients, security activities on own account or on behalf of its clients; issuing and managingmeans of payment, financial leases and factoring, providing information on the credit worthiness of its clientsat their request, foreign credit activities and payment transactions, domestic payment transactions,representation services in the sale of insurance policies and other financial services.

The management Bodies of the Bank are Management Board, Supervisory Board and the Assembly.

Management Board:1. Angelina Horvat – President of the Management Board2. Elvis Mališ – Member of the Management Board till 18 March 20133. Marko Krajina – Member of the Management Board4. Marko Brnić – Member of the Management

Supervisory Board members are:1. Ružica Vađić - President of the Supervisory Board2. Tomislav Rosandić - Vice President of the Supervisory Board3. Hrvoje Markovinović - Member of the Supervisory Board4. Blaženka Eror Matić – Member of the Supervisory Board5. Denis Smolar – Member of the Supervisory Board

Financial statements of the Bank are prepared in accordance with the International Financial ReportingStandards (‘’IFRS’’) (National gazette No 136/09, 8/10, 18/10, 27/10, 65/10, 120/10, 58/11, 140/11,15/12, 118/12) issued by the Committee for Financial Reporting Standards nominated by Government of theRepublic of Croatia, and in accordance with the accordance with statutory accounting requirements for banksin the Republic of Croatia. Banking operations in the Republic of Croatia are subject to the Credit institutions’Act, in accordance with which financial reporting is regulated by the Croatian National Bank (“the CNB”).

21


2.2. Basis for preparation

2.3. Key estimates and uncertainty of estimates

2.4. Reporting currency

3.1. Interest income and expenses

3.2. Fee and commission income and expenses

Financial statements have been prepared by the application of basic accounting presumption of thebusiness event inception upon which the effects of operations are recognized when arisen and are shown inthe financial statements for the period to which they relate and with the basic accounting assumption thatgoing concern concept is applied.

Certain estimates are used during preparation of the financial statements which have inflow to thestatement of property and liabilities of the Bank, income and expenses of the Bank and the disclosure ofpotential liabilities of the Bank.Future events and their inflows could not be predicted with certainty and, following to this, the real results maydiffer from the estimated. Estimates utilized during preparation of the financial statements are subject tochanges by the occurrence of new events, by gathering of additional experience, obtaining of additionalinformation and comprehensions and by a change of environment in which the Bank operates.Key estimates used by the application of accounting policies during preparation of the financial statementsrelate to depreciation count of long-term intangible and tangible property, value decrease of property, valueprovision of receivables and provisions and the disclosure of potential liabilities.

The financial statements of the Bank are prepared in Croatian kuna as a measuring and reportingcurrency of the Bank.

At 31 December 2012 the official rate of Croatian kuna was 7.545624 HRK for 1 EUR (2011: it was7.530420 HRK) and 5.726794 HRK for 1 USD (2011: it was 5.819940 HRK).

Summary of accounting policies applied for preparation of the financial statements is set below.Policies are consistently applied to all the periods presented, unless otherwise indicated.

Interest income and expenses are recognized in the income statement for all interest bearinginstruments on an accrual basis using the effective yield method and based on real purchase price. Interestincome includes coupons earned on fixed income investment and trading securities for sale and accrueddiscount and premium on treasury bills and other discounted instruments.When the loan repayment becomes doubtful, principal amount is decreased to their recoverable amount, andinterest income is thereafter recognised based on the interest rate used for discounting the future cash flow.

Fees and commissions income mainly comprise fees and commissions from domestic andinternational payment transactions, guarantees, letters of credit, cards and assets management, and arerecognized in the income statement when the corresponding service is provided, except for the cases whenthey are included in the calculation of effective interest rates.

III SUMMARY OF ACCOUNTING POLICIES

Fees and commissions expenses comprise fees paid to the authorized banks for foreign paymenttransactions and for the services of the Financial Agency (“FINA”) for domestic paymenttransactions.

22


3.3. Net gains and losses from financial instruments at fair value through profit or loss andthe result of foreign exchange trading and exchange rate differences arising on translationof monetary assets and liabilities

This category include earnings from foreign currency trading, realized and unrealized gains and lossesfrom debt and equity securities held for trading, other financial instruments carried at fair value through profit orloss and derivative financial instruments. Net gains and losses from foreign exchange differences arising ontranslation of monetary assets and liabilities denominated in foreign currencies, are also included in this category.

Transactions in foreign currencies are translated into HRK (Croatian Kuna) at the exchange rate ruling atthe date of the transaction. Croatian Kuna is the official currency of the Bank and the financial statements arepresented in that currency.

Monetary assets and liabilities denominated in foreign currencies at the balance sheet date are translatedto HRK at the foreign exchange rate ruling at that date. Foreign exchange differences arising on translation arerecognized in the income statement.

Non-monetary items denominated in foreign currencies measured at fair value are translated to HRKusing the exchange rates at the date when the fair value is determined. Non-monetary items that are measured interms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initialtransactions.Gains and losses arising on translation and foreign currency trading are recognized in the income statement forthe year concerned.

Income tax expense represents the cumulative amount of the current tax liability and deferred tax.

Current tax liability is based on taxable profit for the year. Taxable profit differs from profit as reported inthe income statement because it excludes items of income or expense that are taxable or deductible in other yearsand it further excludes items that are never taxable or deductible. The Bank’s current tax liability is calculatedusing tax rates that have been enacted or substantively enacted by the balance sheet date.

Management periodically evaluates positions taken in the tax returns with respect to situations in whichapplicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred tax is provided using the liability method and shows tax effects on all significant temporarydifferences at the reporting date between the tax bases of assets and liabilities and their carrying amounts forfinancial reporting purposes.

Defined benefit scheme surpluses and deficits are measured at:• the fair value of plan assets at the reporting date; less• current net value of mandatory benefits; and• adjustments for unrecognised past service costs.

The Bank does not have other retirement arrangements separate from the Croatian State pension system.

3.4. Foreign currency translation

3.5. Taxation

3.6. Retirement benefits: Defined benefit schemes

a) Current tax

b) Deferred tax

Defined contribution schemes

Defined benefit schemes

Contributions for the Bank's retirement plan are debited to the income statement in the year to which they relate.

23


3.7. Financial instruments

Bank's financial instruments are classified into portfolios based on the Bank's intention at the time ofthe acquisition of a financial instrument and in accordance with the Bank's investment strategy. Financial assetsand financial liabilities are classified into the following categories: "at fair value through profit or loss", "held tomaturity", "available for sale", "loans and receivables" and "other financial liabilities".

All financial assets and liabilities are recognized, and derecognised on the trade date where purchaseof a financial asset or financial liability is defined by the contractual delivery date within the timeframeestablished by conventions on the subject market.

At initial recognition of financial assets or liabilities, the Bank measures assets or liabilities at cost,including transaction costs (excluding financial assets at fair value through profit or loss) which are directlyattributable to the acquisition or issue of financial asset or financial liability.

This category has two subcategories: financial instruments held for trading (including derivatives) andthose which the Bank initially deployed into this category. A financial instrument is allocated to this category ifacquired or incurred for sale or repurchase in the short term, for the purpose of short-term profit or deploymentby the Management in this category.After initial recognition, financial assets at fair value through profit or loss are carried at fair value which isequal to the price quoted on recognized stock exchanges or is determined by some acceptable evaluationmodels. The Bank states unrealized gains and losses within net profit / (loss) from financial operations.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that arenot quoted in an active market. Loans and receivables arises when the Bank provides cash to the clients withno intention of trading the receivables and include loans and receivables from banks, loans and receivablesfrom clients, alternate bonds and obligatory reserve at the Croatian National Bank.

Loans and receivables are stated net of allowances for impairment losses.

Allowances for impairment losses are established if there is objective evidence that the Bank will notbe able to collect all amounts due. The amount of the allowance for impairment losses is the differencebetween the carrying amount and the recoverable amount, which represent the present value of expected cashflows, including amounts recoverable from guarantees and collaterals. Allowances for impairment losses byspecific loans are assessed with reference to the performance of the borrower, taking into account the value ofany collateral or third party guarantees.

Due outstanding loans are written-off in the amount of related impairment loss, and all subsequentlycollected amounts are credited to the income statement within other income.

The Bank is charging interest to the debtors for delays in payment, which is accrued based on the cashreceipts and stated within interest income.

Non-derivative financial assets with fixed or determinable payments and fixed maturities are classifiedas held-to maturity when the Bank has the positive intention and ability to hold it to maturity. Mentionedcategory includes certain debt securities.

All financial instruments held to maturity are accounted at amortized cost less impairment provisions.Interest earned on the basis of these financial instruments is stated as interest income.

The Bank regularly checks whether there is objective evidence that would indicate an impaired valueof assets held to maturity. When it is determined the impairment of assets, the Bank recognizes provisions inthe income statement. Impairment loss is cancelled in the next periods when an increase in the recoverableamount of the investment can be related objectively to an event occurring after the impairment recognition.

a) Financial assets and financial liabilities at fair value through profit or loss

b) Loans and receivables

c) Held-to-maturity investments

24


This category comprises non-derivative financial assets which are designated as available for sale or isnot designated in other category. Financial assets designated as available for sale are intended to be held for anindefinite period of time, but may be sold in response to needs for liquidity or changes in interest rates, foreignexchange rates, or equity prices. Available-for-sale financial assets include certain debt and equity securities.

After initial measurement, available-for-sale financial investments are subsequently measured at fairvalue based on quoted prices or amounts derived from cash flows. If the market value cannot be reliablydetermined, the Bank establishes fair value by using the techniques of evaluation. These include the use of pricesachieved in recent transactions between informed, willing parties, reference to other substantially similarinstruments, discount cash flow analysis and price option models, thereby making maximum use of informationfrom the market.

Unrealized gains and losses arising from changes in fair value of available-for-sale assets arerecognized directly in equity until the sale or impairment of financial assets, and then the realized gains or lossesare reported in net profit or loss for the period.

e) Other financial liabilities

Other financial liabilities comprise all financial liabilities not held for trading or not designated at fairvalue through profit or loss.

Associated companies are companies where the Company has control over bringing and implementingfinancial and business policies (portion over 50%). Investments into associated companies are stated at costmethod, decreased by carrying value of these asset-investment to its recoverable amount.The Bank is also preparing consolidated financial statements with the subsidiary in which it has the entire shareportion and control.

The fair value of financial instruments that are traded in active markets at each reporting date isdetermined by reference to quoted market prices or dealer price quotations without any deduction for transactioncosts.

For financial instruments not traded in an active market, the fair value is determined using appropriatevaluation techniques. Such techniques may include using recent arm’s length market transactions; reference tothe current fair value of another instrument that is substantially the same; discounted cash flow analysis or othervaluation models.

Plant and equipment are stated at cost less accumulated depreciation and / or accumulated impairmentlosses, and make tangible assets if their useful life is longer than one year, and single value is greater than HRK3,500 at the acquisition date. Cost includes purchase price, the cost of spare parts, plant and equipment,borrowing costs for long-term construction projects, and other dependent costs and estimated future costs ofdismantling, if recognition conditions are met, while the liability is recorded as commission.Land and property are recorded at cost less accumulated depreciation of property and asset impairment lossesrecognized after the date of revaluation, on the basis of periodic evaluation by professional appraisers.

Depreciation is calculated so to write-off the cost of the assets, except land and investments in progress,over their estimated useful lives using the straight-line method at the following rates:

d) Financial assets available for sale

3.8. Investments in Associates

3.9. Fair value of financial instruments

3.10. Property, plant and equipment

25


Depreciation is calculated separately by each item of assets till it is fully depreciated. An item ofproperty, plant and equipment and any significant part initially recognized is derecognized upon disposal orwhen no future economic benefits are expected from its use or disposal.

Any gains or losses from disposal of certain asset are determined as difference between sale revenueand carrying amount of that asset and are recognized as expense or income in the Income statement. Theassets’ residual values, useful lives and methods of depreciation are reviewed at each financial year end, andadjusted prospectively, if appropriate.

3.11. Intangible assets

3.12. Use of estimates

Intangible assets include IT programmes and leasehold investments initially measured at cost anddepreciated on a straight line basis during the estimated useful life.

Intangible assets acquired separately are measured on initial recognition at cost. The cost ofintangible assets acquired in a business combination is its fair value as at the date of acquisition.

Following initial recognition, intangible assets are carried at cost less any accumulated amortisationand any accumulated impairment losses. Internally generated intangible assets, excluding capitaliseddevelopment costs, are not capitalised and expenditure is reflected in the income statement in the year inwhich the expenditure is incurred. The useful lives of intangible assets are assessed as either finite or indefinite.

Intangible assets with finite lives are amortised over the useful economic life and assessed forimpairment whenever there is an indication that the intangible asset may be impaired. The amortisation periodand the amortisation method for an intangible asset with a finite useful life are reviewed at least at eachfinancial year end. Changes in the expected useful life or the expected pattern of consumption of futureeconomic benefits embodied in the asset is accounted for by changing the amortisation period or method, asappropriate, and are treated as changes in accounting estimates. For the purpose of preparation of thesefinancial statements the Bank calculated depreciation of intangible assets using depreciation rate of 20%.

The amortisation expense on intangible assets with finite lives is recognised in the income statement inthe expense category consistent with the function of the intangible asset. Intangible assets with indefinite usefullives are not amortised, but are tested for impairment annually, either individually or at the cash generatingunit level.

The preparation of the financial statements in accordance with the IFRS requires that the Bank’sManagement Board make estimates and assumptions that affect the amounts reported in financial statementsand accompanying notes. The estimates have been made based on historical experience and various otherfactors that are believed to be realistic in the circumstances and information available at the date ofpreparation of financial statements, the results of which form the basis for judgments about carrying values ofassets and liabilities that are not easily ascertainable from other sources. Actual results may differ from theseestimates.

The estimates and underlying assumptions are reviewed on a regular basis. Revisions to accountingestimates are recognized in the period in which they are incurred if affects only that period or the period inwhich they are incurred and future periods if affects current and future periods.

DESCRIPTION

BuildingsComputer equipmentFurniturePersonal vehiclesSoftwareOther equipmentIntangible assets

2012.%

2011.%

2,5025204020

10 - 2520

2,5025204020

10 - 2520

26


3.13. Contingent liabilities and commitments

3.14. Cash flow statement

3.15. Operating segments

3.16. Regulatory requirements

3.17. Events after the reporting period

3.18. Comparatives

In the ordinary course of business, the Bank was by issuing guarantees, credentials, granting loans that werenot fully utilized and other contingencies stated contingent liabilities and commitments in its off-balancerecords. These financial instruments are stated in the Bank’s balance sheet when and if the Bank settlematured liability.Provisions for possible losses by contingent liabilities and commitments are made at a level Bank’smanagement believe is adequate to absorb probable future losses. Management determines the adequacy ofthe provisions based upon reviews of individual items, current economic conditions, the risk characteristics ofthe various categories of transactions and other pertinent factors.

For the cash flow reporting purposes, cash and cash equivalents are defined as cash, placements with banksand treasury bills of the Ministry of Finance with remaining maturity up to 90 days.

Operating segments are reported in a manner consistent with the internal reporting provided to thechief operating decision-maker. The chief operating decision maker has been identified as the Bank’sManagement Board that reaches strategic decisions.

The Bank has identified four primary segments: Retail, Corporate, Banks and Other. The primarysegmental information is based on the internal reporting structure of business segments. Where it was possiblethe positions of the balance sheet and income statement were shown by mentioned segments.

The Bank is subject to the regulatory requirements of the Croatian National Bank. These regulationsinclude limits and other restrictions pertaining to minimum capital adequacy requirements, classification ofloans and off-balance sheet commitments and provisioning to cover credit risk, liquidity, interest risk and riskrelated to foreign currency position.

Events after the balance sheet date are those favourable and unfavourable events that have occurred betweenthe date of the statement of the financial position and the date on which financial statements are approved forissuance. The Company adjusts amounts recognized in its financial statements for events occurred after thebalance sheet date which requires adjustment.

Where necessary, comparative figures have been reclassified to achieve consistency in disclosure with currentfinancial year amounts and other disclosures.

27


28

33.397

41.628

627

8.807

84.459

1.136

35.954

3.207

7.515

47.812

3.604

8.320

1.087

13.011

1.958

253

723

2.934

27.272

46.969

1.799

7.900

83.940

1.842

35.332

1.514

7.879

46.567

3.343

9.275

842

13.460

2.379

267

710

3.356

DESCRIPTION

DESCRIPTION

DESCRIPTION

DESCRIPTION

4. INTEREST INCOME

5. INTEREST EXPENSES

6. FEE AND COMMISSION INCOME

7. FEE AND COMMISSION EXPENSES


(u 000 kuna)



NOTES TO THE STATEMENT OF INCOME / STATEMENTOF COMPREHENSIVE INCOME

2011

2011

2011

2011

2012

2012

2012

2012

Corporate

Individuals

Banks

Other

Total

Corporate

Individuals

Banks

Other

Total

Corporate

Individuals

Other

Total fee and commission income

FINA services

Foreign banks

Domestic customers

Total


29

21.594

3.937

18.111

43.642

11.885

6.117

2.350

1.242

21.594

20.784

3.777

16.635

41.196

11.586

6.156

2.057

985

20.784

DESCRIPTION

DESCRIPTION

DESCRIPTION

DESCRIPTION

8. NET FOREIGN EXCHANGE GAINS

9. OTHER INCOME

10. OTHER EXPENSES

11. EMPLOYEES' EXPENSE



2011

2011

2012

2012

Employees’ expenses (Note 11)

Depreciation (Notes 22 and 23)

Other operating expenses (Note 12)

Total

Net salaries

Contributions from and on salaries

Taxes and surtaxes from salaries

Other employees' expenses

Total



20112012

20112012

318

1.051

3.873

412

5.654

507

43

44

360

909

Collected court and similar expenses from legal claims

Income from sale of long-term tangible assets

Income from activities related

to assets available for sale

Other

Total

Currency differences on translations

Currency differences from currency clause

Currency differences on foreign currency trading

Total

(1.204)

1.060

3.333

3.189

(9.442)

9.702

3.579

3.839


30

6.403

7.386

1.477

(71)

1.406

1.291

(308)

20%

4.577

6.249

1.250

0

1.250

3.088

(1.416)

20%

DESCRIPTION

DESCRIPTION

DESCRIPTION

12. OTHER OPERATING EXPENSES

13. IMPAIRMENT AND PROVISION COSTS

14. CORPORATE INCOME TAX (in thousands of Kuna)

20112012

Accounting profit

Items which increase tax base

Items which decrease tax base

Corporate income tax base

Corporate income tax rate

Corporate income tax liability

Cost / (income) of deferred tax

Tax loss


20112012

4.504

573

570

80

1.128

(1.657)

139

185

5.522

2.239

745

693

164

0

(84)

35

2.705

6.497

Impairment of loans and prepayments to customers (Note 20)

Impairment of other assets (Note 25)

Special reserves for identified cumulative losses(Note 15, 16, 17, 19, 20)

Impairment of investments in subsidiaries (Note 21)

Impairment of financial assets held-to-maturity(Note 19)

Collected written-off receivables

Provisions for contingent liabilities (Note 31)

Provisions for court disputes (Note 31)

Total


20112012

Material and similar expenses

Services expenses

Representation, advertising and propaganda expense

Reimbursements to the Supervisory Board

Other

Total

2.142

11.933

1.257

566

2.213

18.111

2.263

10.888

1.162

572

1.750

16.635


31

DESCRIPTION

DESCRIPTION

DESCRIPTION

15. CASH

16. RECEIVABLES FROM THE CROATIAN NATIONAL BANK

17. PLACEMENTS WITH BANKS



At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

86.593

14.269

60.000

(1.367)

159.495

5.000

5.015

31.062

1.349

(361)

42.065

88.177

15.106

16.000

(1.014)

118.269

10.664

5.194

52.748

61.586

(1.107)

129.085

Obligatory reserve

- HRK

- foreign currency

Other deposits with CNB

Impairment

Total

Short-term loans to domestic banks

Long-term loans to domestic banks

Short-term deposits at foreign banks

Short-term deposits at domestic banks

Impairment

Total


At 31 Dec 2011At 31 Dec 2012

Gyro account

Cash in hand:

- HRK

- foreign currency

Cash at foreign account at foreign banks

Cash at foreign account at domestic banks

Other cash

Impairment

Total

25.755

19.120

8.218

69.285

11.813

74

(908)

133.357

40.648

12.060

7.457

62.543

3.926

92

(910)

125.816

NOTES TO THE BALANCE SHEET / STATEMENT OF FINANCIAL POSITION

Receivables from the Croatian National Bank represent obligatory reserves in HRK and foreigncurrency, calculated by the rate of 13,5% (2011: 14%) on HRK and foreign currency deposits and on foreigncurrency loans. From that amount the bank holds 70% of HRK obligatory reserves and 60% of foreigncurrency obligatory reserves with Croatian National Bank.


32

DESCRIPTION

DESCRIPTION

DESCRIPTION

Movements on impairments are shown as follows:

18. FINANCIAL ASSETS AVAILABLE FOR SALE

19. FINANCIAL ASSETS HELD TO MATURITY



At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

431

19.801

0

0

14.308

53.664

86.218

174.422

57.560

2.201

646

2.659

21.954

(1.922)

83.098

431

7.118

2.572

28.166

997

45.894

58.187

143.365

77.582

1.958

476

8.435

0

(869)

87.582

Investments in equity securities

Investments in investing funds

Investments in debt securities

- state units’ bonds in HRK

- state units’ bonds with currency clause

- trade companies’ bonds

- treasury bills of the Ministry of Finance in HRK

- treasury bills of the Ministry of Finance with currency clause

Total

Trade companies bills

State units’ bills

Sole traders’ bills

Factoring – State units

Treasury bills of the Ministry of Finance

Impairment

Total


At 31 Dec 2011At 31 Dec 2012

Balance at 1 January

Net impairment (Note 13)

Balance at 31 December

1.107

(746)

361

1.545

(438)

1.107

DESCRIPTION

Movements on impairment are shown as follows: (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012




869

1.053

1.922

809

60

869


33

DESCRIPTION

20. LOANS AND PREPAYMENTS TO CUSTOMERS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

387.765

406.470

28.711

(46.127)

776.819

278.666

407.351

17.342

(40.886)

662.473

Companies

Individuals and sole traders

Other

Impairments

Total

DESCRIPTION

DESCRIPTION

Risk concentration by economic sector in portfolioof loans to customers is shown as follows:

Movements on impairment and provisionsfor possible losses are shown as follows:



At 31 Dec 2011At 31 Dec 2012

Production

Trade

Tourism

Agriculture

Construction

Services

Individuals

Others

Total

Impairment and provisions for loan losses

Total

116.231

115.355

12.358

104.933

30.115

8.609

366.193

69.152

(46.127)

822.946

776.819

57.289

90.821

5.300

67.644

32.770

5.333

380.378

63.824

(40.886)

703.359

662.473

38.609

2.571

68

(362)

40.886

5.355

332

0

0

5.687

33.254

2.239

68

(362)

35.199


Net impairmentand provisions(Note 13)

Write-off and otherForeign currency differences


40.886

5.516

(17)

(258)

46.127

5.687

1.012

0

0

6.699

35.199

4.504

(17)

(258)

39.428

2012

Impairment

Specialreserves foridentified

cumulativelosses Total

2011

Impairment

Specialreserves foridentified

cumulativelosses Total


34

DESCRIPTION

DESCRIPTION

21. INVESTMENTS IN SUBSIDIARY

Movements on impairments are shown as follows:



At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

9.500

(3.821)

5.679

3.741

3.821

80

9.500

(3.741)

5.759

3.577

3.741

164

Turbina d.o.o., Slatina

Impairment





According to the Bank's policies and current legislative, the Bank is required to establish reserves foridentified cumulative losses of placements A, determined in loan portfolio based on previous experience. Theamount of these reserves the Bank keeps at the level 0.85 – 1.00% of non-risk assets and 0.85 – 1.00% ofnon-risk contingent commitments as at 31 December 2012, and according to regulations those can rangefrom 0.85% - 1.20% (At 31 December 2011: 0.85%-1.20% of non-risk assets and 0.85%-1.20% of non-riskcontingent commitments).

The Bank has 100% share portion in the mentioned company. Investment in subsidiary is stated atcost, decreased by carrying value of this asset – investment to its recoverable amount.


35

DESCRIPTION

Movements on property, plant andequipment are shown as follows: (in thousands of Kuna)

Purchase value

Balance at 31 Dec. 2011


Impairment



Net carryingvalue as at31 Dec. 2011

Net carrying valueas at31 Dec. 2012

Direct additions

Transfer from assetsunder construction

Disposals and write-offs

Depreciation for 2012

Disposals and write-offs

111

0

0

0

0

1.145

1.256

0

0

1.145

1.256

Land Buildings Equipment

Furniture andtransportvehicles

Tangibleassets underconstruction

Totalproperty,plant andequipment

22. PROPERTY, PLANT AND EQUIPMENT

624

173

0

839

0

33.106

33.903

11.325

12.164

21.781

21.739

0

1.161

(547)

1.541

(547)

17.368

17.982

14.066

15.060

3.302

2.922

0

621

(337)

358

(337)

7.805

8.089

7.229

7.250

576

839

2.145

(1.955)

0

0

0

369

559

0

0

369

559

59.793

2.880

0

(884)

61.789

32.620

2.738

(884)

34.474

27.173

27.315

The Bank's building in Slatina was pledged as a guarantee for received loan from Zveza Bank,Klagenfurt, Austria in the amount of EUR 1,450 thousand as at 31 December 2012 (31 December 2011: EUR2,000 thousand), Note 29.


36

DESCRIPTION


Intangible assetsin use

Intangible assetsunder construction

Totalintangible

assets

23. INTANGIBLE ASSETS

51

3.190

1.199

9.894

13.135

6.728

7.927

3.166

5.208

2.772

(3.190)

0

1.483

1.065

0

0

1.483

1.065

Purchase value

Balance at 31 December 2011


Impairment



Net carrying valueas at 31 Dec 2011

Net carrying valueas at 31 Dec 2012

Direct additions

Transfer from assets under construction

Depreciation for 2012

11.377

2.823

0

14.200

6.728

1.199

7.927

4.649

6.273

DESCRIPTION

24. FORECLOSED ASSETS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

1.733

2.949

113

1.727

7.219

0

13.741

1.612

1.658

0

655

4.427

2

8.354

Land – foreclosed over 2 years

Buildings - foreclosed over 2 years

Other asset - foreclosed over 2 years

Land

Initially recognized value – Other buildings

Initially recognized value – Other tangible and intangible assets

Total

Foreclosed assets stated in the Balance sheet as at 31 December 2012, in the amount of HRK 13,741thousand (At 31 December 2011: HRK 8,354 thousand), relates to foreclosed assets by the Bank, asreplacement for outstanding loans and placement receivables. The Bank Management Board estimates thatthe value of foreclosed assets approximate to their actual market value.


37

DESCRIPTION

25. OTHER ASSETS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

6.261

2.924

6

1.400

0

464

636

12.439

1.831

(5.968)

19.993

6.555

2.777

7

1.384

198

60

298

11.613

1.760

(5.976)

18.676

Interest receivables

Receivables for fees and provisions

Derivative assets

Trade receivables

Receivables for paid income tax

Prepayment receivables

Prepayments

Other receivables

Deferred tax property

Impairment

Total

DESCRIPTION

Movements on impairment are shown as follows: (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

5.976

2.066

(1.494)

0

(580)

5.968

5.194

2.557

(1.734)

1

(42)

5.976


New impairment (Note 13)

Collected and relieved amounts

Foreign exchange differences

Write-offs and corrections

rBalance at 31 Decembe

DESCRIPTION

26. DUE TO BANKS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

2.617

2.617

2.596

2.596

Term deposits

- foreign currency

Total


38

DESCRIPTION

27. DEMAND DEPOSITS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

64.598

53.068

36.456

4.170

174

36.824

70

361

89

53

619

117.666

40.626

174

36.894

450

672

196.482

55.250

54.414

35.320

7.037

111

48.920

75

146

441

15

984

109.664

42.357

111

48.995

587

999

202.713

Demand deposits - individuals

- HRK

- foreign currency

Demand deposits – trade companies

- HRK

- foreign currency

Demand deposits - financial institutions

- HRK

Demand deposits – State and other institutions

- HRK

- foreign currency

Restricted deposits

- HRK

- foreign currency

Demand deposits - foreigners

- HRK

- foreign currency

Total individuals

Total trade companies

Total financial institutions

Total State and other institutions

Total restricted deposits

Total foreigners

Total


39

DESCRIPTION

28. TERM DEPOSITS (in thousands of Kuna)

At 31 Dec 2012At 31 Dec 2011

189.369

580.592

17.957

626

24.217

13.360

20.945

165

12.579

769.961

18.583

37.577

21.110

12.579

859.810

180.769

558.308

22.956

24.198

25.109

12.915

11.658

159

12.466

739.077

47.154

38.024

11.817

12.466

848.538

Deposits individuals

- HRK

- foreign currency

Deposits – trade companies

- HRK

- foreign currency

Deposits – financial institutions

- HRK

- foreign currency

Deposits – State and other institutions

- HRK

- foreign currency

Deposits – foreigners

- foreign currency

Total individuals

Total trade companies

Total financial institutions

Total State and other institutions

Total foreigners

Total

DESCRIPTION

29. LOAN LIABILITIES (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

126.176

21.913

10.941

159.030

41.097

0

15.061

56.158

Domestic banks (HBOR)

Dometic nonbank financial institutions

Foreign banks

Total loan liabilities

Due to HBOR as at 31 December 2012 amounted to HRK 126,176 thousand (at 31 December 2011:HRK 41,097 thousand). These sources were intended for approval of the loans to legal entities and individualsin accordance with Croatian Bank for Reconstruction and Development programs (HBOR). Depending on theloan purpose, interest rates ranged from 0% to 5% (2011: from 0% to 5.5%).


40

DESCRIPTION

DESCRIPTION

30. OTHER LIABILITIES

31. PROVISIONS



At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

22.955

1

5

1.758

308

122

2.025

10.489

4.615

3.762

48

46.088

2.292

644

2.936

22.675

3

10

1.744

6

122

1.632

9.810

6.392

2.672

49

45.115

2.107

505

2.612

Interest payable

Fee and commission payables

Derivative liabilities

Liabilities to employees

Liabilities for taxes and contributions from income

Dividend liabilities

Trade payables

Deferred interest income

Liabilities for loans over payments

Other liabilities

VAT liabilities

Total

Provisions for court disputes

Provisions for identified cumulativelosses by off-balance contingent liabilities

Total

DESCRIPTION

Movements in provisions are shown as follows: (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

2.612

185

139

2.936

2.333

244

35

2.612


Changes in provisions for court disputes

Movements in provisions for contingent liabilities and commitments (Note 13)


Due to domestic nonbank financial institutions as at 31 December 2012 in amount of HRK 21,913 isrelated to Repurchase and Reverse Repurchase Agreement with Auctor Invest. Repurchase and ReverseRepurchase rate is fixed in range from 4.5% to 6.0%, depand on agreement.

Due to foreign banks as at 31 December 2012 relate to liability to Zveza Bank, Klagenfurt, Austria inthe amount of HRK 10,941 thousand (at 31 December 2011: HRK 15,061 thousand). The loan was grantedin the amount of EUR 1,450 thousand, with singl maturity on 30 June 2017. Interest rate is 4.75% (variable),and is calculated quarterly. The loan was secured by pledge right on the property in Slatina (Note 22).


41

SHAREHOLDER

As at 31 December 2012, largest Bank’s shareholders are shown as follows:

Portionin the

stock capital

in %

At 31 Dec 2012

number of shares

152.502

76.494

72.510

71.374

50.271

40.258

29.962

29.960

29.073

27.792

25.300

19.500

15.519

11.000

10.063

9.000

8.958

8.909

8.703

7.747

7.344

7.257

6.073

4.596

3.853

3.036

181.918

918.972

16,59

8,32

7,89

7,77

5,47

4,38

3,26

3,26

3,16

3,02

2,75

2,12

1,69

1,20

1,10

0,98

0,97

0,97

0,95

0,84

0,80

0,79

0,66

0,50

0,42

0,33

19,80

100,00

HYPO ALPE-ADRIA-BANK D.D./ SZIF D.D. (1/1)DRŽAVNA AGENCIJA ZA OSIG. ŠTEDNIH ULOGA I SANACIJU (1/1)SOKAČIĆ DRAGUTIN (1/1)SB-S D.D. (1/1)ZAGREBAČKA BANKA D.D./ SAVA - RE D.D. (1/1)RAIFFEISENBANK AUSTRIA D.D./ ADRIS GRUPA D.D. (1/1)GALIĆ JOSIP (1/1)MRKOCI MILIVOJ (1/1)FINESA CREDOS D.D., FINANCIJSKA KOMPANIJA (1/1)CROATIA LLOYD D.D. (1/1)PBZ D.D./ PBZ EQUITY - OIF S JAVNOM PONUDOM (1/1)PBZ D.D./ PBZ I-STOCK FOND - OIF S JAVNOM PONUDOM (1/1)ERGOVIĆ IVAN (1/1)VELEBIT ŽIVOTNO OSIGURANJE D.D. (1/1)BORAS ARIJANA (1/1)SESAR IVAN (1/1)TVIN D.O.O. (1/1)VUKELIĆ IVAN (1/1)ZAGREBAČKA BANKA D.D./ ALLIANZ ZAGREB D.D. (1/1)PRIJIĆ SLOBODAN (1/1)STRIZREP TIHOMIR (1/1)BERIŠIĆ ROBERT (1/1)BAHOVEC SREČKO (1/1)SATO D.O.O. (1/1)VRDOLJAK ANTE (1/1)HRVATSKE ŠUME D.O.O. (1/1)OthersTOTAL

32. CAPITALAs at 31 December 2012 subscribed capital amounted to HRK 91,897 thousand and has been

divided into 918,972 shares each at a nominal value of HRK 100.Pursuant to the decision of the Assembly from 29 June 2006 on abolishing privileged shares, it was

determined that the Bank share capital of HRK 91,897 thousand will be divided into 172,412 non-materializedregistered shares out of which 114,662 are regular non-materialized shares of the A series at nominal value ofHRK 600 each and 57,750 are privileged non-materialized shares of the B series at nominal value of HRK400. Pursuant to this decision this privilege was cancelled entirely thus turning the mentioned shares intoregular non-materialized registered shares, each at nominal value of HRK 400. Pursuant to the decision of theAssembly from 29 June 2006 on the division of shares, one regular Bank registered share at nominal value ofHRK 600 is divided into 6 regular Bank registered shares at nominal value of HRK 100; one earlier privilegedBank share at nominal value of HRK 400 is divided into 4 regular Bank shares, at nominal value of HRK 100.


42

DESCRIPTION

DESCRIPTION

33. EARNINGS PER SHARE

34. CONTINGENT LIABILITIES AND COMMITMENTS (in thousands of Kuna)

At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

4.997

918,972

5,44 kune

6.376

0

6.618

783

555

53.556

(644)

67.888

67.244

3.327

918,972

3,62 kune

2.783

177

5.072

200

320

45.420

(505)

53.972

53.467

Profit for the current year

Number of shares (in thousands)

Earnings per share

Performance guarantees

- HRK

- foreign currencies

Payment guarantees

- HRK


Letters of credit


Not withdrawn loan facilities

Provisions for contingent liabilities and commitments

Total

Total

DESCRIPTION

35. CASH AND CASH EQUIVALENTS (in thousands of Kuna)

At 31 Dec 2011At 31 Dec 2012

133.357

36.326

139.882

25.840

335.405

125.816

122.927

104.080

32.438

385.261

Cash

Placements with other banks with remaining maturity up to 3 months

Treasury bills and bills of exchange with remaining maturityup to 3 months – portfolio available for sale

Treasury bills and bills of exchange with remaining maturityup to 3 months – portfolio held to maturity

Total


43

DESCRIPTION

DESCRIPTION

36. FUNDS FOR AND ON BEHALF OF THIRD PARTIES


At 31 Dec 2011

At 31 Dec 2011

At 31 Dec 2012

At 31 Dec 2012

12.524

(12.200)

324

24.964

(24.863)

101

Total Sources

Less: Assets

Unused funds


The Bank is managing Funds for and on behalf of third parties mainly placed in the form ofborrowings.These funds are booked separately from the Bank funds. Income and expenses based on thesefunds are booked as income or expense of certain source, and the Bank does not bear any risk in this respect.For its services the Bank charged fee which was debited to these funds.

37. RELATED PARTY TRANSACTIONS

Related parties are those in which one party is controlling or have significant influence in governingthe financial and operating business decisions of other party. Bank activities with the related parties areconducted in the course of ordinary operations, which include loans and deposits assignation. Mentionedtransactions are conducted under commercial conditions and market rates, respectively, prices. Total amountof transactions with related parties, closing balances at the end of a year and related income and expense forthe year are shown as follows:


Total

Contingent liabilities and commitments

Total

Demand deposits

Total

Term deposits

Total

Shareholders with 5 or more percent of voting shares

Members of the Supervisory Board and their related parties

Other (employees and their related parties)








7.636

344

4.075

611

76

143

343

0

4.606

3.261

12.055

611

562

7.867

-

15.033

5.368

695

-

698

236

1.004

1.223

3.083

20.401

695

934

5.310


44

DESCRIPTION At 31 Dec 2011At 31 Dec 2012

561

1

299

5.685

302

36

569

6

4

230

180

6.546

913

414

290

89

12

5.759

22

1.145

274

6

2

51

148

6.150

1.447

201

Other assets

Total

Income

Total

Expenses

Total



Others (employees and their related parties)










DESCRIPTION

Remuneration to the Management Board is shown as follows:

At 31 Dec 2011At 31 Dec 2012

1.959

2.447

4.406

1.201

1.461

2.662

Net salaries

Taxes and contributions

Total



38. INTEREST RISK

The following table represents the carrying value of the Bank's assets and liabilities, categorized by the earliercontractual re-pricing or maturity, depending which term is earlier as at 31 December 2012.

45

2012Up to 1month


ASSETS

Total assets

LIABILITIES

CAPITAL

Total capital

Total liabilities and capital

Net assets/liabilities and capital

Cash

Placements with banksFinancial assetsavailable for sale

Financial assetsheld to maturity

Loans and prepayments

Investments in subsidiaries

Property, plant, equipment

Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Total liabilities

Subscribed capital

Own shares

Capital gains

Revaluation reserves

Reserves

Retained earnings

Profit of the current year


to customers

0

100.005

35.755

18.590

13.669

166.588

0

0

0

0

0

0

191.566

349.246

33.559

0

0

0

0

0

0

0

0

0

334.607

574.371

0

574.371

(239.764)

0

0

571

11.766

12.170

79.587

0

0

0

0

0

0

0

106.670

12.622

0

0

0

0

0

0

0

0

0

104.094

119.292

0

119.292

(15.198)

0

0

0

11.602

0

190.262

0

0

0

0

0

0

0

71.114

26.629

0

0

0

0

0

0

0

0

0

201.864

97.743

0

97.743

104.121

0

0

0

4.022

0

188.650

0

0

0

0

0

0

0

7.290

44.211

0

0

0

0

0

0

0

0

0

192.672

51.501

0

51.501

141.171

133.357

59.490

0

431

0

0

5.679

27.315

6.273

13.741

19.993

2.617

4.916

17.603

2.367

46.088

2.936

91.897

(6.592)

1.799

149

14.357

68.687

4.997

266.279

76.527

175.294

251.821

14.458

133.357

159.495

42.065

174.422

83.098

776.819

5.679

27.315

6.273

13.741

19.993

1.442.257

2.617

196.482

859.810

159.030

46.088

2.936

1.266.963

91.897

(6.592)

1.799

149

14.357

68.687

4.997

175.294

1.442.257

0

0

0

5.739

128.011

57.259

151.732

0

0

0

0

0

0

0

307.887

39.642

0

0

0

0

0

0

0

0

0

342.741

347.529

0

347.529

(4.788)

From 1 to3 months

From 3 to12 months

From 1 to3 years

Over3 years

Interestfree TOTAL


The following table represents the carrying value of the Bank's assets and liabilities,categorized by the earlier contractual re-pricing or maturity, depending which term is earlier as at31 December 2011.

46


ASSETS

Total assets

LIABILITIES

CAPITAL

Total capital



Cash

Placements with banksFinancial assetsavailable for sale


Loans and prepayments



Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Total liabilities

Subscribed capital

Own shares

Capital gains


Reserves

Retained earningsand profit of the current year


to customers

65.992

102.405

122.787

7.118

15.814

156.063

0

0

0

0

0

0

192.831

535.910

16.046

0

0

0

0

0

0

0

0

470.179

744.787

0

744.787

(274.608)

0

0

140

19.891

16.305

51.406

0

0

0

0

0

0

0

80.220

1.551

0

0

0

0

0

0

0

0

87.742

81.771

0

81.771

5.971

0

0

5.150

0

1.183

183.545

0

0

0

0

0

0

0

46.654

12.624

0

0

0

0

0

0

0

0

189.878

59.278

0

59.278

130.600

0

0

0

30.738

0

139.832

0

0

0

0

0

0

0

4.708

21.118

0

0

0

0

0

0

0

0

170.570

25.826

0

25.826

144.744

59.824

15.864

0

431

0

0

5.759

27.173

4.649

8.354

18.676

2.596

9.882

18.088

279

45.115

2.612

91.897

(398)

149

(1.223)

14.357

68.687

140.730

78.572

173.469

252.041

(111.311)

125.816

118.269

129.085

143.365

87.582

662.473

5.759

27.173

4.649

8.354

18.676

2.596

202.713

848.538

56.158

45.115

2.612

91.897

(398)

149

(1.223)

14.357

68.687

1.331.201

1.157.732

173.469

1.331.201

0

0

0

1.008

85.187

54.280

131.627

0

0

0

0

0

0

0

162.958

4.540

0

0

0

0

0

0

0

0

272.102

167.498

0

167.498

104.604


2011Up to 1month

From 1 to3 months

From 3 to12 months

From 1 to3 years

Over3 years

Interestfree TOTAL

47

Table below shows effective interest rates for interestbearing assets and liabilities:

2012.

%

Assets

Liabilities



Financial assets held to maturity


Due to banks

Demand deposits

Term deposits

Loan liabilities


39. FAIR VALUE OF FINANCIAL ASSETS AND LIABILITIES

Fair value represents the amount in which funds can be exchanged or liabilities settled in the bestinterest of all parties. Since market prices for the major part of Bank’s financial assets and liabilities are notavailable, the fair value of these items is based on the estimates of the Management Board according to thetype of assets and liabilities. According to the estimation of the Management Board, the market value is notmaterially different from the book value of all categories of assets and liabilities.

0,00 - 0,25

0,01 - 6,00

5,25 – 10,00

3,00 – 14,00

-

0,00 - 3,70

0,50 - 6,00

0,00 - 6,00

0,00 - 0,25

0,005 - 3,70

2,70 - 10,00

0,25 - 15,00

-

0,00 - 1,50

0,50 - 8,00

0,00 - 3,75

2011.

%


DESCRIPTION


Geographic region

Total geographic region

Sector

Total analysis by sector

Republic of Croatia

Europe

Republic of Croatia

Croatian National Bank

Trade

Finance

Tourism

Agriculture, fishery

Industry

Individuals (including craftsmenand other independentprofessions)

Non-residents

Other

1.341.910

100.347

196.887

185.053

164.400

59.298

11.675

92.159

115.825

436.565

99.344

81.051

1.442.257

1.442.257

At 31 Dec 2012

Assets LiabilitiesOff-balancesheet items

At 31 Dec 201

48

40. CONCENTRATION OF ASSETS,LIABILITIES AND OFF-BALANCE SHEET ITEMS

Assets LiabilitiesOff-balancesheet items

1.415.362

26.895

45.625

9

14.936

188.484

1.698

3.779

7.501

887.468

24.278

268.479

1.442.257

1.442.257

67.888

8.692

0

4.707

8.778

1.429

1.808

6.872

25.926

0

9.676

67.888

67.888

1.216.881

114.320

150.164

118.269

156.056

82.627

5.474

68.671

57.675

383.399

114.320

194.546

1.331.201

1.331.201

1.297.251

33.950

50.946

9

15.239

80.271

1.221

7.521

8.894

886.971

33.950

246.179

1.331.201

1.331.201

53.972

0

0

6.956

10.000

1.130

2.078

3.761

27.134

0

2.913

53.972

0

53.972


49

2011. EUR


ASSETS

Total assets

LIABILITIES

Total liabilities

CAPITAL

Total capital


Cash



Financial assetsavailable for sale





Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Subscribed capital

Own shares

Capital gains


Reserves

Retained earnings



57.486

14.269

30.692

0

0

0

0

0

0

0

2.285

0

51.369

594.023

53.488

17.838

0

0

0

0

0

0

0

0

0

104.732

716.718

716.718

(611.986)

7.669

0

0

0

0

0

0

0

0

0

0

0

1.803

6.253

0

106

0

0

0

0

0

0

0

0

0

7.669

8.162

8.162

(493)

0

0

0

86.218

0

509.121

0

0

0

0

46

0

0

28.075

0

652

0

0

0

0

0

0

0

0

0

595.385

28.727

28.727

566.658

76.967

14.269

32.051

86.218

0

509.121

0

0

0

0

2.776

2.617

57.255

635.397

53.488

18.660

0

0

0

0

0

0

0

0

0

721.402

767.417

767.417

(46.015)

56.390

145.226

10.014

88.204

83.098

267.698

5.679

27.315

6.273

13.741

17.217

0

139.227

224.413

105.542

27.428

2.936

91.897

(6.592)

1.799

149

14.357

68.687

4.997

175.294

720.855

499.546

674.840

46.015

133.357

159.495

42.065

174.422

83.098

776.819

5.679

27.315

6.273

13.741

19.993

2.617

196.482

859.810

159.030

46.088

2.936

91.897

(6.592)

1.799

149

14.357

68.687

4.997

1.442.257

1.266.963

175.294

1.442.257

0

11.812

0

1.359

0

0

0

0

0

0

0

445

2.617

4.083

7.046

0

64

0

0

0

0

0

0

0

0

0

13.616

13.810

13.810

(194)

USDOther

currencies

HRK withcurrencyclause

Total foreigncurrency

equivalents HRK TOTAL

41. CURRENCY RISK

Bank's foreign currencies and liabilities as at 31 December 2012are shown as follows:



50

Bank's foreign currencies and liabilities as at 31 December 2011are shown as follows:

2011. EUR

ASSETS

Total assets

LIABILITIES

Total liabilities

CAPITAL

Total capital



Cash



Financial assetsheld to maturityLoans and prepayments



Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Subscribed capital

Own shares

Capital gains


Reserves

Retained earnings


to customers

59.415

14.978

105.296

0

0

0

0

0

0

0

2.359

0

55.897

595.010

15.061

18.835

7

0

0

0

0

0

0

182.048

684.810

0

684.810

(502.762)

1.835

0

0

0

0

0

0

0

0

0

0

0

0

7.502

0

0

0

26

2.732

6.394

0

194

0

9.363

9.320

0

9.320

43

0

0

455

93.452

0

491.003

0

0

0

0

759

0

0

32.635

36.883

682

0

0

0

0

0

0

0

585.669

70.200

0

70.200

515.469

73.394

14.978

113.819

93.452

0

491.003

0

0

0

0

3.294

2.596

62.951

640.683

51.944

19.839

7

0

0

0

0

0

0

789.940

778.020

0

778.020

11.920

52.422

103.291

15.266

49.913

87.582

171.470

5.759

27.173

4.649

8.354

15.382

0

139.762

207.855

4.214

25.276

2.605

91.897

(398)

149

(1.223)

14.357

68.687

541.261

379.712

173.469

553.181

(11.920)

125.816

118.269

129.085

143.365

87.582

662.473

5.759

27.173

4.649

8.354

18.676

2.596

202.713

848.538

56.158

45.115

2.612

91.897

(398)

149

(1.223)

14.357

68.687

1.331.201

1.157.732

173.469

1.331.201

0

0

0

0

0

0

0

0

0

0

0

0

0

12.144

566

0

0

0

150

2.596

4.322

6.644

0

128

12.860

13.690

0

13.690

(830)

USDOstalevalute

HRK svalutnomklauzulom

Ukupnodevizni

ekvivalenti HRK UKUPNO


51

2011.


ASSETS

Total assets

LIABILITIES

Total liabilities

CAPITAL

Total capital



Cash




Loans and prepaymentsInvestments in subsidiaries


Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Subscribed capital

Own shares

Capital gains


Reserves

Retained earnings



to customers

133.357

59.490

35.755

174.422

13.669

166.588

0

0

0

0

19.993

0

196.482

155.388

22.618

19.153

0

0

0

0

0

0

0

0

603.274

393.641

0

393.641

209.633

0

52.187

571

0

12.170

79.587

0

0

0

0

0

0

0

177.346

12.614

5.057

0

0

0

0

0

0

0

0

144.515

195.017

0

195.017

(50.502)

0

9.517

0

0

0

190.262

0

0

0

13.741

0

0

0

91.109

26.567

3.020

2.936

0

0

0

0

0

0

0

213.520

123.632

0

123.632

89.888

0

2.393

0

0

0

188.650

5.679

27.315

6.273

0

0

0

0

13.533

54.996

7.233

0

91.897

(6.592)

1.799

149

14.357

68.687

4.997

230.310

75.762

175.294

251.056

(20.746)

133.357

159.495

42.065

174.422

83.098

776.819

5.679

27.315

6.273

13.741

19.993

2.617

196.482

859.810

159.030

46.088

2.936

91.897

(6.592)

1.799

149

14.357

68.687

4.997

1.442.257

1.266.963

175.294

1.442.257

0

0

35.908

5.739

0

57.259

151.732

0

0

0

0

0

2.617

0

422.434

42.235

11.625

0

0

0

0

0

0

0

0

250.638

478.911

0

478.911

(228.273)

TOTAL

42. LIQUIDITY RISK

Remaining maturity of the Bank's assets and liabilities asat 31 December 2012 is shown as follows:

Up to 1 monthFrom 1

to 3 monthsFrom 3

to 12 monthsFrom 1

to 3 yearsOver

3 years


52

(in thousands of Kuna)Remaining maturity of the Bank's assets and liabilities asat 31 December 2011 is shown as follows:

2011.

ASSETS

Total assets

LIABILITIES

Total liabilities

CAPITAL

Total capital



Cash



Financial assetsheld to maturityLoans and prepayments



Intangible assets

Foreclosed assets

Other assets

Due to banks

Demand deposits

Term deposits


Other liabilities

Provisions

Subscribed capital

Own shares

Capital gains


Reserves

Retained earnings


to customers

125.816

0

0

0

0

0

0

0

0

0

0

0

53.486

122.787

143.365

15.814

79.767

17.873

202.713

334.130

985

20.406

430

558.908

558.664

0

558.664

244

0

0

0

0

0

0

0

0

0

0

0

0

11.323

140

0

16.305

54.008

491

0

153.257

1.559

4.319

34

82.267

159.169

0

159.169

(76.902)

0

19.568

5.150

0

1.183

208.818

0

0

0

0

0

2.596

0

32.444

6.715

7.463

2.116

0

0

0

0

0

0

234.719

51.334

0

51.334

183.385

0

0

0

0

0

49.168

27.274

3.522

0

91.897

(398)

149

(1.223)

14.357

68.687

9.234

0

0

165.724

5.759

27.173

4.649

312

212.851

79.964

173.469

253.433

(40.582)

125.816

118.269

129.085

143.365

87.582

662.473

5.759

27.173

4.649

8.354

18.676

2.596

202.713

848.538

56.158

45.115

2.612

91.897

(398)

149

(1.223)

14.357

68.687

1.331.201

1.157.732

173.469

1.331.201

0

0

24.658

1.008

54.280

154.156

0

0

0

8.354

0

0

0

279.539

19.625

9.405

32

0

0

0

0

0

0

0

242.456

308.601

0

308.601

(66.145)

TOTALUp to 1 monthFrom 1

to 3 monthsFrom 3

to 12 monthsFrom 1

to 3 yearsOver

3 years


43. CREDIT RISK

The Bank is exposed to credit risk which is the risk that a counterparty will be unable to pay amounts in fullwhen due. The Bank structures the levels of credit risk by placing limits on the amount of risk accepted inrelation to one borrower, or groups of borrowers, and to geographical and industry segments. Such risks aremonitored on a revolving basis and subject to an annual or more frequent review.

Exposure to credit risk is managed through regular analysis of the ability of borrowers and potential borrowersto meet interest and capital repayment obligations and by changing these lending limits where appropriate.Exposure to credit risk is also managed in part by obtaining collateral and corporate and personal guarantees.

The primary purpose of credit commitments is to ensure that funds are available to a customer as required.Guarantees which represent irrevocable commitments that the Bank will settle the payment to the third partiesif the customers are not able, bear the same credit risk as other loans.

Contingent credit commitments represent undrawn portions of authorised loans and guarantees.According to credit risk related to contingent credit commitments, the Bank takes on potential loss exposure inthe amount equal to total undrawn contingent commitments. However, possible loss amount is lower than totalamount of undrawn contingent commitments, as the most of contingent credit commitments is related tomaintenance of specific credit standards by customers. The Bank monitors the term of maturity of contingentcredit commitments because longer-term commitments generally have a greater degree of credit risk thanshort-term.

On 18 March 2013 Elvis Mališ ceased to be a member of the Management Board.

After the Balance sheet/Statement of financial position date there were no significant events that couldhave the influence on the financial statements for the year 2012, which should be, consequently published.

At 31 December 2012 against the Bank is led 12 court disputes of smaller value, besides the disputewhich was started by part of Jugobanka a.d. in bankruptcy, Belgrade. Trade court in Bjelovar brought thesentence at 19 June 2008 (Official decision VP-167/08-27) by which, as unfounded was rejected thecomplaint request of an accuser. To the stated Official decision was lodged a Complaint which accuser hasstated against the sentence of the Trade court in Bjelovar.

Simultaneously, the accuser was demanded by a complaint the determining of temporary measure,and on this at 3 June 2008 the Republic of Croatia, High trade court of the Republic of Croatia, brought theOfficial decision Pž-3109/08-4 by which the complaint of accuser is rejected as unfounded and the officialdecision of the Trade court in Bjelovar is confirmed.

IV EVENTS AFTER THE BALANCE SHEET

V COURT DISPUTES AND POTENTIAL LIABILITIES

53


54

On the occasion of the prosecutor complaint, the High Commercial Court issued a judgment anddecision 53 Pž-6092/08-3 of 30 October 2012, which reversed the part of the judgment of the CommercialCourt in Bjelovar in relation to the issue of nullification Agreement of 26 October 1992 and found thecontract null and void. Simultaneously, High Commercial Court overturned, by the decision, the rest of thefirst instance judgment relating to claims for compensations of damages, arguing that these issues have notbeen sufficiently discussed, and the case in this part of the returned Commercial Court in Bjelovar on retrial,with instructions that the only debate questions whether there are grounds for compensations of damages,particularly in terms of the objection of limitation. Against the judgment, the Bank has applied for a review ofthe erroneous application of the substantive rights and substantial violations of civil procedure. According toestimates by the Bank's legal counsel Croatian Supreme Court should modify the judgment of the HighCommercial Court or back it for retrial.

The Bank made reservation of assets for the subject dispute according to art. 8 of the Decision onliabilities for making reservation for court disputes which are led against credit institution (National gazette nr1/09, 75/09 and 2/10).


VI APPROVAL OF THE FINANCIAL STATEMENTS

The financial statements were signed and authorised for issuing by the ManagementBoard on 29 March 2013.

Signed on behalf of the Board:

Angelina Horvat,President of the Management Board

Marko Krajina,Member of the Management Board

Marko Brnić,Member of the Management Board

Slatinska banka d.d.Vladimira Nazora 233520 SlatinaThe Republic of Croatia

Godišnja financijska izvješća prema

Odluci o strukturi i sadržaju godišnjih financijskih

izvještaja banaka Hrvatske narodne banke

55

APPENDIXOther legal and regulatory requirements

Additional reports for the Croatian National bank

In addition are shown annual financial statements of the Bank (the Statement of income for 2012,Balance sheet at 31 December 2012, the Cash Flows Statement for 2012 and the Statement of Changes inEquity for 2012) prescribed by the Decision of the Croatian National Bank regarding structure and content ofannual financial reports of banks, prescribed by Croatian National Bank (hereinafter: Decision).

PositionCurrent

yearPrevious

yearADSsign

1. Interest income2. Interest expense

4. Income from fees and commissions5. Expenses from fees and provisions

7. Profit / loss from investments in affiliates, associatedcompanies, joint ventures

8. Profit / loss from trading activity9. Profit / loss from derivatives built into

10. Profit / loss from property which is not traded actively, but is valued atfair value through P & L account11. Profit / loss from activities in category of property available for sale12. Profit / loss from activities in category which is held to maturity13. Profit / loss from protection transactions (hedge)14. Income from investments in affiliates, associated

companies and joint ventures15. Income from other equity investments16. Profit / loss from accounted foreign exchange differences17. Other income18. Other expense19. General administrative costs and depreciation

21. Cost of value adjustments and provisions for losses

3. Net interest income (048-049)

6. Net income from fees and provisions (051-052)

20. Net income from operations before value adjustmentand provisions (050+053 do 064-065-066)

22. PROFIT / LOSS BEFORE TAXATION (067-068)23. INCOME TAX24. PROFIT / LOSS FOR THE CURRENT YEAR (069-070)25. Earnings per share

048049050051052053

054055056

057058059060

061062063064065066

067068069070071072

83.927.18646.916.908

13.460.5103.356.819

-164.3583.580.917

-2.599

045.407

00

00

689.540909.453

4.279.28739.621.311

3.694.695

37.010.278

10.103.691

8.271.731

4.577.0361.249.7273.327.309

4

84.471.30947.889.837

13.011.3472.934.540

-79.9863.334.863

-1.147

03.872.660

00

00

-61.4771.780.9862.859.556

40.967.211

5.273.996

36.581.472

10.076.807

11.677.411

6.403.4151.406.5284.996.887

6

INCOME STATEMENT - for the period 01 Jan 2012 - 31 Dec 2012

56

57


(in thousands of Kuna)BALANCE SHEET as at 31 Dec 2012

ASSETS

A) TOTAL ASSETS (001+004 do 016)

LIABILITIES

B) TOTAL LIABILITIES (018+021+025+028+029+032+033+034)

CAPITAL

C) TOTAL CAPITAL (036 do 042)

D) TOTAL LIABILTIES AND CAPITAL (035+043)

1. CASH AND DEPOSITS WITH CNB (002+003)1.1.Cash1.2.Deposits with CNB

2. DEPOSITS WITH BANKING INSTITUTIONS3. TREASURY NOTES OF THE MINISTRY OF FINANCE

AND TREASURY BILLS OF CNB4. SECURITIES AND OTHER FINANCIAL INSTRUMENTS HELD FOR TRADING5. SECURITIES AND OTHER FINANCIAL INSTRUMENTS

AVAILABLE FOR SALE6. SECURITIES AND OTHER FINANCIAL

INSTRUMENTS HELD TO MATURITY

8. DERIVATIVE FINANCIAL ASSETS9. LOANS TO THE FINANCIAL INSTITUTIONS

10. LOANS TO OTHER CUSTOMERS11. INVESTING IN AFFILIATES, ASSOCIATED COMPANIES AND JOINT VENTURES12. FORECLOSED ASSETS13. TANGIBLE ASSETS (LESS DEPRECIATION)14. INTEREST, FEES AND OTHER ASSETS

1. LOANS FROM FINANCIAL INSTITUTIONS (019+020)1.1. Short term loans1.2. Long term loans

2. DEPOSITS (AOP 022 do 024)2.1. Deposits on gyro accounts and current accounts2.2. Saving deposits2.3. Term deposits

3. OTHER LOANS (026+027)3.1. Short term loans3.2. Long term loans

4. DERIVATIVE FINANCIAL LIABILITIES AND OTHER FINANCIAL LIABILITIESWHICH ARE NOT TRADED

5. ISSUED EQUITY INSTRUMENTS (030+031)5.1. Issued short term security equity investments5.2. Issued long term security equity instruments

6. Issued subordinate instruments7. Issued hybrid instruments8. INTEREST, FEES AND OTHER LIABILITIES

1. SHARE CAPITAL2. PROFIT (LOSS) OF THE CURRENT YEAR3. RETAINED EARNINGS (LOSS)4. LEGAL RESERVES5. STATUTORY AND OTHER CAPITAL RESERVES6. UNREALIZED PROFIT (LOSS) ON THE BASIS OF VALUE ADJUSTMENT

OF FINANCIAL PROPERTY AVAILABLE FOR SALE7. RESERVES ARISEN FROM PROTECTION TRANSACTIONS (HEDGE)

7. SECURITIES AND OTHER FINANCIAL INSTRUMENTS WHICH ARE NOT TRADEDACTIVELY, BUT IS VALUED AT FAIR VALUE THROUGH P & L ACCOUNT

001002003004005

006

007

008

009010011012013014015016017

018019020021022023024025026027

028029030031032033034035

036037038039040

041042043

044

19.609.231158.571.634179.266.567104.080.484

0

39.284.687

87.582.425

06.818

15.722.199662.473.019

5.759.0258.354.557

27.447.76423.042.640

41.096.859

122.133.78279.994.742

848.538.122

017.656.661

9.779

0000

48.302.322

91.498.7803.327.308

65.359.4914.729.4239.777.000

-1.223.2190

178.180.865

1.331.201.050

41.096.859

1.050.666.646

17.656.661

0

1.157.732.267

173.468.783

1.331.201.050

27.411.820185.030.614112.544.271139.882.386

0

34.540.357

83.098.395

05.744

14.919.864771.829.064

5.679.03913.740.83927.534.76726.040.226

21.912.925126.175.758

114.488.14781.485.175

859.809.578

013.558.148

5.459

0000

49.527.838

85.304.8524.996.889

68.686.8004.729.4239.777.000

1.799.3940

212.442.434

1.442.257.386

148.088.683

1.055.782.900

13.558.148

0

1.266.963.028

175.294.358

1.442.257.386

PositionCurrent

yearPrevious

yearADSsign

58


(in thousands of Kuna)CASH FLOWS STATEMENT -in the period 01 Jan 2012 do 31 Dec 2012

INDIRECT METHOD

POSLOVNE AKTIVNOSTI

ULAGA KE AKTIVNOSTI

1. Cash flow from operating activities before changes in business property(002 to 007)

2. Net increase / decrease in business property (009 do 016)

3. Net increase / decrease in operating liabilities (018 do 021)

4. Net cash flow from business activities before net income tax payment(001+008+017)

5. Paid income tax6. Net inflow /(outflow) of cash from operating activities (022+023)

7. Net cash flows from investment activities (026 to 030)

FINANCING ACTIVITIES8. Net cash flow from financing activities (032 to 037)

9. Net increase /decrease of cash and cash equivalents(024+025+031)

10. Effects of changes in foreign currencies on cash and cash equivalents11. Net increase/(decrease) in cash and cash equivalents (038+039)12. Cash and cash equivalents at the beginning of the year13. Cash and cash equivalents at the end of the year (040+041)

1.1. Profit / loss before tax

1.2. Impairment and loss provisions

1.3. Depreciation

1.4. Net unrealized (profit)/loss from financial assets and liabilities at fair value

through profit and loss account

1.5. Profit/loss from sale of tangible assets

1.6. Other income / losses

2.1. Deposits with CNB

2.2. Treasury notes of Ministry of Finance and treasury bills of CNB

2.3. Deposits at banking institutions and loans to financial institutions

2.4. Loans to other customers

2.5. Securities and other financial instruments held for trading

2.6. Securities and other financial instruments available for sale

2.7. Securities and other financial instruments non actively traded,

at fair value through profit and loss account

2.8. Other operating assets

3.1. Demand deposits

3.2. Saving and term deposits

3.3. Derivative financial liabilities and other liabilities which are traded

3.4. Other liabilities

7.1. Receipts from sale /(payments for purchase) of tangible and intangible assets

7.2. Receipts from sale /(payments for purchase)

investments in affiliates, associated companies and joint venture

7.3. Receipts from sale /(payments for purchase) of securities and other

financial instruments held to maturity

7.4. Received dividends

7.5. Other receipts (payments) from investing activities

8.1. Net increase / decrease/ of received loans

8.2. Net increase / decrease/ from the issue of equity and debt financial instruments

8.3. Net increase / decrease/ in subordinated and hybrid instruments

8.4. Receipts from emission of share capital

8.5. Paid off dividends

8.6. Other receipts / payments from financing activities

Č

001002003004

005006007008009010011012013014

015016017018019020021

022023024

025026

027

028029030

031032033034035036037

038039040041042

4.577.036

3.694.695

3.777.333

0

41.892

0

-30.882.089

-2.074.387

4.748.452

-29.644.066

0

-26.197.863

0

-5.333.375

-4.948.005

96.519.866

8

50.342

-1.249.727

-5.698.028

164.358

-18.338.693

0

8.775.568

0

0

0

0

-1.256.610

22.882.524

12.090.956

-89.383.328

91.622.211

14.329.839

13.080.112

-23.872.363

7.518.958

-3.273.293

-3.273.293

19.609.231

6.403.416

5.273.996

3.937.243

0

50.000

0

-26.458.980

-35.801.902

67.524.631

-112.219.413

0

4.744.330

0

-7.327.528

-7.645.635

12.761.889

-4.320

516.008

-1.406.527

-5.702.345

79.986

3.355.744

0

102.893.311

0

0

0

0

-3.171.315

19.609.231

15.664.655

-109.538.862

5.627.942

-88.246.265

-89.652.792

-2.266.615

99.721.996

7.802.589

7.802.589

27.411.820

PositionCurrent

yearPrevious

yearADSsign

STAT

EMEN

T O

F C

HA

NG

ES IN

EQ

UIT

Yfr

om 0

1 Ja

n 20

12 to

31

Dec

201

2

Bala

nce

at 1

Jan

uary

cur

rent

yea

r

Cor

rect

ed b

alan

ce a

t 1

Jan

uary

curr

ent ye

ar (

00

1+

00

2)

Net

gai

ns/l

osse

s di

rect

ly r

ecog

nize

din

cap

ital a

nd r

eser

ves

(00

4+

00

5+

00

6+

00

7)

Tota

l rec

ogni

zed

inco

me

and

expe

nses

for

the

curr

ent ye

ar (

00

8+

00

9)

Allo

catio

n of

pro

fit (

01

4+

01

5)

Bala

nce

at 3

1 D

ecem

ber

(00

3+

01

0+

01

1+

01

2+

01

3+

01

6)

Cha

nges

in a

ccou

ntin

g po

licie

san

d co

rrec

tion

of e

rror

s

Sale

of f

inan

cial

ass

ets

avai

labl

efo

r sa

le

Cha

nge

in fa

ir va

lue

of fi

nanc

ial

asse

ts a

vaila

ble

for

sale

Tax

to it

ems

dire

ctly

rec

ogni

zed

or tr

ansf

erre

d fr

om c

apita

l and

res

erve

s

Oth

er g

ains

/los

ses

dire

ctly

rec

ogni

zed

in c

apita

l and

res

erve

s

Prof

it/(lo

ss)

for

the

curr

ent y

ear

Incr

ease

/dec

reas

e in

sha

re c

apita

l

Purc

hase

/sal

e of

trea

sury

sha

res

Oth

er c

hang

es

Tran

sfer

to r

eser

ves

Pay

off o

f div

iden

ds

001

003

008

010

016

017

002

004

005

006

007

009

011

012

013

014

015

91.8

97.2

00

91.8

97.2

00

0 0 0

91.8

97.2

00

-398

.420

-398

.420 0 0 0

-6.1

93.9

27

14.5

06.4

23

14.5

06.4

23 0 0 0

14.5

06.4

23

65.3

59.4

91

65.3

59.4

91 0 0

3.32

7.30

8

3.32

7.30

8

68.6

86.7

99

3.32

7.30

8

3.32

7.30

8 0

4.99

6.88

9

4.99

6.88

9

-3.3

27.3

08

4.99

6.88

9

-3.3

27.3

08

-1.2

23.2

19

3.02

2.61

3

-1.2

23.2

19

3.02

2.61

3

3.02

2.61

3

1.79

9.39

40

0 0 0 0 0

AO

PPo

sitio

nSh

are

capi

tal

Trea

sury

shar

es

Lega

l,st

atut

ory

and

othe

rre

serv

es

Rasp

olož

ivo

dion

ičar

ima

mat

ično

g dr

uštv

a

Reta

ined

earn

ings

/ lo

ss

Prof

it /

loss

of th

ecu

rren

tye

ar

Unr

ealiz

edpr

ofit/

loss

on th

e ba

sis

of v

alue

adju

stm

ent o

ffin

anci

al a

sset

sav

aila

ble

for

sale

Min

ority

inte

rest

(in th

ousa

nds

of K

una)

Tota

lca

pita

land r

eser

ves

173.

468.

783

3.02

2.61

3

173.

468.

783

3.02

2.61

3

4.99

6.88

9

8.01

9.50

2

-6.1

93.9

27 0

175.

294.

358

59

Inad

ditio

nth

ere

conc

iliat

ion

ofst

atut

ory

annu

alfin

anci

alst

atem

ents

prep

ared

inac

cord

ance

with

repo

rting

fram

ewor

kan

dan

nual

stat

utor

yfin

anci

alst

atem

ents

pre

scrib

ed b

y th

e C

NB

Dec

isio

n on

stru

ctur

e an

d co

nten

t of a

nnua

l fin

anci

al s

tate

men

ts o

f ban

ks:

Fina

ncia

l rep

ort

Am

ount

CN

BA

mou

ntD

iffer

ence

Expl

anat

ion

Inte

rest

inco

me

Inte

rest

exp

ense

Inco

me

from

com

mis

sion

s an

d fe

es

Inco

me

from

com

mis

sion

s an

d fe

es

Prof

it /

loss

from

trad

ing

activ

ity

Prof

it /

loss

from

der

ivat

ives

bui

lt in

to

Prof

it (lo

ss) f

rom

act

iviti

es in

cat

egor

yof

pro

perty

ava

ilabl

e fo

r sal

e

Oth

er in

com

e–

EXTR

AORD

INAR

Y IN

CO

ME

Oth

er c

osts

Com

mon

adm

inis

trativ

e co

sts

and

depr

ecia

tion

Cos

t of v

alue

adj

ustm

ents

and

prov

isio

n fo

r los

ses

Prof

it (lo

ss) f

rom

inve

stm

ents

in a

ffilia

tes,

asso

ciat

ed c

ompa

nies

and

join

t ven

ture

Prof

it (lo

ss) b

efor

e ta

x

Inco

me

tax

Prof

it /

loss

from

acc

rued

fore

ign

exch

ange

diff

eren

ces

Prof

it fo

r th

e cu

rren

t yea

r

Inte

rest

inco

me

Inte

rest

exp

ense

Inco

me

from

fees

and

com

mis

sion

s

Expe

nses

from

fees

and

com

mis

sion

s

Net

inco

me

from

fore

ign

exch

ange

diff

eren

ces

Oth

er in

com

e fro

m re

gula

r ope

ratio

ns

Oth

er e

xpen

ses

Impa

irmen

ts a

nd p

rovi

sion

s

Prof

it be

fore

tax

Inco

me

tax

Prof

it fo

r th

e ye

ar

84.4

59

(47.

812)

13.0

11

(2.9

34)

3.18

9

5.65

4

(43.

642)

(5.5

22)

6.40

3

(1.4

06)

4.99

7

84.4

71

(47.

890)

13.0

11

(2.9

34)

3.33

5

(1)

(61)

3.87

3

1.78

1

(2.8

60)

(40.

967)

(5.2

74)

(80)

6.40

3

(1.4

06)

4.99

7

(12)

Net

fore

ign

exch

ange

diff

eren

ces

on th

e ba

sis

of in

tere

st in

com

e

78N

et fo

reig

n ex

chan

ge d

iffer

ence

son

the

basi

s of

inte

rest

exp

ense

11N

et fo

reig

n ex

chan

ge d

iffer

ence

son

the

basi

s of

inte

rest

inco

me

(78)

Net

fore

ign

exch

ange

diff

eren

ces

on th

e ba

sis

of in

tere

st e

xpen

se

(17)

Net

fore

ign

exch

ange

diff

eren

ces

185

Prov

isio

ns o

f cou

rt di

sput

es

(185

)Pr

ovis

ions

of c

ourt

disp

utes

17N

et fo

reig

n ex

chan

ge d

iffer

ence

s

upon

val

ue p

rovi

sion

s of

pla

cem

ents

upon

val

ue p

rovi

sion

s of

pla

cem

ents

(12) 78 0 0

(84) 0

185

(168

)

60

Fina

ncia

l rep

ort

Amou

ntC

NB

Amou

ntD

iffer

ence

Expl

anat

ion

Cas

h

Dep

osits

with

CN

B

Dep

osits

with

ban

king

inst

itutio

ns

Loan

s to

fina

ncia

l ins

titut

ions

Secu

ritie

s an

d ot

her f

inan

cial

inst

rum

ents

whi

ch a

re h

eld

to m

atur

ity

Trea

sury

not

es o

f MF

and

treas

ury

bills

of C

NB

Secu

ritie

s an

d ot

her f

inan

cial

inst

rum

ents

avai

labl

e fo

r sal

e

Loan

s to

oth

er c

usto

mer

s

Inve

stm

ent i

n af

filia

te c

ompa

nies

Cas

h as

sets

Rece

ivab

les

from

Cro

atia

n N

atio

nal B

ank

Plac

emen

ts w

ith b

anks

Fina

ncia

l ass

ets

held

to m

atur

ity

Fina

ncia

l ass

ets

avai

labl

e fo

r sal

e

Loan

s an

d pr

epay

men

ts to

cus

tom

ers

Inve

stm

ent i

n af

filia

te c

ompa

ny

133.

357

159.

495

42.0

65

83.0

98

174.

422

776.

819

5.67

9

27.4

12

185.

031

112.

544

14.9

20

83.0

98

139.

882

34.5

40

771.

829

5.67

9

25.7

55G

yro-

acco

unt (

acco

unt f

orse

ttlem

ent)

with

CN

B

69.2

85D

eman

d de

posi

ts w

ithfo

reig

n ba

nks

11.8

13D

eman

d de

posi

ts w

ithdo

mes

tic b

anks

(908

)Re

serv

es o

n an

agg

rega

teba

sis

(25.

755)

Gyr

o-ac

coun

t(fo

r set

tlem

ent )

with

CN

B

219

Gen

eral

rese

rves

(69.

285)

Dem

and

depo

sits

with

fore

ign

bank

s

(4.9

90)

Cre

dits

non

bank

finan

cial

inst

.

(11.

813)

Dem

and

depo

sits

with

dom

estic

ban

ks

689

Rese

rves

on

anag

greg

ate

basi

s

4.99

0kr

editi

neb

anko

vnim

finan

cijs

kim

inst

ituci

jam

a

105.

945

(25.

536)

(85.

399) 0 0

4.99

0 0

61

Izno

sO

braz

ac H

NB-

aIz

nos

Razl

ika

Obj

ašnj

enje

Fore

clos

ed a

sset

s

Tang

ible

ass

ets

(less

dep

reci

atio

n)

Inte

rest

, fe

es a

nd o

ther

ass

ets

Der

ivat

ive

finan

cial

ass

ets

Tota

l ass

ets

13.7

41

27.3

15

6.27

3

19.9

93

1.44

2.25

7

13.7

41

27.5

35

26.0

40 6

1.44

2.25

7

(220

)ot

her t

angi

ble

asse

ts

(sm

all i

nven

torie

s)

220

othe

r tan

gibl

e as

sets

(sm

all i

nven

torie

s)

0

(220

)

220

Fina

ncijs

ki iz

vješ

taji

Fore

clos

ed a

sset

s

Prop

erty,

pla

nt a

nd e

quip

men

t

Inta

ngib

le a

sset

s

Oth

er a

sset

s

TO

TA

L A

SS

ET

S

62

Fina

ncia

l rep

ort

Amou

ntC

NB

Amou

ntD

iffer

ence

Expl

anat

ion

Dep

osits

on

gyro

acc

ount

s an

d cu

rren

t acc

ount

s

Savi

ng d

epos

its

Term

dep

osits

Long

term

loan

s fro

m fi

nanc

ial i

nstit

utio

ns

Long

term

oth

er lo

ans

Inte

rest

, fee

s an

d ot

her l

iabi

litie

s

Der

ivat

ive

fina

ncia

l lia

bilit

ies

Tota

l lia

bilit

ies

CAP

ITAL

Shar

e ca

pita

l

Prof

it (lo

ss) o

f the

cur

rent

yea

r

Reta

ined

ear

ning

s (lo

ss)

Lega

l res

erve

s

Stat

utor

y an

d ot

her c

apita

l res

erve

s

Unr

ealiz

ed p

rofit

/ (l

oss)

from

val

ue a

djus

tmen

t of f

inan

cial

asse

ts a

vaila

ble

for s

ale

Tota

l cap

ital

TOTA

L LI

ABI

LITI

ES A

ND

CA

PITA

L

Liab

ilitie

s to

ban

ks

Dem

and

depo

sits

Term

dep

osits

Liab

ilitie

s up

on re

ceiv

ed lo

ans

Oth

er li

abili

ties

Prov

isio

ns

Tota

l lia

bilit

ies

CAP

ITAL

Subs

crib

ed c

apita

l

Ow

n sh

ares

Prof

it (lo

ss) o

f the

cur

rent

yea

r

Zadr

žana

dob

it

Rese

rves

Cap

ital g

ains

Reva

luat

ion

rese

rves

Tota

l cap

ital

TOTA

L LI

ABI

LITI

ES A

ND

CA

PITA

L

2.61

7

196.

482

859.

810

159.

030

46.0

88

2.93

6

1.26

6.96

3

91.8

97

-6.5

92

4997

68.6

87

14.3

57 149

1.79

9

175.

294

1.44

2.25

7

114.

488

81.4

85

859.

810

148.

089

13.5

58

49.5

28 5

1.26

6.96

3

85.3

05

4.99

7

68.6

87

4.72

9

9.77

7

1.79

9

175.

294

1.44

2.25

7

2.61

7Lo

an o

f oth

er n

on re

side

nts

509

Rest

ricte

d de

posi

ts

(2.6

17)

Loan

of o

ther

non

resi

dent

s

(509

)Re

stric

ted

depo

sits

2.61

7

509 0

(2.6

17)

(509

) 0 0 0 0 0 0 0 0

63

64

CORPORATE MANAGEMENT CODEX

ANNUAL QUESTIONNAIRE

GENERAL COMPANY INFORMATION:

CONTACT PERSON AND TELEPHONE NUMBER:

DATE OF FINNING IN THE QUESTIONNAIRE:

All questions in this questionnaire pertain to the period of one fiscal year to which the annual financial statements also pertain.

Please use explanations in your responses only when the questions asks for them explicitly.

Answers found in the questionnaire are valued at certain percentages, shown at the beginning of each chapter

DEDICATION TO PRINCIPLES OF CREATIVE MANAGEMENT AND SOCIAL RESPONSIBILITY

Answers to this set of questions carry 20% of the entire indicator with respect to the harmonization of the company with the corporate management codex.

ExplanationQuestionQuestion

No.

Answer

YES/NO

Has the company accepted the change of the corporate management codex, or adopted its

own corporate management policy?

Are there adopted corporate management codex principles within internal

company policies?

Does the company, within its annual financial statements, publish its conformance with the

principles of corporate management, in accordance with the principle of "use or explain"?

At decision-making, does the company take into consideration interests of all shareholders,

in accordance with the corporate management codex principles?

YES

YES

YES

YES

SHAREHOLDERS AND GENERAL ASSEMBLY



No.

Answer

YES/NO

Is the Company a part of joint shareholding with another company or companies?

(If so, explain)

Does each Company share give the right to one vote?

(if not, explain)

Does the company have the same approach toward, and offer the same conditions,

to all shareholders? (If not, explain)

Is the issuing of authorisation (proxy) for voting at the General Assembly fully simplified

and void of strict formalistic conditions? (If not, explain)

Did the Company ensure (free of charge) proxies for shareholders who could not, for any

reason, vote at the General Assembly, to vote in accordance with their instructions?

(If not, explain)

Has the Company, or the Management Board, when convening the General Assembly, set a

date for according to which it will check the position in the share register - which will be

competent for realising the right to vote in the General Assembly, in a way that this date is

before the General Assembly, but no more than six days before it? (If not, explain)

Were the minutes of the General Assembly, as well as all relevant information and

documents with explanations pertaining to the minutes published on the web pages of the

Company and accessible in the Company facilities to the shareholders from the first public

issue of the minutes? (If not, explain)

Does the decision on the dividend payout or prepayment of the dividend contain the date

on which a person who is a shareholder of the Company realizes his or her right to the

dividend payout, as well as the date and the period for said payout? (If not, explain)

Does the date of payout of dividend or prepayment of dividend fall at most 30 days after

the decision? (If not, explain)

Were any shareholders favoured during the payout/prepayment of dividend?

(If so, explain)

Have you facilitated to shareholders their participation and voting at the General Assembly

using modern communication technology means? (If not, explain)

Were there any conditions set with respect to taking part in the General Assembly or the

use of the right to vote (regardless of the law or the articles of association), such as

announcing participation beforehand, notarising authorisations/proxies, etc.? (If so, explain)

NO

The Company provided proxy forms for

taking part in the General Assembly. The forms

can be found on the Company web pages.

The Company did not pay out

dividends


dividends


dividends

Participation and voting by the shareholdersat the General Assembly of the Company isprescribed by the Company Articles ofAssociation

The obligation of announcing participationbeforehand is set by the Articlesof Association

YES

YES

YES

NO

YES

YES

NO

NO

NO

NO

NO

65

Has the management published publically the decisions of the General Assembly?

YES

YES

Has the management of the Company publicly issued/published information on possible

claims challenging said decisions? (If not, explain)

MANAGEMENT AND SUPERVISORY BODIES

Answers to this set of questions carry 20 % of the entire indicator with respect to the harmonization of the company with the corporate management codex.

NAME MEMBERS OF THE MANAGEMENT BOARD AND THEIR FUNCTIONS:

NAME MEMBERS OF THE SUPERVISORY BOARD AND THEIR FUNCTIONS:


No.

Answer

YES/NO

Has the Supervisory Board, or the Management Board, reached the decision on its operational

framework, including the list of regular meetings and information which regularly and timely

needs to be placed at the disposal to the members of the supervisory board? (If not, explain)

Did the Supervisory Board, or the Management Board, enact internal Rules of Conduct?

(If not, explain)

Is the Supervisory Board, or the non-executive directors in the Management Board, mostly

comprised of independent members? (If not, explain)

Does the Bank have a long-term succession plan? (If not, explain)

Is the compensation/bonus received by the members of the SB and the MB completely or

partly determined according to the contribution to the success of the Company? (If not, explain)

Are supervisory or management board member compensations/bonuses determined by the

decision of the General Assembly or by company by-laws? (If not, explain)

Is detailed information on all compensations and other income by the Company or persons

connected to the Company for each member of the SB or the MB, including the structure of

such compensation, published/issued publicly? (If not, explain)

Does every member of the SB or the MB inform the Company of all changes in connection

with their acquisition, waiver or the possibility of fulfilment of their voting rights over the

Company shares, by five days after such a change at the latest? (If not, explain)

Were all transactions in which the members of the SB or MB, or associated persons and the

Company and associated persons/entities participated, clearly noted in the Company reports:

(If not, explain)

Are there contracts or agreements between any member of the SB or MB and the Company?

Have they been first approved by the SB or the MB? (If not, explain)

Are important elements of such contracts or agreements contained in the annual report?

(If not, explain)

Has the SB or MB instituted a Naming Commission?

Has the SB or MB instituted an Awards Commission?

Has the SB or MB instituted an Audit Commission?

Are most Commission members independent members of the SB? (If not, explain)

Has the Commission followed the integrity of financial information of the Company, and

especially the correctness and consistency of accounting methods used by the Company and

the Group the Company belongs to, including the criteria for consolidating financial statements

of companies belonging to the Group? (If not, explain)

Has the Commission assessed the quality of the internal controls system and the risk

management system, with the goal being proper identification of main risks the Company is

exposed to (including risks tied to adherence to regulations), i.e. their proper identification,

exposure, and management? (If not, explain)

Did the Commission work on ensuring the efficiency of the internal audit system, especially

through drafting recommendations during phases of choosing, naming, repeat naming and

dismissal of internal audit managers and with respect to assets available to them, as well as

the assessment of actions undertaken by managers in view of findings and recommendations

of the internal audit? (If not, explain)

If the function of internal audit does not exist within the Company, has the Commission

made an assessment of the need to introduce it? (If not, explain)

Did the Commission monitor the independence and objectivity of the external auditor,

especially with respect to the rotation of authorised auditors within the auditors' company

and the compensation the Company is paying for their services? (If not, explain)

Has the Commission followed the nature and the quantity of services not constituting an audit,

but still being received by the Company from the auditors' or associated entities? (If not, explain)

NO

YES

YES

YES

NO

NO

NO

NO

NO

NO

YES

YES

YES

YES

YES

YES

YES

YES

YES

NO

Members of the Management Board are named

by the Supervisory Board, and approved by

the CNB

The compensation/bonus is

determined by the General Assembly

Expenses are published jointly

The Bank organised the function of

internal audit.

No such services

The Supervisory Board convenes at least once

a month and enacts decisions in its purview, in

accordance with the Articles of Association and

the Rules of Conduct of the Supervisory Board

66

Has the Commission drafted such regulations on which services the auditors' and their

associates may not render to the Company, which services they may render only with

previous approval by the Commission, and which services they may perform without

previous approval? (If not, explain)

Has the Commission deliberated on the efficiency of external audit and the actions of the senior

management staff with respect to the recommendations made by the external auditor? (If not, explain)

Has the Audit Commission ensured submission of high-quality information by dependant

and associated companies and third parties (such as expert advisors)? (If not, explain)

Was the documentation relevant for the operation of the SB or MB submitted on time to all

members? (If not, explain)

Were all decisions and voting results noted in the SB/MB meeting minutes? (If not, explain)

Has the SB/MB drafted the evaluation of its performance in the previous period, including

assessment of contribution and competence of each individual member, as well as the joint

performance of the Commission, assessment of performances of SB-established commissions,

and the assessment of goals met with respect to those set by the Company?

Has the Company published the statement on the policy of management and SB, MB and

Management awards as a part of the annual report? (If not, explain)

Is the Statement on the SB/MB/Management awarding policy constantly present on the web

pages of the Company? (If not, explain)

Is detailed information on all salaries and compensations for each member of the

Management or executive directors publicly declared in the annual report? (If not, explain)

Are all forms of awards to the members of the management or the SB, including options and

other benefits publicly declared (in detail by entry and person) in the annual report?

(If not, explain)

Were all transactions in which the members of the SB or MB, or associated persons and the

Company or associated persons/entities participated, clearly noted in the Company reports:

(If not, explain)

Does the report which the Supervisory Board or the Management Board submits to the

General Assembly contain (along with the legally prescribed report), the assessment of total

business success of the Company (read: the Bank), activities of the Company management,

and special cooperation of the Board with the management? (If not, explain)

NO

YES

YES

YES

YES

NO

NO

NO

NO

NO

YES

YES

This is regulated through legal

provisions. External auditor performs

auditing services only.

Awarding is defined through

employment contracts.



AUDIT AND INTERNAL CONTROL MECHANISMS


BUSINESS TRANSPARENCY AND PUBLIC APPEARANCE



No.

Answer

YES/NO


No.

Answer

YES/NO

Does the Company have its external auditing company?

Is the external auditor connected to the Company in ownership or interest?

Does the external auditor offer other services to the Company, whether by itself or through

associated entities?

Has the company publicly declared the amounts of compensation paid out to external

auditors for services of audit and other services rendered? (If not, explain)

Does the Company have internal auditors and an integrated system of internal control?

(If not, explain)

Are semi-annual, annual and quarterly reports available to shareholders?

Has the Company drafted a calendar of important events?

Has the Company introduced mechanism whereby persons who handle or come into

contact with eyes-only (privileged) information have the nature and significance of that

information explained to them, including limitations?

Has the Company introduced mechanisms ensuring oversight over the flow of privileged

information and possible misuse of the same?

Did anyone suffer negative consequences because he/she pointed out to the competent

bodies within the Company or outside the Company any insufficiencies in the application

of regulations or ethical norms within the Company? (If so, explain)

Did the Company have any meetings during the previous year with interested investors?

Are all members of the Management, the SB and the MB in agreement that the answers to

the questions in this questionnaire, to their best knowledge, completely true?

YES

NO

NO

NO

YES

The external auditor provided only

the services of audit, in accordance

with the conditions of their business.

YES

NO

YES

YES

NO

NO

YES

ORG

AN

IZA

TIO

NA

L D

IAG

RA

M

GEN

ERAL

ASS

ENBL

Y

SUPE

RVIS

ORY

BOAR

D

MAN

AGEM

ENT

AUD

IT B

ORD

INTE

RNAL

AUD

IT

CRE

DIT

BO

ARD

SOLV

ENC

YBO

ARD

INFO

RMAT

ION

SYST

EMM

ANAG

MEN

T BO

ARD

INFO

RMAT

ION

SYST

EM S

AFET

Y

RISK

CO

NTRO

LAN

D M

ANAG

MEN

T BO

ARD

INTE

RNAL

CON

TROL

AND

PREV

ENTIO

NOF

MON

EY LA

OUND

ERIN

G AN

DTE

RROR

ISM FI

NANC

ING

MAR

KETIN

G D

EPAR

TMEN

T

RISK

MAN

AGEM

ENT D

EPAR

TMEN

T

RISK

PLA

CEM

ENTS

CO

LLEC

TIO

NAN

D C

OLL

ECTI

ON

MO

NITO

RIN

GDE

PART

MEN

T

TREA

SURY

AN

DSO

LVEN

CY

SEC

TOR

PAYM

ENT

TRA

NSA

CTI

ON

S SE

CT O

RBU

SIN

ESS

SUPO

RT S

ECTO

RA

CC

OU

NT

SEC

TOR

LEG

AL

AN

D G

ENER

AL

AD

MIN

ISTR

ATIO

NSE

CTO

R

Sect

or M

anag

men

t

Trea

sury

dep

artm

ent

Solv

ency

Dep

artm

ent

Sect

or M

anag

men

tSe

ctor

Man

agm

ent

Sect

or M

anag

erSe

ctor

Man

ager

Sect

or M

anag

er

Sect

or C

ontro

lD

epar

tmen

t

Bloc

kage

, Man

date

and

Treas

ury D

epar

tmen

t

Paym

ent T

rans

actio

nD

epar

tmen

t

Sect

or C

ontro

lD

epar

tmen

t

Cre

dit a

nd G

uara

ntee

Busin

ess

Supp

ort D

epar

tmen

t

Dep

osits

and

Cre

dtit

Car

dTr

ansa

ctio

ns B

usin

ess

Supo

rtD

epar

tmen

t

Lega

l and

Per

sonn

elD

epar

tmen

t

Gen

eral

Adm

inis

tratio

nD

epar

tmen

t

Acco

unt,

Anal

ysis

i and

Repo

rting

Dep

artm

ent

Cle

arin

g D

epar

tmen

t

Syst

em S

uppo

rtD

epar

tmen

t

Clie

nt S

uppo

rtD

epar

tmen

t

67

IT S

ECTO

RC

RED

ITS

AN

DG

UA

RAN

TIES

SEC

TOR

Sect

or M

anag

er

Reta

il and

Bus

iness

Cred

its S

ecto

r

ZAG

REB

FIN

ANC

IAL

CEN

TRE

OSI

JEK

FIN

ANC

IAL

CEN

TRE

RIJE

KAFI

NAN

CIA

L C

ENTR

E

BAN

K BR

ANC

HES

CONTACTS

SUPERVISORY BOARD

CHAIRWOMAN OF THE MANAGEMENTBOARD

BORD MEMBER

BOARD MEMBER

IZVRŠNI DIREKTORU SEKTORU PODRŠKE POSLOVANJU

LOANS AND GUARANTEESSECTOR MANAGER

BUSINESS SUPPORTSECTOR MANAGER

TRANSACTIONSSECTOR MANAGER

Mrs. Ružica Vađić, ChairwomanMrs. Blaženka Eror Matić - MemberMr. Hrvoje Markovinović - MemberMr. Denis Smolar - MemberMr. Tomislav Rosandić - Member

Angelina Horvat, B.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-400, 840-401Fax: 033/551-566E-mail: ahorvat slatinska-banka.hr

Marko Krajina, B.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-400, 01/455-0397fax: 033/551-566 , 01/461-4714E-mail: mkrajina slatinska-banka.hr

Marko Brnić dipl.oec.V.Nazora 2, SlatinaTel: 033/840-400, 01/455-0397fax: 033/551-566 , 01/461-4714E-mail: mbrnić slatinska-banka.hr

Elvis Mališ, B.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-400, 840-401fax: 033/551-566E-mail: emalis slatinska-banka.hr

Mr. sc.Tina ŽivkovićV.Nazora 2, SlatinaTel: 033/840-421fax: 033/840-429E-mail: tzivkovic slatinska-banka.hr

Natalina Zdjelarević, B.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-440fax: 033/551-566E-mail: nzdjelarevic slatinska-banka.hr

Snježana Pačarić, B.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-430Fax: 033/551-566E-mail: spacaric slatinska-banka.hr

@

@

@

@

@

@

@

68

KONTAKTI

TREASURY AND SOLVENCYSECTOR MANAGER

ACCOUNTINGSECTOR MANAGER

LEGAL AND ADMINISTRATIVESECTOR MANAGER

IT SECTOR MANAGER

Manuela Kolarić, M.Sc. (Econ.)V.Nazora 2, SlatinaTel: 033/840-438Fax: 033/551-566E-mail: mkolaric slatinska-banka.hr

Gordana Potočki, B.Sc.V.Nazora 2, SlatinaTel: 033/840-451Fax: 033/551-566E-mail: gpotocki slatinska-banka.hr

Nada Samardžić, LLB.V.Nazora 2, SlatinaTel: 033/840-460Fax: 033/551-566E-mail: nsamardzic slatinska-banka.hr

Dražen Brkljač, B.Sc. (Eng.)V.Nazora 2, SlatinaTel: 033/840-470Fax: 033/551-566E-mail: dbrkljac slatinska-banka.hr

@

@

@

@

69

SLATINSKA BANKA D.D. - BUSINESS NETWORK

FINANCIAL CENTRES

OSIJEK FINANCIAL CENTRE

ZAGREB FINANCIAL CENTRE

RIJEKA FINANCIAL CENTRE

BRANCHES:

SLATINA BRANCH – BANK MAIN OFFICE

DONJI MIHOLJAC BRANCH

DARUVAR

NAŠICE

KOVO

ORAHOVICA

POŽEGA

VALPOVO

VIROVITICA

PITOMAČA

KOPRIVNICA

SLAVONSKI BROD

ILOK

Županijska 13, 31000 Osijekvoditelj: Marina Penavin, tel: 031/200-

Tomašićeva 2, 10000 Zagrebvoditelj: Nataša Putak, tel: 01/46-14-706

Jelačićev trg 1, 51000 Rijekavoditelj: Vedran Draženović, tel: 051/332-183

V.Nazora 2, 33520 Slatinavoditelj: Marina Koleno, tel: 033/840-411

Vukovarska 4, 31540 D.Miholjacvoditelj: v.d. Juraj Nerovčić tel: 031/631-221

Kralja Tomislava 22, 43500 Daruvarvoditelj: Jasminka Ajdić, tel: 043/331-469

Trg Izidora Kršnjavija 3, 31500 Našicevoditelj: Sanja Kapraljević, tel: 031/617-506

Stjepana Radića 9, 31400 akovovoditelj: Ivan Pološki, tel: 031/811-977

Kralja Zvonimira 14, 33515 Orahovicavoditelj: Juraj Nerovčić, tel: 033/674-002

Kamenita vrata 4, 34000 Požegavoditelj: Ivan Renka, tel: 034/271-279

Trg kralja Tomislava bb, 31550 Valpovovoditelj: Ignjo Ivanović, tel: 031/650-450

Trg kralja Tomislava 6, 33000 Viroviticavoditelj: Ksenija Stanić, tel: 033/ 722-790

Trg kralja Tomislava bb, 33405 Pitomačavoditelj: Neven Bedeković, tel: 033/783-950

Dr. Željka Selingera 2a, Koprivnicavoditelj: Predrag Marković, tel: 048/621-451

Matije Gupca 39, 35000 Slavonski Brodvoditelj: Filip Tolić tel: 035/400-

Trg žrtava domov. Rata 1, 32236 Ilokvoditelj: v.d Marina Penavin, tel:032/590-252

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

BRANCH

\A\

BRANCH OFFICES:

ČAČINCI BRANCH OFFICE

BRIBIR

VIŠKOVO

NOVA KAPELA

SUHOPOLJE

ČA AVICA

KUTJEVO

PLETERNICA

NOVA BUKOVICA

KAPTOL

MIKLEUŠ

MOLVE

Trg dr. F. Tuđmana 1, 33514 Čačincitel: 033/400-999

Bribir 10, Bribir 51253 Bribirt el: 051/284-164

Vozišće 1, 51216 Viškovotel: 051/503-756

Kralja Tomislava 13, 35410 Nova Kapelatel: 035/385-023

Trg Sv. Terezije 10,33410 Suhopoljetel: 033/ 801-106

Zagrebačka 11, 33523 Čađavicatel: 033/544-232

Trg Graševine 2, 34340 Kutjevotel:034/315-076

Trg Z. Frankopana 10, 34310 Platernicatel: 034/251-829

Zagrebačka 2, 33518 Nova Bukovicatel:033/564-101

Trg Vilima Korajca 15, 34334 Kaptoltel:034/231-175

Ivana pl. Zajca bb, 33517 Mikleuštel: 033/563-020

Trg Kralja tomislava 31, 48327 Molvetel: 048/625-453

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

BRANCH OFFICE

\

70

CORRESPONDENT BANKS

CORRESPONDENT BANK

UNICREDIT BANK AUSTRIA AG, VIENNA

ZVEZA BANK RZZOJ,

KLAGENFURT

DEUTSCHE BANK TRUST COMPANY AMERICAS,

NEW YORK

DEUTSCHE BANK AG

FRANKFURT AM MAIN

BAYERISCHE LANDESBANK,

MUNCHEN

INTESA SANPAOLO SPA,

MILAN

BANCA POPOLARE DI CIVIDALE SOCIETA COOPERATIVE PER AZIONI,

CIVIDALE DEL FRIULI

BANCA ANTONVENETA SPA,

PADOVA

SVENSKA

HANDELSBANKEN AB(PUBL),

STOCKHOLM

CREDIT SUISSE,

ZURICH

KBC BANK NV

BRUSSELS

STATE

AUSTRIJA

SAD

NJEMAČKA

ITALIJA

ŠVEDSKA

ŠVICARSKA

BELGIJA

71

Documents

ANNUAL REPORT FOR SLATINSKA BANKA d.d. SLATINA · DEVELOPMENT OF SLATINSKA BANKA d.d. SLATINA SLATINSKA BANKA d.d. was founded 9 October 1992 and is the only banking institution seated