Annual Report20012001
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Surveyof key data
RZB GROUP (IAS-compliant) 2001 2000financial year financial year Change
INCOME STATEMENTNet interest income after provisioning for possible loan losses ( in millions) 422.5 356.4 18.5%
Net commission income ( in millions) 213.7 149.6 42.9%Trading profit/(loss) ( in millions) 239.5 166.1 44.2%General administrative expenses ( in millions) (702.5) (483.3) 45.3%Profit before tax ( in millions) 231.7 180.5 28.4%Consolidated profit ( in millions) 163.6 133.1 23.0%BALANCE SHEETLoans and advances to banks ( in millions) 16,582 13,550 22.4%Loans and advances to customers ( in millions) 16,936 13,885 22.0%Deposits from banks ( in millions) 24,915 20,842 19.5%Deposits from customers ( in millions) 10,261 6,932 48.0%Equity ( in millions) 1,956 1,619 20.8%Balance-sheet total ( in millions) 44,584 36,468 22.3%REGULATORY OWN FUNDSEligible own funds ( in millions) 2,425 2,121 14.3%Own funds requirement ( in millions) 1,929 1,554 24.2%Core capital ratio (per cent) 7.2% 7.6% (5.8%)Own funds ratio (per cent) 10.1% 10.9% (7.8%)INDICATORSReturn on equity (ROE) before tax 13.3% 14.4% (7.2%)Cost/income ratio 71.1% 66.2% 7.5%IAS earnings per share () 41.5 40.9 1.5%Return on assets (ROA) before tax 0.57% 0.55% 3.3%Provisions for possible loan losses ( in millions) (112.1) (58.4) 91.8%Provisions for possible loan losses/risk-weighted assets 0.46% 0.30% 54.5%RESOURCESAverage number of staff 11,368 7,235 57.1%Banking outlets 526 206 155.3%
RATINGS Long-term Short-term Financial strengthMoodys Investors Service A1 P-1 C+Standard & Poors A1
RAIFFEISEN BANKING GROUP (HGB-compliant)Consolidated balance-sheet total ( in millions) 110,177 97,467 13.0%Equity ( in millions) 5,297 4,903 8.0%
Vision & Mission
Vision
RZB is the leading banking groupin Austria and Central & EasternEurope (CEE).
Mission
We seek long-term customer relationships.
In Austria and CEE, we provide a fullrange of top-quality financial services.
In the worlds financial centres and Asia, we are an important niche player.
As the Central Institution of the Raiffeisen Banking Group in Austria, weoffer specific services to our owners.
We achieve sustainable and above-average return on equity.
We empower our employees to be entrepreneurial and to show initiative and we foster their development.
Andrea PeterneliRisk manager and Deputy General Manager of Raiffeisen Leasing, Ljubljana
Survey of key data 2
Highlights during 2001 8
Statement by the Chairman of the Managing Board 10
Overview of RZB 16
75 years of Raiffeisen Zentralbank 26
The Raiffeisen Banking Group in 2001 32
Managements Report and Staff Report 40Managements Report 41Staff Report 50
Segment reports 52Corporate Business 53Treasury and Investment Banking 60Retail Banking 68Transaction Services 72Other, Equity Participations and Consolidation 77
Financial Statements (IAS-compliant consolidated financial statements) 86Consolidated Income Statement and Consolidated Balance Sheet 88Notes 93Notes to the Consolidated Income Statement and Consolidated Balance Sheet 105Notes to financial instruments 138Notes required by Austrian legal standards 147Boards and officers of Raiffeisen Zentralbank 152Auditors Report 154Equity Participations 155Glossary of important terms and abbreviations 159
Supervisory Boards Report 162
Addresses and contacts for RZB Group-members 164
Note: In this report, RZB refers to the RZB Group and Raiffeisen Zentralbank is used whenever statements refer solely to RaiffeisenZentralbank sterreich AG.
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Tableof Contents
Highlightsduring 2001
January RZB decides to found a banking subsidiary in
Yugoslavia.
February RZB submits a tender for Romanias Banca
Agricolau S.A., Bucharest.
March RZBs Global Trading Center in Vienna opens. It is
Central Europes most advanced securities, forex and money dealing room.
Raiffeisen Bank d.d. Bosna i Hercegovina,Sarajevo, opens a branch in Banja Luka, Republika Srpska, to become the only bank in Bosnia and Herzegovina to develop a nationwide presence.
April The 45.09 per cent increase in RZBs stake in
Centro Internationale Handelsbank AG to80.23 per cent turns RZB into the majority shareholder of this Viennese trade and investment bank.
Investment magazine Global Finance awards RZBthe title of Best Bank in Central and Eastern Europe.
May RZB acquires a 100 per cent stake in Herze-
govinian regional bank Hrvatska PotanskaBanka d.d., Mostar (now Raiffeisen Bank HPB d.d.).
The opening of the representative office in Seoul, Korea, deepens RZBs presence in Eastern Asia.
Austrian Federal President Thomas Klestil opens the RZB branch in Beijing, China.
June ZAO Raiffeisenbank Austria, Moscow, expands to
St. Petersburg. Thomas Klestil opens the new branch in Russias second most important economic area.
July RZB takes over a 93.4 per cent stake (direct and
indirect) in Banca Agricolau S.A., Bucharest (now Banca Agricola-Raiffeisen S.A.) to become a key player in the Romanian marketplace.
Raiffeisenbank Jugoslavija a.d., Belgrade, becomes the first new post-revolution bank to open its doors just five months after being granted a licence.
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August The EU Commission approves the takeover of
Centrobank.
September Financial Times professional journal The Banker
names RZB Bank of the Year 2001 in Central and Eastern Europe and Bank of the Year 2001 in Austria, Slovakia and Bosnia and Herzegovina.
Our retail customer base in the CEE region exceeds one million for the first time.
At the end of the third quarter, Raiffeisen Bank d.d. Bosna i Hercegowina, Sarajevo, takes over leadership of the market in Bosnia und Herzegovina.
October RZB acquires the remainder of Centrobanks stock
to become its sole shareholder. This bank now called Raiffeisen Centrobank AG (RCB) is turned into the Raiffeisen Banking Groups equity house following the integration of the RZB departments specializing in equities business.
November RZB participates in a capital increase through the
issue of convertible preference shares to acquire a stake of about 10 per cent in leading Kazakh bank OJSC Bank TuranAlem, Almaty.
Karl Stoss one of Austrias most renowned bankers is appointed a member of RZBs Managing Board.
December RCB enters the new year as the leading trader on
the Vienna stock exchange. RZB is the years market leader in syndicated
large-volume loans in Central and Eastern Europe.
Captions:
1. Ceremony to open Raiffeisenbank Jugoslavija.
2. Federal President Thomas Klestil opens the St. Petersburg branch.
3. The Banker Awards ceremony: Editor-in-Chief Stephen Timewell
gives Karl Sevelda the award.
4. RZB is a powerful player in the treasury segment, and RCB is
the leading trader on the Vienna stock exchange.
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Walter RothensteinerChairman of the Managing Board of Raiffeisen Zentralbank
Dear Sir or Madam,
RZB can look back on a successful year in 2001.Raiffeisen Zentralbank and its Group-membersremained firmly on their chosen growth path. In doingso, they made use of an increasingly adverse marketenvironment to continue to strengthen the Groupsmarket position.
The density of our banking network in Central andEastern Europe (the CEE region) went on increasingand we pressed purposefully ahead with our expan-sion: RZB remained true to its traditional pioneeringrole, launching the banking subsidiary in Yugoslaviain record time, so RZB once again had the best possi-ble starting position in a newly accessible market.Lending volumes in Austria continued to grow, and wedeveloped the foundations for leadership in the invest-ment banking segment.
For the first time, our consolidated financial statementsare based on the International Accounting Standards(IAS). The IAS figures indicate the same trend as theAustrian accounting standards previously in use (HGB).
RZBs consolidated balance-sheet total grew by 22.3per cent to roughly 44.6 billion. Once again, by farthe greater part of that growth was organic, under-scoring our solid position in high-growth business seg-ments and regions. The most powerful motors ofgrowth remained business in Austria and the bankingnetwork in Central and Eastern Europe.
As you know from earlier reports, RZBs businessgrowth always goes hand-in-hand with uncompromis-ing scrutiny of the associated risks. In line with RZBs
traditionally cautious measuring of risks, the economicslowdown and the resulting problems for our sector inparticular led to a significant increase in our provisionfor possible loan losses in 2001 (albeit from a lowbase). The selective development of assets in the CEEregion over the past few years has kept our risk posi-tion well-balanced.
RZBs earning power is unbroken. Net interest income,Net commission income and Trading profit/(loss) grewin step with our assets. Our profit before tax was thus28.4 per cent up on the previous years good result at 231.7 million.
That increase in profit was achieved despite sustainedheavy investment in our ongoing expansion and thedevelopment of a solid basis for further growth andfuture profits. As in prior years, RZB invested prima-rily in the carefully considered development of IT infra-structures and enlargement of its banking network.
High levels of investment increased our cost/incomeratio and reduced our return on equity. However, thatdoes not mean that our business growth
