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13.10.06

Raiffeisen International raises its expectations for consolidated profitat Capital Markets Day in Kiev.

The second Capital Markets Day of Raiffeisen International Bank-HoldingAG met with a very positive response from the financial community. Morethan 110 analysts and investors from the most important financialcenters throughout the world attended the event in order to obtaininformation about Raiffeisen International. The Capital Markets Day tookplace in the Ukrainian capital Kiev and was thus the first such event inone of the 15 Central and Eastern European markets in which RaiffeisenInternational is represented by a bank. The choice of the venueunderlined the top position of Raiffeisen International in the CIS, onthe one hand, and emphasized the importance of the former Bank Aval, onthe other hand. This bank is the biggest acquisition in the Groups history. From now on it will appear on the market as OJSC Raiffeisen Bank Aval.

All members of Raiffeisen Internationals Managing Board participated in the Capital Markets Day. For the first time, the local management also presented its progress in the transformation of Raiffeisen Bank Aval, as well as in the integration of JSC Impexbank in Russia. Moreover, management reported in depth on various projects of strategic importance.

Earlier than expected agreement on purchase price acceleratesImpexbank integration.

Raiffeisen International and the former owners of JSC Impexbank haveagreed on the final payment for the acquisition of Impexbank earlierthan expected. At the time of the acquisition, the agreement called forthe payment of the purchase price in two tranches. The first payment ofUSD 500 million was made at the closing of the transaction in May 2006.The second payment of an amount of up to USD 50 million was to becomedue in 2007, on the basis of the audited financial results for 2006.

It has now been agreed that the second tranche will amount to USD 25million. Furthermore, in accordance with the purchase agreement, signedin January 2006, the value of the head-office building was re-estimatedby an independent appraiser, which raised the purchase price by anadditional USD 30.2 million to a total of USD 555.2 million. Theanticipated agreement on the purchase price enables RaiffeisenInternational to speed up the merger of Impexbank with ZAORaiffeisenbank Austria. The legal merger is planned for 2007.

In addition, participants were also informed about the future brandingand the new management of the bank. After the merger, the new bank willbe named ZAO Raiffeisenbank Austria. The Management Board of the bankwill consist of nine members. Johann Jonach, CEO of the currentRaiffeisenbank, will also become CEO of the new bank.

Consolidated profit for 2006 expected to rise to 550 million

Once again, the outlook given by the Management Board for the comingyears was very positive. Raiffeisen Internationals management expects strong earnings growth for the medium term in the CIS and above all in Ukraine and Russia. However, restructuring measures in Ukraine and Russia, due to the acquisition of Bank Aval and Impexbank, will burden earnings in the short term. RaiffeisenInternational continues to judge the potential for the countries of Southeastern Europe (SEE) optimistically, but somewhat more cautiously because of restrictions on credit growth prescribed by supervisory authorities. In Central Europe (CE), the company is increasingly focusing on the fast-growing segments of asset management and insurance products in addition to traditional business.

"We expect a consolidated profit of approximately 550 million for 2006. This amount does not include the proceeds from the sale of Raiffeisenbank Ukraine and the proceeds from the sale of our minority stake in Bank TuranAlem in Kazakhstan," said Herbert Stepic, CEO ofRaiffeisen International, while commenting on the positive businessdevelopment. Previously, Raiffeisen International had assumed that itsconsolidated profit for the year would amount to at least 500 million.

Management estimates the balance sheet total will grow by at least 20per cent annually in the period to 2008. The strongest increases will beseen in the CIS, partly because of the acquisitions made there. Duringthe same period, the network of outlets in Central and Eastern Europewill grow by about 450 branch offices.

Raiffeisen International intends to achieve a return on equity (ROE)before tax of more than 25 per cent by the end of 2009. The cost/incomeratio is set to fall below 58 per cent and the risk/earnings ratioshould be about 15 per cent.

Every autumn, Raiffeisen International organizes a Capital Markets Day.This facilitates a continuing flow of information and exchange ofopinions with the financial community at the highest level.

You can find the Investors Handbook, published on the occasion of the Capital Markets Day, at http://www.ri.co.at/cmdhandbook2006.

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Raiffeisen International operates one of the leading banking networks inCEE with subsidiary banks and leasing companies in 16 markets. More than11 million customers are attended to through more than 2,700 businessoutlets. In eight markets, the respective Network Bank ranks among thethree largest local banks. Representative offices in Lithuania andMoldova complement the Group''s presence in the region. RaiffeisenInternational is a fully consolidated subsidiary of RaiffeisenZentralbank Osterreich AG (RZB), which owns 70 per cent of the commonstock. The remaining 30 per cent is free float, the shares are traded onthe Vienna Stock Exchange. RZB is a leading corporate and investmentbank in Austria and the central institution of the Austrian RaiffeisenBanking Group, the country''s largest banking group.

Raiffeisen International''s balance-sheet total amounted to 46.3 billion at the end of the first semester 2006 (plus 14 per cent compared with year-end 2005). Consolidated profit (after minorities) increased by 56 per cent to 289 million, compared with the first semester 2005.

For further information please contact Michael Palzer(+43-676-86061-1504, michael.palzer@ri.co.at) or Lars D. Hofer (+43-1-71707-1930, lars.hofer@ri.co.at).

http://www.ri.co.at, http://www.rzb.at

 

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