Branko Jelínek: Portrét vlajky II. / Porträt der Flagge II. / Portrait of the ...

Branko Jelínek: Portrét vlajky II. / Porträt der Flagge II. / Portrait of the flag II.
• naroden˘ 21. apríla 1978 v Banskej ·tiavnici
• 1992 – 1996 ‰tudent ·UV v Ko‰iciach na odbore propagaãná grafika
• od roku 1996 ‰tudent V·VU v Bratislave na katedre grafiky, ateliér Voºnej grafiky a kniÏnej illustrácie
pod vedením profesora akademického maliara Du‰ana Kállaya.

Annual Report 1999
45

46
Dear clients and friends of ªUDOVÁ
BANKA,
The last year before the turn of the millennium,
1999, is the eighth year of
operations for ªUDOVÁ BANKA. The
year was also the year in which the Slovak
government, following the parliamentary
elections in September 1998,
implemented measures aimed at stabilising
the economy and regaining macro
economic balance. As a result of these
measures there was a slow down in
economic growth, a significant increase
in the rate of unemployment and considerable
problems in the entrepreneurial
sector were experienced. However, significant
progress was made in the process
of restructuring state banks and in
their preparation for the entry of strategic
foreign investors.
As would be expected, these measures
also influenced the business activities of
ªUDOVÁ BANKA. Although there was a
slow down in the growth of some of the
Bank’s key indicators (total assets, deposits,
customer loans), it was not as significant
as the slow down and, in certain
cases decrease, experienced in the rest
of the banking sector. ªUDOVÁ BAN-
KA’s market share continued to grow
during the year. To ensure that growth
would not adversely impact the loan
portfolio, of the Bank. There was strict
adherence to the principles of prodential
banking. The Bank’s strategy during
this period was growth in quality.
The growth in the Bank’s branch network
continued during 1999. New
branches were opened in Luãenec,
Banská Bystrica and RuÏomberok. At
the beginning of 2000, a branch was
opened in Pre‰ov and sub-branches in
the Bratislava region. ªUDOVÁ BANKA
now has 21 branches. The expansion
of the branch network to cover all the
important geographical areas of the Slovak
Republic remains a key component
of the Bank’s strategic commercial objectives
for the coming year. The market
positioning of ªUDOVÁ BANKA as a
subsidiary of ÖVAG - a regional European
bank - proved to be correct. Current
trends towards globalisation, especially
in the banking and insurance sectors,
creates even more market opportunities
for regional banks focusing on
small and medium-size enterprises and
private banking.
As a result of the Bank’s objective to diversify
its range of services to private
and corporate sectors, the Bank’s licence
was amended to include mortgage
lending and the sale of insurance products.
Following from these amendments,
the previously announced cooperation
with VV AG and with OVVV
came to fruition.
A Word from the Managing Board
From left:
Karl Mayr-Kern, Wolfgang Siller, Jozef Kollár, Alexander Bayr
A significant contribution was made by
the Information Technology Department
in the smooth transition from 1999 to
2000. Of great importance for the
Bank in 2000 is the successful completion
of the electronic banking project.
Looking towards the future, pressures on
margins, declining yields from state securities
and upward pressure on operational
costs (especially human resources)
will require the Bank to adapt. This will
be accomplished mainly through improvement
and increased quality and innovation
in banking products and in the
long-term investment in human resources.
The Bank would like to express its gratitude
towards all staff members of
ªUDOVÁ BANKA, its clients, business
partners and shareholders. We believe
that you will remain committed to a financial
institution that combines foreign
know-how with a deep knowledge of
the Slovak market.
ªUDOVÁ BANKA. TRUST IS COMMITMENT.

Highlights
1999 1998 1997
in SKK million in SKK million in SKK million
Total assets 22,279 20,378 15,704
Clients’ payables 17,580 16,386 12,139
Clients’ receivables 6,160 7,377 5,790
Operating profits 944 927 685
Operating costs 598 459 411
Earnings from ordinary activities 227 265 197
Number of employees 483 417 338
Number of branches 20 16 13
47
Annual Report 1999

48
President
Klaus Thalhammer
Deputy General Director
Vice-Chairman of the Management Board
Österreichische Volksbanken-AG.,
Vienna
Vice-Chairman
Ekkehard Fügl
Head of Foreign Payments Dept.
Österreichische Volksbanken-AG., Vienna
since 15.4.1999
Peter Weiß
Director, Consultant
Österreichische Volksbanken-AG., Vienna
till 15.4.1999
Members
Zdenko Alexy
Advisor
Stock Exchange, j.s.c., Bratislava
Ugo Fatini
General Management Advisor
Banca Popolare di Vicenza, Italy
till 13.4.2000
Andrej Glatz
Director
Motorcar Wiesenthal & Co.,
Bratislava
Andrej Hrádocký
Physician
Trenčín
till 13.4.2000
Hans Janeschitz
Director
Österreichische Volksbanken-AG., Vienna
Pierre Klein
Vicepresident
Chambre Syndicale des Banques Populaires,
Paris
Franz Lagler
Director, Chairman of Board
Volksbank Krems-Zwettl AG., Krems
till 15.4.1999
Karl Mayr-Kern
Director, Chairman of Board
Magyarországi Volksbank Rt., Hungary
since 14.4.2000
Rastislav Opaterný
Commercial Lawyer
Bratislava
Hubert Piel
Management Director
Member of the Management Board
WGZ-Bank, Düsseldorf
till 15.4.1999
Stephan Wolf
Consultant
Slovak Technical University
Bratislava
Gerhard Wöber
Foreign Payments Dept.
Österreichische Volksbanken-AG., Vienna
since 15.4.1999
Bank Management
Supervisory Board Board of Directors
Karl Mayr-Kern
Director
Chairman
till 13.4.2000
Jozef Kollár
Director
Vice-Chairman
till 13.4.2000
Chairman
since 14.4.2000
Matthäus Thun-Hohenstein
Director
Member
till 10.12.1999
Wolfgang Siller
Director
Member
since 15.4.1999
Alexander Bayr
Director
Member
since 10.12.1999

Senior Executives
Departments Holders of procuration
Jana Krempová
Director
Economics Dept.
Jana Kudláčová
Director
Treasury Dept.
Jarmila Pašteková
Director
Administration and Supplies
Oľga Rebrová
Director
Risk Management Dept.
David Saleh
Director
Head of Branch Network
Alexander Spišiak
Director
Account Management Dept.
Credit & Loans
Lucia Šimková
responsible to run the division
Back Office
Jaroslava Šuchová
Director
Head of International Division
Sections
Johannes Breiteneder
Internal Audit
Alena Huťanová
Human Resources
Ľubomír Nemček
Director
Legal Counsel
Jaroslava Pribylincová
Director
Marketing and Publicity
Alexander Turan
Building Projects
Monika Zvarová
Translations Dept.
Alica Bobková
Head of Credit Administration
Ján Hargaš
Senior Account Manager
Peter Kníž
Head of Dealing
Irena Kobzová
Head of Accounting & Statistics Dept.
Štefan Prachár
Head of Information Systems Dept.
Ján Rašo
Head of IT Development
Milan Šikula
Head of Documentary Payments
Directors of Branches
Jozef Boržík
Director
Prešov
Elena Hegerová
Director
Banská Bystrica
Stanislav Jakubík
Director
Trenčín
Monika Ježková
Director
Žilina
Ľudovít Korotnoky
Director
Košice
Tatiana Krajmerová
Director
Nitra
Roman Kurák
Director
Ružomberok
Bystrík Mucha
Director
Poprad
Ivan Oravský
Director
Bratislava, Motobanka
Pavol Príhoda
Director
Galanta
Nina Stankeová
responsible for Branch Management
Bratislava, Nám. SNP 15
Marián Šimoňák
Director
Lučenec
Sub-branches
Július Bujdák
Head
Šaľa
Miroslav Frič
Head
Bratislava, Špitálska 37
Danica Gombošová
Head
Bratislava, Jesenského 2
Rastislav Ilenčík
Head
Bratislava, Ľ. Fullu 62
Gabriela Laluhová
Head
Bratislava, Trnavská 50/A
Juraj Lóci
Head
Bratislava, Dulovo nám. 1
Marián Miškeje
Head
Bratislava, Sch. Trnavského 14
Katarína Sadloňová
Director
Bratislava, Vysoká 9
Jozef Sloboda
Head
Bratislava, Haanova 12
49
Annual Report 1999

50
ªudová Banka began trading in Slovakia
in 1992. The main shareholder is
Österreichische Volksbaken-AG.
(ÖVAG). Other shareholders include
GZB, WGZ-Bank, SGZ-Bank, members
of the Austrian Volksbanken, group of
north Italian Volksbanken and individual
Slovakshareholders.
ÖVAG was established 1992 with the
founding of the Osterreichische Zentralgenossenschaftskasse
as the umbrella
organisation for a decentralised banking
sector. ÖVAG is one of Austria’s
ten largest banks and is owned by approximately
60 Volksbanken with more
than 600 branches. Additional shareholders
are DG BANK Deutsche Genossenschaftsbank
AG., VICTORIA
Ruckversicherung AG., VICTORIA Versicherung
AG. and Raiffeisen Zentralbank
Osterreich AG.. With accumulated total
assets in 1999 of approximately ATS
400 billion and a total of 7,200 staff,
the Austrian Volksbaken Group is one of
Austria’s most successful banking
groups.
ÖVAG has been active in Central and
Eastern Europe for approximately 10
years and provides professional financial
services through more than 1,000
staff operating in a network of over 50
branches in Croatia, Slovakia, Slovenia,
the Czech Republic and Hungary.
In addition, there is a Volksbank in
Malta and a representative office in
Italy. In the course of 2000, subsidiaries
will commence operations in Romania
and Bosnia-Herzegovina.
International Integration
Co-operating through the international
association of Volksbanken (CIBP) and
its network of 42,000 banking outlets in
the member states of Argentina, Belgium,
Germany, France, Italy, Canada,
Marocco, Spain, Turkey, Hungary,
Great Britain and Japan and with the
stakes held by DG BANK in ÖVAG,
ªUDOVÁ BANKA is able to offer a
worldwide presence in all major financial
centres.
Shareholders Share in %
VBB-International Holding GmbH 71,7
GZB 3,3
WGZ-Bank 3,3
SGZ-Bank 3,3
Volksbank Donau-Weinland 0,2
Niederösterreichische Landes- und Hypothekenbank AG. 2,5
Volksbank Ötscherland 1,7
Volksbank Waldviertler Horn 0,2
Banca Agricola Mantovana 3,4
Banca Popolare dell’ Emilia Romagna 3,4
VENETO BANCA 2,3
Banca Popolare di Vicenza 2,3
Small shareholders 2,4
Together 100,0%

Slovak Economy in 1999 and Prospects for 2000
Slovak Economy in 1999
Macroeconomic Imbalance
The economic policy before 1999 was
characterised by comparatively high
growth with a parallel increase in both
external and internal imbalances. In
1998, the current account deficit as a
percentage of GDP was over 10%,
gross foreign debt exceeded 60% of
GDP and the budget deficit, including
the public finance deficit was in excess
of acceptable norms in mature economies.
This was due to an economic policy
which requided funds in excess of
available sources. Subsequent to the election
in the autumn of 1998, the new
government’s policies focused on ending
adverse economic trends and regaining
balance.
GDP Decrease and Growing Unemployment
A direct result of regaining balance in
1999 was a decrease in GDP growth
to 2% compared to 6% in the years
1995 to 1997 and 4.4% in 1998.
GDP growth prior to 1998 was amongst
the highest in the transition economics
of central and eastern Europe. The
main source of this growth was foreign
demand. With the slow-down in the
growth rate in the economy and the
delay in restructuring, the high level of
unemployment became critical. At the
end of 1999 unemployment reached
the alarming level of 19%, which is a
25% increase year-on-year.
Government Measures - Rapid
increase in inflation
The government adopted measures in
the first half of 1999 to address the
economic imbalances. This included the
introduction of a temporary 7% import
surcharge, increases in excise taxes and
VAT and also partial price deregulation.
As a result of these measures, year-onyear
inflation increased to 14.2% in December
1999 and the average inflation
rate for the year increased to 10.6%.
As a consequence of price deregulation,
electricity, energy, natural gas, heating
and telecommunication charges increased.
Positive Change in Foreign
Trade
The deficit on the balance of payments
decreased in 1999 by SKK 37.2 billion
to SKK 45.7 billion compared to
1998. The increased deficit in 1998
had resulted in pressures on the Slovak
Crown and on the reserves of the National
Bank of Slovakia. The main factors
that lead to the improvement in the
balance of payments were, firstly, a
decrease in domestic demand, which
resulted in a decrease in imports (yearon-year
growth of 1.6%); and secondly,
exports increased (year-on-year growth
of 11.8%) as a result of the recovery of
the economies in the Euro zone.
Restrictive Fiscal Policy - Lower
Budgeted Public Debt
The expansive fiscal policy of recent
years was replaced by a restrictive fiscal
policy in 1999. This resulted in the
deficit reaching, according to preliminary
figures, 2% of GDP. As a result of
the drop in interest rates, the cost of financing
the deficit also decreased. On
1 January 2000 the corporate income
tax rate was lowered from 40% to 29%.
Forecast for 2000
The stabilisation of the macro economy
will continue in 2000. According to
preliminary estimates, the growth in
GDP will be between 1.7% and 2%.
The high levels of unemployment will
also continue. Reducing unemployment
is dependent on long term economic
growth and a fundamental restructuring
that will impact at the micro economic
level. The Government will continue with
price deregulation, which will lead to a
further increase in the consumer price
index. The continuing economic boom
in OECD countries, which accounts for
92 to 93% of Slovakia’s exports, will
translate into a reduction in the trade
deficit and other current external imbalances.
Higher direct foreign investment
is expected, especially after 2000. The
Government has started with the long
postponed restructuring of the economy,
including the privatisiation of the large
state-owned banks (V‰eobecná úverová
banka, Slovenská sporiteºÀa and Investiãná
a rozvojová banka). These banks
are to be sold to foreign investors in
2000 or 2001. A further important
event is the possible inclusion of Slovakia
in the OECD. The decision will be
taken at the end of April 2000.
51
Annual Report 1999

52
Services Offered to Clients
ªUDOVÁ BANKA expanded the range
of services offered. Private Banking is
now available to high net worth clients.
A comprehensive added-value service is
provided for the client.
With the aim of establishing relationships
with clients from a young age, a
new product, Account for the Youth,
was introduced alongside the Children’s
Deposit Book. The product offers advantageous
interest rates on personal current
accounts for clients between 18
and 25 years old and has the option to
obtain the EURO 26+ Youth Card or
the International ISIC Students card free
of charge.
ªUDOVÁ BANKA expanded card products
to include, in addition to cards
from EUROPAY and VISA, the prestigious
Diners Club International card.
The number of EUROPAY and VISA
cards issued increased by 21% from
last year and is now in excess of
27,000. This trend can also be seen in
the increase in the number of EFT/POS
terminals of the Bank’s partners and the
increase in the Bank’s ATMs. The total
number of ATM transactions increased
by 55% compared to last year.
The introduction of the EURO also affected
the Banks’activities in foreign trade
and international co-operation. This
lead to the extension and improvement
in the quality of ªUDOVÁ BANKA’s network
of correspondent banks to meet
Development of Deposit during 1995 - 1999
Bank Management Report
clients’ foreign trade needs in most territories.
As a result of trading partners requiring
a higher level of certainty regarding
foreign trade, documentary payments
increased. The number of letters of
credit increased by more than 13%.
(in SKK mill.) 1995 1996 1997 1998 1999
Total 6,233 8,448 12,139 16,386 17,580
18.000
12.000
6.000
0
1995 1996 1997 1998 1999
Development of Deposit during 1999
(in SKK mill.) 4.Q./98 1.Q./99 2.Q./99 3.Q./99 4.Q./99
Saving and Depositcertificats 2,756 2,877 2,920 2,779 3,121
Non-termtime 5,399 5,732 5,663 5,357 5,763
Termtime 8,231 8,330 7,769 8,408 8,696
Total 16,386 16,939 16,352 16,544 17,580
Development of the Ratio of Foreign Currency and Slovak Crown Deposits
(in SKK mill.) 4.Q./98 1.Q./99 2.Q./99 3.Q./99 4.Q./99
Deposits in SKK 10,327 10,710 10,655 10,925 11,870
Deposits in FC 6,059 6,229 5,697 5,619 5,710
Total 16,386 16,939 16,352 16,544 17,580

Bank Management Report
Deposits
Absolute increments in savings, as well
as in current accounts and in fixed-term
accounts participated approximately in
the same way in primary funds increments
in the volume of SKK 1.2 billion.
The transitional drop in total deposits in
the 2nd quarter year was balanced by
just as considerable increments in deposits
in the last quarter year. The Bank reached
increments inflow in deposits, in
spite of considerable fall of interest rates
on deposit type of products, what was
the consequence of manifested confidence
from the part of clients in stability
of the Bank. The confidence of depositors
in the Slovak currency is illustrated
by decreased share of foreign exchange
deposits in total deposits that declined
from 37% at the beginning of the
year to 32.5% at the end of the year.
Development of Primary and Secondary Deposits
(in SKK mill.) 1995 1996 1997 1998 1999
Primary Deposits 6,233 8,448 12,139 16,386 17,580
Secondary Deposits 903 1,571 1,562 1,969 2,371
Ratio Secondary Deposits 14% 19% 13% 12% 13%
18.000
12.000
6.000
0
1995 1996 1997 1998 1999
Development of the number of Deposits
1996 1997 1998 1999
Total 66,485 84,755 119,728 127,276
130000
104000
78000
52000
26000
0
1996 1997 1998 1999
53
Annual Report 1999

54
Credits
Loans to customers were SKK 6.4 billion
at year end. The number of loans provided
increased slightly. To maintain a
healthy credit portfolio, conservative risk
policies were implemented. The Bank’s
policy was aimed at providing credit
products and improving the quality of
service provided to clients. The client
focus is on successful small and mediumsized
entrepreneurs in various sectors of
the economy to ensure proper diversification
of credit risk. Also included in the
focus is the Top 100 Slovak companies
who will use a wide range of products
provided by the Bank.
The maturity structure of the portfolio
consists of 62% short-term credits, 32%
medium-term credits and long-term credits
6%.
Strukture of Loans according
do maturity terms
as of December 31, 1999
(excluding overdrafts)
Short-term 62%
Middle-term 32%
Long-term 6%
6 %
62 %
32 %
Bank Management Report
Development of the number of Loan accounts by the years 1995 - 1999
1995 1996 1997 1998 1999
Total 895 1,358 1,647 1,730 1,746
1.800
1.200
600
0
1995 1996 1997 1998 1999
Volume development of the granted Loans by the years 1995 - 1999
(in SKK mill.) 1995 1996 1997 1998 1999
8.000
6.000
4.000
2.000
0
2,743 3,961 5,919 7,649 6,431
1995 1996 1997 1998 1999

Bank Management Report
Payments and Settlements
The value and number of payments and
settlements increased in 1999. Domestic
payments and settlements exceeded
two million which represents a 23% increase
over the previous year. Home
banking transactions increased by 34%
of the total value of transactions. The
value of foreign payments and settlements
reached SKK 45 billion during
the year.
Treasury
The money market gradually stabilised
during 1999, with a decrease in price
volatility. The only exception was the crisis
during May which was caused by
adverse movements in macro economic
indicators and the uncertainty surrounding
the out-come of the presidential elections.
During this period the National
Bank of Slovakia did not fix the BRIBOR
reference rate and the short-term interest
rate reached 50%. The exchange rate
between the Slovak Crown and the
EURO weakened to 48.20. In the second
half of the year the Slovak Crown
gradually strengthened to 42.30
against the EURO, at which time the
National Bank of Slovakia intervened
on the currency market. Trading on the
capital market stagnated over the course
of 1999. In an effort to revive trading
on the secondary market, the stock
exchange organised the so-called market
makers. Currently only state bonds
are traded.
The crises in the market have had a limited
effect on the Bank, due to the stable
primary funding sources. ªUDOVÁ
BANKA strengthened its position in the
market through active trading. Preparatory
work was done throughout the year
to ensure a proper transition with the
date change to the year 2000.
Marketing
The marketing department co-operated
in the development of new products, the
sale of those products and assisted in
improving the quality of service provided
to clients.
As in the past, the Bank focused sponsorships
on the health care sector. Donations
during the year totalled SKK 2.6
million.
Information Technology
The main focus of the EDP department
during the year was the ”Year 2000“
issue and ensuring that there was a
smooth transition for both the main and
support information technology systems.
Other tasks during the year included:
• Installation of a backup computer
center,
• Upgrade of the main MIDAS information
system,
• Implementation of new applications
in the Lotus Notes environment to improve
communications and work organisation,
• Implementation of new Homebanking
program.
Human Resources
The Bank employed 483 people by the
end of 1999. The branch network increased
from 16 branches in 1998 to
21 branches at the beginning of 2000,
an increase of 16% compared to the
previous year.
The objective of ªUDOVÁ BANKA in
the area of human resources and training
is to provide continuous education
and professional development to employees
through the LB-Academy.
55
Annual Report 1999

56
Assets (in SKK ’000) Notes 58-60
Balance Sheet as at 31 December 1999
1999 1998 1997
Cash on hand 498,397 377,046 450,658
Balances with NBS 1,462,236 1,058,930 1,265,920
Due from banks 4
a) payable on demand 1,262,913 645,450 812,570
b) other 6,956,118 6,328,034 3,406,947
Due from customers 4
8,219,031 6,973,484 4,219,517
a) short-term 2,010,837 2,157,266 855,410
b) medium-term 2,634,577 2,376,676 2,478,945
c) long-term 440,857 523,291 555,822
d) overdrafts 1,344,402 2,591,289 2,029,264
6,430,673 7,648,522 5,919,441
Provisions for nonstandard loans -271,125 -271,626 -129,808
Values to be collected 270 240 495
Securities 5 4,577,682 3,413,120 3,159,408
Participations 58,062 46,473 34,394
Accruals and prepaid expenses 485,686 377,447 109,267
Tangible and intangible fixed assets 6 805,113 690,729 651,801
Other assets 12,864 63,813 23,130
Total 22,278,889 20,378,178 15,704,223
Liabilities (in SKK ’000)
Due to banks 7
a) payable on demand 126,261 66,983 24,630
b) other 2,245,290 1,902,300 1,537,200
Due to customers 7
2,371,551 1,969,283 1,561,830
a) payable on demand 5,762,915 5,399,153 4,414,356
b) term deposits 8,986,712 8,299,948 4,908,380
c) savings deposits 2,830,033 2,686,722 2,816,739
17,579,660 16,385,823 12,139,475
Accruals and deferred revenues 307,843 411,908 638,126
Other liabilities 236,302 105,187 104,194
Reserves and reserve funds 9 513,704 374,672 320,274
Share capital 670,000 670,000 670,000
Retained profits 386,289 200,279 108,715
Net profit for the year 213,540 261,026 161,609
Total 22,278,889 20,378,178 15,704,223
Prepared in using an The accompanying notes form an integral accounting regulations. part of the financial statements.
exchange rate of USD/SKK 42,266
as at December 31, 1999
ªUDOVÁ BANKA, a. s.
Board of Directors
Bratislava, 21 February 2000
Karl Mayr-Kern
Chairman
Jozef Kollár Wolfgang Siller
Vice-Chairman Member

Profit & Loss Account for the year ended 31 December 1999
Income (in SKK ’000) Notes 58-60
1999 1998 1997
Interest and related income from banks 679,299 961,385 784,385
Interest and fees received from customers 1,277,716 1,284,465 848,773
Foreign exchange revenues 4,595,920 6,736,959 1,677,657
Income from other banking activities 384,209 300,551 93,618
Other income 273,951 172,462 129,138
Total 7,211,095 9,455,822 3,533,571
Expenses (in SKK ’000)
Interest paid to banks 213,273 484,637 513,557
Fees and commissions paid to banks 16,598 16,261 13,204
Interest and fees paid to customers 1,318,688 1,264,476 725,756
Foreign exchange expenses 4,275,966 6,448,561 1,416,665
Personnel expenses 3 173,363 138,477 105,482
General operating expenses 317,942 232,270 198,558
Depreciation and provisions 473,889 445,583 208,033
Other expenses 207,836 164,531 170,695
Income tax 0 0 20,012
Net profit for the year 213,540 261,026 161,609
Total 7,211,095 9,455,822 3,533,571
Regrouped profit and loss account for 1999, 1998 and 1997 (in SKK ’000)
Interest and related income from banks 679,299 961,385 784,385
Interest and fees received from customers 1,277,716 1,284,465 848,773
Interest and fees payable to banks -229,871 -500,898 -526,761
Interest and fees payable to customers -1,318,688 -1,264,476 -725,756
Net interest income 408,456 480,476 380,641
Foreign exchange income (net) 319,954 288,398 260,992
Income from securities (net) 383,898 298,576 90,782
Other operating income (net) -168,144 -140,527 -79,794
Operating result 944,164 926,923 652,621
General and administrative expenses -597,946 -459,357 -378,313
Increase in general loan loss provision -125,540 -46,312 -21,426
Increase in specific provisions for loans 6,400 -155,963 -54,473
Decrease/Increase to other reserves -449 54 -56
Income tax 10 0 0 -20,012
Extraordinary income 4,658 4,769 55,245
Extraordinary expenses -17,747 -9,088 -71,977
Net Profit 213,540 261,026 161,609
These figures have been obtained from
the statutory Profit and Loss Account for
the year ended 31 December 1999,
prepared in accordance with Slovak
accounting regulations.
21 February 2000
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Annual Report 1999

58
1. General Information
ªUDOVÁ BANKA, a. s. was incorporated
and commenced trading in 1991.
By 31 December 1999, the Bank had
opened branches in Bratislava, Galanta,
·aºa, Nitra, Poprad, Ko‰ice, Trenãín,
Îilina, Luãenec, RuÏomberok and Banská
Bystrica.
The Bank has the following principal activities:
• Maintenance of Slovak crown and foreign
currency accounts
• Domestic and foreign payments
• Granting of loans
• Money market activities in Slovak crowns
and foreign curencies
2. Accounting Policies
The financial statements for the year
ended 31 December 1999 were prepared
in accordance with the relevant Slovak
accounting regulations.
a) Accounting Records
The Bank maintains accounting records
and prepares regular financial reports in
accordance with regulations applicable
to Slovak banks.
b) Tangible and intangible fixed assets
Tangible and intangible fixed assets are
stated at acquisition cost less depreciation.
Depreciation is provided using the
straight line method at rates set out in
the current provisions of § 31 of Act
286/1992 on Income Tax, with the exception
of motor vehicles for which depreciation
is provided using the reducing
balance method at the current rate
set out in the Act.
c) Foreign currencies
Foreign currency transactions are translated
to Slovak Crowns in accordance
with § 24 of Act 563/91 on Accounting
using exchange rates prevailing on the
date of the transaction quoted by the
National Bank of Slovakia („NBS”). On
31 December 1999 assets and liabilities
denominated in foreign currencies were
translated to Slovak Crowns using closing
exchange rates quoted by the NBS.
Notes to the Financial Statements
d) Loans and advances
Loans and advances to customers and
banks are stated net of specific provisions.
Such provisions are determined
based on the classification of such loans
and advances in accordance with the
guidelines issued by the NBS. In addition,
a general reserve is made to cover
losses which are present in the loan portfolio
but which have not yet been specifically
identified. This reserve is calculated
in accordance with existing tax legislation.
e) Securities
Securities are stated at cost less provisions.
Treasury bills are stated at nominal
value. The differences between
purchase cost and redemption value are
amortized on a straight line basis to the
profit and loss account over the period
to maturity. Specific provision is made
for any diminution in value.

Notes to the Financial Statements
3. Salaries and Other Personnel Costs
Salaries and other personnel costs include: (in SKK mill.) 1999 1998
Salaries 131,516 104,267
Other 2,085 1,578
Social security costs 39,762 32,632
6. Tangible and Intangible Assets
173,363 138,477
Average number of employees during the year 424 366
4. Loans and Advances
Loans and Advances (SKK ’000) up to 3 m. up to 1 y. up to 5 y. over 5 y. 1999 1998
Due from banks 1,262,913 1,262,913 645,450
Term deposits 6,909,414 46,704 6,956,118 6,328,034
Total banks 8,172,327 46,704 8,219,031 6,973,484
Loans and advances to customers 2,500,462 897,687 2,601,666 430,858 6,430,673 7,648,522
5. Securities
Securities (SKK ’000) 1999 1998
Treasury bills 1,580,000 900,000
State bonds 2,411,436 1,520,348
Other bonds 586,246 992,772
Total 4,577,682 3,413,120
Movements during the year were as follows: (in SKK mill.)
Land and Office
Buildings equipment Vehicles Software Total
Cost
1. 1. 1999 440,577 374,384 15,131 71,177 901,269
Additions 107,165 72,300 3,104 18,729 201,298
31. 12. 1999
Accumulated depreciation
547,742 446,684 18,235 89,906 1,102,567
1. 1. 1999 21,394 190,467 10,807 19,381 242,049
Depreciation 12,116 54,325 2,333 20,215 88,989
31. 12. 1999
Net book value
33,510 244,792 13,140 39,596 331,038
1. 1. 1999 419,183 183,917 4,324 51,796 659,220
31. 12. 1999 514,232 201,892 5,095 50,310 771,529
In addition at 31 December 1999 the Bank had acquired assets at a cost of Sk 33,584 million which had not yet been put into use
(1997: Sk 31,510 million).
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Annual Report 1999

60
7. Due to Banks and Customers
In accordance with the Commercial Code, Act No. 513/91, 5% of the annual profit
after taxation is transferred to the legal reserve fund. The transfer to the legal reserve
fund in respect of 1999 will be made following approval of the Annual General Meeting.
The revaluation difference arising on investments denominated in foreign currency
is Sk 0,063 million.
10. Taxation
The profit before taxation for 1999 amounted
to SKK 214 million. The tax computation
resulted in a loss and therefore
there is no tax liability so the profit after
taxation was SKK 214 million.
11. Assets and Liabilities
in Foreign Currencies
Assets and liabilities denominated in foreign
currencies included in the balance
sheet were as follows:
Notes to the Financial Statements
Due to Banks and Customers (in SKK ’000) up to 3 m. up to 1 y. up to 5 y. over 5 y. 1999 1998
Due to banks 126,261 126,261 66,983
Term deposits 2,245,290 2,245,290 1,902,300
Total banks 2,371,551 2,371,551 1,969,283
Current accounts 5,762,915 5,762,915 5,399,153
Term deposits 7,573,621 1,250,593 162,498 8,986,712 8,299,948
Saving books 1,122,679 1,424,459 282,895 2,830,033 2,686,722
Customers 14,459,215 2,675,052 445,393 17,579,660 16,385,823
8. Contingent Liabilities
The Bank has contingent liabilities
arising from the provision of guarantees
and letters of credit totalling SKK
575 million.
9. Reserves and Reserve funds
a) Reserves
At 31 December 1999 there was a reserve
of SKK 262 million, which was
intended to cover general risks arising
from banking activities. The reserve was
calculated in accordance with sections 5
and 8 of Act No. 610/92 on tax deductible
reserves.
b) Reserve Funds
The reserve funds consist of:
Reserve Funds (in SKK mill.)
Legal Share Other Total
reserve premium reserve
fund account fund
1. 1. 1999 23,915 179,694 34,506 238,115
Additions 13,052 13,052
31. 12. 1999 36,967 179,694 34,506 251,167
Assets and Liabilities in Foreign Currencies (in SKK mill.) 1999 1998
Assets 6,315,306 6,124,514
Liabilities 6,168,437 6,225,375

Cash flow
(in SKK ’000) 1999 1998
Cash flows from operating activities
Profit on ordinary activities before tax 213,540 261,026
Adjustments for:
Provision for credit losses -6,400 155,963
Reserve for general banking risks 125,991 46,239
Depreciation 88,988 85,546
Operating profit before changes in operating assets and liabilities 422,119 548,774
(Increase)/decrease in operating assets
Due from banks -628,084 -2,921,087
Due from customers 1,217,849 -1,729,081
Other assets 50,635 -44,616
Prepayments and accrued income -108,239 -268,180
Increase/(decrease) in operating liabilities
Due to banks 402,268 407,453
Due to customers 1,193,837 4,246,348
Other liabilities 69,876 65,483
Accruals and deferred income -42,826 -290,708
Net cash flow from operating activities before income tax 2,577,435 14,386
Income taxes paid 0 0
Net cash flow from operating activities 2,577,435 14,386
Cash flows from investing activities
Purchase of participating interest -11,589 -12,079
Purchase of tangible fixed assets -203,372 -124,474
Fixed interest securities -478,379 -1,363,669
Net cash flow from investing activities -693,340 -1,500,222
Cash flows from financing activities
(Decrease)/Increase in share capital and other capital funds -11 79
Dividends paid -61,965 -61,965
Net cash flow from financing activities -61,976 -61,886
Net increase in cash and cash equivalents 1,822,119 -1,547,722
Cash and cash equivalents at the beginning of the year 2,981,426 4,529,148
Cash and cash equivalents at the end of the year 4,803,545 2,981,426
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Annual Report 1999

62
Report of the Auditors

Report of the Supervisory Board
The Supervisory Board of ª U D O V Á B A N K A, a. s.
at its meeting on April 13, 2000, reviewed the submitted
financial statements for the year ended December 31, 1999 and came
to the following conclusions:
Pursuant to Section 21 (3) of the Articles of Association the Supervisory Board unanimously approves
the financial statements for the financial year 1999 audited by KPMG Slovensko spol. s r.o., Bratislava.
The Board of Directors proposed, the Supervisory Board has decided to submit
to the General Assembly of ªUDOVÁ BANKA, a. s. to be held on April 13, 2000, the following
distribution of profits for 1999 SKK 213,540,186.94
• 5% contribution to Reserve Fund as required by Law SKK 10,677,010.00
• Payment of dividends SKK 61,965,000.00
ordinary shares (SKK 490,— /share)
preference shares (SKK 487,50 /share)
• Retained profit SKK 140,898,176.94
General Management Director
Klaus Thalhammer
President of Supervisory Board
Bratislava, April 13, 2000
63
Annual Report 1999