Annual report 2004 (PDF, 4141 kB) - Unicredit Bank

developed a new concept of the cash management and derivative trades thus anticipating
higher requirements of corporate clients for cashflow management and risk management.
Along with changes carried out in the product sphere the Bank implemented new rules for
business and management work, which have been created within the framework of the Sales
Force Management project. Živnostenská banka assumed and implemented Corporate Credit
Underwriting Tool, a new model of processing loans, thus harmonizing processes with
UniCredito standards.
Risk Management
Živnostenská banka has traditionally paid great attention to risk management processes. By
early identification and monitoring of risks, by use of high quality of measurement and
sophisticated structure of internal limits for individual types of risks and products, the Bank is
able to eliminate individual risks to an acceptable level. The proof of this trend is a low
volume of non-performing loans, which is deep below the average of the whole banking
sector, and generally good business results of the Bank.
Having regard to the Basle Committee's requirements for banking supervision, in 2003-2004
the Bank had been preparing intensively for changes in regulation and will continue so in the
years to come. Representatives of the Bank are engaged in the Basle II project jointly with
representatives of the CNB, Czech Association of Banks, Chamber of Auditors and other
banks.
Basic risk management methodology is a Value at Risk (VaR) method which the Bank has
been applying since 2003. In 2004 the Bank implemented a new internal rating system for
corporate banking segment. The internal rating is an integral part of the credit process of the
Bank.
In the sphere of the operating risk the Bank has built up a sustained database of operating risk
events.
Charity and Sponsorship
Last year Živnostenská banka focused its sponsorship support on projects corresponding to
values which the Bank has been long developing and representing and which are in line with
the sponsorship strategy of UNIDEA, a foundation of UniCredito Italiano, the main
shareholder.
In 2004, Živnostenská banka became a sponsor of the Czech Olympic team for the period of 4
years. In our opinion the Olympic movement exactly symbolises values which Živnostenská
banka wishes to develop - traditions, dynamism and competitiveness within the framework of
fair play rules. Živnostenská banka is a long-time sponsor of the international tennis
tournament Živnobanka Czech Open in Prostějov, which is a significant regional event of the
international significance.
Last year Živnostenská banka continued to provide support to projects focused on health and
charity. The Bank granted a gift to the foundation Kapka naděje which helps children with
defects of blood forming. Within the scope of small charity events Živnostenská banka
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