996 - Banca Antonveneta

With reference to the brokered volumes, the fundingpolicy followed by the Bank, which is based on thereplacement of short term securities by indirect depositsand supported also by the specific agreements forfinancing under favourable terms concluded with ABNAMRO Bank, was negatively affected, particularly asfrom the second semester of 2007, by the badperformance of the asset management department.As at 31 December 2007, the total deposits amounted to61,358 million euro, down by 2.0% compared to the62,602 million euro at the end of 2006. In particular, the4.3% drop in direct deposits (25,160 million euro) wasmainly due to bonds, while the indirect deposits (36,198million euro) dropped by only 0.3% compared to the12.4% drop in the asset management area and theincrease of 6.7% for administered deposits.At the same date, the loans to customers amounted to30,595 million euro, increasing by 2.0% on an annualbasis. The increase in the loans is due to the “mediumand long term” component and mortgage loans inparticular (+6.5%) which are granted to the commercialas well as the consumer clientele.After having proceeded to acquire 458 million euro ofnon-performing loans from the securitisation companyAntenore Finance (180 million euro) and Theano Finance(278 million euro), last month Banca Antonvenetaconcluded a transaction involving the disposal ofproblem loans and bad debts. This transaction involvedthe sale without recourse of these loans both for theBank (approximately 1.1 billion euro including theadjustments made over time) and the securitisationcompany Antenore Finance (39 million euro) and TheanoFinance (994 million euro). Between 31 December 2006and 31 December 2007, the net impaired loansdecreased by 6.6%, including as an effect of theaforementioned disposal, with a hedging level of 53.4%down from 54%.Business PoliciesDuring 2007, the Bank's business policies were centredaround new products and services that respond better tomarket demand and are more competitive in terms ofprice.Three new advertising campaigns promoting packagecurrent accounts were launched in order to attract newcustomers and retain existing ones. The “member getmember” initiative which was directed towards privatecustomers that are holders of a “Systema” accountprovided a discount on the service fee depending on thenumber of new customers presented; the offer wasnamed “costo zero” and involved the Systema, InTeam (which targets businesses and has now beenrenamed Working Team) and Conto Pro (forfreelance professionals) opened in 2007 and offered thepossibility of zeroing the service charge and theproduction and account statement expenses completelyby 31 st December of last year; the “più usi, menopaghi” (the more you use the less you pay) campaigntargeted holders of Systema accounts, making itpossible to gradually reduce the monthly service chargeuntil its complete removal, in return for increased usageof the individual services.Last July the new Conto Internet account was developedspecifically for customers who prefer using alternativechannels to traditional ones while there are no chargesor commissions for some transactions that take placedirectly at the branch. In September, a new product waslaunched in Padua (with the intention of extending it tothe entire network) which targeted university students(Dr. Jecko) with favourable conditions and numerouspromotional initiatives.To further reinforce relations with the family segment,the housing loan segment was increased considerablywith a series of new products:• the Mutuo Easy 5 which aims to facilitate youngpeople in the purchase of their “starter home”and provides for fixed low instalments for the firstfive years which repay only interest andthereafter provides the possibility of selecting therate, on several occasions and without addedcosts. This is a 40 year loan which covers up to90% of the value of the property;• the Mutuo Liquidità, which consists of a loanguaranteed by mortgage on a property that isalready owned by the applicant. This loan can beused for various purposes such as paying offother loans or for purchases required forlaunching a business;• the new product for refinancing of housing loansgranted by other institutions, which involves thesubrogation of the Bank in the rights of theprevious creditor, pursuant to the “Bersani Bis”Legislative Decree (which was converted into Law40/2007). The replacement offer, which aims toimprove the conditions of the preceding loanagreement and to reduce the instalment amount,including through extension of the loan’s durationup to 40 years, does not involve penalties forrepayment of the old loan or the payment of bankcharges and refinancing taxes on the new loan.Furthermore, two new types of personal loans wereproposed, the Eco Prestito, which is specifically forbuilding renovations and the production ofenvironmentally sustainable energy sources (which havebecome attractive on account of the 2007 tax measures)and the Prestito Premio di Rottamazione, whichaccompanies the scrapping loan.For the private sector, the activity of which had beenpreviously carried out by AAA Bank and was acquired by200