Annual Report Euram Bank AG 2014 / 2015

Decision
Control
Concretization
Negotiation
Annual Report
Euram Bank AG
2014/ 2015

2014
Initiative
Analysis
Innovation
Models
Vision
Evaluation
07 08 09 10 11 12

2015
Decision
Control
Concretization
Structuring
Realization
Negotiation
Rome
wasn’t built in a day.
01 02 03 04 05 06

Annual Report 2014/2015
European American Investment Bank AG

Annual Report
Euram Bank AG
2014/ 2015

FOREWORD
BY THE CHIEF EXECUTIVE OFFICER
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In our last annual report, we asked if the much discussed restructuring
of the banking sector was finally completed after turbulent
years.
It is not – and that’s just what we anticipated at the time. The
financial industry is still trying to cope with the consequences
of regulatory changes and new settings. More than ever, these
conditions require adequate action, clear decisions, long-term
strategies, and their well-considered implementation into reality.
This takes time. Even more it demands that we use the time wisely
to avoid letting ourselves be dazzled by quick transactions that
would be negligible, if not even counterproductive, to deliberately
planned development.
We have used the time well in the past year and have restructured
our bank with calm and utmost diligence, carefully considering
all aspects, all opportunities and all risks and consequences.
This foresight has enabled us to win over new partners
who share our goals and support us in achieving them: refraining
from high-risk transactions, focussing on our core competences
and further developing the domestic markets of Austria and Germany
and as well as initiating the development of sustainably
profitable new areas of business.
The goal is solid growth – based on professional knowledge and
innovative action, and absolute reliability every step of the way.
Let’s embark on that path together! On behalf of the Management
Board, I would like to thank you for your continued trust and
support.
Manfred Huber
Chief Executive Officer
September 2015

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The entrepreneurial mind lets early
anticipation lead the way to later
knowledge. It takes the first step,
encourages and drives forward
the development of a plan and its
implementation.
Initiative

CORPORATE BODIES
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Supervisory Board
Adolf Walter Höllmer
Chairman
Dr. Erik Max Michael Obermayer
Vice Chairman
Dkfm. Senta Penner
Managing Board
Manfred Huber
Chairman
Manfred Huber
Johannes Langer
Josef Leckel
Johannes Langer
Josef Leckel

Realising future opportunities is
even more important than analysing
past events. Knowledge emerges
through a constant dialogue with
potential clients and partners,
beyond any statistics and numbers.
Analysis

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Vision
It may take some time to translate an
entrepreneur’s vision into an effective
operation and a real marketable value.
But those who set out are still faster
than those who spend their time idly
waiting without perspective.

MANAGEMENT REPORT
1. Business development and economic environment
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Business model
European American Investment Bank Aktiengesellschaft (Euram
Bank) is an Austrian bank specialising in private banking, asset
management and card payment services. Our clients are mainly
international high net worth individuals and entrepreneurs, as
well as established institutional investors. Our highly qualified
staff are drawn from various nations, reflecting the cosmopolitan
corporate culture of Euram Bank.
Euram Bank is 100% privately owned. Senior management and
financial investors hold a majority stake in the bank through
Euram Holding AG.
Business Development
The international economic environment showed a volatile development
in the first half of 2015. Due to diverging trends between
industrialized countries and emerging markets, the global economy
only reported moderate growth rates. Again, impulses primarily
originated from industrialized countries, while the growth
dynamic in the emerging markets continued at a slow pace. The
conflict in Ukraine, recession in Russia and the export sanctions
imposed, as well as the Greek budget crisis still had a restraining
effect on economic activity – especially in Europe. The low
oil prices were an additional burden on commodity-exporting
emerging market countries. In Asia, economic development was
also volatile. China is experiencing a continuation of declining
growth rates. On the other hand, the Japanese economy has reported
slightly higher growth rates recently – with the export
sector in particular benefitting from the low yen exchange rate.
The countries of Southeast Asia are currently benefitting from
gradual relocations of production sites from China. Positive signals
came from the USA. Europe continued to report only slight
growth. Apart from Great Britain and Spain, France made positive

contributions to growth again. Business activity in Germany and
industrial production have only increased slightly during the
period under review.
Ever since its formation in 1999, Euram Bank remained true to
its successful strategy. A strong focus on business areas that require
a high amount of advisory service and consciously avoiding
retail business have proven successful – to private banking, asset
management and card payment services alike. Owing to the
experience and commitment of our outstanding staff, and very
good performance in all investment strategies, the confidence
and expectations of our clients were again not disappointed in
the financial year 2014/2015, despite the difficult market environment.
Our competence and many years’ experience in advising
our clients in wealth and investment matters, our reliable
and committed way of working, and the risk-aware management
of the assets entrusted to us absolutely proved their worth.
The balance sheet total increased as compared to the previous
year by 4.8% from EUR 148.1 million (30.6.2014) to EUR 155.2
million. “Receivables from customers” increased by 38.6% to
EUR 79.6 million (EUR 57.4 million as at 30.6.2014), the “Liabilities
to customers” also increased by 6.5% to EUR 133.9 million
(EUR 125.7 million as at 30.6.2014). As per 30 June 2015,
“Cash at hand and balances with central banks” amounted to
EUR 1.4 million; the decline by 94.5% as compared to the previous
year (EUR 26.4 million as at 30.6.2014) is due to regrouping
of cash and cash equivalents to “Debt instruments
issued by public authorities and bills of exchange admitted
for refinancing with the central bank” (EUR 9.0 million) and
“Debentures and other fixed-income securities” (EUR 9.0 million).
“Claims against credit institutions” amounted to EUR 49.2
million (EUR 57.0 million as at 30.6.2014), the “Liabilities to
credit institutions” amounted to EUR 2.6 million at the end of
the financial year (EUR 2.1 million as at 30.6.2014), due to the
minor importance of this type of refinancing in the financial year
2014/2015.

In spite of the low level of interest rates and due to the continued
focus on quality when investing liquidity, net interest income
increased to EUR 1.2 million (EUR 1.0 million as at 30.6.2014). In
the period under review, operating income decreased from EUR
8.3 million (30.6.2014) to EUR 6.7 million. As mentioned already,
Euram Bank successfully sold an innovative and customized
card-based payment processing product developed with international
partners to an international partner in the financial year
2013/2014. In the financial year 2014/2015 the final payment of
EUR 3.0 million arising from this sale was recognized in profit
or loss.
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As in the financial year 2013/2014, operating expenses were
reduced again and amounted to EUR 6.8 million (EUR 7.6 million
as at 30.6.2014). This was due to a reduction in payroll costs to
EUR 3.4 million (EUR 3.8 million as at 30.6.2014), primarily due
to the elimination of performance-related remuneration components,
on the one hand, and to reduced administrative expenses
of EUR 3.2 million, which fell by 13.2% (EUR 0.5 million), on the
other hand (EUR 3.7 million as at 30.6.2014). The slightly negative
operating result amounted to EUR -54 thousand (EUR 763
thousand as at 30.6.2014).
Income from the release of value adjustments of receivables and
of accruals for contingent liabilities and for credit risks amounted
to EUR 87 thousand (as per 30.6.2014, value adjustments for
receivables of EUR 91 thousand were reported), value adjustments
for securities and for investments and shares in affiliated
companies amounted to EUR 59 thousand (EUR 138.3 thousand
as at 30.6.2014).
The slightly negative result on ordinary activity accordingly
amounted to EUR -26 thousand (EUR 534 thousand as at
30.6.2014).
Tax compensation and deferred taxes had a positive influence on
the item “income and earnings tax”, in the amount of EUR +219.2
thousand (EUR -231.9 thousand as at 30.6.2014), the annual surplus
thus amounted to EUR 193.2 thousand (EUR 302 thousand
as at 30.6.2014).

Not all that is new is also relevant.
To obtain value the market’s interest
is vital. This ‘inter-est’ - this “beingin-between”
– materializes in the
relationship between market players:
demand, supply and satisfaction.

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Innovation

Financial and non-financial performance indicators
The capital resources of Euram Bank continue to be excellent.
The eligible capital for the purposes of Part 2 of EU Regulation no.
575/2013 amounted to EUR 15.4 million (EUR 15.4 million as at
30.6.2014), and the overall risk value under Article 92 of the Regulation
(EU) 575/2013 amounts to EUR 65.5 million (EUR 58.9
million as at 30.6.2014). The total capital ratio ((eligible capital )/
(overall risk value)) amounts to 23.5% (26.1% as at 30.6.2014),
which is well above the legal minimum. The equity capital reported
consists entirely of Tier 1 capital. The cost/income ratio
(administrative expenses/revenue) amounted to 100.8% (90.9%
as at 30.6.2014) due to the slightly negative operating result.
In the financial year 2014/2015, a net profit of EUR 197.4 thousand
was earned. After passing a respective resolution in the
annual general meeting in November 2015, Euram Bank will not
distribute a dividend to its shareholders.
Euram Bank is a wholly owned subsidiary of Euram Holding AG.
In the financial year 2014/2015, two shareholders of Euram Holding
AG sold their shares in Euram Holding AG to several international
investors – further sales of shares by existing shareholders
to investors with strategic potential for Euram Bank are not excluded
in the financial year 2015/2016.
Retaining experienced and committed staff is a fundamental
precondition for any enterprise’s long-term success. The qualification
of its staff is of utmost concern for Euram Bank. Euram
Bank offers its employees the opportunity of ongoing training
and development to achieve their personal and career goals by
systematically developing their competencies.
Events of particular importance after the balance sheet
date of 30 June 2015
In the general assembly meeting on 28.7.2015, Dr. Peter Maser
was elected a member of the Supervisory Board.

2. Anticipated trends and risks
Prospects for 2015/2016
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We anticipate that the growth of the global economy will gain momentum
in 2015 and 2016, but will remain subdued compared to
the time before the crisis; additionally, the distribution of growth
over the various global regions will change compared to the past
years. An acceleration of economic activity will be supported by
very favourable monetary conditions, a slower consolidation of
public households, an improved financial situation, and reduced
oil prices. However, investments need to pick up yet. The appreciation
of the US dollar versus most other currencies has resulted
in a marked adjustment of exchange rates. Due to the resulting
relative price effects, global demand is shifting more towards Europe,
Japan and some emerging markets. Within the group of
emerging markets, growth is slackening due to individual factors
in China, Brazil and Russia. Without structural reforms to
eliminate bottlenecks, growth rates might remain weak in these
countries. Exceptional risks include geopolitical upheavals and a
situation of serious financial instability that might emerge, if the
exit from the zero-interest strategy in the United States fails to
take place in an orderly manner, if Greece fails to reach a satisfactory
agreement with its creditors, or if the Chinese economy
experiences a hard landing. In order to avoid these risks and to
get the global economy back on a more sturdy, more stable course
of growth, mutually reinforcing measures of monetary, fiscal and
structural politics are required.
For the Private Banking division, the financial year 2015/2016
will bring a clear focus on integrated strategies to maintain capital
and assets, based on individual planning combined with firstclass
customer care. Additionally, the division plans to extend
its product range for clients from Austria and Germany – with
a focus on the financing of residential and commercial real estate
projects. With our competence in financing matters, swift
processing and transparent communication, we intend to use
these market opportunities successfully. The Asset Management
division will consistently pursue the conservative investment

approach, thus striving again for the continuous positive performance
of Euram’s public funds. In the Card Payment Services
division we are currently developing further projects in the field
of card-based payment transactions together with our international
partners.
Material risks and uncertainties
An order issued by the Securities and Exchange Board of India
(SEBI) dated 22 September 2011, accusing Euram Bank of infringing
the code of conduct of the Indian stock exchange as an FII
licensee, remains in force. In October 2014, Euram Bank made
another comprehensive statement vis-à-vis SEBI in this respect.
Euram Bank continues to cooperate with all the authorities involved,
seeking rapid resolution.
In February 2012, an Indian enterprise brought an action for
declaratory judgement against Euram Bank before the Commercial
Court of Vienna, based on a dispute as to whether a pledge
agreement dated March 2010 between the Indian enterprise as
pledgor and Euram Bank as pledgee is genuine. On 2.7.2015, the
judge concluded the oral proceedings of first instance, announcing
that a decision would follow. Considering the course of the
proceedings until this date, Euram Bank anticipates the decision
to be in its favour – the provision for risk of litigation formed in
this respect in the financial year 2012/2013 was not reversed in
the current financial year 2014/2015.
In January 2013, Euram Bank learnt that an American citizen
brought an “action for damages” in August 2011 against Euram
Bank before the North Carolina Central County Court in the United
States. In November 2014, the competent court denied the appeal
of the American citizen and upheld the decision to dismiss
the American citizen’s complaint.

Euram Bank has applied to a UNCITRAL arbitration tribunal in
respect of an escrow investment in Slovakia on account of infringement
of the bilateral investment treaty. The arbitration tribunal
dismissed Euram Bank’s action against the Slovak Republic
in June 2014 as being outside its jurisdiction. The resultant
costs incurred by Euram Bank are covered. A civil action is still
pending in this matter brought by Euram Bank before a Slovakian
court.
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3. Research and development
Euram Bank undertakes no research and development activities.
4. Risk reporting
Euram Bank continuously develops its risk management in order
to effectively detect, assess and control risks. Risk management
is a component of overall bank management, and takes into account
the nature, extent and complexity of transactions, and the
resultant risks, in addition to the legal and regulatory framework.
Euram Bank creates a risk strategy that is updated annually. As
provided for in the risk strategy, the analysis of risk-bearing capacity
checks the risk coverage against the prevailing risks. This
analysis is created quarterly, and brought to the attention of the
Management Board and the Supervisory Board in the risk report.
Euram Bank uses the standard approach specified in CRR, Part
3, Articles 107 to 311, to calculate credit risk. Loans are granted
within established customer relationships and are fully collateralized,
either by cash deposits or securities held in a custody
account at Euram Bank, taking account of the relevant (conservative)
lending limits. Own account investments in derivative
financial instruments are occasionally made to a minor extent for
the purpose of managing own risk positions.

Evaluation
Models
Business models are similar to
architectural models. They enable
us to consider all aspects of a
plan in order to make ourselves
familiar with and understand its
true and multi-dimensional impact.

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The evaluation of alternative
options relies on precise
information. However, exact
information from the future
is scarce.

Because of the geographical orientation of Euram Bank, the operational
risk represents the most significant risk. Money laundering
risk is limited by the use of an analytical anti-money laundering,
compliance and risk solution. This AML solution allows
to detect unusual, unexpected and suspicious customer features
and transactions, and automatically alerts the Compliance Officer
if there are indicative grounds for suspicion. In addition to identifying
grounds for suspicion, this AML solution supports the
investigation, processing and documentation of identified cases.
Each operation is also comprehensively documented in auditable
form, and can be reviewed and tracked by reports at any time.
In operational risk management, the guidelines for identifying,
assessing, and monitoring are updated annually; day-to-day risk
management has been firmly established in the business and administration
departments. This business partnership model creates
close control, and leads to increased internal awareness of
operational risks.
The base indicator approach according to CRR, Part 3, Articles
312 to 324 is applied for calculating operational risk.
Euram Bank does not trade securities for its own account. The
bank mainly holds debt instruments issued by public authorities,
and debentures and other fixed-income securities with top
ratings. Euram Bank allocates very low limits for overnight positions,
so the foreign exchange exposure in Euram Bank’s banking
book is very limited. Foreign currency loans are refinanced
exclusively in the same currency as the loan.
Liquidity risk is limited by matching maturities to a great extent.
Client deposits are predominantly invested according to maturities
– and demand deposits for up to one week – with a selected
group of third-party banks. Interest-rate risks are controlled on
the basis of the recommendations of the Asset/Liability Management
Committee (ALCO), which sets rules for active and passive
management. The results are discussed in biweekly meetings,
and the assumptions made are reviewed.

In order to limit legal risk, Euram Bank maintains a close cooperation
with a prestigious law firm, and uses the expertise of this
law firm in connection with introducing new products, transactions
and lines of business.
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Vienna, on 7 September 2015
The Management Board
Manfred Huber
Johannes Langer
Josef Leckel

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BALANCE SHEET AS OF JUNE 30, 2015
Assets 30. 6. 2015 30. 6. 2014
EUR EUR TSD EUR
1. Cash in hand, balances with
central banks and post office banks 1,438,580.56 26,444
2. Debt instruments issued by public authorities 8,983,651.50
3. Claims against credit institutions 49,238,513.41 57,048
a) repayment on demand 49,238,513.41 54,756
b) other loans and advances 0.00 2,292
4. Loans and advances to customers 79,560,829.26 57,403
5. Debentures and other fixed-income
securities of public issuers 8,979,895.74 0,00
6. Stocks and other non fixed-income
securities 4,801,363.88 3,501
7. Participations 70.00 1,205
8. Shares in affiliated companies 159,000.00 159
9. Intangible fixed assets 87,072.80 46
10. Tangible Assets 138,907.96 155
11. Other Assets 1,369,191.01 1,736
12. Prepayments and accrued income 444,398.46 357
155,201,474.58 148,054
1. Foreign assets 99,486,064.04 74,017

BALANCE SHEET AS OF JUNE 30, 2015
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Liabilities 30. 6. 2015 30. 6. 2014
EUR EUR TSD EUR
1. Liabilities to credit institutions 2,564,532.28 2,058
a) repayable on demand 64,514.92 2
b) with agreed maturity dates
or period of notice 2,500,017.36 2,056
2. Liabilities to customers 133,852,640.18 125,711
a) Other liabilities
aa) repayable on demand 125,315,653.17 119,415
bb) with agreed maturity dates
or period of notice 8,536,987.01 6,296
3. Securitized liabilities 25,262.20 424
a) self-issued bond 15,572.52 16
b) other securitized liabilities 9,689.68 408
4. Other liabilities 1,524,261.78 2,048
5. Accruals and deferred income 84,000.00 67
6. Provisions 1,466,934.73 2,156
a) provisions for severance payments 380,884.34 308
b) other provisions 1,086,050.39 1,848
7. Subscribed capital 10,045,712.61 10,046
8. Capital reserves 1,920,350.77 1,920
a) tied-up 1,886,813.16 1,887
b) free 33,537.61 33
9. Profit reserves, other reserves 2,859,904.17 2,860
10. Liability reserve pursuant
to §57 para 5 Banking Act 660,500.00 660
11. Net Profit 197,375.86 104
155,201,474.58 148,054
1. Contingent liabilities 6,757,288.65 5,556
2. Fiduciary Deposits 0.00 1,230
3. Own funds to be taken into account pursuant to
Part Two Regulation (EU) 575/2013 15,403,527.28 15,373
4. Required own funds pursuant to Article 92
Regulation (EU) 575/2013 65,522,534.02 58,938
a) CET 1 capital ratio 23.5 % 26.1 %
b) T1 capital ratio 23.5 % 26.1 %
c) Total capital ratio 23.5 % 26.1 %
5. Liabilities abroad 126,422,949.47 121,321

PROFIT- AND LOSS ACCOUNT AS OF JUNE 30, 2015
Profit- and Loss Account 30. 6. 2015 30. 6. 2014
EUR EUR TSD EUR
1. Interest and interest-like earnings 1,347,209.50 1,469
hereof: fixed interest securities 177,975.38 34
2. Interest and interest-like expenditures -192,157.04 -465
I. NET INTEREST EARNINGS 1,155,052.46 1,004
3. Earnings from securities and participations 132,246.20 197
a) Earnings from shares, other share rights
and not fixed-income securities 132,246.20 126
b) Earnings from shares in affiliated
companies 0.00 71
4. Earnings from commissions 95,874,415.44 69,319
5. Expenditures from commissions -93,525,701.44 -65,910
6. Earnings/expenditures from
financial transactions -210,687.62 28
7. Other operating earnings 3,271,129.95 3,700
II. OPERATING EARNINGS 6,696,454.99 8,338
8. General administrative expenditures
a) personnel expenditures -3,438,732.55 -3,775
aa) wages and salaries -2,554,034.16 -2,872
bb) payment of legal social levies
and compulsory contributions -605,270.66 -605
cc) other social expenditures -52,678.66 -46
dd) expenditures for old-age provisions
and assistance -112,064.25 -73
ee) endowment of the severance
payment provision -114,684.82 -179
b) Other administrative expenditures
(overhead) -3,016,321.55 -3,205
-6,455,054.10 -6,980

PROFIT- AND LOSS ACCOUNT AS OF JUNE 30, 2015
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Profit- and Loss Account 30. 6. 2015 30. 6. 2014
EUR TSD EUR
9. Value adjustments of the assets listed
in asset items 9 and 10 -109,308.99 -109
10. Other operating expenditures -186,009.34 -486
III. OPERATING EXPENDITURES -6,750,372.43 -7,575
IV. OPERATING RESULT -53,917.44 763
11. Value adjustmens of claims and
allocations to provisions
for contingent liabilities and for credit risk 0.00 -91
12. Earnings from the dissolution of value adjustments
of claims and from provisions
for contingent liabilies and for credit risk 87,000.00 0.00
13. Value adjustments of securities valued
like financial investments
as well as of participations and
shares held in affiliated companies -59,000.00 -138
V. RESULT OF ORDINARY BUSINESS OPERATION -25,917.44 534
14. Income and earnings tax 219,160.77 -232
VI. ANNUAL SURPLUS 193,243.33 302
15. Change of reserves 0.00 -225
VII. ANNUAL PROFIT 193,243.33 77
16. Profit carryforward 4,132.53 27
VIII. NET PROFIT 197,375.86 104

Future success is the result of a
well calculated entrepreneurial risk.
Not taking any risks would mean
not taking any decisions and
surrendering success to others.
Decision

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Negotiation
Negotiating well does not mean to
pull the partner over the barrel to
reach a common perspective. It
rather means to share perspectives
in order to develop mutual assets
and benefits for all parties involved.

NOTES
to the annual accounts of European American
Investment Bank Aktiengesellschaft
(“Euram Bank”) for the year ending 30
June 2015.
The principle of itemised valuation was
applied for the valuation of the assets and
liabilities, on the assumption of a going
concern.
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The annual accounts for the year ending
30 June 2015 were prepared in accordance
with the regulations of the Accounting
Act, taking account of the special requirements
of the Banking Act.
The principle of prudence was observed
by reporting only profits realised on the
reporting date, and recognising all discernible
risks and impending losses in the
balance sheet.
1. General principles and information
on accounting and valuation
General principles
The annual accounts for the year ending
30 June 2015 are prepared in compliance
with generally accepted accounting principles,
and with the general standard of
conveying a true and fair view of the company’s
assets, financial situation and results
of operation.
Under the provisions of section 9 of the
Corporate Income Tax Act (KStG) relating
to group taxation, a corporate group exists
as at 30.06.2015 comprising Euram Holding
AG as group parent and Euram Bank
as group member. The tax sharing agreements
stipulate the stand-alone method.
The bank is organized as a stock corporation.
Euram Bank is wholly owned by Euram
Holding AG.
The principle of completeness and accounting
continuity was observed in preparing
the annual accounts. With respect
to accounting consistency, the option
to account for deferred tax assets under
section 198 (10) Austrian Business Code
(UGB) was newly exercised in the financial
year 2014/15, and a deferred tax asset
was itemised for the first time.
Foreign currency amounts
Foreign currency amounts are translated
at the middle rates set on the reporting
date, in accordance with section 58 (1)
Banking Act.

Financial investments
Holdings are valued at cost of purchase.
Lower values are recognised in the case of
material, sustained impairments.
Securities held as fixed assets are valued at
the lower of fair value and cost of purchase
on the balance sheet date. Non-scheduled
depreciation of a fair value that is lower on
the reporting date is applied if the impairments
seem likely to be enduring.
Write-ups of fixed assets are applied if
the reasons for the non-scheduled depreciation
no longer apply, unless the lower
value can be retained for determining taxable
income, provided that it also remains
unchanged in the annual accounts.
For holdings write-ups are applied in the
event of recovery, regardless of the reasons
responsible for the non-scheduled
depreciation.
Current assets
Items classified as current assets were reported
at cost of purchase less value adjustments
for discernible individual risks
or possibly a lower share price, market
value, or market value derived from a similar
financial instrument, on the reporting
date.
Financial instruments in the bank
book
Shares in hedge funds and a special fund
of EUR 2.2 million (EUR 1.1 million as at
30.06.2014) are held in the bank book.
Hedge fund shares EUR thousand
1794 Commodore
Overseas Fund EUR 0
CFS I EUR 25
Sharpe Futures Fund EUR 682
Sharpe Art Segregated
Portfolio Fund EUR 1,501
Collateralized loan
obligations
EUR thousand
Canal Point I Ltd. EUR 0
Lending risks
Loans to customers amount to EUR 79.6
million (EUR 57.4 million as at 30.6.2014);
loans to customers with a volume of EUR
35.1 million (EUR 29.8 million as at
30.6.2014) are secured by deposits, loans
to customers with a volume of EUR 43.9

million (EUR 27.4 million as at 30.6.2014)
are mainly secured by mortgages, deposits
and/or securities. The amounts due from
customers include amounts due from issuers
with a volume of EUR 2.9 million (EUR
0.0 million as at 30.6.2014).
Lendings
EUR million
secured by
deposits EUR 35.1
secured by mortgages,
deposits and securities
EUR 43.9
unsecured EUR 0.6
Shares in affiliated companies
Euram Bank has a 100% holding in Euram
Invest Holdings 3 GmbH headquartered in
Munich, Germany (line of business of the
GmbH: management of investments).
Participations
This item includes the share in the deposit
guarantee scheme (Einlagensicherung
der Banken and Bankiers GmbH), Vienna,
in the amount of EUR 70.0 (EUR 70.0
as at 30.6.2014). In the financial year
2014/2015, the trust investment in E.I.C.
a.s. (EUR 1.2 million) was terminated.
Intangible and tangible assets
Intangible fixed assets and tangible assets
are valued at cost of acquisition or production,
less scheduled depreciation. Low-value
items are capitalized and fully depreciated
in the year of acquisition. Assets are
depreciated on a straight-line basis.
The following useful life is assumed for
the purposes of scheduled depreciation:
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In the financial year 2014/2015, as already
in financial year 2013/2014, no dividends
were distributed to Euram Bank.
According to section 238 (2) of the Commercial
Code (UGB), the equity capital
and results of the last financial year of the
affiliated undertakings are as follows:
Euram Invest Holdings 3 GmbH
(in EUR Thousand)
Equity 257.6
Share of Equity 100%
Result last FY -8.0
Company cars
Office furniture
Fixtures
Office equipment
Software
Hardware
8 years
5 years
5 years
5 years
5 years
5 years

After concluding the appropriate
groundwork and considering
all restrictions, control means the
empowerment to act.

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Control

The tax regulations permit a full year’s depreciation
for acquisitions in the first half
of the year, and half a year’s depreciation
for acquisitions in the second half of the
year.
Provisions for severance payments
The provisions for severance pay are calculated
according to actuarial principles,
applying an interest rate of 1% (previous
year: 3%), and on the basis of an imputed
pension age of 60 for women and 65 for
men. A fluctuation discount is not applied.
Other provisions
Observing the principle of prudence, other
provisions include all risks discernible
at the time the accounts are prepared, and
liabilities that are uncertain in terms of
amount and substance are reported at the
amounts dictated by prudent commercial
judgment.
Contingent liabilities
Contingent liabilities contain financing
guarantees given, secured by banks, securities
or cash, amounting to EUR 0.1
million (EUR 2.1 million as at 30.6.2014),
and an unsecured financing guarantee
amounting to EUR 0.7 million (EUR 0.6
million as at 30.6.2014).
Credit risks
This item contains undrawn credit facilities,
amounting to EUR 3.6 million (EUR
0.7 million as at 30.6.2014) as well as
guarantees to credit card institutions for
the facilities granted to Euram Bank customers
in the amount of EUR 2.4 million
(EUR 2.1 million as at 30.6.2014).
Fiduciary receivables
Fiduciary receivables are contained in the
following items:
- Shares and other non-fixed interest
securities: EUR 1.1 million
(EUR 0.7 million as at 30.6.2014)
- Participations: EUR 0.0 million
(EUR 1.2 million as at 30.6.2014)

Fiduciary liabilities
Fiduciary liabilities are contained in the
following items:
- Liabilities to customers: EUR 1.1 million
(EUR 1.9 million as at 30.6.2014)
- Securitized liabilities: EUR 25.3 thousand
(30.6.2014: EUR 25.3 thousand)
2. Notes to the accounts
A. Maturities analysis
Receivables from and payables to banks
and customers other than repayable on demand
are structured according to remaining
maturity as follows:
Receivables from banks EUR thousand
up to 3 months EUR 0
more than 3 months
up to 1 year EUR 0
more than 1 year
up to 5 years EUR 0
over 5 years EUR 0
Receivables from customers
EUR thousand
up to 3 months EUR 1,192
more than 3 months
up to 1 year EUR 12,873
more than 1 year
up to 5 years EUR 30,401
over 5 years EUR 2,180
Payables to banks
EUR thousand
up to 3 months EUR 2,500
more than 3 months
up to 1 year EUR 0
more than 1 year
up to 5 years EUR 0
over 5 years EUR 0
Payables to customers
EUR thousand
up to 3 months EUR 0
more than 3 months
up to 1 year EUR 1,660
more than 1 year
up to 5 years EUR 6,877
over 5 years EUR 0
B. Securities
In the financial year 2014/2015, securities
were held in the following assets:
- Debt instruments issued by public
authorities: EUR 9.0 million
(EUR 0.0 million as at 30.6.2014)
- Amounts due from customers:
EUR 2.9 million (EUR 0.6 million as at
30.6.2014)
- Debentures and other fixed-interest
securities: EUR 9.0 million
(EUR 0.0 million as at 30.6.2014)
- Shares and other non-fixed interest
securities: EUR 4.8 million
(EUR 3.5 million as at 30.6.2014)
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41

B.1. Debt instruments issued by public
authorities that are admitted for
refinancing at the Central Bank
In the financial year 2014/2015, a nonfixed
interest listed security (regulated
market) was held in current assets.
thousand
Land Niederösterreich
FRN 01.10.14–01.10.19 EUR 8,984
B.2. Amounts due from customers – of
which other issuers
In the financial year 2014/2015, a fixed-interest
unlisted security was held in the
fixed assets and a fixed-interest listed security
(open market) was held in current
assets.
Fixed assets
thousand
CPI Immobilien AG
30.11.13–30.11.33 EUR 1,910
Current assets
thousand
ADLER Real Estate AG
01.04.14–01.04.19 EUR 0
ADLER Real Estate AG
08.04.15–08.04.20 EUR 1,012
B.3. Debentures and other fixed-interest
securities
In the financial year 2014/2015, the following
fixed-interest listed securities are held
in current assets:
Current assets
thousand
Republic of Austria
17.06.11–17.06.16 EUR 1,811
Asian Development Bank
30.05.12–17.08.15 EUR 1,343
Asian Development Bank
19.03.13–20.06.16 EUR 1,341
Kommunalbanken AS
19.01.11–19.01.16 EUR 1,369
The Netherlands
24.02.12–24.02.17 EUR 1,775
Schweden, Kingdom of
29.10.12–22.12.15 EUR 1,340
B.4. Shares and other non-fixed interest
securities
This item contains investment fund shares
allocated to fixed assets in the amount of
EUR 1,712 thousand (EUR 1,771 thousand
as at 30.6.2014).

Hedge fund shares amounting to EUR 0.7
million (EUR 1.1 million as at 30.6.2014)
and a special fund amounting to EUR 1.5
million (EUR 0.0 million as at 30.6.2014)
are reported in current assets. Current assets
also include investment fund shares
of the Euram public funds in the amount
of EUR 0.9 million (EUR 0.6 million as at
30.6.2014). Shares are also held in “Petrocapital
Resources PLC” in the amount
of EUR 10 (EUR 10 as at 30.6.2014) are
held. All securities shown in the asset
item “Shares and other non-fixed-interest
securities” are unlisted.
One share (“Petrocapital Resources PLC”)
was held in the financial year 2014/2015.
“Petrocapital Resources PLC” was delisted
in 2010.
In the financial year 2014/2015, the company
managed a customer securities portfolio
to a value of EUR 160.3 million (EUR
127.1 million as at 30.6.2014).
C. Fixed assets
The fixed assets movement schedule is
presented as a separate schedule.
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43
Fixed assets
thousand
Europportunity Bond EUR 1,712
Current assets
thousand
CFS I EUR 25
Sharpe Futures Fund EUR 682
Sharpe Art Segregated
Portfolio Fund EUR 1,501
1794 Commodore
Overseas Fund EUR 0
Europportunity Bond EUR 277
USD Convergence Bond EUR 593
Advantage Stock EUR 10
Petrocapital
Resources PLC EUR 0.01
No securities trading book was kept in the
financial year 2014/2015.

A goal is not yet a plan, a plan not
yet a model, a model not quite
a house – the house must yet be
built. It is no coincidence that
the English word “concrete” also
means “cement”.

44
45
Concretization
Structuring
To link up the future with the
present, time must be turned
into space and paths must
be established and reinforced.

D. Other assets
Other assets include
- a pending repayment of EUR 0.4 million
(EUR 0.6 million as at 30.6.2014),
- fees charged for the management of
investment funds amounting to
EUR 0.3 million (EUR 0.3 million as at
30.6.2014),
- receivables due from an affiliated
company from distribution of the tax
burden: EUR 5.6 thousand (EUR 0.0 as
at 30.6.2014)
- outstanding receivables: EUR 0.2 million
(EUR 0.2 million as at 30.6.2014)
- a long-term discounted receivable of
EUR 0.2 million (EUR 0.4 million as at
30.6.2014)
- a real estate property not intended to
be held long-term amounting to EUR
240 thousand (EUR 240 thousand as at
30.6.2014).
Other receivables with a remaining term
to maturity of more than one year amounting
to EUR 0.2 million (EUR 0.4 million as
at 30.6.2014) were reported in the financial
year 2014/2015.
The material revenue included in the
item “Other assets” in the financial year
2014/2015 that becomes payable only after
the reporting date amounts to 0.7 million
(EUR 0.9 million as at 30.6.2014).
E. Prepayments
This item includes current salary payments
amounting to EUR 115.4 thousand
(EUR 150.6 thousand as at 30.6.2014),
prepaid insurance premiums, and information
and maintenance costs amounting
to EUR 160.3 thousand (EUR 192.2 thousand
as at 30.6.2014) as well as other prepayments
amounting to EUR 48.3 thousand
(EUR 13.8 thousand as at 30.6.2014).
At the balance sheet date, prepayments
according to section 198 (10) UGB amount
to EUR 120.4 thousand (previous year:
EUR 0.0). The option to capitalize deferred
taxes was exercised.
F. Securitized liabilities
This item includes a self-issued bond and
a self-issued certificate.
thousand
CFS Alternative Investment
Note I EUR 25
Euram Commodore Index –
Euro Protected 2 Certificates
EUR 0
The amount of securitized liabilities becoming
due in the year following the balance
sheet date is EUR 25 thousand (EUR
0.4 million as at 30.6.2014).

G. Other liabilities
I. Equity capital
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47
Other liabilities include invoices already
received but not yet paid relating to the
financial year 2014/2015 amounting to
EUR 0.2 million (EUR 0.4 million as at
30.6.2014), liabilities to a data acquisition
company amounting to EUR 0.7 million
(EUR 1.3 million as at 30.6.2014), liabilities
arising from tax allocations with an
affiliated undertaking amounting to EUR
234.6 thousand (EUR 240.1 thousand as
at 30.6.2014), and liabilities to the tax
authorities amounting to EUR 367.1 thousand
(EUR 77.2 thousand as at 30.6.2014).
The material expenses included in the
item “Other liabilities” in the financial
year 2014/2015 that become payable only
after the reporting date amount to EUR 0.4
million (EUR 0.4 million as at 30.6.2014).
1.) The share capital amounting to EUR
10,045,700 is divided into 270 thousand
share units, each with an equal portion of
the share capital.
2.) The equity capital is made up as follows:
thousand
Subscribed capital EUR 10,045.7
(Appropriated) capital
reserve EUR 1,886.8
(Free) capital reserve EUR 33.5
Retained Earnings EUR 2,859.9
Liability reserve as per
section 57 (5) Banking Act EUR 660.5
3.) The net profit for the financial year
2014/2015 amounts to EUR 197.4 thousand
(EUR 104.1 thousand as at 30.6.2014).
H. Accruals and deferred income
This item includes mainly fees already received
but allocated to the financial year
2015/2016 amounting to EUR 84 thousand
(EUR 67.5 thousand as at 30.6.2014).
4.) Euram Bank effected no allocations
to revenue reserves in the financial year
2014/2015 (EUR 225 thousand as at
30.6.2014).

J. Required own funds
Euram Bank uses the following methods
to calculate its required own funds:
Credit risk: Standard approach
Operational risk: Basic indicator approach
Risk of adjustment to credit valuation
(CVA risk): Standard method
In the financial year 2014/2015, the total
amount of risk under Article 92 of the CRR
– EU Regulation no. 575/2013 amounts to
EUR 65,522 thousand (EUR 58,938 thousand
as at 30.6.2014).
The total amount of risk from foreign currency
risks amounts to EUR 0 (EUR 0 as at
30.6.2014).
The total amount of risk from adjustment
to the credit valuation (CVA risk)
amounts to EUR 856.53 (EUR 362.13 as
at 30.6.2014).
The total amount of risk of the exposures
to operational risk amounts to EUR 17,959
thousand (EUR 22,438 thousand).
The risk weighted item amounts for the
credit risk are EUR 47,562 thousand (EUR
36,500 thousand as at 30.6.2014) and
break down as follows:
thousand
Exposures to central governments or central banks EUR 0
Exposures to regional or local administrative bodies EUR 0
Exposures to multilateral development banks EUR 0
Exposures to institutes EUR 9,379
Exposures to corporates EUR 22,213
Exposures from retail business EUR 3,105
Defaulted exposures EUR 0
Exposures secured by real estate property EUR 1,315
Exposures to institutes and corporates with short-term
credit ratings EUR 1,569
Exposures in the form of investment fund units (UCI) EUR 3,723
Investment exposures EUR 159
Other items EUR 6,099

K. Additional disclosures
1.) Total of assets and liabilities in foreign
currency:
million
Assets in foreign
currency EUR 89.6
Liabilities in foreign
currency EUR 93.7
The foreign currency assets and liabilities
essentially concern USD.
2.) In the financial year 2014/2015, Euram
Bank had a restraint on disposal for an asset
amounting to EUR 3.0 million (EUR 2.5
million as at 30.6.2015).
3.) Receivables from affiliated undertakings
amount to EUR 1.7 million (EUR 1.2
million as at 30.6.2014).
4.) Liabilities to affiliated undertakings
amount to EUR 1.6 million (EUR 4.3 million
as at 30.6.2014).
5.) In the financial year 2014/2015, Euram
Bank had no material transactions
with other “related parties” (30.6.2014: no
material transactions with other “related
parties”). All transactions have been concluded
on arm's length terms.
6.) Other provisions amounting to EUR 1.1
million (EUR 1.8 million as at 30.6.2014)
include:
thousand
Legal, auditing and
consultancy fees EUR 310.9
Outstanding
vacation
entitlements EUR 221.2
Bonuses EUR 553.9
Other expenses EUR 0.0
7.) From a present-day perspective, the liabilities
arising from the use of fixed assets
not reported in the balance sheet amount
to EUR 411.5 thousand (EUR 409.3 thousand
as at 30.6.2014) for the coming year
and EUR 2 million for the subsequent five
years, and relate exclusively to rental payments
for the use of office space.
8.) The three forward exchange transactions
(30.06.2014: one) concluded by the
company serve to secure foreign currency
positions. As at 30 June 2015, the total volume
of derivative instruments was:
Nominal Market
volume value
EUR thousand
Exchange rate contracts
– forward
exchange transaction 5,462 44
Underlying transaction 5,462 44
Hedging transaction 5,462 44
The term of the foreign exchange transactions
is less than one year.
48
49

Realization

50
51
The reality check for successful
implementation: long-term profitability
as a result of far-sighted initiative,
solid investment and systematic work.

9.) In the financial year 2014/2015,
Euram Bank issued one loan to officers
and related persons (30.6.2014: three
loans) amounting to EUR 665 thousand
(EUR 625.9 thousand as at 30.6.2014).
10.) In the financial year 2014/2015,
Euram Bank reports a return on assets
(annual result after tax / total assets) in
the amount of 0.12%.
3. Notes to the profit and loss
account
In the financial year 2014/2015, the breakdown
of income by geographical markets
as per section 64 (1) (9) BWG is essentially
the following:
Interest income:
thousand
The Caribbean EUR 81.3
Asia EUR 75.3
Europe – EU EUR 667.7
CEE EUR 514.9
Income from securities and investments:
thousand
Europe – EU EUR 132.2
Fees earned:
thousand
The Caribbean EUR 237.0
Asia EUR 101.6
Europe – EU EUR 95,284.9
CEE EUR 148.3
Income/expenses from financial transactions:
thousand
The Caribbean EUR -83.8
Europe – EU EUR -129.7
Other operating income:
thousand
Europe – EU EUR 3,271.1
The operating expenses of EUR 3.0 million
(EUR 3.2 million as at 30.6.2014) reported
in the financial year 2014/2015, comprise
mainly the following:
thousand
IT and information
expense EUR 927
Office and operating
expense EUR 106
Rental expense EUR 411
Advertising expense EUR 371
Insurance EUR 179
Legal and consultancy
expense EUR 591
Supervisory board EUR 138
Recruitment and training EUR 63
Travel expenses and motor
vehicle operating costs EUR 141
Other costs EUR 89

With reference to section 237 UGB, the
itemisation of other operating income and
other operating expense in accordance
with section 64 (1) (12) BWG is as follows:
- Other operating income includes part
of the proceeds of an innovative payment
processing product amounting
to EUR 3.0 million (EUR 3.1 million
as at 30.6.2014), in addition to costs
recharged to customers amounting to
EUR 0.2 million (EUR 0.3 million as at
30.6.2014), as well as a value added
tax credit in the amount of EUR 10.9
thousand (EUR 164.9 thousand as at
30.6.2014).
- The other operating expenses of EUR
186 thousand (EUR 486.3 thousand as
at 30.6.2014) reported in the financial
year 2014/2015 mainly relate to expenditures
for external consultants.
No value adjustments on receivables were
recognized in the financial year 2014/2015
(EUR 91 thousand as at 30.6.2014).
Value adjustments for securities and investments
and shares in affiliated companies
amount to EUR 59 thousand (EUR
138.3 thousand as at 30.6.2014), and relate
to the value adjustments for the Europportunity
Bond Fund held in fixed assets
amounting to EUR 59 thousand (EUR
73.8 thousand as at 30.6.2014).
The expenses for auditors attributable
to the financial year are disclosed in the
group accounts of Euram Holding AG.
The “Taxes on income and earnings” reported
in the profit and loss accounts including
tax allocations amounting to EUR
+219.2 thousand (EUR -231.9 thousand as
at 30.6.2014) affected the “Profit or loss on
ordinary activity” to the extent of +845.6%
(30.6.2014: -43.4%).
No allocation to retained earnings was
effected in the financial year 2014/2015
(EUR 225 thousand as at 30.6.2014).
52
53
Income from the release of value adjustments
on receivables and from provisions
for contingent liabilities and for credit
risks in the amount of EUR 87 thousand
arose in the financial year 2014/2015
(EUR 0.0 as at 30.6.2014).

4. Other information
1.) An average of 32 staff were employed
in the financial year 2014/2015 (30 as at
30.6.2014).
2.) Severance payment expenses in the
financial year 2014/2015 for senior staff
amounted to EUR 178.7 thousand (EUR
156.6 thousand as at 30.6.2014) and for
other employees EUR 202.2 thousand
(EUR 151.1 thousand as at 30.6.2014). In
addition, the amount of EUR 120.9 thousand
(EUR 73.2 thousand as at 30.6.2014)
was paid in contributions to the company
pension fund.
3.) Total remuneration of 3 (3 as at
30.6.2014) members of the Management
Board for their services in the financial
year 2014/2015 amounted to EUR 1.1 million
(EUR 1.5 million as at 30.6.2014); the
remuneration paid to the members of the
Supervisory Board in the financial year
2014/2015 amounts to EUR 0.1 million
(EUR 0.1 million as at 30.6.2014).
4.) No loans were granted to senior staff in
the financial year 2014/2015 (EUR 0.0 as
at 30.6.2014).
5.) The company’s Management Board consisted
of the following members during
the financial year 2014/2015:
Manfred Huber (chairman)
Johannes Langer
Josef Leckel
6.) The Supervisory Board consisted of the
following members during the financial
year 2014/2015:
Adolf Walter Höllmer (chairman)
Dr. Erik Max Michael Obermayer (vice
chairman)
Dkfm. Senta Penner
7.) Euram Bank is included in the consolidated
accounts of the following company:
Euram Holding AG
Wallnerstrasse 4
1010 Vienna, Austria

5. Additional disclosures
54
55
In order to comply with the company's
disclosure obligations under Articles 431
to 435 of the CRR – EU Regulation no.
575/2013, it is pointed out that the publication
is made available on the website
of Euram Bank (www.eurambank.com) under
“Euram Bank / Publications and Disclosures”.
Vienna, on 7 September 2015
The Management Board
Manfred Huber
Johannes Langer
Josef Leckel

56
57

AUDIT OPINION
Report on the Financial Statements
58
59
We have audited the accompanying financial statements, including
the accounting system, of European American Investment
Bank Aktiengesellschaft, Vienna, for the fiscal year from July 1,
2014 to June 30, 2015. These financial statements comprise the
balance sheet as of June 30, 2015, the income statement for the
fiscal year ended June 30, 2015, and the notes.
Management’s Responsibility for the Financial Statements
and for the Accounting System
The company’s management is responsible for the accounting
system and for the preparation and fair presentation of these
financial statements in accordance with Austrian Generally Accepted
Accounting Principles. This responsibility includes: designing,
implementing and maintaining internal control relevant
to the preparation and fair presentation of financial statements
that are free from material misstatement, whether due to fraud
or error; selecting and applying appropriate accounting policies;
and making accounting estimates that are reasonable in the circumstances.
Auditor’s Responsibility and Description of Type and Scope
of the Statutory Audit
Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with laws and regulations applicable in Austria and Austrian
Standards on Auditing. Those standards require that we comply
with professional guidelines and that we plan and perform
the audit to obtain reasonable assurance whether the financial
statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditor’s judgment, including
the assessment of the risks of material misstatement
of the financial statements, whether due to fraud or error. In
making those risk assessments, the auditor considers internal
control systems relevant to the company’s preparation and fair
presentation of the financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for
the purpose of expressing an opinion on the effectiveness of the
company’s internal control. An audit also includes evaluating the
appropriateness of accounting policies used and the reasonableness
of accounting estimates made by management, as well as
evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
Opinion
Our audit did not give rise to any objections. In our opinion,
which is based on the results of our audit, the financial statements
comply with legal requirements and give a true and fair
view of the financial position of the company as of June 30, 2015
and of its financial performance for the fiscal year from July 1,
2014 to June 30, 2015 in accordance with Austrian Generally Accepted
Accounting Principles.

Comments on the Management Report
Pursuant to statutory provisions, the management report is to
be audited as to whether it is consistent with the financial statements
and as to whether the other disclosures are not misleading
with respect to the company’s position. The auditor’s report also
has to contain a statement as to whether the management report
is consistent with the financial statements.
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61
In our opinion, the management report is consistent with the
financial statements.
Vienna, September 7, 2015
KPMG Austria GmbH
Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
Mag. Bernhard Gruber
Certified Public Accountant
p.p. Mag. (FH) Doris Thomann
Certified Public Accountant

Rome
wasn’t built in a day.

62
63

Euram Bank AG
Palais Esterházy
Wallnerstrasse 4
1010 Vienna, Austria
Tel. +43 1 512 38 80 0
Fax +43 1 512 38 80 888
office@eurambank.com
www.eurambank.com
This is a translation from German. In case of any discrepancies
between the English and the German version the German text
shall prevail.
Concept, design and production
die3 Agentur für Werbung und Kommunikation GmbH
Photographs
Kurth Keinrath
Print
Druckerei Thurnher

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5

Innovation
Models
Evaluation
Vision