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 EuramBank of infringing the code of conduct of the Indian stock exchange as an FII licensee, remains in force. In October 2014, EuramBank made another comprehensive statement vis-à-vis SEBI in this respect. EuramBank continues to cooperate with all the authorities involved, seeking rapid resolution. In February 2012, an Indian enterprise brought an action for declaratory judgement against EuramBank 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 EuramBank 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, EuramBank 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, EuramBank learnt that an American citizen brought an “action for damages” in August 2011 against EuramBank 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.
EuramBank 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 EuramBank’s action against the Slovak Republic in June 2014 as being outside its jurisdiction. The resultant costs incurred by EuramBank are covered. A civil action is still pending in this matter brought by EuramBank before a Slovakian court. 20 21 3. Research and development EuramBank undertakes no research and development activities. 4. Risk reporting EuramBank 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. EuramBank 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. EuramBank 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 EuramBank, 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.