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LOCAL GOVERNMENT
Structure
The local government segment encompasses
Kommunalkredit Austria AG as
KOMMUNALKREDIT: SPECIALIST the specialist bank for public
BANK FOR PUBLIC FINANCE
finance and its subsidiaries, of
which the most important are
Kommunalkredit International Bank Ltd and Dexia
Kommunalkredit Holding as sole shareholder of the
“As an innovative issuing house, Kommunalkredit
Austria AG has developed a modern covered bond
product (the Kommunalkredit Austria Covered
Bond “KACB”) based on Austrian law, and successfully
introduced it to the international capital
markets. With this, Kommunalkredit Austria AG
has become the only bank without public backing
in Austria to have a refinancing instrument at its
disposal with a AAA rating from a rating agency
(Moody’s). In 2004 Kommunalkredit issued two
further benchmark transactions – one for EUR 1 bn
and one for CHF 500 m. The KACBs were in strong
demand as investment instruments, especially
from central banks and other investors seeking
the highest degree of creditworthiness. Our goal
is to place liquid investment instruments at our
investors’ disposal that cover the whole range of
maturities.”
“Viewed internationally, Kommunalkredit Austria AG
counts as one of the Top 50 issuers of structured
medium term notes (EMTNs). In 2004 the bank
completed 97 transactions with a total face value
of around EUR 1.3 bn. These issues were placed
with investors around the world – from Asia to the
Middle East and right across Europe
and South America. One of our core
competencies is to make tailor-made
investment instruments available to
our investors.”
Reinhard Platzer
CEO and Chairman of the Executive Board
Kommunalkredit Austria AG
Slovak Dexia banka Slovensko (formerly Prvá
Komunálna Banka). With two double A ratings
(Moody’s and Fitch), Kommunalkredit is the bestrated
Austrian bank outside the public sector. There
SEGMENT REPORTING / LOCAL GOVERNMENT
were 224 employees (that is 45% of the whole
Group) in the Kommunalkredit Group at year-end
2004. Kommunalkredit Austria AG strengthened its
own funds in January 2004 with a capital increase
amounting to around EUR 51 m. The two main
shareholders, Investkredit and Dexia, contributed
most to the increase of 35,000 to 225,000 shares.
Österreichischer Gemeindebund has come in as a
new shareholder with 0.22%. At 31 December 2004,
Investkredit Bank AG now holds 50.78% of the
shares.
Business approach
In 2004 Kommunalkredit Austria AG continued to
expand its position as number one in the public
finance segment. It pursues this specialisation in
its foreign commitments as
well. Both cross-border financ- KOMMUNALKREDIT WITH A
STRONGER MARKET PRESENCE
ing as well as consulting and
financial services provided by
the Kommunalkredit subsidiaries showed growth
in volume and earnings in 2004. Setting up Dexia
Kommunalkredit Bank, which will be responsible
for the dynamic CEE market, will give substantial
support to the Kommunalkredit Group’s expansion
policy.
The reason for Kommunalkredit’s lasting success at
home and abroad is the ongoing development of
tailor-made innovative products that distinguish it
significantly from its competitors.
Core market and
international locations
Around 60% of Austrian local authorities are
included amongst Kommunalkredit’s customers in
Austria. In its second core market – Switzerland –
it is one of the largest foreign financiers of the public
sector. Kommunalkredit does business in Central
and Eastern European countries together
with its strategic partner Dexia Crédit Local. Its
investment in Slovakia (via Dexia Kommunalkredit
Holding), Dexia banka Slovensko, has a market
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