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62 SEGMENT REPORTING / LOCAL GOVERNMENT
FINANCING COMPLETED IN 2004 BY THE LOCAL GOVERNMENT SEGMENT
in terms of volume
Hungary 1.3% Rest of the EU 29.4%
Czechia 8.7% Rest of Europe 1.4%
Slovakia 1.0%
Switzerland 6.5%
Poland 9.0%
Core market 50.4%
Loans and advances to customers rose as a result
of a new stronger focus within the lending business
on the infrastructure and healthcare sector
as well as structured financing transactions and
other products – from EUR 6.0 bn to EUR 7.6 bn.
A regional breakdown of this increase shows it
occurring above all in Austria, Switzerland and the
rest of Western Europe but there was also a pleasing
rise in the new EU member countries in Central
Europe. Growth in the securities field, where
financial investments rose from EUR 2.9 bn to
EUR 5.2 bn, was mainly in Western Europe and in
selected non-European countries with very good
ratings. All in all, as at 31 December 2004 the reinforcement
of the internationalisation strategy
meant that, for the first time, there were more
financing transactions outside than inside Austria.
This can be clearly seen in the table entitled
“Financing in the local government segment”.
Rest of the World 18.8%
Austria 16.9%
Germany 7.0%
TREASURY AND INVESTMENT
BANKING
Kommunalkredit’s securities portfolio grew in the
course of the year by more than EUR 1 bn. Above
all, it was investments in government bonds (Eastern
Europe, Asia and other emerging markets) and
bank bonds that generated satisfactory yields.
Overall around EUR 3.1 bn were taken up through
the capital market in 2004 to finance the public
sector. Kommunalkredit carried out more than
100 refinancing transactions – mainly through its
EUR 11 bn debt issuance programme.
Kommunalkredit’s covered bonds (KACBs) developed
nicely in 2003 and with the AAA rating they
were given by a rating agency, became well established
on the capital market. Right at the beginning
FINANCING IN THE LOCAL GOVERNMENT SEGMENT
Austria Other Core Market Rest of the World Total
in EUR m 2004 2003 Change 2004 2003 Change 2004 2003 Change 2004 2003 Change
Loans 1) Securities
4,475 4,056 +10% 1,816 1,030 +76% 1,332 918 +45% 7,622 6,003 +27%
financing 2) 166 106 +56% 269 92 +193% 1,301 594 +119% 1,736 792 +119%
Total financing 4,641 4,162 +12% 2,084 1,122 +86% 2,633 1,512 +74% 9,358 6,796 +38%
1) Loans and advances to customers, trust loans and provision for guarantees
2) Bonds and other fixed-income securities (except those issued by states and banks)