Erste Bank JPMorgan Merrill Lynch International

Expenses for insurance claims
The following table provides an overview of expenses for insurance claims for the periods
presented:
Fiscal year ended
December 31,
2007 2006 2005
(in EUR million)
Payments for insurance claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206.4 202.9 198.4
Change in the provision for outstanding insurance claims . . . . . . . . . . . . . . . 0.8 0.9 0.2
Changes in actuarial reserves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48.9 45.1 43.3
Expenses for the refund of premiums unrelated to results . . . . . . . . . . . . . . . 10.7 12.1 11.0
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 266.9 261.0 252.9
The slight increase in expenses for insurance claims from EUR 252.9 million in fiscal year 2005
to EUR 261.0 million in fiscal year 2006 is approximately equal to the growth in premiums.
The slight increase in expenses for insurance claims from EUR 261.0 million in fiscal year 2006
to EUR 266.9 million in fiscal year 2007 is slightly less, on a proportional basis, than the growth in
premiums.
Operating expenses
The following table provides an overview of operating expenses for the periods presented:
Fiscal year ended
December 31,
2007 2006 2005
(in EUR million)
Commissions and other acquisition costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24.6 23.0 22.7
Administrative costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14.2 13.2 12.5
Reinsurance commissions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -0.1 -0.1 -0.1
Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38.7 36.1 35.1
Operating expenses rose slightly from EUR 35.1 million in fiscal year 2005 to EUR 36.1 million in
fiscal year 2006 and increased to EUR 38.7 million in fiscal year 2007.
Profit before taxes
Profit before taxes fell by 40.5% from EUR 21.5 million in fiscal year 2005 to EUR 12.8 million in
fiscal year 2006. This was primarily due to changes in the financial result resulting from depreciation
on real estate.
Profit before taxes increased by 17.2% from EUR 12.8 million in fiscal year 2006 to EUR 15.0 million
in fiscal year 2007. This was primarily due to the better financial result.
Liquidity
Equity capital stock
The regulations concerning equity capital stock are uniform due to EC directives in member
states and in the European Economic Area. Most countries in the CEE region, which are not member
states of the EU, have adopted these regulations. Under the regulations, individual companies are
subject to the EU regulations concerning equity capital stock. Further, insurance groups must fulfill the
conditions of the adjusted equity capital stock (a computation of the equity capital stock at group
level). As a result, insurance companies of the Vienna Insurance Group are subject to the individual
provisions concerning equity capital stock. As parent company, Wiener Städtische AG must present
the adjusted equity capital stock. WST-Versicherungsverein as insurance holding is subject to the
directive concerning additional monitoring of insurance groups. However, the company under obligation
to meet the requirements is Wiener Städtische AG.
The strategy with respect to equity capital stock of Wiener Städtische AG and its national and
foreign operative subsidiaries varies depending on the function of the respective business. The
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