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PRESS RELEASE 23 March 2006 RAIFFEISEN INTERNATIONAL GROUP SIGNS FIRST SYNTHETIC SECURITISATION WITH KFW IN CENTRAL AND EASTERN EUROPE Raiffeisen Bank Polska S.A and Raiffeisenbank a.s., the Polish and Czech affiliates of Raiffeisen International Bank-Holding AG, which belongs to the RZB Group, and Kreditanstalt für Wiederaufbau (KfW) concluded the first Eastern-European synthetic securitisation transaction “ROOF CEE 2006-1” today. The transaction was arranged by Dresdner Kleinwort Wasserstein (DrKW) and Raiffeisen Zentralbank Österreich AG (RZB). For the first time loans granted to Polish and Czech small and medium-sized enterprises have been securitised and placed in the market in a multi-seller transaction. The transaction is launched under the securitisation platform of KfW. In the context of the transaction the two subsidiaries of Raiffeisen International transfer the default risks from their respective subportfolio to KfW through two individual credit default swaps (CDS). In deviation from the standardised PROMISE structure KfW pools the sub-portfolios of Polish and Czech SME risks and hedges them under the synthetic transaction. The European Investment Fund (EIF) acts as investor in the senior and mezzanine tranches while RZB invests in the junior tranche. Moreover, a revolving transfer of credit risks is planned on a five-year basis, which enables the securitisation of new lending to small and medium-sized enterprises in these countries, too. The estimated average maturity of the transactions is approximately seven years. The combined portfolio has a volume of EUR 450 million. The share of Polish SME loans is limited to 60 per cent of the total volume. The combined portfolio is initially composed of 1,256 loans extended to altogether 943 Polish and Czech borrowers. The longest maturity of the individual loans is five years. The average loan size is approximately EUR 360,000. "After the successful completion of the True-Sale Securitisation for Raiffeisen Leasing Poland, in which the EIF was also involved as an investor, we could again demonstrate the quality of our loan portfolios in Central and Eastern Europe with this transaction ", said Herbert Stepic, CEO of Raiffeisen International. "The result shows that we have an excellent risk structure Raiffeisenbank a.s. Olbrachtova 9 140 21, Prague 4, Czech Republic Tel.: 221 141 170 Fax: (02) 221 142 170 Internet: http://www.rb.cz E-mail: [email protected] PRESS RELEASE within the group which is comparable - if not even superior - to Western European peers", he added. “Dresdner Bank has itself used the instrument of asset securitisation for several years. Dresdner Kleinwort Wasserstein makes the know-how in the field of synthetic securitisation available to its customers in Eastern Europe and further develops it in cooperation with its partner RZB“, said Stefan Ziese, Managing Director at DrKW.“With this cross-national combination of loan portfolios and the thereby achieved diversification, the transaction is calculating. With this transaction we're expanding our already strong engagement in the East-European securitisation market”, Ziese added. “This transaction is of special importance with regard to the promotional task of KfW,” explained Hans W. Reich, Chairman of the Board of Managing Directors of KfW Bankengruppe. ”It is the very first synthetic securitisation transaction of SME loans of banks in the new EU member states and thus in Eastern Europe. And the transaction brings us a great deal closer to our goal of a European market for securitised SME risks. We are pleased that we have contributed our share to this transaction due to the provision of the well established KfW securitisation platform and the proven cooperation with the EIF.” KfW expects further opportunities for cooperation to arise and other Eastern European banks to benefit from the creation of this market. The European Investment Fund (EIF) is the EU financial institution within the EIB Group specialising in SMEs. EIF enjoys a AAA/Aaa/AAA rating and multilateral development bank (MDB) status. EIF provides guarantees, invests in venture capital funds and provides financial engineering services. Securitisation backed by SME financing is a core activity for EIF. So far EIF has participated as in investor in some 50 transactions backed by more than EUR 51 billion of SME loans. KfW Bankengruppe (KfW banking group) gives impetus to economic, political and social development in Germany and Europe. With its long-term, low-interest loans KfW promotes small and medium-sized enterprises and business start-ups, among others. Through its securitisation platforms KfW gives credit institutions the opportunity to securitise credit risks under a highly standardised scheme. The equity relief thus achieved creates greater scope to Raiffeisenbank a.s. Olbrachtova 9 140 21, Prague 4, Czech Republic Tel.: 221 141 170 Fax: (02) 221 142 170 Internet: http://www.rb.cz E-mail: [email protected] PRESS RELEASE grant new loans. KfW has developed securitisation platforms for SME loans (PROMISE) and for residential mortgage loans (PROVIDE) in 2000 and 2001, respectively. Tomáš Kofroň Raiffeisenbank a.s. Raiffeisenbank a.s. Olbrachtova 9 140 21, Prague 4, Czech Republic Tel.: 221 141 170 Fax: (02) 221 142 170 Internet: http://www.rb.cz E-mail: [email protected]