Oesterreichische Volksbanken : Consolidated result for the first quarter of 2015

Vienna (May 12, 2015) - VBAG group has continued in the first quarter 2015 the wind-down measures in accordance with the restructuring plan set out by the European Commission. As at 31 March 2015 total assets were reduced by a further euro 0.3 billion to euro 14.8 billion (31 December 2014: euro 15.1 billion).

After the sale of Volksbank Romania S.A. (Closing on April 7, 2015) concrete negotiations are currently underway concerning the sale of national offices of the VB Leasing International Group.

The sale processes have been started for VB Leasing Finanzierungsgesellschaft m.b.H., for Volksbank Invest Kapitalanlagegesellschaft m.b.H. and its subsidiary Immo Kapitalanlage AG, as well as for VB Factoring Bank AG, and data rooms have been set up. In some cases, due-diligence reviews by potential buyers are still ongoing. No other extensive negotiations with interested parties are currently taking place.

The consolidated result after taxes and non-controlling interests came in at euro -2 million. Net interest income amounted to euro 32 million in the first quarter of 2015, down euro 19 million from the result for the comparable period (Q1/2014: euro 50 million). The decline in net interest income is mainly attributable to the lack of net interest income from former subsidiaries as a result of the sale in 2014.

Net fee and commission income amounted to euro 4 million in the reporting period, falling by euro 1 million compared with the previous period (Q1/2014: euro 5 million).

Net trading income is up compared with the previous period (Q1/2014: euro -12 million). Net trading income totalled euro 26 million in the reporting period. The increase over the previous year is primarily attributable to interest rate-related transactions and is related to restructurings involving derivative transactions. This helped to optimise hedge accounting, which led to an improvement in net trading income.

Income of euro 2 million was recognised in the first quarter of 2015 from risk provisioning. That represents a decline of euro 13 million compared with the previous year (euro -11 million). Due to the winding down of non-core loans as part of the restructuring, fewer impairment provisions needed to be created in the reporting period than in the comparable period or were able to be released through the creation of risk provisions.

General administrative expenses came in at euro 59 million, a decline compared with the previous year (Q1/2014: euro 64 million). Staff fell by 49 employees compared with the end of 2014 and now totals 1,268 employees. Of these, 280 work outside of Austria.

Own funds of the VB Holding eGen Group of credit institutions amounted to euro 1.5 billion as at 31 March 2015 (31 December 2014: euro 1.2 billion). The total risk amount of the VB Holding eGen Group of credit institutions stood at euro 8.3 billion as at 31 March 2015 (31 December 2014: euro 8.7 billion). The core Tier 1 ratio based on total risk was 9.8% (31 December 2014: 6.2%), and the core capital ratio was 10.1% (31 December 2014: 6.2%). The equity ratio amounted to 17.6% (31 December 2014: 14.2%).

The Preparatory measures on proposed split-up of VBAG are running: At the General Meeting scheduled for 28 May 2015, it is planned to approve the Division and Transfer Agreement. At the same time, it is intended that the General Meeting resolves to reduce the share capital and various participation capitals in order to cover losses.

The legal split-up of VBAG, the transfer of the spun-off part of the business to Volksbank Wien-Baden, the surrender of VBAG's banking licence and its departure from the liability association are planned for 4 July. These measures are currently being examined and remains subject to approval by the banking regulator, the European Commission and other authorities and institutions.