Österreichische Volksbanken-Aktiengesellschaft

EANS-Adhoc: Österreichische Volksbanken-Aktiengesellschaft
anticipated loss in 2011 - information on planned de-merger and on measures to strengthen capitalization

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Company Information

13.10.2011

Since last year, Oesterreichische Volksbanken-Aktiengesellschaft (VBAG) has
focused on the redesign of its business model and has evaluated strategic
options. In particular, the major deterioration of the market environment for
banks, the severe crisis on international financial markets as well as
extraordinary impairment requirements on country risks, on participations, and
from the sale of participations are expected to significantly affect VBAG´s
results as well as its planned measures:


•       Annual loss (according to guidance) in the VBAG single entity financial
statements is expected to amount to approximately EUR 900 million (+/- EUR 150
million depending on the development of the markets. We expect a loss ranging
from EUR 500 million to EUR 750 million on the consolidated group level (IFRS).
The main drivers are significant write-downs in the amount of EUR 700 million on
the book value of the participations in Investkredit Bank AG and Volksbank
Romania S.A. in the single entity accounts of VBAG.
•       The planned transfer of the banking business of Österreichische
Volksbanken-Aktiengesellschaft to Investkredit Bank AG by way of de-merger will
not take place this year.
•       Currently no repayment of EUR 300 million participation capital held by
the Republic of Austria. 
•       Despite of the expected loss, capital ratios according to pillar I are
clearly exceeding regulatory requirements. In addition, VBAG Group strengthened
capital ratios through the sale of Volksbank International to Sberbank,
resulting in an expected increase of the core capital ratio to 10.4% and a rise
of the equity ratio to 13.7% by year end 2011.


Currently the board of directors and the core shareholders of VBAG are
discussing measures to strengthen VBAG´s capitalization. Part of these
discussions is the modification of the Schultze-Delitzsch Genossenschaftsverbund
in the form of a cooperation under Article 3 of the directive 2006/48/EC (part
of the European application of Basel II) or the Article 9 of the CCR I draft
(Capital Requirements Regulation I, which is the directly applicable regulatory
part of the Basel III execution on the European level). A resolution to
implement such modification was adopted today.



Stock exchange listed issues of participation capital issued by Österreichische
Volksbanken-Aktiengesellschaft:
ISIN:
AT0000755665 Österreichische Volksbanken-AG Partizipationsscheine 
XS0359924643 EUR 500,000,000 Perpetual Non Cumulative Participation Capital
Certificates 

The five biggest listed issues of Österreichische Volksbanken-Aktiengesellschaft
in terms of issue volume:

ISIN:                   
XS0451759012    
XS0417722393    
XS0412533399    
XS0271095357    

AT000B053442

The issues of Österreichische Volksbanken-Aktiengesellschaft are admitted on the
following stock exchanges:
Second Regulated market of Wiener Börse AG
Official trading of Wiener Börse AG
EUWAX segment of Baden-Württembergische Wertpapierbörse
Regulated market of Baden-Württembergische Wertpapierbörse
Regulated market of the Prague Stock Exchange
Regulated market of the Luxembourg Stock Exchange
Open Market of Berlin Stock Exchange
Open Market of Stuttgart Stock Exchange
Open Market of Frankfurt Stock Exchange


Further inquiry note:
Ansprechpartner:

Walter Gröblinger

Tel.: +43/ (0) 50 4004-0

E-Mail: walter.groeblinger@volksbank.com

end of announcement                               euro adhoc 
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issuer:      Österreichische Volksbanken-Aktiengesellschaft
             Kolingasse  19
             A-1090 Wien
phone:       +43 0 50 4004-0
WWW:      www.volksbank.com
sector:      Banking
ISIN:        AT0000755665
indexes:     Standard Market Auction
stockmarkets: stock market: Prague Stock Exchange, official market: Wien 
language:   English
 



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