Bank Austria – Öffentliche Pfandbriefe (Public Sector ... · Market share(1) Ranking Logo Austria 16.3% # 1 Emerging Europe 7.0% # 1 e.g. Italy 13.5% # 2 Germany 3.5% # 3 UNICREDIT

Bank Austria – Öffentliche Pfandbriefe(Public Sector Covered Bonds)

March 2010

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UNICREDIT GROUP / BANK AUSTRIA: OVERVIEW

PUBLIC COVERED BOND OF UNICREDIT BANK AUSTRIA

AUSTRIAN LEGAL FRAMEWORK PFANDBRIEFE

AGENDA

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AGENDA




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Market share(1) Ranking Logo

Austria 16.3% # 1

Emerging Europe 7.0% # 1 e.g.

Italy 13.5% # 2

Germany 3.5% # 3

UNICREDIT GROUP IS “A TRULY EUROPEAN BANK”

Market capitalisation (EUR bn)as of May 31, 2010

Leading position in core markets

(1) Market shares in terms of loans as of Feb10. Source: UniCredit Research Network

At a glance*

Strong local roots in 22 European countries

Approx. 163,000** employees, 9.600** branches

EUR 185 bn assets under management

Loans and receivable with customers: EUR 565 bn

Customers deposits and securities: EUR 593 bn

EUR 27.6 bn operating income in 2009

Aa3 Stable/A Stable/A Negative long-term ratings(Moody's, S&P, Fitch)

* As of Mar 2010** Including all employees and branches of subsidiaries consolidated proportionatelySource: FY2009 and 1Q10 Financial Report

32,0

33,6

37,4

39,7

41,9

43,5

45,0

68,5

130,1

54,8

RBS

UCG

CS

ST.CHART

UBS

BARC

LLOYDS

BNP

SAN

HSBC

3rd in EURzone

UNICREDIT GROUP: OVERVIEW

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UniCreditHolding Function

CIB & PB StrategicBusiness Area

CEE Region

Retail Network

Italy

CIB NetworkGermany

CIB NetworkAustria

Private BankingGermany

Private BankingAustria

Retail NetworkGermany

Retail NetworkAustria

Private BankingItaly

ProductFactoriesProduct

Factories

Note: Retail, CIB and PB Poland Networks Divisions will be established cancelling the current Poland’s Markets function upon completion of Poland’s divisionalisation project

HIGH DIVISIONAL COMPETENCE ENSURES GROUPWIDESTANDARDS BEYOND VARIOUS LEGAL ENTITIES ACTING AS ISSUER

CIB Network

Italy

UNICREDIT GROUP: OVERVIEW

IssuingLegal Entity

All CEECountries

Retail StrategicBusiness Area

UniCredit Bank Austria

UniCredit Bank AG (HVB)

UniCredit S.p.A

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2009 results confirm the solid franchise

UNICREDIT & BANK AUSTRIA: OVERVIEW

EXECUTIVE SUMMARY ON 2009 FINANCIALS

Even in a difficult market

environment

Key pillars

Diversificationbenefits

Cost control

Deleveraging

Capital strength

UniCredit Group

1.7 bn net profit in a challenging year

Operating profit up 20.3% y/y, or +27.5%at constant FX and perimeter

Operating costs -8.2% y/y, -5.3% atconstant FX and perimeter

Effective deleveraging:total assets -11.2% from Dec 08;Tangible Assets / Tangible equity from29x to 22x pro-forma for 4 bn capitalincrease announced in September 2009and finalized in February 2010

Tier 1 at 8.63%, ~9.5% pro forma(Core Tier 1 ~8.47%) for 4 bn capitalincrease

Bank Austria Group

1.1 bn consolidated net profit in achallenging year

Operating profit up 10.3% y/y

Operating costs -8.1% y/y,Cost/Income Ratio at 49.9%

Total assets (194 bn) down by 12% vs.December 2008

Core Tier 1 ratio at 8.33%

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Q1 2010

Key pillars

1Q10 results reflect a focus on cost and sustained profitability despite still high loan loss provisions

Cost control

Balance sheetstabilization

Capital strength

Focus on AssetQuality

UNICREDIT & BANK AUSTRIA: OVERVIEW

Core Tier 1 basically stable at 8.45% (-2bp q/q) reflecting RWAs back tomoderate growth (mainly due to FX) anddividend accrual

Diversificationbenefits

520 mln net profit in 1Q10 (+40.1% q/qand +16.5% y/y)

Revenues +5.6% q/q and +3.7% y/y,with resilient q/q trend of net interestand net commissions

Loan provisions keep decreasing(-13.4% q/q); 127 bp cost of risk

Asset quality deterioration slowing:gross impaired loans +4.3% q/q; grossNPLs +4.2% q/q

Total assets back to moderate growthwith loans stabilizing, higher deposits,lower net interbank exposure

UniCredit Group

Cost/income ratio -2.0 p.p. q/q to57.0%, thanks to structural efficiency(-2,683 FTE in 1Q10)

242 mln consolidated profit in 1Q10 ina still challenging environment

Revenues on level of previousquarters

Operating costs -1% q/q

Y/y a reduction of total assets (-6,3%),moderate growth in 1Q10

Core Tier 1 rose to 10.01 % - followinga capital increase of € 2 bn carried out inMarch 2010

Loan loss provisions decreasing(-33% q/q); 140 bp cost of risk

Bank Austria Group

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STRONG CAPITAL POSITION: CORE TIER 1 AT 10.01%, TOTALCAPITAL RATIO AT 12.37% (BA)

Core Tier 1 stands at 10.01 % - following a capital increase of EUR 2 bn carried out in March 2010 – hereby exceeding

the ratio of most Austrian competitors

Safe capital base as Bank Austria – unless its main competitors – did not take up state capital to be repaid at a later

stage

Deleveraging of RWA (-10% since the end of 2008) also contributed to the current strong capital ratios

Core Tier 1 Ratio (Basel 2)

+168bp

March 10

10,01%

Dec. 09

8,33%

+145bp

March 10

12,37%

Dec. 09

10,92%

Total Capital Ratio (Basel 2)

BANK AUSTRIA GROUP: OVERVIEW

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Customer Deposits (€ bn)

Leverage(1)

Customer Loans (€ bn)

Shareholders’ Equity (€ bn)

(1) Defined as Assets/ Equity as per IFRS

Leverage ratio improving to 11.6% mainly due to €

2 bn capital increase

Customer loans increased by 2% at BA Group level

Increase in particular in some areas: Turkey,Romania, Croatia, Retail Austria

Securities in Issue (€bn)

Both customer deposits and securities up

Customer loans funded by more than 100% bycustomer deposits and securities

Increase in equity mainly due to € 2 bn capital increase

in March 2010 and retained profit

BALANCE SHEET EVOLUTION IN 1Q10 AGAIN SOLID (BA)

Dec 09 March 10

123.6 126.5

Dec 09 March 10

97.0 97.6

Dec 09 March 10

28.8 29.7

March 10Dec 09

13.5%11.6%

March 10Dec 09

14.417.4

BANK AUSTRIA GROUP: OVERVIEW

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RATING OVERVIEW

(as of May 2010)

1) Grandfathered debt is rated Aa2 (senior debt) and respectively Aa3 (subordinated debt) by Moody’s and AA+ (senior and subordinated debt) byStandard & Poor’s. This relates to securities issued before 31 Dec. 2001 which are guaranteed by the City of Vienna.

Short Term Long Term Subordinated Short Term Long Term Subordinated Short Term Long Term Subordinated

P-1 A1 A2 A-1 A A- - - -

negative outlook stable outlook

P-1 Aa3 A1 A-1 A A- F1 A A-

stable outlook stable outlook negative outlook

Bank Austria Public

Covered Bond

UniCredit S.p.A.

Bank Austria 1)

FitchMoody's S&P

Aaa - -

Moody's S&P Fitch

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AGENDA




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EXECUTIVE SUMMARY BANK AUSTRIAPUBLIC SECTOR COVER POOL

Aaa Rating by Moody‘s

Strong and long existing legal framework for Austrian Pfandbriefe

All cover pool assets are either originated in Austria (98.8%) or originated in Europe and

guaranteed by the Republic of Austria (1.2%)

Average Volume of loans less than EUR 1 mn

Average seasoning is 6 years

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PARAMETERS OF COVER POOL AND ISSUES

Total Value of the Cover Pool as of 31.03.2010 in EUR equivalent: 2,785 mn

• thereof in EUR: 1,807 mn

• thereof in CHF*: 181 mn

• thereof public sector bonds in EUR equivalent: 797 mn

Moody’s Rating: Aaa

Nominal Over-Collateralisation: 176.5%**

Total Value of Sold Covered Bonds as of 31.03.2010 in EUR: 1,007 mn

* Cover Pool incl. FX Haircut 15.7%.

** Austrian Mortgage Law requires a nominal over-collateralisation of min. 2%. Additionally, in its Articles of Association,

UniCredit Bank Austria commits itself to an over-collateralisation on a present value basis.

Parameters of Issues:

Total Number 40

Average Maturity (in years) 5.3

Average Volume (in EUR) 25,182,555

Parameters of Cover Pool

Weighted Average Life (in years incl. Amortization) 10.2

Contracted Weighted Average Life (in years) 13.5

Average Seasoning (in years) 6.3

Total Number of Loans 3,164

Total Number of Debtors 1,041

Total Number of Guarantors 102

Average Volume of Loans (in EUR) 870,886

Stake of 10 Biggest Loans 26.7%

Stake of 10 Biggest Guarantors 42.8%

Stake of Bullet Loans 46.8%

Stake of Fixed Interest Loans 33.5%

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MATURITY STRUCTURE OF COVER POOL AND ISSUES

Maturity of Assets in the Cover Pool in mn EUR In %

Maturity up to 12 Months 79 2.8%

Maturity 12 - 60 Months 450 16.2%

thereof Maturity 12 - 36 Months 332 11.9%



Maturity longer than 120 Months 1,869 67.1%

Total 2,785 100.0%

Maturity of Issued Covered Bonds in mn EUR In %

Maturity up to 12 Months 145 14.4%





Maturity longer than 120 Months 190 18.9%

Total 1,007 100.0%

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REGIONAL BREAKDOWN OF ASSETS* IN AUSTRIA

* Considering Guarantors

Regional Breakdown Austria in mn EUR In %

Vienna 328 11.8%

Lower Austria 624 22.4%

Upper Austria 456 16.4%

Salzburg 144 5.2%

Tyrol 208 7.5%

Styria 231 8.3%

Carinthia 538 19.3%

Burgenland 62 2.2%

Vorarlberg 120 4.3%

Republic of Austria 73 2.6%

Total Austria 2,785 100.0%

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VOLUME BREAKDOWN BY SIZE OF ASSETS

Volume Breakdown by Size of Assets in mn EUR Number

below 300.000 226 1,870

thereof under 100.000 42 869

thereof 100.000 - 300.000 184 1,001

300.000 - 5.000.000 1,065 1,223

thereof 300.000 - 500.000 186 481

thereof 500.000 - 1.000.000 296 428

thereof 1.000.000 - 5.000.000 583 314

above 5.000.000 1,494 71

Total 2,785 3,164

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ASSETS VOLUME BREAKDOWN BY TYPE OF DEBTOR /GUARANTOR

Assets: Type of Debtor / Guarantor in mn EUR Number

State 35 3

Federal States 170 449

Municipalities 1,116 2,335

Guaranteed by State 38 19

Guaranteed by Federal States 984 54

Guaranteed by Municipalities 375 222

Other 68 82

Total 2,785 3,164

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AGENDA




AUSTRIAN LEGAL FRAMEWORKMORTGAGE AND PUBLIC SECTOR PFANDBRIEFE

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Austrian Covered Bonds

Pfandbriefe

Pfandbriefgesetz(Pfandbrief Law 1938)

Hypothekenbankgesetz(Mortgage Banking Act 1899)

FundierteSchuldverschreibungen

Law from 1905

UniCredit Bank Austria

Remark:Austrian ‘Mortgage Pfandbriefe‘ also follow the same legal regulation but are not topic of this presentation.

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Criteria of Pfandbrief law /Hypothekenbankgesetz

Austria Germany

Pfandbrief law in place YES YES

Mortgage and public sectorcollateral assets in seperate pools

YES YES

Cover register YES YES

Collateral assets limited to Europe YES X

Legally required minimum over -collateralization

YES YES

Cover Pool monitoring (Trustee) YES YES

Special proceedings in case of

insolvencyYES YES

Pfandbriefe remain outstanding incase of issuer‘s bankruptcy

YES YES

NPV matching YES* YES

* if included in the Articles of Association of the respective credit institution

Austrian „Hypothekenbankgesetz“was intially based on the Germanlegislation

Important changes to the German"Pfandbrief" - legislation werefollowed by the Austrian"Hypothekenbankgesetz", whichcontinues to reflect the principalfeatures of the German"Pfandbriefgesetz”.

Main differences in the currentversion are:

• German law also allowscollateral assets from non-European countries

• German law includescompulsory NPV-matching,whereas in Austrian lawNPV-matching is voluntary(Bank needs to setup a self-commitment in its articles ofassociation – which is thecase for Bank Austria)

MORTGAGE AND PUBLIC SECTOR PFANDBRIEF

YOUR CONTACTS

CFO FinanceUniCredit Bank Austria AG

Franz StegmüllerHead of Strategic Funding

Tel. +43 (0) 50505 82639Fax + 43 (0)1 3191356 [email protected]

Günther StromengerHead of Corporate RelationsTel. +43 (0) 50505 87230Fax + 43 (0) 50505 [email protected]

Impressum

UniCredit Bank Austria AGCFO FinanceA-1010 Wien, Schottengasse 6-8

Corporate & Investment BankingUniCredit Bank Austria AG

Gabriele WiebogenHead of Long Term FundingTel. +43 (0) 50505 82337Fax + 43 (0) 50505 [email protected]

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DISCLAIMER

This publication is presented to you by:UniCredit Bank Austria AGSchottengasse 6-8A-1010 Wien

The information in this publication is based on carefully selected sources believed to be reliable. However we do not make any representation as to its accuracy or completeness. Any opinions herein reflect our judgement at the date hereofand are subject to change without notice. Any investments presented in this report may be unsuitable for the investor depending on his or her specific investment objectives and financial position. Any reports provided herein are provided forgeneral information purposes only and cannot substitute the obtaining of independent financial advice. Private investors should obtain the advice of their banker/broker about any investments concerned prior to making them. Nothing in thispublication is intended to create contractual obligations. Corporate & Investment Banking of UniCredit Group consists of UniCredit Bank AG, Munich, UniCredit Bank Austria AG, Vienna, UniCredit CAIB Securities UK Ltd. London, UniCreditS.p.A., Rome and other members of the UniCredit Group. UniCredit Bank AG is regulated by the German Financial Supervisory Authority (BaFin), UniCredit Bank Austria AG is regulated by the Austrian Financial Market Authority (FMA),UniCredit CAIB AG is regulated by the Austrian Financial Market Authority (FMA) and UniCredit S.p.A. is regulated by both the Banca d'Italia and the Commissione Nazionale per le Società e la Borsa (CONSOB).

Note to UK Residents:In the United Kingdom, this publication is being communicated on a confidential basis only to clients of Corporate & Investment Banking of UniCredit Goup (acting through UniCredit Bank AG, London Branch and/or UniCredit CAIB SecuritiesUK Ltd. who (i) have professional experience in matters relating to investments being investment professionals as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (“FPO”); and/or (ii)are falling within Article 49(2) (a) – (d) (“high net worth companies, unincorporated associations etc.”) of the FPO (or, to the extent that this publication relates to an unregulated collective scheme, to professional investors as defined in Article14(5) of the Financial Services and Markets Act 2000 (Promotion of Collective Investment Schemes) (Exemptions) Order 2001 and/or (iii) to whom it may be lawful to communicate it, other than private investors (all such persons beingreferred to as “Relevant Persons”). This publication is only directed at Relevant Persons and any investment or investment activity to which this publication relates is only available to Relevant Persons or will be engaged in only with RelevantPersons. Solicitations resulting from this publication will only be responded to if the person concerned is a Relevant Person. Other persons should not rely or act upon this publication or any of its contents.The information provided herein (including any report set out herein) does not constitute a solicitation to buy or an offer to sell any securities. The information in this publication is based on carefully selected sources believed to be reliable butwe do not make any representation as to its accuracy or completeness. Any opinions herein reflect our judgement at the date hereof and are subject to change without notice.We and/or any other entity of Corporate & Investment Banking of UniCredit Group may from time to time with respect to securities mentioned in this publication (i) take a long or short position and buy or sell such securities; (ii) act asinvestment bankers and/or commercial bankers for issuers of such securities; (iii) be represented on the board of any issuers of such securities; (iv) engage in “market making” of such securities; (v) have a consulting relationship with anyissuer. Any investments discussed or recommended in any report provided herein may be unsuitable for investors depending on their specific investment objectives and financial position. Any information provided herein is provided forgeneral information purposes only and cannot substitute the obtaining of independent financial advice.UniCredit Bank AG, London Branch is regulated by the Financial Services Authority for the conduct of business in the UK as well as by BaFIN, Germany. UniCredit CAIB Securities UK Ltd., London, a subsidiary of UniCredit Bank Austria AG,is authorised and regulated by the Financial Services Authority.Notwithstanding the above, if this publication relates to securities subject to the Prospectus Directive (2005) it is sent to you on the basis that you are a Qualified Investor for the purposes of the directive or any relevant implementing legislationof a European Economic Area (“EEA”) Member State which has implemented the Prospectus Directive and it must not be given to any person who is not a Qualified Investor. By being in receipt of this publication you undertake that you willonly offer or sell the securities described in this publication in circumstances which do not require the production of a prospectus under Article 3 of the Prospectus Directive or any relevant implementing legislation of an EEA Member Statewhich has implemented the Prospectus Directive.

Note to US Residents:The information provided herein or contained in any report provided herein is intended solely for institutional clients of Corporate & Investment Banking of UniCredit Group acting through UniCredit Bank AG, New York Branch and UniCreditCapital Markets, Inc. (together “UniCredit”) in the United States, and may not be used or relied upon by any other person for any purpose. It does not constitute a solicitation to buy or an offer to sell any securities under the Securities Act of1933, as amended, or under any other US federal or state securities laws, rules or regulations. Investments in securities discussed herein may be unsuitable for investors, depending on their specific investment objectives, risk tolerance andfinancial position.In jurisdictions where UniCredit is not registered or licensed to trade in securities, commodities or other financial products, any transaction may be effected only in accordance with applicable laws and legislation, which may vary fromjurisdiction to jurisdiction and may require that a transaction be made in accordance with applicable exemptions from registration or licensing requirements.All information contained herein is based on carefully selected sources believed to be reliable, but UniCredit makes no representations as to its accuracy or completeness. Any opinions contained herein reflect UniCredit's judgement as of theoriginal date of publication, without regard to the date on which you may receive such information, and are subject to change without notice.UniCredit may have issued other reports that are inconsistent with, and reach different conclusions from, the information presented in any report provided herein. Those reports reflect the different assumptions, views and analytical methods ofthe analysts who prepared them. Past performance should not be taken as an indication or guarantee of further performance, and no representation or warranty, express or implied, is made regarding future performance.UniCredit and/or any other entity of Corporate & Investment Banking of UniCredit Group may from time to time, with respect to any securities discussed herein: (i) take a long or short position and buy or sell such securities; (ii) act asinvestment and/or commercial bankers for issuers of such securities; (iii) be represented on the board of such issuers; (iv) engage in “market-making” of such securities; and (v) act as a paid consultant or adviser to any issuer.The information contained in any report provided herein may include forward-looking statements within the meaning of US federal securities laws that are subject to risks and uncertainties. Factors that could cause a company's actual resultsand financial condition to differ from its expectations include, without limitation: Political uncertainty, changes in economic conditions that adversely affect the level of demand for the company‘s products or services, changes in foreignexchange markets, changes in international and domestic financial markets, competitive environments and other factors relating to the foregoing. All forward-looking statements contained in this report are qualified in their entirety by thiscautionary statement.

UniCredit Bank Austria AG, Viennaas of 12 August 2010

Documents

Bank Austria – Öffentliche Pfandbriefe (Public Sector ... · Market share(1) Ranking Logo Austria 16.3% # 1 Emerging Europe 7.0% # 1 e.g. Italy 13.5% # 2 Germany 3.5% # 3 UNICREDIT