Press Releases: Greece

BANK OF ATTICA S.A.

Financial Results

February 23, 2006 ATTICABANK KEY FINANCIAL FIGURES FOR 2005 As stated at the 2005 Annual General Meeting of the Bank, last year was planned to be a year of operational reorganization both for the Bank and its Group of companies. To this end, the management of the Bank decided to double in 2005 the provisions for doubtful loans passing from euro 22 million to euro 44 million. Due to the increase of the provisions, in 2005 the Bank had losses. These provisions: - Help restructure the loan portfolio of the bank according to the IFRS and in view of the implementation of the Basel II accord - Create the conditions which - combined with other measures- will guarantee sound organic growth in the future. In 2005 apart from the issue of the restructuring of the loan portfolio, the Administration of the Bank also focused on the use of up-to-date IT systems, the implementation of new methods for the management of risk and, the operational and organizational restructuring of the Bank and its subsidiaries. The initiatives that were materialized with regard to the above issues aimed at the proportional reduction of costs and the efficient allocation of capital. Financial figures and results for the Bank Due to the increase of the provisions, the Bank had losses that amounted to euro9.5 million. Losses after taxes amount to euro 7.9 million. The cumulative provisions made by the Bank increased by 44,8% to euro 102.7 million. This amount outbalances possible losses that may arise in the future due to doubtful loans. Furthermore, the Bank, in line with its policy for the restructuring of its loan portfolio, has written off euro 12.2 million of doubtful loans against provisions made in the past. - Profits (before taxes, provisions and depreciation) were euro 39.7 million, up by 6.4% compared to 2004 (profits before taxes, provisions and depreciation that year were euro 37.3 million). - The Bank's Total Assets amounted to euro 2,468.8 million, increased by 3.1% compared to 2004 - Loans (before provisions) amounted to euro 1,829.6 million, increased by 2.2% compared to 2004. Total lending amounted to euro1,917 million, up by 5.3%. - In 2005 mortgages increased by 48.6% to euro 255.7 million (in 2004 mortgages were euro172.1 million). In 2005 consumer lending (loans and credit cards) was euro259.4 million, increased by 27.8% compared to 2004. Lending million euros 31/12/2005 (1) 31/12/2004 (2) Change %(1)/(2) Loans 1,829.6 1,791.1 2.2% Of which: - Consumer Loans 259.4 202.9 27.8% - Mortgages 255.7 172.1 48.6% CORPORATE BONDS 87.4 30.2 189.4% TOTAL LENDING 1,917.0 1,821.3 5.3% -Deposits and repos amounted to euro 1,955.9 million, reduced by 6.2% in accordance with the Banks policy for the active management of liquidity -Net interest income was euro 75.5 million, increased by 6.2% compared to 2004 (net interest income in that year was euro 71.1 million) -Total operating income in 2005 was euro 116.3 million, representing an increase of 5.9% -Employee costs increased by 4.5% to euro 49.1 million -General operating expenses were euro 27.4, up by 7.5% compared to 2004 -Depreciation of fixed assets was up by 10.3% to euro 5.3 million. ATTICA BANK: FINANCIAL RESULTS 2005 million euros 2005 2004 Change % Net Interest Income 75.5 71.1 6.2% Commissions and other operating income 40.8 38.7 5.4% Total Operating Income 116,.3 109.8 5.9% Employee Costs (49.1) (47.0) 4.5% General Operating Expenses (27.4) (25.5) 7.5% Profits before provisions and depreciation 39.7 37.3 6.4% Depreciation (5.3) (4.8)10.3% Provisions 44,0 22,0 100.0% Profit/loss before tax (9.5) 10.6 Profit/loss after tax (7.9) 5.1 As mentioned above, as a part of the Banks strategy for the restructuring of the loan portfolio, the Bank has made provisions that amount to euro 44 million (twice the provisions made in 2004) that were entered to the profit and loss account. Key Financial Ratios 2004 2005 Loans to Deposits ratio 85.90% 93.54% Cumulative Provisions to Loans ratio 3.96% 5,62% Cumulative Provisions to NPL* 62.3% 66.8% Net Interest Margin (NIM) 2.97% 3.06% Operative Expenses to Operative Income ** 66.03% 65.85% Profits before taxes to Own Equity 20.09% 22.54% Profits before provisions to Assets 1.36% 1.40% Return On Equity 6.52% - 6.24% Return On Assets 0.44% - 0.39% * NPL (Non Performing Loans) = Loans overdue for more than 180 days+ doubtful loans ** Operative expenses = Wages and Employee costs + General operative expenses General operative income= Total operating income On the basis of the indicators presented above, the following conclusions can be drawn:- The Loans to Deposits ratio and the Net Interest Margin have increased despite the fact that competition has driven interest rates down. These increases serve as a proof of the success of the Banks strategy concerning the management of liquidity. - The Cumulative Provisions to Loans ratio has improved significantly due to the 100% increase of provisions in 2005 aiming at the restructuring of the loan portfolio - The Operative Expenses to Operative Income ratio has improved marginally despite the fact that the reorganization of operations has led to significant costs - The Profits before taxes to Own Equity and Profits before provisions to Assets ratios improved thanks to the organic profitability of the Bank. - As expected the Return On Equity and Return On Assets indicators are negative. Consolidated Results. Subsidiaries. In 2005 the Bank of Attica Group of Companies suffered losses that amounted to euro11.1 million before tax and euro 9.9 million after tax. The consolidated result was affected by the negative results of the Bank and the transformation of Attikis Investments S.A. into mutual funds.Consolidated Figures for 2005 million euros 2005 2004 Change % Profits before provisions and depreciation 38.5 39.1 -1.5% Depreciation (5.3) (4.9) 7.4% Provisions 44.3 22.0 101.4% Profits/losses before tax (11.1) 12.1 Profits/losses after tax (9.9) 6.3 Key figures of the subsidiaries of the Group: - ATTIKIS LEASING In 2005, income from taxes was euro4,161.6 thousand, up by 46.5% compared to 2004. Profits before taxes were euro 674.14 thousand (profits in 2004 were euro607.98 thousand). - ATTIKI AEDAK Since July 2005 the company manages two new foreign mutual funds. Total funds under management now amount to euro 84.7 million (2004: euro 34.3 million). Due to the increase of the funds managed by Attiki AEDAK, the turnover of the company in 2005 reached euro 999 thousand (2004: euro 546 thousand) and profits were euro290 thousand (2004: euro26.2 thousand). - ATTICA VENTURES In 2005 Attica Ventures kept on its profitable track, strengthening its presence in the domestic market. Profits before taxes were up by 141.6% reaching euro 180 thousand (2004: euro74.9 thousand). Profits after taxes were up by 180% to euro103.1 thousand (profits after taxes in 2004 were euro 36.8 thousand). - ATTICA CONSULTING AND TRAINING SERVICES S.A. The company holds a 49% stake in the share capital of ATTIKI AEDAK. In 2005 the profits of the company were euro 56.5 thousand (in 2004 the company had losses that amounted to euro 4 thousand).Prospects for 2006. The Administration of the Bank is currently implementing a strategy that aims at restructuring the Bank's and the Group's operations. To this end: -The regulatory capital of the Bank has been increased by means of a euro 100 m. subordinate bond issue (Tier II). -Network expansion: Two new branches opened recently in N. Psychiko and Aspropyrgos. Three more branches will open in 2006. -The Bank now offers bancassurance products in cooperation with the Generali group of companies. -On April 24th 2005, the Bank's 51% share in the Kerdoos Hermes brokerage was sold. In the last four years the firm had created very few synergies and was a source of accumulating losses for the Bank. The bank now offers trading services in cooperation with the BETA brokerage firm. -Last July, Attikis Investments S.A. was transformed into mutual funds that are managed by Attiki AEDAK S.A. -During the first quarter of 2006 the Bank will set up its e-banking system. -In 2006 the Bank will conclude the first stage of its CRM project, which is expected to increase cross-sales. -After the completion of the Globus project during the first semester of 2006, the system will be upgraded to version T24 that will allow the Bank to operate on a 24/7 basis. At its Extraordinary General Meeting that took place on September 19th 2005, the administration of the Bank decided to terminate the contract that had been signed jointly with the workers' association regarding the payment of retirement benefits to the staff of the Bank. Benefits of this kind will be paid in the future according to the provisions of Law 3371/2005. This decision protects the established pension fund rights of the staff, guarantees the conditions of fair competition with other banks, does not affect the Banks capital adequacy rates and creates the necessary conditions for the future development of the Bank and its Group.