Financials

In 2007, Parex banka continued to deliver the highest standards of performance for the customers, shareholders and communities it serves. This performance was translated once again into strong revenue and net income growth in all our principal areas of business.

As at 31 December 2007, Parex banka was the market leader in Latvia in terms of deposits with 17.9% market share, according to the information provided by Association of Latvian Commercial Banks. The market share in terms of assets comprised 14.6%, while loans reached 11.7%. The Bank remains the leader on the Latvian deposit market and is a top three player in every retail and corporate segment.

The net profit for Parex Group for the year ended 2007 comprised 41.4 million lats. In 2007, Parex Group's assets grew by 35.8%, comprising 3.35 billion lats; issued loans grew by 40.1%, to 2 billion lats; and deposits increased by 33.3% to
2.1 billion lats.

In 2007, Parex banka was among the fastest growing retail banks in Latvia serving the financial needs of more than 400,000 retail customers. Parex banka demonstrated its commitment to high standards of customer service for its corporate clients resulting in a 21.2% increase in corporate deposits and 29.4% growth in corporate loans in 2007.

Balance sheets as at 31 December 2007 and 2006 LVL 000's 31/12/2007 31/12/2006 31/12/2007 31/12/2006 Group Group Bank Bank   Assets         Cash and deposits with central banks 257,280 267,213 236,062 258,594 Balances due from credit institutions 430,868 174,174 522,633 189,988 Financial assets held for trading: fixed income securities 5,575 31,465 4,323 27,364 shares and other non-fixed income securities 39,809 49,713 38,466 47,207 Derivative financial instruments 11,516 8,800 11,785 8,837 Financial assets designated at fair value through profit and loss 277 - - - Available-for-sale financial assets: fixed income securities 475,042 382,483 438,175 359,204 shares and other non-fixed income securities 548 339 57 57 Loans and receivables to customers 2,006,642 1,431,979 1,738,330 1,316,164 Held-to-maturity investments: fixed income securities 40,224 67,932 73,898 80,866 Current income tax assets 3,356 11 3,209 - Fixed assets 50,514 34,712 18,610 14,396 Goodwill and intangible assets 5,014 5,111 990 1,168 Investments in subsidiaries - - 56,477 32,660 Deferred income tax assets 1,141 - 830 - Other assets 24,818 14,535 12,455 9,104 Total assets 3,352,624 2,468,467 3,156,300 2,345,609 Liabilities Financial liabilities held for trading - 1,242 - 1,242 Derivative financial instruments 12,951 7,251 13,288 7,259 Financial liabilities designated at fair value through profit and loss 277 - - - Financial liabilities measured at amortised cost: balances due to credit institutions and central banks 777,111 463,198 775,345 453,354 deposits from customers 2,081,965 1,561,484 1,909,128 1,461,787 issued debt securities 187,907 210,073 187,907 210,073 other financial liabilities 2,970 - - - Current income tax liabilities 315 1,918 - 1,212 Deferred income tax liabilities 631 870 - 561 Other liabilities 34,438 21,803 25,372 17,450 Subordinated liabilities 28,113 - 28,113 - Total liabilities 3,126,678 2,267,839 2,939,153 2,152,938 Equity Paid-in share capital 65,027 65,027 65,027 65,027 Share premium 12,694 12,694 12,694 12,694 Fair value revaluation reserve (18,302) (2,200) (17,619) (1,949) Retained earnings 166,527 125,107 157,045 116,899 Total shareholders' equity attributable to the shareholders of the Bank 225,946 200,628 217,147 192,671 Minority interest - - - - Total equity 225,946 200,628 217,147 192,671 Total liabilities and equity 3,352,624 2,468,467 3,156,300 2,345,609 Statements of income for the years ended 2007 and 2006 LVL 000's 31/12/2007* 31/12/2006** 31/12/2007* 31/12/2006** Group Group Bank Bank   Interest income 193,209 125,591 176,455 114,322 Interest expense (109,949) (67,903) (106,681) (66,247) Net interest income 83,260 57,688 69,774 48,075 Commission and fee income 47,730 37,092 40,228 31,675 Commission and fee expense (9,836) (9,108) (9,921) (8,625) Net commission and fee income 37,894 27,984 30,307 23,050 Trading and foreign exchange gains, net 22,645 16,514 20,716 14,586 Other income 10,110 27,767 6,953 26,153 Other expense (878) (1,424) (710) (500) Administrative expense (91,466) (64,884) (71,863) (53,797) Amortisation and depreciation charge (7,629) (6,637) (5,748) (5,780) Impairment charges and reversals, net (4,617) 3,759 (2,355) 4,233 Profit before taxation 49,319 60,767 47,074 56,020 Corporate income tax (7,899) (8,660) (6,928) (8,018) Net profit for the period 41,420 52,107 40,146 48,002 Attributable to: Equity holders of the Bank 41,420 52,107 40,146 48,002 Minority interest - - - -   41,420 52,107 40,146 48,002

Parex quarterly reports 2008 Parex banka IS&BS, 3Q2008 Parex banka IS&BS, 2Q2008 Parex banka IS&BS, 1Q2008   Parex banka annual reports 2007 Parex banka annual report 2006 Parex banka annual report