1 K&H Bank Budapest, 21 April 2004 K&H Group’s market position and key strategy John Hollows CEO

2 contents K&H Bank market position strategy of the Bank

3 snapshot I. 157 retail branches 19 corporate branches staff retail clients corporate clients, medium-sized companies

4 snapshot II. leading corporate bank 2nd placed retail bank 2nd placed bank (in terms of assets) profits of EUR 70 million p.a. ROE 17%

5 K&H Bank network 157 branches

6 K&H Group K&H Asset Management with HUF 120 billion in assets under management, third largest player, 8.3% market share, wide range of funds K&H Medicina Health Fund the first nationwide health fund operated by a bank K&H Leasing Group with a portfolio of HUF 140 billion, 400 partners nationwide, second largest market player, 80,000 clients K&H Life Insurance with a premium income of HUF 4 billion, 35,000 clients, comprehensive insurance services K&H Equities a wide range of capital market services for domestic and foreign private, as well as corporate clients

7 market share I. figures by assets 30 September 2003 HUF bln K&H Bank: IAS, consolidated datas; other banks: HAS, non-consolidated datas

8 market share II. operating profit 30 September 2003 HUF bln K&H Bank: IAS, consolidated datas; other banks: HAS, non-consolidated datas

9 ROE

10 ROA

11 SWOT analysis strengths full service bank corporate market leader growing retail business extensive network strong performance since merger strong profitability

12 SWOT analysis weaknesses reputation damaged cost income weak too reliant on Corporate too many back offices systems weak Corporate deposit growth product driven internal barriers

13 SWOT analysis opportunities expanding economy strong shareholders committed staff loyal clients

14 SWOT analysis threats competition banking consolidation client expectations regulator expectations

15 mission statement By combining best international practice with sound local knowledge we aim to provide: our clients with a distinctively modern banking service which begins with their needs and concludes with the delivery of effective solutions at competitive prices; our staff with clear goals, strong leadership, transparent reward programs and attractive career path choices; and our shareholders with growing and sustainable profitability at above average returns.

16 strategy To fulfill our mission we are developing a client needs approach to marketing and sales drawing upon the resources of our shareholders to offer effective and modern client solutions simplifying and rationalizing back office systems and procedures to improve efficiency and enhance control seeking to achieve a better balance between Corporate and Retail contributions

17 on top of my agenda corporate governance strategy implementation credit risk Leasing systems (including K2)

18 recent developments balanced scorecard investment advisers Equities re-opens executive retail committee

19 concluding remarks strong organic growth building on past success drawing on shareholder resources client focus, values embedded sound systems and controls quality – earnings, growth, return