Romanian Banking System Robert C. Rekkers CEO, Banca Transilvania March 2007

Contents  Developments  Macroeconomic Indicators  Banking System

Developments

 Current account deficit:  2005: EUR 6.9 bn. (8.7% of GDP); 75.6% covered by FDI;  2006 estimate: EUR 10% of GDP  Fiscal balance:  2005: 0.8% of GDP  2006 estimate: 1% of GDP

Developments in  International reserves at a record level (FCY including gold):  2005: EUR 18.3 bn.; forex reserves EUR 16.8 bn.  2006: EUR 22.9 bn.; forex reserves EUR 21.3 bn.  Rating agencies upgraded Romania’s rating:  Fitch upgraded Romania’s foreign currency rating from BBB- to BBB with stable outlook on August 31, 2006  Moody's upgraded Romania’s rating for short and long term borrowings both in FCY and in lei at Baa3/P-3, with stable outlook, in October 2006

Macroeconomic Indicators

annual percentage change Source: NBR, NIS

Public debt was 20.1% of GDP in 2005 (domestic debt: 5.6% of GDP; external debt: 14.4% of GDP) Source: NBR, NIS EUR billion *) November 2006

Source: Ministry of Public Finance, NIS percent

Banking System

Banking System in Romania Source: NBR

Banking Sector in Romania (2006) Features:  37 banks (of which 6 foreign bank branches)  61% of banking assets held by top five banks  Solvency ratio: 17.9% Source: NBR

Banking Sector in Romania

Banking Sector Concentration (Top 5 commercial banks) December 2005 RON billionEUR billion% of total banking system Assets Loans Deposits Own capital September 2006 Assets Loans Deposits Own capital Source: NBR

Conclusions The evolution of macroeconomic ratios show a positive outlook and an upward trend of the whole economy; Romania successfully achieved the targets set for its accession to UE marking an important turnaround point for its future development; Competition sharpened, especially in the banking system, but there is still place for growth, considering the low banking penetration in GDP; new important international players announced their intentions to step in;