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GPB financial results for 2009 according to consolidated IFRS

Moscow, May 20th – Gazprombank has published consolidated financial results for 2009 according to IFRS. Key financial indicators of Gazprombank Group activities are presented in the following table.

RUR, bln.

Gazprombank Group reported net profit of RUR 58.8 bln. for the year 2009 compared to RUR 68.2 bln. loss in 2008. Equity of the Group increased by 53.2% and reached RUR 196 bln.. As of 31.12.2009 capital adequacy ratio calculated according to Basel I was 14.8% compared to 9.2% as of 31.12.2008. In 2009 Gazprombank successfully resolved certain tasks which were the consequences of the global financial crisis.

• Growth of funds allocation efficiency

In 2009 Gazprombank Group reduced volumes of inter-bank operations increasing the corporate loan portfolio by 30% to RUR 723 bln. (31.12.2008 – RUR 557 bln.) by means of lending to corporate borrowers in strategic sectors of the national economy. In addition core banking profits from lending and commission activities grew by 12.8% in 2009 and reached RUR 40.0 bln. compared to RUR 35.5 bln. in 2008.

• Maintaining high quality of assets

The main focus during implementation of the Groups’ credit policy was on maintaining high quality of assets. As of 31.12.2009 NPL ratio was 3.9% of the Groups’ total loan portfolio. The level of Gazprombank Group allowances for loan impairment grew from 3.6% at the end of 2008 to 6.9% at the end of 2009. The level of allowance for impairment turned out to be lower than the Groups’ management previously forecasted (8% of the total loan portfolio). Abovementioned results are in general much better than similar indicators demonstrated by the banking system in Russian Federation.

• Change in funding structure

During 2009 Gazprombank Group demonstrated vast increase of customer funds. Thus corporate deposits grew by 43% reaching RUR 765 bln. as of 31.12.2009. Retail deposits grew by 29% and reached RUR 171 bln. by the end of 2009. Also in 2009 the Group received long-term subordinated deposits from its shareholders and Vnesheconombank in overall amount of RUR 115 bln. As a result, Gazprombank Group significantly reduced the volume of funds received from the Central Bank of Russia from RUR 519 bln. at the end of 2008 to RUR 49 bln. as of 31.12.2010.

• Income from trading and investment activities

Gradual recovery of the Russian stock markets and successful partial disposal of securities portfolio in 2009 resulted in net profit of RUR 39.7 bln. from operation with securities compared to RUR 32.2 bln. loss in 2008. Net profit from operations with foreign currency including revaluation of derivatives composed RUR 27.3 bln. compared to RUR 75.8 bln. loss in 2008. In 2009, net results from growth in value of the Groups’ non-banking assets value including petrochemical, heavy machinery and media businesses, reached RUR 11.8 bln. compared to RUR 10.6 bln. in 2008.

• Restoring of the Groups’ capitalization

As a result of Gazprombank Group high profitability in 2009, level of the Groups’ capital adequacy significantly restored. Capital adequacy ratio calculated according to Basel I reached 14.8% compared to 9.2% in 2008. This result was achieved despite the growth of the Groups’ subordinated deposits in 2009 as in contrast with the Central Bank of Russia rules for capital adequacy calculation the sub-debt injection did not have considerable effect on the calculation of capital adequacy ratio according to Basel I requirements.