This review analyses the financial performance of the NLB Group ('the Group') including the parent bank, Nova Ljubljanska banka d.d. (the 'Bank' or 'NLB'), and its domestic and overseas subsidiaries and non-bank companies. The analysis is based on the Group's audited consolidated financial statements, prepared under the Slovene Accounting Standards (SAS) and Bank of Slovenia prescribed reporting methodology. They are fully disclosed in the Financial Report section of this Annual Report. Full disclosure of the Bank's non-consolidated financial statements, prepared under SAS, are shown in the Financial Report on pages 81 to 116 of this Annual Report.

The Financial Review describes and analyses the performance of the Group according to SAS standards. In order to meet international requirements and facilitate international comparison, the financial performance, the results and accounts under the International Accounting Standards (IAS) are shown separately on pages 119 to 167 . The main differences between SAS and IAS are described in Note 50 of IAS financial accounts.

The 2001 consolidated accounts are not directly comparable with those of the previous year because of the corporate activity. The 2001 accounts include LHB Internationale Handelsbank AG, Frankfurt for the first time as it was an affiliate until 29 December, 2001, when it was consolidated as a subsidiary. In addition Tutunska banka, a.d., Skopje and Commercebank, d.d., Sarajevo are consolidated for the first time.

On 1 October 2001 the Bank issued new shares which were immediately swapped with those held by the minority holders in Banka Velenje, Pomurska banka and Dolenjska banka [1]. Following this transaction these three former daughter banks ceased to exist as independent legal entities and were transformed into the regional retail divisions of the Bank.