Banks

Banks in Slovenia

The NLB Group operates in Slovenia through the NLB and three subsidiaries: NLB Banka Domžale, NLB Banka Zasavje and NLB Koroška Banka. Characteristic of the three subsidiaries is that they operate as local banks, covering the region of their origin. With a market share of 34%, the NLB Group is by far the largest banking group in Slovenia.

The year 2006 marked the beginning of the merger of these subsidiaries into the NLB, which will be completed by May 2008.

The three subsidiaries and Banka Celje, which has a status of an associated bank, complete the list of NLB Group operations in Slovenia. With a market share of 5.5%, 605 employees, and 36 branch offices, Banka Celje is the fourth largest Slovenian bank.

Banks in SE Europe

The NLB Group is the largest banking and financial institution in Slovenia, with a special interest in further expansion into SE European markets. The NLB Group operates in the following strategic SE European markets: Bosnia and Herzegovina, Macedonia, Serbia and Montenegro.

Bosnia and Herzegovina

The NLB Group operates in both entities, the Federation Bosnia and Herzegovina and Republika Srpska.

NLB Razvojna Banka is a full-service bank also registered to trade securities. In the Republika Srpska, it is the largest business network. In terms of the number of clients it is the largest, and in terms of total assets the second biggest in the Republika Srpska. It contributes 3.3% to the NLB Group profits.

NLB Razvojna Banka successfully completed the issue of 50,000 bonds in the initial public offering in 2007. This was also the first time bonds were issued in Republika Srpska and the whole of Bosnia and Herzegovina. These bonds are traded on the Banja Luka Stock Exchange.

NLB Tuzlanska Banka offers comprehensive banking services and has over a hundred-year tradition of providing financial services in northeastern Bosnia. The bank is the fifth largest in the Federation of Bosnia and Herzegovina based on balance sheet totals. In 2007, it expanded into the Una-Sana Canton. It contributes 2.1% to overall NLB Group profits.

Montenegro

NLB Montenegrobanka offers complete banking services. In 2006 and 2007 it underwent a thorough review of its offerings in financial services, particularly in the field of retail banking (remodeling branch offices, reorganizing client accounts and substantial investments in both the ATM network and credit card operations). Because of rapid growth, the bank was capitalized in the amount of €5 million by the end of 2007. In terms of total assets it is the third largest bank in the country, contributing 1.8% to overall NLB Group profits.

Macedonia

NLB Tutunska Banka offers comprehensive commercial banking services, and is one of the most successful members in the Group. The financial magazine, The Banker, for two consecutive years named the bank as the best in Macedonia. The bank targets small and mid-size businesses. Following its strategic objectives, the bank is intensively expanding its business network, as well as consolidating its position in the international market. Due to robust growth in the past years, the bank was capitalized in 2007, with NLB increasing its participation in its total assets to 26.96%. Measured by its total assets it is the third largest bank in the country. Its contribution to overall NLB Group profits is 3.8%.

Serbia

The NLB Group operates in the Serbian market, and also in Kosovo, which the Group entered with capital investments in 2007.

In the Serbian market, the NLB Group operates through two banks: NLB LHB Banka Beograd and NLB Continental Banka.

Both banks offer all-inclusive banking services to individuals and to businesses, banks and international institutions. In terms of size, they are smaller banks. Characteristic of both banks are a longestablished business policies and continuous growth. In order to more effectively and successfully meet the banks' targeted objectives, a merger of the two that began in 2007 is scheduled for completion by the beginning of 2009.

Kosovo²

Since spring 2007, the NLB Group operated in Kosovo through NLB BRK and NLB Kasabank, which after the merger on January 1, 2008 adopted the name NLB Prishtina.

The merged NLB Prishtina bank is, in terms of total assets, the third largest bank in Kosovo. It provides a solid foundation for comprehensive banking and financing, and offers high quality customer services in the emerging Kosovo market. The bank advances closer business and economic ties between Slovenia and Kosovo, where many Slovenian companies already operate.

² Republic of Slovenia recognized Kosovo’s independence on 5. 3. 2008.

Banks in Other EU Countries

LHB Internationale Handelsbank operates as a universal bank, specialized for operations in SE Europe. In 2007, the NLB increased its participation in the bank’s capital to 81.02%. The bank contributes 1.7% to the NLB Group profits.

NLB West East Bank was founded to provide financing for trade between Slovenia and Bulgaria and other central European and Mediterranean countries. Most of its business is with mid-size and smaller firms, whose business is mostly in the area of commerce, agriculture and construction. This market provides 0.9% of the NLB Group profits.

The associated bank, Adria Bank in Vienna, and Trieste Branch complete the list of NLB Group banks in the countries of the EU.

Trieste Branch is primarily involved with mid-size enterprises from Northern Italy that conduct business with Slovenia and Central and SE Europe. Retail banking is a supplemental activity. The bank has two offices in Trieste and Gorizia.

NLB Group
Annual Report 2007