INTERIM FINANCIAL RESULTS OF HANSABANK GROUP

Q2 2008

FINANCIAL HIGHLIGHTS FOR CONTINUED OPERATIONS*

(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
For the period (EUR in millions)
Net profit 135 114 18% 126 7% 248 233 6%
Estonia 49 52 -6% 60 -19% 101 117 -14%
Latvia 28 36 -21% 38 -26% 64 63 0%
Lithuania 29 27 7% 28 3% 56 51 11%

At the end of period (EUR in millions)

Loans** 20,341 19,640 4% 16,885 20%
Estonia 8,128 7,873 3% 6,829 19%
Latvia 6,368 6,159 3% 5,407 18%
Lithuania 5,750 5,546 4% 4,457 29%
Deposits 11,035 10,877 1% 10,006 10%
Estonia 4,998 4,881 2% 4,423 13%
Latvia 2,479 2,430 2% 2,347 6%
Lithuania 3,558 3,568 0% 3,170 12%

Ratios (%)
Return on shareholders' equity 26.3% 23.6% 32.1% 25.0% 31.0%
Estonia*** 31.5% 32.7% 40.5% 32.1% 40.9%
Latvia*** 23.7% 30.0% 37.5% 26.8% 33.1%
Lithuania*** 24.1% 22.3% 33.8% 23.2% 33.1%
Cost-income ratio 32.9% 40.7% 39.0% 36.6% 39.4%
Estonia 39.9% 37.9% 37.6% 38.9% 36.9%
Latvia 42.0% 37.7% 36.0% 39.9% 38.0%
Lithuania 46.7% 47.1% 43.6% 46.9% 45.0%
Net loan losses 0.55% 0.39% 0.24% 0.47% 0.28%
Estonia 0.58% 0.38% 0.15% 0.48% 0.18%
Latvia 0.75% 0.54% 0.37% 0.64% 0.50%
Lithuania 0.31% 0.25% 0.21% 0.28% 0.20%

Number of employees**** 9,242 9,206 0% 9,158 1%

Number of bank branches 284 290 -2% 300 -5%
Total customers, million 5.32 5.28 1% 5.08 5%

* Country results do not sum to total group results as eliminations and group units are excluded. All numbers for continued
operations.
** Loans to customers (excluding repos)
*** Return on allocated equity –equity capital is allocated to the business units based on 8.4% capital adequacy in the Baltic
countries. At the Group level, ROE is calculated based on actual equity.
**** Full time equivalent of employees

Hansabank Group Interim report 1

Q2 2008
C HANGES IN REPORTING PRINCIPLES
These interim condensed financial statements are prepared in accordance with IAS 34 Interim financial reporting.
The accounting policies used in the preparation of the interim condensed financial statements are consistent with
those used in the annual financial statements for the period ended 31 December 2007. These condensed
financial statements should be read in conjunction with the annual financial statements for the year ended 31
December 2007.

There have been a few changes to reporting principles from the beginning of 2008.

ALLOCATION AND COST OF EQUITY

Hansabank Group is using the following Tier I capitalization and cost of equity levels.

2007 2008
Baltic units Russia Baltic units Russia
Cost of equity 10% 11% 12% 12%
Tier I capital* 8% 11% 8.4% 11%
* % of business unit’s risk-weighted assets

BASIS OF PREPARATION
Hansabank Group results include OAO Swedbank and Hansa Leasing Ltd until 30 April 2008. After this date, these
operations are reported in accordance with IFRS 5 as “Discontinued operations” (see page 33 for details).

In Swedbank interim reporting Russian entities’ results are shown under Strategic and International Banking
business unit and not Baltic Banking.

Current financial analysis is presented for continued operations (without OAO Swedbank and Hansa Leasing Ltd).
All historical ratios have been recalculated for continued operations.

The financial effect of the bonus reserve reversal and two disposals is recorded at the Hansabank Group level and
not allocated to country business units. For better comparison, changes in main indicators have been normalized by
the effect of disposal of Russian companies, disposal of associated company and reversal of bonus (info in
parentheses).

Hansabank Group Interim report 2

Q2 2008
OPERATING RESULTS, Q208
HIGHLIGHTS OF CONTINUED OPERATIONS
 Loans increased by 4% qoq and 20% yoy
 Deposits increased by 1% qoq and increased by 10% yoy
 Net interest margin was 2.69%, down 7bp qoq and 22bp yoy
 Net profit was EUR 135m, 18% qoq, 7% yoy
 Return on equity 26.3%
 Income EUR 259m, 7% qoq, 7% yoy
 Expenses were EUR 85m, -13% qoq, -10% yoy
 Cost-income ratio was 32.9%

Hansabank Group achieved net income of EUR 135m from continued operations in Q208. The results are
boosted by positive one-off effects of related companies’ disposals and bonus reserve reversal. Without
these effects, core business continued solid performance. Despite increasing financing cost net interest
income remained stable compared to Q1. Trading income recovered from poor Q1 results to an average
quarterly level. Weakening economic conditions across Baltics pose challenges especially in terms of
asset quality. As expected, net loan losses increased to 55bp in Q2 with largest problems in real estate
sector. During second half of 2008 pressure on revenue growth is anticipated to continue. Hansabank’s
cost control and asset quality improvement efforts remain the cornerstones of achieving the set
efficiency and return targets.

ECONOMY AND BANKING MARKET
Global economic developments have negative impact
on Baltic economies, which are currently going
through correction period of decreasing growth rates.
Slower economic growth in developing world is
threatening export possibilities of Baltic companies.
And as the competitiveness of many of them has
already diminished significantly in last years (due to
rapidly growing production costs), economies are
facing the threat of falling export growth. One good
factor is that economic forecast for main export
partners for 2008-2009 is relatively good and the
negative impact of weaker domestic demand growth
may be in some extent outweighed.
Global energy and food prices have already
increased local inflation more than expected in all
three countries, and they will remain a major threat
for the future as well.
The monetary conditions, which already are
unfavorable to Baltic countries, are posing additional
risks. Higher interest rates (they are imported from
the euro zone as countries currencies are pegged
with euro) will increase debt servicing costs of
existing loans (most of mortgages have floating
interest rates dependent on Euribor) and make new
borrowing more costly. The threat of increasing risk
margins as economies slow will make economic
recovery more difficult, as borrowing becomes even
more restricted.
It can be noted that high optimism toward Baltics of
the early 2000 has changed to excessively negative
attitude toward Baltic economies. This may make the
transformation process even more difficult and
lengthy. Economies are now definitely in the better
situation than then and fundamental risks are
significantly lower (e.g. financial system is stronger,
production is more sophisticated, fiscal policy is
stronger).
In Estonia, the official GDP growth in the 1st quarter
was surprisingly low 0.1% yoy as domestic demand
declined 0.7% yoy and net real exports contributed
negatively to GDP growth (-0.8%). The 1st quarter
balance of payments showed improvement: the
current and capital account deficit fell to 11.2% of
GDP (22.8% a year before, 14.2% in Q4). That
included strong improvement of the trade and
services balances as exports grew 7.7% yoy, while
imports declined 1.2% yoy because of faltering
domestic demand. Consumer price growth in June
reached 11.4% yoy (due to oil prices). Base inflation
has started to slow (7.5% yoy in February, 6.5% in
May) as consumers have to cut their spending and
hence the faster slowdown of consumer price inflation
is expected in coming months.
In Latvia, official real GDP growth in the 1st quarter of
2008 moderated to 3.3% yoy (from 8.1% a quarter
before). Domestic demand contracted by 0.3% yoy
driven by 6.8% yoy contraction in investment activity.
Weak domestic demand translated into real
contraction of goods and services imports by 1.6%
yoy, real exports growth was 6.5%. Trade and
services deficit improved as expected and stood at
18% of GDP (24.3% a year ago) while current
account deficit improved to 18.3% (26.6% a year
ago). Consumer price growth gradually slows as
weakening domestic demand takes its toll and quite

Hansabank Group Interim report 3

Q2 2008
expectedly inflation retreated from the peak of 17.9%
yoy in May to 17.7% in June.
Lithuania remains in a downward phase of the
economic cycle. Overall economic growth was
relatively strong so far, confirming “soft landing”
scenario. The revised GDP estimate was 7% annual
real growth in Q1. The main contributor was
consumer spending (12.2% yoy), while investment
growth of 22.4% was mostly related to the increase in
inventories. After four months of impressive growth
(20% yoy in January-April), retail sales increased by
4.8% yoy in May and contracted by 4.8% compared
to April. Household consumption remained strong in
Q1 2008 but is expected to slow in the upcoming
quarters. Annual CPI growth has been accelerating
since the beginning of the year (from 9.9% in January
to 12.5% in June) but is expected to stabilize around
12–12.5% in the upcoming months. The main
reasons for the persistent rise were administrative
decisions (higher excise duties for fuel, alcohol and
tobacco) prices of food and energy.
HANSABANK NEWS
Hansabank in Estonia, Hansabanka in Latvia and
Hansabankas in Lithuania will be changed to
Swedbank in the autumn of 2008. Full migration to
the new brand in the Baltics will take about one year
and is expected to be completed by autumn 2009.
Hansabank is changing its business and
management model starting from 2009. The most
important step in the current change is the creation of
Business Development (BD) unit. This unit will have
four main pan-Baltic functions: client concept design;
product units handling the whole product lifecycle;
process design; and cross-border marketing. The
head of the new BD unit will be Giedrius Dusevičius.
Antanas Danys will take over his position as the head
of Hansabankas in Lithuania.
Hansa Property & Casualty insurance that was
previously present only in Estonia is expanding to
Latvian market in 2009. Launch of non-life insurance
operations in Estonia has been a success story with
over 10% market share captured during the first year
of operations and significant synergies gained in the
process.
Starting from May, Hansabank issues highly
appreciated American Express gold and platinum
credit cards. American Express cards are meant for
demanding customers, who expect high quality and
considerable benefits. They provide a number of
valuable and unique benefits and features, many of
which are new to the Estonian customer.
Hansabank Group Interim report
Q2 2008
DISPOSAL OF OAO SWEDBANK, HANSA LEASING
LTD AND AS PANKADE KAARDIKESKUS
A decision was made in the third quarter of 2007 to
transfer ownership of the bank OAO Swedbank and
the leasing company Hansa Leasing Ltd from
Hansabank in Estonia to Swedbank in Sweden. On
12 May 2008, AS Hansapank and AS Hansa Capital
entered into an agreement with Swedbank AB for the
sale of the above entities.
The transfers were made at market value and the
sale resulted in a loss of EUR 2.8m. Total loss on the
sale can be divided into two components: gain on the
sale of equity investment (EUR 1.7m) is classified
under Other income and loss on the adjustment of
unrealized foreign exchange differences (EUR 4.5m)
under Trading income.
In Estonia, Hansapank, SEB Pank and Sampo Pank
as the owners of the Banks' Card Centre (Pankade
Kaardikeskus (PKK), located in Estonia) signed an
agreement to sell the PKK to Northern Europe
Transaction Services (NETS), the Scandinavian
mediator of bank card transactions. Capital gain on
the sale of the shares in associated company was
EUR 7.02m (Other income).
REVERSAL OF BONUS RESERVE
Performance based remuneration provisions in
Hansabank are accrued as a percentage of annual
Economic Value Added (EVA). Substantial increase
of EVA over the recent years has resulted in larger
reserves than forecasted. The accumulated reserves
were reduced by about EUR 19.7m during Q2 2008;
as a result performance based staff costs in
Hansabank decreased with the same amount. The
model for future provisions has been adjusted.
The financial effect of the bonus reserve reversal and
two disposals is recorded at the Hansabank group
level and not allocated to country business units.
4
INCOME
Total income was EUR 259m in the second quarter of
2008 with an annual growth of 7% (+5%). Second
quarter outcome was EUR 18m higher than Q108
(EUR +14m). Weak and turbulent financial markets
continued in the second quarter and influenced
trading and fee income and also cost of funding.
Second quarter income is affected by the one-off
effects of the sale of Russian business unit and PKK
(net gain on the sale of both entities of EUR 4.2m).
Annual growth was largest in other income +124%
(-16%) and insurance income +43%. Net interest
income grew 11% and net fee income declined 2%
yoy. Second quarter trading income declined -33%
(-15%) yoy due to the negative trend in financial
markets.
NET INTEREST INCOME
Net interest income increased 11% yoy to EUR
169m in Q208 supported by higher lending volumes
which on the other hand was counterbalanced by
higher cost of funding. On the business unit level the
annual net interest income growth rates were as
follows: Estonia 7%, Latvia 3% and Lithuania 31%.
Group’s loan portfolio increased 20% yoy to EUR
20.3bn during Q208. Mortgage lending increased by
21% yoy and corporate lending 23%. In connection
with the sale of Russian business unit, Hansabank’s
loan portfolio was reduced by EUR 1,076.9m and
deposits by EUR 65.4m (as of 30 April 2008). Loan
portfolio growth was strongest in Lithuania 29%,
followed by Estonia 19% and Latvia 18%.
Hansabank’s lending market share has not change
in 2008 and was 46% in Estonia, 27% in Latvia and
25% in Lithuania at the end of May. The bank has
maintained its tightened credit selection procedures
and followed risk based pricing guidelines to ensure
that new lending quality is according to set
guidelines.
Deposit growth was EUR 158m in the second
quarter (10% yoy). Deposit market shares were
55% in Estonia, 30% in Lithuania and 17% in Latvia
with no change in 2008.

INTEREST INCOME, NET

(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Continuing operations
Interest income
Loans 282.5 275.6 3% 209.7 35% 558.1 389.3 43%
Bank deposits and loans 7.2 7.1 1% 4.5 60% 14.3 10.9 31%
Correspondent accounts 17.9 17.8 1% 13.1 37% 35.7 25.9 38%
Securities portfolio 12.4 9.5 31% 7.1 75% 21.9 14.2 54%
Leasing 57.9 57.2 1% 45.8 26% 115.1 85.6 34%
Factoring 9.0 8.8 2% 7.1 27% 17.8 13.2 35%
Derivatives, hedging 15.2 18.3 -17% 15.9 -4% 33.5 20.3 65%
Total interest income 402.1 394.3 2% 303.2 33% 796.4 559.4 42%
Interest expenses
Deposits 84.0 78.7 7% 53.8 56% 162.7 99.3 64%
Demand deposits 20.5 21.5 -5% 19.9 3% 42.0 37.7 11%
Time deposits 53.7 47.4 13% 24.8 117% 101.1 45.1 124%
Deposit Guarantee Fund 9.8 9.8 0% 9.1 8% 19.6 16.5 19%
Bank deposits and loans 122.7 118.9 3% 75.4 63% 241.6 136.8 77%
Securities 11.2 9.9 13% 8.9 26% 21.1 17.9 18%
Derivatives, hedging 14.9 16.7 -11% 12.8 16% 31.6 16.0 98%
Total interest expense 232.8 224.2 4% 150.9 54% 457.0 270.0 69%
Interest income from continuing
operations, net 169.3 170.1 0% 152.3 11% 339.4 289.4 17%
Net interest margin % 2.69% 2.76% 2.91% 2.72% 2.88%
Discontinuing operations
Interest income from discontinued
operations, net 4.1 10.9 -62% 9.4 -56% 15.0 17.3 -13%

Interest income, net 173.4 181.0 -4% 161.7 7% 354.4 306.7 16%

Hansabank Group Interim report 5

Q2 2008
Deposit margins increased noticeably during 2007, MARGIN OF LOANS AND DEPOSITS
but have decreased back to early 2007 level during Q2 2008 Q1 2008 Q2 2007
first half of 2008. Deposit margins declined in all three Loans
countries during Q208. Lower local interest rates,
Estonia 2.53% 2.74% 2.64%
higher share of savings deposits and higher cost of
Latvia 1.91% 2.21% 2.30%
deposits are the main reasons. Lending margins have
declined in 2008 in all three countries on the basis of Lithuania 1.68% 1.75% 1.85%
increasing funding costs. in annual comparison there Deposits
is a 26bp margin decline in loan margin. Estonia 1.94% 2.15% 1.51%
Latvia 1.81% 2.51% 4.16%
Lithuania 2.16% 2.31% 2.55%

Deposit margin=(FTP-interest expense)/average deposits

Loan margin=(interest income-FTP)/average loans

NET FEE INCOME

Net fees and commissions totaled EUR 51m in
Q208 with a decline of 2% yoy. In quarterly
comparison, net fee income increased EUR 2m.
The three major groups within the fee income are:
payment-related fees, investment & trading related
fees and lending-related fees, each of them
amounting to 64%, 16% and 13% of the total fee
income in Q208, respectively. All other fees account
for 7% of the total fee income.

FEES AND COMMISSIONS, NET

(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Continuing operations
Fee and commission income
Payment related fees 44.2 40.1 10% 39.8 11% 44.2 39.8 11%
Transfers 11.8 11.0 7% 11.6 2% 22.8 22.1 3%
Cash services 3.0 2.9 3% 3.6 -17% 5.9 6.9 -14%
Bank cards 27.1 24.0 13% 22.6 20% 51.1 42.6 20%
Other e-channels 2.3 2.2 5% 2.0 15% 4.5 3.8 18%
Investment and trading related fees 11.2 12.2 -8% 12.7 -12% 11.2 12.7 -12%
Custody 8.1 8.3 -2% 7.9 3% 16.4 14.4 14%
Brokerage and investment services 3.1 3.9 -21% 4.8 -35% 7.0 10.4 -33%
Lending related fees 8.7 6.9 26% 9.2 -5% 8.7 9.2 -5%
Loan management and guarantees 6.4 4.8 33% 7.1 -10% 11.2 11.9 -6%
Leasing and factoring 2.3 2.1 10% 2.1 10% 4.4 4.1 7%
Other 5.2 5.4 -4% 7.1 -27% 5.2 7.1 -27%
Insurance brokerage 1.0 1.2 -17% 1.4 -29% 2.2 2.6 -15%
Other 4.2 4.2 0% 5.7 -26% 8.4 11.5 -27%
Total fee and commission income 69.3 64.6 7% 68.8 1% 133.9 130.3 3%
Fee and commission expense
Settlem ents 1.4 1.4 0% 2.0 -30% 2.8 3.7 -24%
Loan management and guarantees 1.6 0.6 167% 0.7 129% 2.2 1.4 57%
Card services 8.9 7.6 17% 7.5 19% 16.5 13.9 19%
Securities transaction fees 1.6 2.0 -20% 2.4 -33% 3.6 4.6 -22%
Encashment and cash services 2.5 2.4 4% 2.3 9% 4.9 4.3 14%
Other 2.3 2.0 15% 1.9 21% 4.3 3.9 10%
Total fee and commission expense 18.3 16.0 14% 16.8 9% 34.3 31.8 8%
Fees and commissions from continuing
operations, net 51.0 48.6 5% 52.0 -2% 99.6 98.5 1%
Discontinuing operations
Fees and commissions from discontinued
operations, net 0.2 0.7 -71% 0.5 -60% 0.9 1.1 -18%
Fees and commissions, net 51.2 49.3 4% 52.5 -2% 100.5 99.6 1%

Hansabank Group Interim report 6

Q2 2008
Payment-related fees include income from bank
cards, transfers and cash services. Fee income
from these services increased 11% yoy. The income
from bank cards increased by 20% yoy to EUR 27m
while transfers increased by a more modest 2% to
EUR 12m. The number of cards issued (both debit
and credit) increased 9% yoy.
Investment & trading related fees include fees from
brokerage & investment services together with
custody. Fee income from these areas decreased
by 12% yoy. This fee income group has suffered
because of decreasing trading activity and reduced
success fees. Total assets gathered amounted to
EUR 2.4bn at the end of Q208.
Lending-related fees include primarily factoring and
consumer financing fees and minor fee income also
from lending and leasing. Lending-related fees
decreased by 5% yoy given lower new lending
volumes.
Hansabank Group Interim report
Q2 2008
TRADING INCOME
Trading income increased by EUR 9m (EUR +13m)
to EUR 17m in Q2. Annual decline was 33% (-15%)
as weak financial markets have lead to decreased
activity and fair value revaluations of the holdings
(primarily from our life-insurance portfolio). Trading
income is affected by the loss on the adjustment of
unrealized foreign exchange differences (EUR 4.5m)
in relation to the sale of Russian business unit.
Increase in trading income was larger in Estonian
and Lithuanian units given very poor performance of
Q1. Unrealized loss on fair value adjustments and
realized losses on the fall of prices of our main
holdings limited the growth also in Q2.
INSURANCE AND OTHER INCOME
Other income grew by 124% (-16% yoy) as a result of
one of effects on sale of group companies. Looking at
regular operations, insurance income continued to
present strong annual growth of 43%.
7
EXPENSES
Operating expenses decreased by 10% yoy (+14%)
to EUR 85m. As said earlier, Q2 Group-level
expenses include a reversal of bonus reserve in the
amount of EUR 19.7m. Compared to first quarter,
expenses declined EUR 13m (EUR +10m). On a
country level, Latvia had highest expense growth of
22% yoy. Lithuanian expenses grew 21% and
Estonian 6% yoy.
In the short term, expense growth has been
addressed and controlled through heightened
attention on employee growth and optimizing branch
network to adjust to lower volume growth. Longer
term focus is on setting up cross-border operating
model and creating business processes for more
mature markets. Several initiatives have been
launched to support this - such as operational
excellence, pan-Baltic product development,
customer value management. These initiatives
require initial investment in current period while the
effect on financials becomes evident only in the
future.
Group’s personnel expenses decreased by 31% yoy
(+11%). Annual decrease is a result of the reduction
of accumulated bonus reserves by EUR 19.7m
during Q2 2008. Salary and tax growth was 27%
while bonus reserve allocation decreased 177% yoy
(-24%).
The number of employees (FTE) grew by 1% over
the past year amounting to 9,242 employees at the
end of Q208. During the second quarter the number
of employees increased by 36 in the group. During
summer Hansabank employs summer trainees to
assist over vacation period that also affects the
employee growth. There were 221 trainees hired
during Q208 and the number of regular bank
employees decreased by 185 people. Employee
breakdown is as follows: 3,346 in Estonia, 2,659 in
Latvia and 3,237 in Lithuania.
Number of branches decreased by 6 during Q208: 4
in Estonia, 3 in Lithuania and increased by 1 in
Latvia. Branch network strategy is to move from
smaller branches to larger and universal full service
branches.

PERSONNEL EXPENSES
(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Continuing operations
Salaries and compensations 36.6 35.8 2% 28.3 29% 72.4 56.1 29%
Performance pay reserve -11.5 10.0 -215% 14.9 -177% -1.5 27.4 -105%
Social insurance charges 9.8 9.9 -1% 8.2 20% 19.7 16.1 22%
Training 1.9 1.3 46% 2.2 -14% 3.2 3.3 -3%
Total personnel expenses from
continued operations 36.8 57.0 -35% 53.6 -31% 93.8 102.9 -9%
Discontinuing operations
Total personnel expenses from
discontinued operations 1.3 4.5 -71% 3.6 -64% 5.8 6.1 -5%

Total personnel expenses 38.1 61.5 -38% 57.2 -33% 99.6 109.0 -9%

Continued operations
Number of employees, end of period 9,242 9,206 0% 9,158 1% 9,242 9,158 1%
Number of employees, average of the
period 9,208 9,222 0% 8,878 4% 9,216 8,731 6%

Hansabank Group Interim report 8

Q2 2008
Administrative expenses increased by 36% yoy. larger strategic projects mentioned in the previous
Annual growth in administrative is related to the paragraph.
bank’s investments to organization. Professional
services expenses have increased due to several

ADMINISTRATIVE EXPENSES
(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Continuing operations
Office expenses 9.0 8.6 5% 6.7 34% 17.6 14.0 26%
Transportation, car lease 1.0 0.7 43% 0.7 43% 1.7 1.2 42%
Supplies 1.6 1.4 14% 1.6 0% 3.0 3.1 -3%
Communications 1.7 1.8 -6% 1.6 6% 3.5 3.1 13%
Professional services 5.9 3.6 64% 3.2 84% 9.5 6.0 58%
Insurance 0.4 0.5 -20% 0.4 0% 0.9 0.8 13%
Security 1.2 1.1 9% 1.1 9% 2.3 2.1 10%
Other 0.1 0.1 0% 0.1 0% 0.2 0.2 0%
Total administrative expenses from
continued operations 20.9 17.8 17% 15.4 36% 38.7 30.5 27%
Discontinuing operations
Total administrative expenses from
discontinued operations 0.8 2.2 -64% 1.4 -43% 3.0 2.5 20%

Total administrative expenses 21.7 20.0 8% 16.8 29% 41.7 33.0 26%

Other expenses increased 10% yoy in the second related costs have increased due to seasonality of
quarter. In comparison to Q108, marketing and PR these expenses.

OTHER EXPENSES
(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Continuing operations
Business trips 1.1 0.9 22% 0.9 22% 2.0 1.6 25%
Marketing 5.0 2.5 100% 4.5 11% 7.5 6.8 10%
Representation 1.5 1.4 7% 1.1 36% 2.9 2.4 21%
Other 5.1 5.4 -6% 5.0 2% 10.5 9.5 11%
Total other expenses from continued
operations 12.7 10.2 25% 11.5 10% 22.9 20.3 13%
Discontinuing operations
Total other expenses from discontinued
operations 0.3 1.0 -70% 0.9 -67% 1.3 1.4 -7%

Total other expenses 13.0 11.2 16% 12.4 5% 24.2 21.7 12%

ASSET QUALITY Portfolio quality reporting is improved and frequency

Overall asset quality has remained good and in-line
with expectations. As expected, key risk ratios have
trended up in Q1 and Q2, particularly in Estonia and
Latvia. However, in both countries the risk ratios are
noticeably below that of local market indicators. This
is the result of portfolio quality improvement
measures that were introduced already at the end of
2006. Real estate sector growth has been taken
under control and existing portfolio is regularly
scrutinized. Risk units have been reinforced by
increasing the number of people dealing with
problem loans and strengthened workout team.
increased.
Net loan losses were EUR 26m in Q208, increase of
EUR 8m from Q108. Net loan losses to beginning
of the year portfolio were 0.55% in Q208, up from
0.39% in Q1.
Loans overdue more than 60 days were 1.20 % of
12-month old loan portfolio - a 34bp increase from
Q108. Increase in loans overdue is evident in
Estonia and Latvia. During 2008, overdue
management policies and procedures have been
reviewed, updated and reinforced. The primary

Hansabank Group Interim report 9

Q2 2008
focuses in overdue management are efficient set timing and means of client contacts.
process design, prudent handling tactics and clearly

ALLOWANCE FOR CREDIT LOSSES

(in millions of euros) Group Estonia Latvia Lithuania Russia
Balance, as of 31.12.07 156.3 57.9 42.8 43.0 12.6
Write-offs -4.3 -1.4 -2.1 -0.8 -
Loan losses 23.7 9.0 8.6 4.1 2.0
Effect of exchange rate changes -0.6 - -0.2 - -0.4
Reclassification -1.1 - - -1.1 -
Balance, as of 31.03.08 174.0 65.5 49.1 45.2 14.2
Write-offs -5.3 -2.1 -1.9 -1.3 -
Loan losses 29.3 12.1 11.3 4.8 1.1
Effect of exchange rate changes -0.2 - -0.4 - 0.2
Reclassification -0.8 - - -0.8 -
Sale of Russian business unit -14.8 - - - -14.8
Balance, as of 30.06.08 182.2 75.5 58.1 47.9 0.7
*The distribution of loans is based on the origin of customer.

LOANS OVERDUE
(in millions of euros) Group Estonia Latvia Lithuania Russia
Total loans overdue, 31.12.07 1,649.8 417.9 560.5 669.4 2.0
Up to 30 days 1,836.9 294.3 486.1 1,056.5 -
31 to 60 days 155.7 59.2 66.6 29.9 -
Over 60 days 133.4 41.9 59.7 30.7 1.1
Total loans overdue, 31.03.08 2,126.0 395.4 612.4 1,117.1 1.1
Up to 30 days 1,217.7 331.4 397.5 488.8 -
31 to 60 days 183.3 72.3 53.2 57.8 -
Over 60 days 201.3 77.5 86.5 37.3 -
Total loans overdue, 30.06.08 1,602.3 481.2 537.2 583.9 -

Loan portfolio as at the end of period* 20,246.3 8,127.9 6,368.4 5,749.9

Average loan portfolio* 19,938.3 8,022.8 6,246.1 5,669.4
Net loan losses** 0.55% 0.58% 0.75% 0.31%
Allowance for credit losses / loan portfolio* 0.90% 0.93% 0.91% 0.83%
Over 60 days / loan portfolio**** 1.15% 1.13% 1.60% 0.84%
* Excluded loans to consolidated companies and the distribution of loans is based on the origin of customer, loans do not
include repos
** Overdue amount includes total outstanding principal amount and interest payable for the overdue loan. No limitations have
been set regarding the amount, days overdue, etc.
*** net loan losses equals to (provisions+write-offs – recoveries) / portfolio at the beginning of the year
**** Over 60 days / Loan portfolio ratio is calculated based on one year old portfolio volume

Hansabank Group Interim report 10

Q2 2008
DISTRIBUTION OF RISK PORTFOLIO* BY RATING CLASSES
(in millions of euros, except ratios) 30.06.08 % 31.12.07 %
1 Highest rating class. Companies in this class are assumed to have virtually no
credit risk. 162.7 0.7% 133.5 0.6%
1- Top investment grade. Companies in this class have very small credit risk. 127.8 0.5% 53.7 0.2%
2 Top investment grade. The short and medium-term creditworthiness of the
company is beyond any doubt. 341.1 1.4% 328.7 1.4%
2- Investment grade. The short and medium-term creditworthiness of the company is
strong. 712.2 3.0% 688.8 2.9%
3 Investment grade. The current creditworthiness of the company is very good.
Reasonable adverse shocks on the market (economy in general) are not likely to
have a material impact on the financial strength of the company. 1,043.6 4.4% 1,054.0 4.5%
3- Investment grade. The current creditworthiness of the company is good. Moderate
adverse shocks on the market (economy in general) are not likely to have a material
impact on the financial strength of the company. 1,334.4 5.6% 1,414.4 6.0%
4 Investment grade. The company short-term creditworthiness is normal, and long-
term creditworthiness is more than acceptable. 2,773.4 11.7% 2,746.5 11.6%
4- Investment grade. The company short-term creditworthiness is normal, and long-
term creditworthiness is acceptable with certain reservations. 2,239.7 9.4% 2,283.8 9.6%
5 Investment grade. Both the short-term and the long-term creditworthiness of the
company are weak. 1,298.7 5.5% 1,334.9 5.6%
5- Lowest investment grade. Both the short-term and the long-term creditworthiness
of the company are very weak. 404.2 1.7% 258.0 1.1%
6 Speculative grade. Creditworthiness of the company is sub-standard. 85.1 0.4% 69.3 0.3%
6- The company is close to default. - 0.0% 10.9 0.0%
7 The borrower has defaulted. 62.5 0.3% 14.5 0.1%
Not individually rated* 13,122.5 55.4% 13,283.5 56.1%
Total 23,707.9 100.0% 23,674.5 100.0%
* Highly diversified private and SME mass lending (incl. private mortgages)

Hansabank Group Interim report 11

Q2 2008
ESTONIA
(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Total income 99.3 94.6 5% 99.6 0% 193.9 192.8 1%
Operating expenses 39.6 35.9 10% 37.4 6% 75.5 71.1 6%
Operating profit before provisions 59.7 58.7 2% 62.2 -4% 118.4 121.7 -3%
Net profit 48.8 51.8 -6% 60.0 -19% 100.6 116.5 -14%
EVA* 30.4 32.7 -7% 45.1 -33% 63.1 87.5 -28%

Return on allocated equity** 31.5% 32.7% 40.5% 32.1% 40.9%

Cost-income ratio 39.9% 37.9% 37.6% 38.9% 36.9%
Net loan losses*** 0.58% 0.38% 0.15% 0.48% 0.18%
Net interest margin 2.41% 2.53% 2.74% 2.47% 2.75%

Loans**** 8,127.9 7,872.8 3% 6,828.8 19%

Deposits 4,998.0 4,880.9 2% 4,423.4 13%
Allocated equity** 643.9 635.3 1% 613.3 5%
Assets 10,773.6 10,421.5 3% 9,220.4 17%

Number of employees (full-time equivalent) 3,346 3,234 3% 3,338 0%

* Cost of equity used for EVA calculation was 10% in 2007 and 12% in 2008
** based on 8% capital adequacy for 2007 and 8.4% for 2008
*** net loan losses equals to (provisions+write-offs – recoveries) / beginning of the year loan portfolio
**** Loans to customers (excluding repos)

Estonian business unit has been fastest to react to changing economic conditions and has cut expense
growth from 33% in Q207 to low 6% in Q208. Increase in loan losses negatively impacted second quarter
net profit that declined to EUR 48.8m. Core ratios were strong: ROE 31.5% and cost-income ratio was
39.9%.

BASIS OF PREPARATION Though life insurance product reserve fair value

Current financials do not include the one-off effect of adjustments continued in Q2, the effect was less
the sale of Russian business unit and PKK. evident.

INCOME
Total quarterly income was EUR 99.3m in Q208 and
did not change during the year.
Net interest income decreased by EUR 1m in Q208
to EUR 64.3m. Net interest margin declined from
2.53% to 2.41% in one quarter due to higher cost of
funding, especially deposits.
The annual loan portfolio growth rate has declined
from 25% at the end of 2007 to 19% at the end of
Q208. Loan portfolio increased by EUR 255m from
the last quarter to EUR 8.1billion. Deposit portfolio
increased by EUR 117m to EUR 5.0 billion, with yoy
growth of 13%.
Net fee income was lower at EUR 22.5m in Q208
(EUR -0.6m QoQ). Asset Management, custody and
other securities’ related fees have declined the most
given weaker financial markets. Trading income was
EUR 4.0m, increase of EUR 5.4m from weak Q1.
EXPENSES
Operating expenses increased by 6% yoy and were
EUR 39.6m in Q2. In a quarterly comparison
expenses increased by EUR 3.7m. Personnel
expenses declined by EUR 0.6m, because of lower
salaries and remuneration. Number of employees
increased by 112 in Q208 to 3,346 (including IT and
group level employees working in Estonia).
Employee growth was largely related to summer
trainees. Annual employee growth was 0%. Other
expenses increased because of higher
administrative and group level expenses.
ASSET QUALITY
Net loan losses increased from EUR 7.1m to EUR
10.9m in Q208. Net loan losses to beginning of the
year portfolio formed 0.58% in Q208, up from 0.38%
in Q1. Loans overdue more than 60 days to 12-
month old loan portfolio were 1.14% - up 49bp from
Q1.

Hansabank Group Interim report 12

Q2 2008
COUNTRY-BASED BALANCE SHEETS – ESTONIA

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Assets
Cash, dues from central bank and other banks 1,945.9 1,874.0 2,070.7 1,627.5 1,449.6
Securities 241.3 244.1 354.2 381.2 338.6
Loans 8,439.3 8,167.5 7,738.9 7,496.2 7,179.8
- Allowances for credit losses -76.2 -66.6 -58.0 -47.9 -42.6
Net loans 8,363.1 8,100.9 7,680.9 7,448.3 7,137.2
Other assets 223.3 202.5 231.1 197.0 295.0
Total assets 10,773.6 10,421.5 10,336.9 9,654.0 9,220.4

Liabilities
Deposits 4,998.0 4,880.9 4,719.6 4,359.6 4,423.4
Demand deposits 2,938.4 2,925.1 2,967.1 3,024.6 3,188.6
Time deposits 2,059.6 1,955.8 1,752.5 1,335.0 1,234.8
External funding 4,340.4 4,450.5 4,495.1 4,239.9 3,902.9
Other liabilities and internal funding adjustment 791.3 454.8 454.8 397.9 280.8
Equity 643.9 635.3 667.4 656.6 613.3
Total liabilities and equity 10,773.6 10,421.5 10,336.9 9,654.0 9,220.4

COUNTRY-BASED INCOME STATEMENTS – ESTONIA

(in millions of euros, unaudited) Q2 2008 Q1 2008 Q4 2007 Q3 2007 Q2 2007

Interest income 171.2 166.8 157.7 145.0 131.7

Interest expense -106.9 -101.4 -91.6 -79.8 -71.6
Interest income, net 64.3 65.4 66.1 65.2 60.1

Fee and commission income 30.0 30.3 31.9 33.8 33.4

Fee and commission expense -7.5 -7.2 -7.9 -8.2 -7.8
Fees and commissions, net 22.5 23.1 24.0 25.6 25.6

Net result from financial operations 4.0 -1.4 2.0 8.6 9.8
Net income from insurance activities 5.3 4.9 5.0 3.0 2.4
Other income 3.2 2.6 2.3 2.7 1.7
Total income 99.3 94.6 99.4 105.1 99.6

Operating expenses
Personnel expenses 16.2 16.8 17.5 15.3 15.9
Data network expenses 7.9 7.3 8.5 6.6 8.0
Administrative expenses 7.0 6.1 6.8 6.1 5.3
Other expenses 4.7 3.6 5.5 3.4 4.1
Depreciation 0.8 0.8 0.8 0.8 0.8
Group overhead adjustment 3.0 1.3 3.2 3.9 3.3
Total operating expenses 39.6 35.9 42.3 36.1 37.4
Operating profit before provisions 59.7 58.7 57.1 69.0 62.2
Losses on loans and guarantees -11.8 -7.8 -10.8 -8.1 -2.8
Recovered loans 0.9 0.7 0.7 0.4 0.5
Income from associated companies - 0.2 0.2 0.3 0.1
Profit before income tax 48.8 51.8 47.2 61.6 60.0
Income tax - - - - -
Profit after income tax 48.8 51.8 47.2 61.6 60.0
Minority interest - - - - -
Net profit 48.8 51.8 47.2 61.6 60.0

Hansabank Group Interim report 13

Q2 2008
LATVIA
(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Total income 79.5 78.0 2% 75.9 5% 157.5 136.9 15%
Operating expenses 33.4 29.4 14% 27.4 22% 62.8 52.1 21%
Operating profit before provisions 46.1 48.6 -5% 48.5 -5% 94.7 84.8 12%
Net profit 28.1 35.5 -21% 38.1 -26% 63.6 63.4 0%
EVA* 13.8 21.3 -35% 27.7 -50% 35.1 43.9 -20%

Return on allocated equity** 23.7% 30.0% 37.5% 26.8% 33.1%

Cost-income ratio 42.0% 37.7% 36.0% 39.9% 38.0%
Net loan losses*** 0.75% 0.54% 0.37% 0.64% 0.50%
Net interest margin 2.92% 3.02% 3.37% 2.97% 3.16%

Loans**** 6,368.4 6,158.5 3% 5,406.6 18%

Deposits 2,479.4 2,429.8 2% 2,347.1 6%
Allocated equity** 466.5 476.8 -2% 430.1 8%
Assets 7,540.1 7,326.2 3% 6,519.3 16%

Number of employees (full-time equivalent) 2,659 2,653 0% 2,514 6%

* Cost of equity used for EVA calculation was 10% in 2007 and 12% in 2008
** based on 8% capital adequacy for 2007 and 8.4% for 2008
*** net loan losses equals to (provisions+write-offs – recoveries) / beginning of the year loan portfolio
**** Loans to customers (excluding repos)

Latvian business unit performance improved on the income side but growing expenses and higher loan
losses reduced quarterly net profit to EUR 28m. ROE was 23.7% and cost-income ratio 42.0%.

INCOME
Total income of the Latvian business unit increased
by 5% yoy to EUR 79.5m. Quarterly increase was
EUR 1.5m.
Net interest income was weaker by EUR 0.6m in Q2
mainly due to rising funding cost (both foreign
funding and deposits). Net interest margin declined
from 3.02% to 2.92%.
Loan portfolio grew by EUR +210m in Q2 or 18%
yoy. Corporate portfolio grew EUR +150m,
mortgages EUR +27m, ABF EUR 27m and
consumer finance EUR 12m during the quarter.
Deposits increased EUR 50m in Q208 (+6% yoy).
Shift from demand to time deposits continued in
Q208.
Net fee income increased EUR 1.2m from Q1 to
EUR 14.9m. Securities’ related items continue to
underperform due to weaker financial markets.
Trading income increased by EUR 1.0m from first
quarter.
EXPENSES
Latvian unit’s operating expenses increased by EUR
4m from Q1, with yoy growth of 22%. Personnel
expenses increased by 13% yoy and decreased
slightly from Q1 (EUR -0.6m). Number of employees
(incl Group and IT) increased by 7 during Q2 and
6% on an annual comparison. All other expense
items increased compared to Q1 from higher
administrative expenses.
ASSET QUALITY
Net loan losses increased EUR 2.9m to EUR 11m in
Q208. Higher provisions for small and medium
enterprises with real estate exposure were main
contributors to loan loss figure. Net loan losses
formed 0.75% of the beginning of the year portfolio
in Q208, up from 0.54% in Q1. Loans overdue more
than 60 days formed 1.60% of the 12-month old
loan portfolio - up 38bp from Q1.

Hansabank Group Interim report 14

Q2 2008
COUNTRY-BASED BALANCE SHEETS – LATVIA

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Assets
Cash, dues from central bank and other banks 833.5 849.8 980.9 725.6 809.9
Securities 257.9 241.9 224.9 214.0 213.3
Loans 6,379.3 6,167.8 5,984.1 5,721.5 5,412.8
- Allowances for credit losses -58.0 -49.1 -42.8 -39.4 -35.9
Net loans 6,321.3 6,118.7 5,941.3 5,682.1 5,376.9
Other assets 127.4 115.8 114.1 107.4 119.2
Total assets 7,540.1 7,326.2 7,261.2 6,729.1 6,519.3

Liabilities
Deposits 2,479.4 2,429.8 2,445.1 2,306.5 2,347.1
Demand deposits 1,454.7 1,501.4 1,644.7 1,627.4 1,706.4
Time deposits 1,024.7 928.4 800.4 679.1 640.7
External funding 4,095.3 3,971.5 3,870.0 3,535.7 3,327.9
Other liabilities and internal funding adjustment 498.9 448.1 472.3 432.1 414.2
Equity 466.5 476.8 473.8 454.8 430.1
Total liabilities and equity 7,540.1 7,326.2 7,261.2 6,729.1 6,519.3

COUNTRY-BASED INCOME STATEMENTS – LATVIA

(in millions of euros, unaudited) Q2 2008 Q1 2008 Q4 2007 Q3 2007 Q2 2007

Interest income 122.4 121.5 123.2 109.4 99.4

Interest expense -68.5 -67.0 -63.3 -54.6 -46.9
Interest income, net 53.9 54.5 59.9 54.8 52.5

Fee and commission income 20.1 18.5 20.9 18.8 17.8

Fee and commission expense -5.2 -4.8 -6.2 -5.2 -4.6
Fees and commissions, net 14.9 13.7 14.7 13.6 13.2

Net result from financial operations 9.0 8.0 7.5 7.4 8.9
Net income from insurance activities - - - - -
Other income 1.7 1.8 1.3 1.7 1.3
Total income 79.5 78.0 83.4 77.5 75.9

Operating expenses
Personnel expenses 13.8 14.4 14.3 13.3 12.2
Data network expenses 6.2 6.1 6.1 5.2 5.1
Administrative expenses 5.9 4.5 6.0 4.3 4.1
Other expenses 4.9 2.8 5.4 3.3 3.6
Depreciation 1.0 1.0 1.0 0.9 0.9
Group overhead adjustment 1.6 0.6 1.6 2.0 1.5
Total operating expenses 33.4 29.4 34.4 29.0 27.4
Operating profit before provisions 46.1 48.6 49.0 48.5 48.5
Losses on loans and guarantees -11.4 -8.6 -9.3 -5.3 -4.4
Recovered loans 0.4 0.5 0.5 0.3 0.4
Income from associated companies - - - - -
Profit before income tax 35.1 40.5 40.2 43.5 44.5
Income tax -7.0 -5.0 -6.3 -7.0 -6.4
Profit after income tax 28.1 35.5 33.9 36.5 38.1
Minority interest - - - - -
Net profit 28.1 35.5 33.9 36.5 38.1

Hansabank Group Interim report 15

Q2 2008
LITHUANIA

(in millions of euros) Q2 2008 Q1 2008 QoQ % Q2 2007 YoY % YTD 2008 YTD 2007 YTD %
Total income 73.8 68.4 8% 65.4 13% 142.2 121.0 18%
Operating expenses 34.5 32.2 7% 28.4 21% 66.7 54.4 23%
Operating profit before provisions 39.3 36.2 9% 37.0 6% 75.5 66.6 13%
Net profit 29.0 27.0 7% 28.1 3% 56.0 50.6 11%
EVA* 14.6 12.5 17% 19.6 -26% 27.1 34.7 -22%

Return on allocated equity** 24.1% 22.3% 33.8% 23.2% 33.1%

Cost-income ratio 46.7% 47.1% 43.6% 46.9% 45.0%
Net loan losses*** 0.31% 0.25% 0.21% 0.28% 0.20%
Net interest margin 2.81% 2.80% 2.78% 2.80% 2.77%

Loans**** 5,749.9 5,546.5 4% 4,457.1 29%

Deposits 3,557.8 3,568.2 0% 3,170.3 12%
Allocated equity** 474.4 485.5 -2% 361.8 31%
Assets 7,437.7 7,186.9 3% 5,916.3 26%

Number of employees (full-time equivalent) 3,237 3,319 -2% 3,304 -2%

* Cost of equity used for EVA calculation was 10% in 2007 and 12% in 2008
** based on 8% capital adequacy for 2007 and 8.4% for 2008
*** net loan losses equals to (provisions+write-offs – recoveries) / beginning of the year loan portfolio
**** Loans to customers (excluding repos)

Strong performance of Lithuanian business unit was a result of solid core revenues and moderate increase
in expenses and net loan losses. Net profit totaled EUR 29m in Q2. Core ratios improved during the quarter:
ROE was 24.1% and cost income ratio 46.7% in Q208.

INCOME
Total income increased by 13% yoy and was EUR
73.8m in Q208. Quarterly increase was EUR 5.4m.
Net interest income increased by EUR 1.2m QoQ,
+31% YoY. Net interest margin did not change during
Q2 and was 2.81%.
Lithuanian business unit’s loan portfolio increased by
29% yoy and grew by EUR 203m in Q208. Strongest
growth was mortgages in EUR +65m, followed by
corporate lending EUR +63m and asset based
finance EUR +55m. Deposits decreased by EUR
10m in Q2, +12% YoY.
Net fees and commissions increased by EUR 1.8m
QoQ and by +5% YoY. Trading income increased in
quarterly comparison but was affected by fair value
adjustments of the life insurance portfolio.
EXPENSES
Operating expenses showed EUR 2.3m QoQ
increase; annual growth was 21%. In annual
comparison personnel expenses grew 23%, IT
expenses 19% and all other expenses 20%. Number
of employees declined by 83 in Q208 to 3237, annual
decline was 2%.
ASSET QUALITY
Net loan losses were EUR 4.1m in Q208, an increase
of EUR 0.8m from Q108. Net loan losses formed
0.31% of the beginning of the year portfolio in Q208 -
an increase of 6bp from Q1. Loans overdue more
than 60 days formed 0.84% of the 12-month old loan
portfolio - up 8bp from Q1.

Hansabank Group Interim report 16

Q2 2008
COUNTRY-BASED BALANCE SHEETS – LITHUANIA

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Assets
Cash, dues from central bank and other banks 564.3 597.4 835.6 517.4 541.8
Securities 989.1 908.2 923.4 828.8 786.3
Loans 5,754.1 5,551.1 5,374.4 5,012.0 4,463.0
- Allowances for credit losses -47.9 -45.2 -43.0 -41.9 -38.9
Net loans 5,706.2 5,505.9 5,331.4 4,970.1 4,424.1
Other assets 178.1 175.4 187.8 183.5 164.1
Total assets 7,437.7 7,186.9 7,278.2 6,499.8 5,916.3

Liabilities
Deposits 3,557.8 3,568.2 3,633.1 3,307.7 3,170.3
Demand deposits 2,136.0 2,137.4 2,373.9 2,210.4 2,135.5
Time deposits 1,421.8 1,430.8 1,259.2 1,097.3 1,034.8
External funding 2,690.8 2,499.0 2,593.5 2,187.9 1,874.9
Other liabilities and internal funding adjustment 714.7 634.2 645.1 603.7 509.3
Equity 474.4 485.5 406.5 400.5 361.8
Total liabilities and equity 7,437.7 7,186.9 7,278.2 6,499.8 5,916.3

COUNTRY-BASED INCOME STATEMENTS – LITHUANIA

(in millions of euros, unaudited) Q2 2008 Q1 2008 Q4 2007 Q3 2007 Q2 2007

Interest income 108.7 106.3 97.4 82.8 70.5

Interest expense -57.5 -56.3 -48.2 -39.2 -31.4
Interest income, net 51.2 50.0 49.2 43.6 39.1

Fee and commission income 20.1 16.8 17.9 17.5 18.1

Fee and commission expense -6.2 -4.7 -5.2 -5.1 -4.8
Fees and commissions, net 13.9 12.1 12.7 12.4 13.3

Net result from financial operations 4.6 1.8 7.9 6.8 6.9
Net income from insurance activities 2.0 3.1 3.9 2.4 2.7
Other income 2.1 1.4 2.7 2.3 3.4
Total income 73.8 68.4 76.4 67.5 65.4

Operating expenses
Personnel expenses 18.0 17.5 18.0 14.1 14.6
Data network expenses 6.9 6.3 6.6 5.7 5.8
Administrative expenses 5.2 4.8 6.1 4.3 4.3
Other expenses 2.0 2.6 3.6 2.2 1.7
Depreciation 0.7 0.7 0.6 0.8 0.6
Group overhead adjustment 1.7 0.3 1.3 1.7 1.4
Total operating expenses 34.5 32.2 36.2 28.8 28.4
Operating profit before provisions 39.3 36.2 40.2 38.7 37.0
Losses on loans and guarantees -4.5 -3.7 -1.5 -4.1 -2.4
Recovered loans 0.4 0.4 0.3 0.4 0.4
Income from associated companies - - - - -
Profit before income tax 35.2 32.9 39.0 35.0 35.0
Income tax -6.2 -5.9 -6.6 -6.0 -6.9
Profit after income tax 29.0 27.0 32.4 29.0 28.1
Minority interest - - - - -
Net profit 29.0 27.0 32.4 29.0 28.1

Hansabank Group Interim report 17

Q2 2008
CONSOLIDATED BALANCE SHEETS

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Assets
Cash 215.4 230.1 280.8 223.1 222.9
Due from Central Bank 1,334.8 1,533.2 1,270.8 1,471.0 1,347.3
Due from other financial institutions 1,477.6 1,456.7 2,236.3 1,035.0 1,246.4
Trading securities 150.6 150.1 212.2 246.6 225.6
Financial assets designated at fair value through P/L 1,196.9 1,115.5 1,142.2 1,023.8 959.8
Held-to-maturity securities 125.5 122.1 133.0 137.0 138.7
Investments in associates 0.4 3.9 3.7 3.5 3.2
Available for sale securities 8.6 0.1 0.1 0.2 0.1
Loans 20,667.3 20,970.4 20,169.4 19,087.7 17,923.7
- Allowances for credit losses -182.1 -174.0 -156.3 -139.2 -127.3
Net loans 20,485.2 20,796.4 20,013.1 18,948.5 17,796.4
Tangible assets 142.1 142.0 134.2 125.6 122.1
Intangible assets 32.5 29.4 29.6 28.9 29.0
Prepayments and accrued interest 244.8 260.8 282.5 279.5 294.3
Other assets 96.8 69.4 87.7 70.8 148.5
Total assets 25,511.2 25,909.7 25,826.2 23,593.5 22,534.3

Liabilities
Due to Central Bank and government 27.3 2.0 2.4 16.5 3.4
Due to other financial institutions 9,788.1 10,574.3 10,506.3 9,257.4 8,349.7
Deposits 11,034.5 10,917.2 10,913.3 10,107.1 10,050.7
Demand deposits 6,528.4 6,598.9 7,097.2 6,956.1 7,104.3
Time deposits 4,506.1 4,318.3 3,816.1 3,151.0 2,946.4
Debt securities issued 1,012.7 897.5 872.0 881.1 895.5
Accrued liabilities 378.0 403.3 425.1 406.5 374.2
Other reserves 373.0 379.7 412.9 397.6 365.6
Deferred tax liability 2.8 2.8 2.7 2.6 2.6
Other liabilities 271.6 200.9 287.7 267.7 354.2
Total liabilities 22,888.0 23,377.7 23,422.4 21,336.5 20,395.9
Subordinated Loan 500.0 538.0 520.5 500.0 500.0

Equity attributable to equity holders of parent

Common stock 202.8 202.8 202.8 202.8 202.8
Share premium 32.2 32.2 32.2 32.2 32.2
Reserves 64.1 55.8 55.7 55.7 55.7
Other restricted equity - - - 6.4 6.4
Revaluation reserve -26.3 -20.1 -15.2 - -20.2
Cash-flow hedge reserve -7.7 -5.5 -6.9 -30.0 -
Retained earnings 1,858.1 1,728.8 1,614.7 1,489.9 1,361.5
Total equity attributable to equity holders of parent 2,123.2 1,994.0 1,883.3 1,757.0 1,638.4
Minority interest - - - - -
Total shareholders' equity 2,123.2 1,994.0 1,883.3 1,757.0 1,638.4
Total liabilities and shareholders' equity 25,511.2 25,909.7 25,826.2 23,593.5 22,534.3

Hansabank Group Interim report 18

Q2 2008
CONSOLIDATED INCOME STATEMENTS

(in millions of euros, unaudited) Q2 2008 Q1 2008 Q4 2007 Q3 2007 Q2 2007

Continuing operations
Interest income 402.1 394.3 379.1 339.0 303.1
Interest expense -232.8 -224.2 -204.9 -175.9 -150.8
Interest income, net 169.3 170.1 174.2 163.1 152.3

Fee and commission income 69.3 64.5 70.0 69.1 68.9

Fee and commission expense -18.3 -15.9 -18.5 -17.7 -16.8
Fees and commissions, net 51.0 48.6 51.5 51.4 52.1

Net result from financial operations 17.2 8.4 17.3 22.8 25.6
Net income from insurance activities 7.3 8.0 8.9 5.4 5.1
Other income 13.9 5.7 6.4 6.9 6.2
Total income 258.7 240.8 258.3 249.6 241.3

Operating expenses
Personnel expenses 36.7 57.0 61.3 55.3 53.7
Data network expenses 9.1 7.6 8.9 7.8 8.6
Administrative expenses 20.9 17.8 21.6 16.2 15.4
Other expenses 12.7 10.2 16.5 10.9 11.5
Depreciation 5.6 5.3 5.4 5.0 4.9
Total operating expenses 85.0 97.9 113.7 95.2 94.1
Operating profit before provisions 173.7 142.9 144.6 154.4 147.2
Losses on loans and guarantees -27.6 -20.0 -21.7 -17.4 -9.3
Recovered loans 1.7 1.6 1.7 1.1 1.3
Share of profit of associates - 0.2 0.2 0.3 0.1
Profit before income tax 147.8 124.7 124.8 138.4 139.3
Income tax -13.2 -10.9 -12.9 -13.0 -13.3
Profit for the period from continued operations 134.6 113.8 111.9 125.4 126.0
Discontinuing operations
Total profit for the period from discontinued operations 2.9 0.4 6.5 3.0 1.5

Total profit for the period 137.5 114.2 118.4 128.4 127.5
Attributable to:
Equity holders of the parent 137.5 114.2 118.4 128.4 127.5
Minority interest - - - - -

Hansabank Group Interim report 19

Q2 2008
CONSOLIDATED C ASH FLOW STATEMENTS

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Profit before income tax 278.2 126.7 535.7 404.8 262.5

Adjustments to profit before income tax
Loan losses 50.8 21.8 51.8 28.2 18.8
Interest income -829.8 -419.5 -1,353.2 -952.3 -593.7
Interest expense 475.5 238.5 690.5 473.3 287.0
Depreciation and amortization 11.1 5.5 20.6 15.0 9.8
Profit from sales of tangible assets -0.3 - -1.2 -1.3 -0.2
Book value of tangible assets written-off 0.4 - - - 0.2
Total adjustments to operating profit -292.3 -153.7 -591.5 -437.1 -278.1
Changes in operating assets and liabilities
Net change in prepayments 37.5 21.8 -15.6 -22.0 -42.6
Net change in accrued liabilities -73.4 -50.4 21.4 40.8 22.0
Net change in deposits placed with other financial institutions 610.4 592.8 -476.4 57.9 104.0
Net change in financial assets held for trading 61.6 62.1 -141.6 -154.2 -106.6
Net change in loans to financial institutions 209.2 255.5 -87.0 248.9 189.8
Net change in compulsory reserve to Central Bank 5.6 -18.1 -65.2 -47.2 -37.5
Net change in loans -497.9 -801.0 -5,279.1 -4,197.4 -3,033.4
Net change in other assets -11.1 19.0 -24.0 -7.1 -84.9
Net change in short-term liabilities due to other banks -118.5 -178.5 610.8 300.4 148.2
Net change in demand deposits -568.8 -498.3 360.7 219.6 367.7
Net change in time deposits 698.5 502.2 1,222.3 557.3 352.7
Net change in other liabilities -27.5 -72.6 142.3 117.8 180.0
Total adjustments to operating assets and liabilities 325.6 -165.5 -3,731.4 -2,885.2 -1,940.6
Interest received 830.1 419.5 1,326.0 934.5 581.7
Interest paid -449.3 -209.9 -628.9 -430.9 -261.8
Income tax paid -23.9 -10.2 -38.7 -27.6 -9.3
Net cash used in operating activities 668.4 6.9 -3,128.8 -2,441.5 -1,645.6
Cash from investing activities
Net change in securities held for investment 2.3 10.7 -11.7 -15.5 -17.0
Acquisition of tangible assets -25.9 -16.5 -45.3 -30.1 -19.5
Sale of tangible assets 8.0 3.6 7.5 6.2 3.2
Acquisition of intangible assets -5.6 -0.1 -2.4 -1.0 -0.9
Sale of intangible assets 1.5 - - - -
Net cash provided by/used in investing activities -19.7 -2.3 -51.9 -40.4 -34.2
Cash from financing activities
Credit lines of Central Bank and government received 25.1 - - 11.8 -
Credit lines of Central Bank and government paid -0.2 -0.5 -2.8 -0.5 -1.8
Long-term loans received from other financial institutions 570.0 246.4 4,945.6 3,738.7 2,716.2
Long-term loans paid back to other financial institutions -1,178.2 - -1,495.9 -1,227.5 -960.5
Issue of debt securities 144.5 27.3 -152.9 -154.4 -146.3
Dividends paid - - -5.0 -5.0 -5.0
Net change in subordinated liabilities -20.5 17.5 220.5 200.0 200.0
Net cash provided by financing activities -459.3 290.7 3,509.5 2,563.1 1,802.6
Effect of the change in exchange rate from foreign subsidiaries -12.0 -3.5 5.8 -13.8 -8.6
Net increase in cash and cash equivalents 177.4 291.8 334.6 67.4 114.2
Cash and cash equivalents at the beginning of the year 2,806.5 2806.5 2,471.9 2,471.9 2,471.9
Cash and cash equivalents at the end of the period 2,983.9 3,098.3 2,806.5 2,539.3 2,586.1

Hansabank Group Interim report 20

Q2 2008
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(in millions of euros, unaudited) 30.06.08 31.03.08 31.12.07 30.09.07 30.06.07

Equity attributable to equity holders of parent
Share capital
Balance at the beginning of the year 202.8 202.8 202.8 202.8 202.8
Balance at the end of the period 202.8 202.8 202.8 202.8 202.8

Share premium
Balance at the beginning of the year 32.2 32.2 32.2 32.2 32.2
Balance at the end of the period 32.2 32.2 32.2 32.2 32.2

Reserves-general banking reserve

Balance at the beginning of the year 21.8 21.8 21.8 21.8 21.8
Balance at the end of the period 21.8 21.8 21.8 21.8 21.8

Reserves-statutory reserve
Balance at the beginning of the year 33.9 33.9 27.9 27.9 27.9
Appropriations to statutory reserve 8.4 0.1 6.0 6.0 6.0
Balance at the end of the period 42.3 34.0 33.9 33.9 33.9

Other reserves - stock dividends of subsidiaries

Balance at the beginning of the year - - 6.4 6.4 6.4
Change in other reserves - - -6.4 - -
Balance at the end of the period - - - 6.4 6.4

Revaluation reserves
Balance at the beginning of the year -15.2 -15.2 -16.1 -16.1 -16.1
Net change in revaluation reserves -11.1 -4.9 0.9 -13.9 -4.1
Balance at the end of the period -26.3 -20.1 -15.2 -30.0 -20.2

Cash-flow hedge (effective portion)

Balance at the beginning of the year -6.9 -6.9 - - -
Net change in cash-flow hedge reserve -0.8 1.4 -6.9 - -
Balance at the end of the period -7.7 -5.5 -6.9 - -

Retained earnings
Balance at the beginning of the year 1,614.7 1,614.7 1,135.7 1,135.7 1,135.7
Net profit 251.8 114.2 483.5 365.1 236.7
Appropriations to reserves -8.4 -0.1 -6.0 -6.0 -5.9
Dividends paid - - -4.9 -4.9 -5.0
Reclassification * - - 6.4 - -
Balance at the end of the period 1,858.1 1,728.8 1,614.7 1,489.9 1,361.5

Total equity attributable to equity holders of parent 2,123.2 1,994.0 1,883.3 1,757.0 1,638.4

Minority interests
Balance at the beginning of the year - - - - -
Acquisition of subsidiaries - - - - -
Minority share of net profit of subsidiaries - - - - -
Balance at the end of the period - - - - -

Total equity 2,123.2 1,994.0 1,883.3 1,757.0 1,638.4

Hansabank Group Interim report 21

Q2 2008
C APITAL ADEQUACY
NEW CAPITAL ADEQUACY RULES (“BASEL 2”)
On January 1, 2007 Estonia introduced new capital
adequacy rules, Basel 2. The rules are based on the
so-called Basel Accord and are being introduced
throughout the EU according to the provisions of the
EU’s Banking Directive and Capital Requirements
Directive. According to the new rules, the capital
requirement will be more closely linked to the
institute’s risk profile.
According to the new rules, there are two principal
methods to calculate the capital requirement for credit
risks: the standardized method and the IRB (internal
ratings based) method. In the IRB method the capital
requirement, to a greater degree than before, is
linked to the bank’s current and future risk profile, its
own risk measures and an assessment of risk capital
needs. The IRB method applies to banks with
sophisticated and well developed risk measurement
processes. Before applying the IRB method, the
banks are required to seek approval from the
Financial Supervisory Authority. Until the approval is
granted, the capital requirement will be based on the
standardized method which is very similar to the
previous method (Basel 1). In addition to the capital
requirement for credit and market risks a capital
requirement is also introduced for operational risks.
Another of the most important changes in the new
rules is the requirement that the institutions prepare
and document its own internal capital adequacy
assessment process (Pillar 2). All relevant sources of
risk must be taken into account when assessing the
total capital needed, i.e. not only those already
included when calculating the capital requirement for
credit, market and operational risks (Pillar 1).
Moreover, the new rules include requirements on the
institution to disclose comprehensive information
about its risks, risk management and associated
capital requirements (Pillar 3).
Hansabank Group has submitted an application for
regulatory approval of IRB approach in credit risk
area. In 2008, Hansabank Group uses standardized
method for credit, market and operational risks in all
group companies. Information on the capital base
and capital requirements is provided for the most
significant sub-consolidation groups within the
Hansabank Group: AS Hansapank, A/S Hansabanka,
and AB bankas Hansabankas.

HANSABANK GROUP COMPANIES INCLUDED IN CAPITAL ADEQUACY CALCULATION

As of June 30th, 2008 the Hansabank Group companies included in capital adequacy calculation were as follows:

Sub-consolidation groups Companies of the sub-consolidation

(parent company and major group included in the CAD Companies of the sub-consolidation group NOT
subsidiaries) calculation included in the CAD calculation *
AS Hansa Investeerimisfondid Estonia AS Hansa Elukindlustus Estonia
OÜ Crebit Estonia AS Hansa Varakindlustus
Balti Kindlustusmaakleri OÜ (under liquidation)
AS Hansa Capital Estonia
AS Hansapank (Estonia) AS Hansa Liising Eesti
AS Hansa Leasing Russia
Balti Autoliisingu AS

SIA Hansa Lizings

SIA Hansabankas Centrala eka
SIA Baltijas Autolizings
A/S Hansabanka (Latvia)
SIA Hansa Apdrošinašanas Brokeris
AS IPS Hansa Fondi
AS Hansa atklatais pensiju fonds

UAB Hansa Lizingas UAB Hansa gyvybes draudimas

UAB Hansa Investiciju valdymas UADBB Hansa Draudimo Brokeris (sold in 2007)
AB bankas Hansabankas
UAB Baltijos Autolizingas
(Lithuania) UAB Hansa Valda
UADBB”HDB”
* The group’s insurance companies are not included according to the Basel 2 capital adequacy rules.

Hansabank Group Interim report 22

Q2 2008
CAPITAL BASE
The capital base serves as a buffer against the
losses that can arise from risks to which Hansabank
Group is exposed. Hansabank's ability to sustain
large losses is also to a large extent dependent on
the strength of the income statement but also on
more qualitative factors such as risk management
capabilities and internal governance and control.
CAPITAL REQUIREMENT FOR CREDIT RISKS
Credit risk refers to the risk that a counterpart is
incapable of meeting its obligations and pledged
assets do not cover the claims. Credit risk includes
concentration risk that includes large individual
exposures as well as significant exposures to groups
of counterparts whose likelihood of default is driven
by common underlying factors, such as the economy,
sector, geography, instrument type or other. Credit
risk forms the largest part of the total outstanding risk
for the Group and is inherent in almost all regular
credit products such as loans, leasing, credit cards,
guarantees and derivatives.
MARKET RISKS
Exposure to market risks arises from positions that
are affected by changes in market risk factors:
interest rates, foreign exchange rates and equity
prices (or other relevant risk factors such as implicit
volatility for options).
For capital requirement calculation purposes, the
standardized approach has been implemented under
Basel 2 capital adequacy rules.
OPERATIONAL RISK
Operational risk stands for any undesirable impact to
business objectives, including direct or indirect
financial loss or loss of confidence, occurring in day-
to-day business operation, resulting from errors or
omissions in internal procedures or systems, or due
to human errors or fraud, or from external events.
For defining capital requirement to cover unexpected
losses from operational risk, the Group has
implemented the standardized approach under Basel
2 capital adequacy rules. The Group has
implemented the required methods, such as loss
database, risk self-assessment and business
contingency planning.

CAPITAL BASE

According to According to According to

Basel II rules Basel I rules Basel I rules
(in millions of euros) 30.06.08 30.06.08 31.12.07
Primary capital (Tier 1)
Share capital 202.8 202.8 202.8
Share premium 32.2 32.2 32.2
Reserves 62.9 64.1 55.7
Retained earnings from previous periods 1,570.9 1,606.3 1,131.2
Retained earnings from current period - - 483.5
Minority ownership - - -
Revaluation reserves -26.3 -34.0 -22.1
Less: Intangible assets -19.5 -32.5 -29.6
Treasury shares -7.7 - -
Total Tier 1 1,815.3 1,838.9 1,853.7
Supplementary capital (Tier 2)
Subordinated debt 500.0 500.0 500.0
Total Supplementary capital (Tier 2) 500.0 500.0 500.0
Own funds, total 2,315.3 2,338.9 2,353.7
Deductions from own funds 28.6 - -
Own funds, net 2,286.7 2,338.9 2,353.7

Hansabank Group Interim report 23

Q2 2008
CAPITAL RATIOS

According to According to According to

Basel II rules Basel I rules Basel I rules
(per cent, unaudited) 30.06.08 30.06.08 31.12.07
1
Tier 1 capital ratio 9.84% 8.71% 8.60%
2
Tier 2 capital ratio 2.54% 2.37% 2.32%
Total capital ratio 12.37% 11.08% 10.92%
1
Tier 1 capital divided by total risk-weighted on and off balance sheet items
2
Tier 2 capital divided by total risk-weighted on and off balance sheet items

CAPITAL REQUIREMENTS

HANSABANK GROUP
According to According to According to
Basel II rules Basel I rules* Basel I rules*
(in millions of euros) 30.06.08 30.06.08 31.12.07
Capital requirement for credit risks, standardized approach
Central governments and central banks 1.3
Regional and local governments 4.7
Institutions administered by state authorities, non-profit institutions and
associations 25.1
Multilateral development banks -
International organizations -
Credit institutions and investment firms 29.1
Companies 813.4
Retail exposures 200.8
Exposures secured by real property 573.4
Past due claims 6.7
High-risk assets -
Covered bonds -
Short-term debts of credit institutions, investment firms and other
companies -
Shares of investment funds 1.3
Other assets 66.3
Securitized positions -
Total capital requirement for credit risk 1,722.1 2,007.5 2,048.1
Capital requirement for market risks
Foreign exchange risk capital requirement 28.4
Commodities risk capital requirement -
Capital requirem ent for interest rate risk 14.4
Equity position capital requirem ent 2.7
Capital requirem ents for options 0.4
Capital requirem ent of trade portfolio positions exceeding limitations on
concentration of exposures -
Trade portfolio delivery risk capital requirem ent -
Foreign exchange risk, commodities risk and trade portfolio position
risk capital requirements according to the internal models approach -
Total capital requirement for market risk 45.9 94.7 94.6
Capital requirement for operational risks
Operational risk standardized approach 97.5
Total capital requirement for operational risk 97.5
Total capital requirement 1,865.5 2,102.2 2,142.7
* Regulative split of risk position classes was different in Basel 1

Hansabank Group Interim report 24

Q2 2008
CAPITAL REQUIREMENTS, SIGNIFICANT SUB-CONSOLIDATION GROUPS

A/S AB bankas
AS Hansabanka Hansabankas
June 30, 2008 Hansabank Latvia Lithuania
(in millions of euros)
Capital requirement for credit risks, standardized approach
Central governments and central banks 0.2 0.3 0.3
Regional and local governments 2.4 1.3 -
Institutions administered by state authorities, non-profit institutions and
associations 19.6 - 2.3
Multilateral development banks - - -
International organizations - - -
Credit institutions and investment firms 123.7 8.3 4.7
Companies 236.5 280.1 160.2
Retail exposures 32.5 39.4 34.4
Exposures secured by real property 320.0 54.2 52.3
Past due claims 1.1 2.6 0.6
High-risk assets - - -
Covered bonds - - -
Short-term debts of credit institutions, investment firms and other
companies - - -
Shares of investment funds - - -
Other assets 4.6 3.7 4.9
Securitized positions - - -
Total capital requirement for credit risk 740.6 389.9 259.7
Capital requirement for market risks
Foreign exchange risk capital requirement 11.3 - 54.9
Commodities risk capital requirement - - -
Capital requirem ent for interest rate risk 1.4 5.2 8.0
Equity position capital requirem ent 2.5 - -
Capital requirem ents for options 0.5 - -
Capital requirem ent of trade portfolio positions exceeding limitations on
concentration of exposures - - -
Trade portfolio delivery risk capital requirement - - -
Foreign exchange risk, commodities risk and trade portfolio position
risk capital requirements according to the internal models approach - - -
Total capital requirement for market risk 15.7 5.2 62.9
Capital requirement for operational risks
Operational risk standardized approach 33.7 24.9 22.4
Total capital requirement for operational risk 33.7 24.9 22.4
Total capital requirement 790.0 420.0 345.0
* Individual subsidiary results do not sum to total group results due to eliminations

Hansabank Group Interim report 25

Q2 2008
INCOME BY BUSINESS SEGMENTS

(in millions of euros, for the period) 6m 2008 share 2007 share
Banking 457.3 88% 874.3 87%
Leasing 74.4 14% 135.5 14%
Insurance 9.3 2% 24.4 2%
Other 5.2 1% 13.1 1%
Eliminations -26.3 -5% -44.7 -4%
Total income 519.9 100% 1,002.6 100%

NET PROFIT BY BUSINESS SEGMENTS

(in millions of euros, for the period) 6m 2008 share 2007 share
Banking 217.9 87% 390.0 81%
Leasing 30.0 12% 77.8 16%
Insurance 5.5 2% 16.1 3%
Other -1.7 -1% -0.4 0%
Total net profit 251.7 100% 483.5 100%

ASSETS BY BUSINESS SEGMENTS

(in millions of euros) 30.06.08 share 31.12.07 share

Banking 22,314.6 87% 22,628.1 88%
Leasing 4,401.4 17% 4,278.0 16%
Insurance 424.4 2% 454.2 2%
Other 65.3 0% 53.1 0%
Eliminations -1,694.5 -7% -1,587.2 -6%
Total assets 25,511.2 100% 25,826.2 100%

Hansabank Group Interim report 26

Q2 2008
DISTRIBUTION OF LOANS BY PRODUCT

(in millions of euros) 30.06.08 31.12.07

Loans 15,625.6 15,553.2
Finance leases 3,254.0 3,237.7
Overdraft 969.2 713.7
Factoring 492.1 444.2
Repos 326.4 220.6
Gross lending to customers 20,667.3 20,169.4
Specified loan-loss allowance -182.1 -156.3
Net lending to customers 20,485.2 20,013.1

GEOGRAPHIC DISTRIBUTION OF LOANS*

(in millions of euros) 30.06.08 31.12.07

Estonia 8,059.5 7,533.9
Latvia 6,445.3 6,032.9
Lithuania 5,754.5 5,377.1
OECD 332.6 227.8
Other 75.4 997.7
Gross lending to customers 20,667.3 20,169.4
Specified loan-loss allowance -182.1 -156.3
Net lending to customers 20,485.3 20,013.1

* The distribution of loans is based on the origin of customer

* Loan portfolio includes repos

LOAN PORTFOLIO BY SECTORS

(in millions of euros) 30.06.08 % 31.12.07 %

Individuals 8,621.4 42.4% 8,140.2 40.8%
Student Loans 175.6 0.9% 180.4 0.9%
Wholesale and retailing 1,802.6 8.9% 1,841.8 9.2%
Industry 1,811.2 8.9% 1,847.4 9.3%
Real estate management and other business
services 3,109.5 15.3% 3,249.9 16.3%
Transport and communications 1,049.8 5.2% 1,177.6 5.9%
Energy 183.6 0.9% 186.7 0.9%
Municipalities and government 61.2 0.3% 111.1 0.6%
Agriculture and forestry 506.3 2.5% 435.4 2.2%
Construction 579.7 2.8% 609.3 3.1%
Hotels and restaurants 327.8 1.6% 329.0 1.6%
Finance and insurance 100.5 0.5% 15.0 0.1%
Other business services 1,587.4 7.8% 1,557.1 7.8%
Other 424.3 2.1% 267.9 1.3%
Total 20,340.9 100.0% 19,948.8 100.0%

* Loan portfolio does not include repos

** Starting from 2008, Bank of Estonia changed the official sector classification details. During the process of implementing the
new classification, Hansabank reviewed the sector data in detail. As a result, many reclassifications were performed with
strongest impact to the real estate management sector.

Hansabank Group Interim report 27

Q2 2008
GEOGRAPHIC DISTRIBUTION

Derivative fin.
instruments, fin.
Liabilities and commitments and Profit before income
Assets shareholders equity guarantees tax
(in millions of euros) 30.06.08 31.12.07 30.06.08 31.12.07 30.06.08 31.12.07 30.06.08 31.12.07
Estonia 9,143.2 8,630.8 6,899.0 6,263.5 1,540.0 1,710.2 118.4 203.9
Latvia 6,896.7 6,615.0 2,810.5 2,696.2 1,515.3 1,421.7 80.5 167.2
Lithuania 6,359.8 6,043.9 4,482.5 4,288.5 1,487.4 1,527.3 76.5 144.5
CIS 163.5 1,192.5 107.4 369.0 41.8 142.2 2.8 20.1
OECD 2,886.3 3,258.8 10,938.2 11,774.6 3,520.7 3,479.6 - -
Other 61.7 85.2 273.6 434.4 13.5 10.4 - -
Total 25,511.2 25,826.2 25,511.2 25,826.2 8,118.7 8,291.4 278.2 535.7

TANGIBLE ASSETS

Equipment
(in millions of euros, June 30, 2008) Land Buildings and other* Construction Total
Cost
Balance at the beginning of the year 4.4 101.1 125.1 5.6 236.2
Additions 0.1 2.2 16.4 7.5 26.2
Reclassification - 0.2 -3.6 -0.2 -3.6
Disposals - -0.4 -7.0 - -7.4
Write-offs - -0.2 -0.5 - -0.7
Effect of movements in foreign exchange - -0.5 -0.6 - -1.1
Balance at the end of the period 4.5 102.4 129.8 12.9 249.6

Depreciation
Balance at the beginning of the year - 26.9 75.0 - 101.9
Depreciation charge for the year - 2.3 7.8 - 10.1
Reclassification - - -1.2 - -1.2
Disposals - -0.3 -2.3 - -2.6
Write-offs - - -0.3 - -0.3
Effect of movements in foreign exchange - -0.1 -0.3 - -0.4
Balance at the end of the period - 28.8 78.7 - 107.5
- 28.8 78.8 - 107.5
Net book value
Balance at the beginning of the period 4.4 74.2 50.1 5.6 134.3
Balance at the end of the period 4.5 73.6 51.1 12.9 142.1

* Equipment and other tangible assets also include fixed assets under operating lease

Hansabank Group Interim report 28

Q2 2008
DEPOSITS DIVIDED BY CLIENT TYPE

Estonia Latvia Lithuania Russia Group

(in millions of euros) 30.06.08 31.12.07 30.06.08 31.12.07 30.06.08 31.12.07 30.06.08 31.12.07 30.06.08 31.12.07

Demand deposits
Public sector 16.1 16.2 19.3 15.5 248.4 320.5 - - 283.8 352.2
Corporate customers 604.4 756.8 419.2 522.7 348.7 406.6 - 33.9 1,372.3 1,720.0
Private individuals 1,123.7 1,073.0 623.1 646.9 1,306.0 1,391.9 - 7.2 3,052.8 3,119.0
Total demand deposits 1,744.2 1,846.0 1,061.6 1,185.1 1,903.1 2,119.0 - 41.1 4,708.9 5,191.2

Overnight deposits*
Public sector 52.1 43.7 10.9 3.4 95.7 41.5 - - 158.7 88.6
Corporate customers 1,053.5 1,074.5 331.3 380.6 133.0 212.5 - - 1,517.8 1,667.6
Private individuals 88.0 73.9 50.9 75.1 4.1 0.8 - - 143.0 149.8
Total overnight deposits 1,193.6 1,192.1 393.1 459.1 232.8 254.8 - - 1,819.5 1,906.0
1,819.51
Time deposits
Public sector 299.6 156.4 27.8 5.8 102.8 34.8 - - 430.2 197.0
Corporate customers 743.6 717.7 265.4 140.2 64.6 78.4 - 2.4 1,073.6 938.7
Private individuals 1,016.4 878.5 731.5 654.4 1,254.4 1,146.0 - 1.5 3,002.3 2,680.4
Total time deposits 2,059.6 1,752.6 1,024.7 800.4 1,421.8 1,259.2 - 3.9 4,506.1 3,816.1
Total deposits 4,997.4 4,790.7 2,479.4 2,444.6 3,557.7 3,633.0 - 45.0 11,034.5 10,913.3

*In the balance sheet overnight deposits are recorded as part of demand deposits

Hansabank Group Interim report 29

Q2 2008
DERIVATIVE FINANCIAL INSTRUMENTS

30.06.08 31.12.07
Contractual/ Contractual/
notional notional
amount Fair values amount Fair values
(in millions of euros) Total** Assets Liabilities Total** Assets Liabilities
Foreign exchange derivatives
Forward exchange contracts 114.1 0.5 -0.4 145.3 0.2 -1.6
Currency swaps 2,583.1 8.4 -7.5 1,943.1 5.7 -9.7
incl. hedges - - - - - -
OTC* options bought and sold 125.5 0.2 -0.2 239.9 0.6 -0.5
Other 133.8 0.3 -0.2 100.9 0.3 -0.1
Total FX derivatives 2,956.5 9.4 -8.3 2,429.2 6.8 -11.9

Interest rate derivatives

Swaps 1,072.7 1.1 -10.5 1,078.1 13.2 -0.9
incl. hedges 1,005.7 - -9.3 1,008.2 12.5 -
OTC options bought and sold 1.9 - - 1.9 - -
Other 68.3 - - 33.3 - -
Total interest rate derivatives 1,142.9 1.1 -10.5 1,113.3 13.2 -0.9

Equity and other derivatives

Futures 73.3 1.7 -1.2 175.5 3.1 -2.8
OTC options bought and sold 579.1 50.0 -5.0 847.7 53.9 -13.3
Total equity and other
derivatives 652.4 51.7 -6.2 1,023.2 57.0 -16.1

Total derivatives 4,751.8 62.2 -25.0 4,565.7 77.0 -28.9

* Over the counter

** Includes the sum of long and short notional amounts
The bank has designed a fair value hedge to eliminate the interest risk from fixed rate leasing and loan contracts, which are
funded from short-term deposits. The hedging instruments are interest rate swaps (IRS) that transform fixed rate assets to
variable rate assets, which are naturally hedged with short-term deposits. The hedging period is intended to match the maturity
of the last hedging instrument.

FINANCIAL COMMITMENTS AND GUARANTEES

30.06.08 31.12.07
Risk Risk
Credit Credit
Nominal weighted Nominal weighted
equivalent equivalent
(in millions of euros) amount amount
Guarantees 556.5 425.5 393.7 502.1 384.3 360.7
Undisbursed facilities 1,902.1 644.8 635.2 2,391.3 930.9 920.7
Letters of credit 25.6 12.8 12.3 49.1 24.5 24.3
Other 882.8 - - 783.2 - -
Total 3,367.0 1,083.1 1,041.2 3,725.7 1,339.7 1,305.7

Hansabank Group Interim report 30

Q2 2008
 MATURITY STRUCTURE

June 30, 2008 Under 1…3 3…12 1…2 2…5 Over 5 Other Non-
(without financial
(in millions of euros) 1 month months months years years years Total
maturity) assets

Assets
Cash and due from Central Bank 1,550.2 - - - - - - - 1,550.2
Due from other financial institutions 1,290.9 180.9 5.8 - - - - - 1,477.6
Securities 74.1 154.9 420.0 300.8 203.7 88.5 240.0 - 1,482.0
Loans 925.0 1,349.9 3,185.0 2,223.0 4,040.3 8,944.1 - - 20,667.3
- Allowance for credit losses -37.8 -13.6 -39.5 -24.3 -31.8 -35.1 - - -182.1
Tangible and intangible assets - - - - - - - 174.6 174.6
Other assets 234.0 21.2 39.6 6.6 8.0 19.9 - 12.3 341.6
Total assets 4,036.4 1,693.3 3,610.9 2,506.1 4,220.2 9,017.4 240.0 186.9 25,511.2

Liabilities
Due to Central Bank and Government 25.8 0.2 0.4 0.4 0.4 0.1 - - 27.3
Due to other financial institutions 623.6 560.6 1,124.4 1,912.3 5,449.8 117.4 - - 9,788.1
Deposits 8,241.4 1,032.5 1,579.7 163.2 16.3 1.4 - - 11,034.5
Debt securities issued to the public 136.3 27.9 65.8 754.3 2.9 - - - 987.2
Other liabilities 442.1 74.0 115.4 39.4 61.8 96.2 172.8 49.2 1,050.9
Subordinated liabilities - - - - - 500.0 - - 500.0
Shareholders' equity - - - - - - - 2,123.2 2,123.2
Total liabilities 9,469.2 1,695.2 2,885.7 2,869.6 5,531.2 715.1 172.8 2,172.4 25,511.2
Balance sheet maturity gap -5,432.8 -1.9 725.2 -363.5 -1,311.0 8,302.3 67.2 -1,985.5 -

Off balance sheet items

Guarantees, letters of credit and
undisbursed loans -618.1 -390.9 -1,172.2 -445.6 -500.5 -239.6 - - -3,366.9
Derivatives, assets 1,530.7 877.9 1,706.7 93.7 28.4 32.3 - - 4,269.7
Derivatives, liabilities -1,534.7 -882.7 -1,790.9 -112.1 -31.7 -32.3 - - -4,384.4
Off balance sheet maturity gap -622.1 -395.7 -1,256.4 -464.0 -503.8 -239.6 - - -3,481.6
Net maturity gap -6,054.9 -397.6 -531.2 -827.5 -1,814.8 8,062.7 67.2 -1,985.5 -3,481.6

Hansabank Group Interim report 31

Q2 2008
OPEN CURRENCY P OSITIONS

June 30, 2008

(in millions of euros) EEK LVL LTL EUR USD Others Total

Assets
Cash and due from Central Bank 779.5 357.8 370.5 26.3 8.0 8.1 1,550.2
Due from other financial institutions 43.3 42.7 1.7 1,011.0 249.9 129.0 1,477.6
Securities 76.4 35.7 67.6 1,161.4 133.6 7.3 1,482.0
Loans 981.1 686.7 1,505.9 17,063.0 420.0 10.6 20,667.3
- Allowance for credit losses -14.2 -15.1 -18.8 -131.3 -2.7 - -182.1
Tangible and intangible assets 56.4 51.8 66.4 - - - 174.6
Other assets 94.5 20.0 53.2 158.0 11.5 4.4 341.6
Total assets 2,017.0 1,179.6 2,046.5 19,288.4 820.3 159.4 25,511.2

Liabilities
Due to Central Bank and Government 0.9 - 0.7 24.4 1.3 - 27.3
Due to other financial institutions 42.5 101.4 7.0 9,505.2 98.2 33.8 9,788.1
Deposits 3,512.7 1,213.0 2,869.6 2,671.4 674.7 93.1 11,034.5
Debt securities issued to the public - - 166.0 820.5 0.7 - 987.2
Other liabilities 210.8 81.2 263.2 386.9 93.0 15.8 1,050.9
Subordinated liabilities - - - 500.0 - - 500.0
Total liabilities 3,766.9 1,395.6 3,306.5 13,908.4 867.9 142.7 23,388.0
Shareholders' equity 2,123.2 - - - - - 2,123.2
Net balance sheet position -3,873.1 -216.0 -1,260.0 5,380.0 -47.6 16.7 -

Off balance sheet net notional position 113.8 568.8 586.1 -1,341.0 59.0 3.7 -9.6

Hansabank Group Interim report 32

Q2 2008
DISCONTINUED OPERATIONS

On 12 May 2008, AS Hansapank and AS Hansa
Capital entered into an agreement with Swedbank AB
for the sale of the following operations (Russian
business unit):
 OOO Swedbank - 85% of the shares (Note:
15% of the shares belong to EBRD)
 Hansa Leasing Ltd - 100% of the shares
The sale price was EUR 91.5m. The disposals were
made at market value and it resulted in a loss of EUR
2.8m. Total loss on the sale can be divided into two
components: gain on the sale of equity investment
(EUR 1.7m) is classified under Other income and loss
on the adjustment of unrealized foreign exchange
differences (EUR 4.5m) under Trading income.

In 2008, the financial results of the sold entities have
been consolidated for the period of January to April
(incl). From 30 April 2008, these operations are
reported in accordance with IFRS 5, “Discontinued
operations”.
In connection with the sale of Russian business unit,
Hansabank’s loan portfolio was reduced by EUR
1,076.9m and deposits by EUR 65.4m as of 30 April
2008.

The profit for the period from the discontinued operation is analyzed as follows:
Month end 3 m ended 4 m ended 6 m ended
(in millions of euros) 4/30/2008 6/30/2007 4/30/2008 6/30/2007
Profit in Russian unit for the period 1.2 1.5 1.7 3.4
Gain on the sale of Russian unit 1.7 - 1.7 -
Total 3.0 1.5 3.4 3.4

The following were the results of Russian unit for the period:
Month end 3 m ended 4 m ended 6 m ended
(in millions of euros) 4/30/2008 6/30/2007 4/30/2008 6/30/2007
Total income 6.60 10.38 18.68 19.42
Total operating expenses -2.55 -6.02 -10.53 -10.32
Net credit losses -2.03 -1.28 -4.08 -2.97
Profit before tax 2.03 3.08 4.08 6.13
Income tax expense -0.81 -1.60 -2.39 -2.74
Profit after tax 1.21 1.48 1.69 3.39

Net assets of Russian subsidiaries at the date of disposal were as follows:

(in millions of euros) 4/30/2008
Net assets disposed of 88.2
Attributable goodwill 1.5
Total 89.8
Profit on disposal 1.7
Total consideration 91.5
Satisfied by cash, and net cash inflow arising on disposal 91.5

Hansabank Group Interim report 33

Q2 2008
R ATINGS
MOODY'S INVESTORS SERVICE
27.06.08 24.02.07 31.05.06 14.11.05 12.12.02 29.07.02 29.01.02 02.05.00

Long-term local A1 A1 A1 A1 A1 Baa1 Baa1 Baa1

currency deposit
Global Local Currency Aa3 Aa2
Deposit
Short-term deposit Prime 1 Prime 1 Prime 1 Prime 1 Prime 1 Prime 2 Prime 2 Prime 2
Financial strength C C+ C+ C+ C C C- C-

Senior-debt Aa3 Aa2 Aa3 A1 A1 A2 A2

Hansabank Group’s interim and annual reports are published on the Group’s internet home page:
www.swedbank.com

HANSABANK’S FINANCIAL CALENDAR FOR 2008:

Q1 2008 April 24
Q2 2008 July 17
Q3 2008 October 23
Q4 2008 February 12, 2009

Hansabank Group Interim report 34

Q2 2008