2016 Annual Financial Report

RAIFFEISEN
ZENTRALBANK
ANNUAL FINANCIAL
REPORT 2016
2 Overview
Overview
Raiffeisen Zentralbank (RZB)
Monetary values in € million 2016 Change 2015 2014 2013 2012
Income statement 1/1-31/12 1/1-31/12 1/1-31/12 1/1-31/12 1/1-31/12
Net interest income 3,218 (11.2)% 3,623 4,024 3,931 3,531
Net provisioning for impairment losses (758) (39.8)% (1,259) (1,786) (1,200) (1,031)
Net fee and commission income 1,599 0.3% 1,594 1,647 1,630 1,521
Net trading income 220 >500.0% 16 (21) 323 196
General administrative expenses (3,141) (0.9)% (3,170) (3,294) (3,460) (3,340)
Profit/loss before tax 843 14.4% 737 (56) 1,049 918
Profit/loss after tax 533 14.5% 465 (556) 756 641
Consolidated profit/loss 253 6.7% 237 (399) 422 370
Earnings per share 37.28 2.33 34.95 (58.84) 62.29 58.79
Statement of financial position 31/12 31/12 31/12 31/12 31/12
Loans and advances to banks 11,024 (9.0)% 12,113 18,892 22,650 21,430
Loans and advances to customers 79,769 0.4% 79,458 87,741 90,594 85,600
Deposits from banks 24,060 (14.4)% 28,113 33,200 33,733 38,410
Deposits from customers 80,325 2.9% 78,079 75,168 75,660 66,439
Equity 9,794 5.4% 9,296 9,207 11,788 12,172
Assets 134,847 (2.6)% 138,426 144,805 147,324 145,955
Key ratios 1/1-31/12 1/1-31/12 1/1-31/12 1/1-31/12 1/1-31/12
Return on equity before tax 8.9% 1.3 PP 7.6% – 8.9% 7.9%
Consolidated return on equity 4.7% 0.4 PP 4.3% – 5.9% 5.4%
Cost/income ratio 61.2% 1.8 PP 59.4% 57.5% 57.4% 62.2%
Return on assets before tax 0.61% 0.10% 0.51% – 0.74% 0.60%
Net interest margin (average interest-bearing
assets) 2.51% (0.20) PP 2.72% 2.98% 3.05% 2.61%
Provisioning ratio (average loans and
advances to customers) 0.93% (0.52) PP 1.45% 1.97% 1.40% 1.20%
Bank-specific information 31/12 31/12 31/12 31/12 31/12
NPL ratio 8.7% (2.4) PP 11.1% 10.8% 10.2% 9.7%
Risk-weighted assets (total RWA) 68,055 (5.5)% 72,038 78,703 89,082 87,065
Total capital requirement 5,444 (5.5)% 5,763 6,296 7,127 6,965
Total capital 10,088 2.7% 9,820 11,814 12,645 12,667
Common equity tier 1 ratio (transitional) 11.9% 1.5 PP 10.4% 10.2% 9.8% 10.9%
Common equity tier 1 ratio (fully loaded) 11.9% 2.0 PP 9.9% 8.5% – –
Total capital ratio (transitional) 14.8% 1.2 PP 13.6% 15.0% 13.1% 14.5%
Total capital ratio (fully loaded) 14.0% 0.8 PP 13.2% 13.5% – –
Resources 31/12 31/12 31/12 31/12 31/12
Employees as at reporting date (full-time
equivalents) 50,203 (5.4)% 53,096 56,212 59,372 60,694
Business outlets 2,523 (7.3)% 2,722 2,882 3,037 3,115
In this report, ”RZB”refers to RZB Group respectively not separatley specified Group units. ”RZB AG” is used wherever statements
refer solely to Raiffeisen Zentralbank Österreich AG. Adding and subtracting rounded amounts in tables may have led to minor
differences. Information about changes (percentages) is based on actual and not rounded values, which are shown in the tables.
The original Annual Financial Report was prepared in German. Only the German language version is the authentic one. The
English language version is a non-binding translation of the original German text. Please be aware that due to the rounding off of
amounts and percentages there may be minor differences.
© 2017 RBI Accounting & Reporting

With cooperation of: RBI Group Communications (Parts of Management Report), RZB Risk Controlling (Parts of Risk Report)
Raiffeisen Zentralbank | Annual Financial Report 2016

Content 3
Content
Consolidated financial statements ............................................................................................................................................. 4
Statement of comprehensive income ...................................................................................................................................................................................................... 4

Interim results..................................................................................................................................................................................................................................................... 7
Statement of financial position ................................................................................................................................................................................................................... 8
Statement of changes in equity ................................................................................................................................................................................................................. 9
Statement of cash flows............................................................................................................................................................................................................................. 10
Segment reporting....................................................................................................................................................................................................................................... 12
Notes ............................................................................................................................................................................................................................................................... 15
Notes to the income statement............................................................................................................................................................................................................... 19
Notes to the statement of financial position ....................................................................................................................................................................................... 27
Disclosures to financial instruments ........................................................................................................................................................................................................ 54
Risk report ....................................................................................................................................................................................................................................................... 68
Other disclosures ...................................................................................................................................................................................................................................... 100
Events after the reporting date ............................................................................................................................................................................................................. 114
Recognition and measurement principles ........................................................................................................................................................................................ 137
Auditor’s report .......................................................................................................................................................................................................................................... 158
Management report ............................................................................................................................................................... 164
Market development............................................................................................................................................................................................................................... 164

Development of the banking sector................................................................................................................................................................................................... 166
Earnings and financial performance ................................................................................................................................................................................................. 168
Research and development.................................................................................................................................................................................................................. 179
The internal control and risk management system in relation to the Group accounting process ................................................................................ 180
Risk management ..................................................................................................................................................................................................................................... 183
Human Resources .................................................................................................................................................................................................................................... 183
Outlook ........................................................................................................................................................................................................................................................ 185
Annual financial statements.................................................................................................................................................... 187
Statement of financial position ............................................................................................................................................................................................................. 187

Income statement...................................................................................................................................................................................................................................... 190
Notes ....................................................................................................................................................................................... 191
Company .................................................................................................................................................................................................................................................... 191

Recognition and measurement principles....................................................................................................................................................................................... 193
Notes on individual items of the statement of financial position .............................................................................................................................................. 197
Notes to the income statement............................................................................................................................................................................................................ 205
Other............................................................................................................................................................................................................................................................. 206
Management report ............................................................................................................................................................... 213
Market development............................................................................................................................................................................................................................... 213

Development of the banking sector................................................................................................................................................................................................... 215
Business performance............................................................................................................................................................................................................................. 217
Financial performance indicators........................................................................................................................................................................................................ 221
Non-financial Performance Indicators............................................................................................................................................................................................... 224
Corporate responsibility ......................................................................................................................................................................................................................... 225
Risk management ..................................................................................................................................................................................................................................... 226
Risk report .................................................................................................................................................................................................................................................... 227
Internal control and risk management system with regard to the accounting process.................................................................................................... 239
Outlook ........................................................................................................................................................................................................................................................ 241
Auditor's Report ...................................................................................................................................................................... 243
Statement of all legal representatives .................................................................................................................................. 247

4 Consolidated financial statements
Consolidated financial
statements
Statement of comprehensive income
Income statement
in € thousand Notes 2016 2015 Change
Interest income 4,459,090 5,338,577 (16.5)%
Current income from associates 74,375 132,837 (44.0)%
Interest expenses (1,315,907) (1,847,993) (28.8)%
Net interest income [2] 3,217,559 3,623,422 (11.2)%
Net provisioning for impairment losses [3] (757,590) (1,259,049) (39.8)%
Net interest income after provisioning 2,459,970 2,364,372 4.0%
Fee and commission income 2,260,483 2,211,819 2.2%
Fee and commission expense (661,332) (618,014) 7.0%
Net fee and commission income [4] 1,599,151 1,593,805 0.3%
Net trading income [5] 219,604 15,700 >500.0%
Net income from derivatives and liabilities [6] (258,863) (14,457) >500.0%
Net income from financial investments [7] 55,527 (32,583) –
General administrative expenses [8] (3,141,188) (3,170,095) (0.9)%
Other net operating income [9] (118,767) (71,866) 65.3%
Net income from disposal of group assets [10] 27,186 51,993 (47.7)%
Profit/loss before tax 842,620 736,869 14.4%
Income taxes [11] (309,683) (271,515) 14.1%
Profit/loss after tax 532,938 465,354 14.5%
Profit attributable to non-controlling interests [33] (280,309) (228,489) 22.7%
Consolidated profit/loss 252,629 236,864 6.7%
Earnings per share

in € thousand 2016 2015
Consolidated profit/loss 252,629 236,864
Average number of ordinary shares outstanding 6,776,750 6,776,750
Earnings per share in € 37.28 34.95
Earnings per share are obtained by dividing consolidated profit/loss by the average number of common shares outstanding.
There were no conversion rights or options outstanding and earnings per share were not diluted.

Consolidated financial statements 5
Other comprehensive income and total comprehensive income

Total Group equity Non-controlling interests
in € thousand 2016 2015 2016 2015 2016 2015
Profit/loss after tax 532,938 465,354 252,629 236,864 280,309 228,489
Items which are not reclassified to profit and loss 7,756 (7,084) 7,472 (5,276) 285 (1,808)
Remeasurements of defined benefit plans 9,865 5,819 8,805 4,667 1,060 1,152
Changes in equity of companies valued at equity which are not
reclassified to profit and loss (959) (11,868) (449) (9,196) (510) (2,672)
Deferred taxes on items which are not reclassified to profit and
loss (1,150) (1,035) (885) (747) (265) (288)
Items that may be reclassified subsequently to profit or loss 144,513 (134,896) 94,971 (103,541) 49,542 (31,355)
Exchange differences 290,626 (189,332) 181,458 (111,773) 109,168 (77,560)
Capital hedge (43,445) 90,316 (26,418) 54,929 (17,026) 35,387
Net gains (losses) on derivatives hedging fluctuating cash flows1 5,788 (436) 3,921 899 1,867 (1,335)
Changes in equity of companies valued at equity (39,465) (76,800) (25,520) (66,721) (13,946) (10,079)
Net gains (losses) on financial assets available-for-sale (82,011) 81,490 (45,944) 45,075 (36,068) 36,415
Deferred taxes on income and expenses directly recognized in
equity 13,021 (40,133) 7,474 (25,950) 5,547 (14,184)
Other comprehensive income 152,270 (141,980) 102,443 (108,817) 49,826 (33,163)
Total comprehensive income 685,207 323,373 355,072 128,047 330,135 195,326
1 Adjustment of the previous year’s figures due to a capital-neutral shift between group equity and non-controlling interests
Other comprehensive income
According to IAS 19, revaluations of defined benefit plans are to be shown in other comprehensive income. This resulted in other
comprehensive income of € 9,865 thousand in the reporting year (2015: € 5,819 thousand).
The positive exchange rate differences are derived primarily from the appreciation of the Russian rouble, generating a gain of
€347,933 thousand, whereas the devaluation of the Polish zloty created a loss of €48,582 thousand. Due to the deconsolida-
tions, losses of €11,317 thousand (2015: losses of €4,018 thousand) were reclassified to the income statement in the reporting
year.
Capital hedge comprises hedges for investments in economically independent sub-units. The negative result of €43,445 thousand
posted here in reporting year 2016 is attributable to the partial hedging of the net investments in Russia and Poland and the corre-
sponding currency developments in those countries.
Cash flow hedging has been applied in two Group units to hedge against interest rate risk. In the reporting year, no gains or
losses were reclassified to the income statement. In the previous year, losses of €1,079 thousand were reclassified to the income
statement.
Changes in equity of companies valued at equity mainly relate to changes in UNIQA Insurance Group AG in Vienna. This is
attributable, firstly, to measurement changes of the available-for-sale portfolio of securities. Secondly, in connection with the partial
share disposal at the start of December 2016, retained earnings of € 64,205 thousand were reclassified to the income statement.
The item net gains (losses) on financial assets available-for-sale directly shown in equity contains net valuation results from financial
investments. The decrease in this item mainly resulted from the sale of shares in VISA Europe to VISA Inc. and the corresponding
reclassification of retained earnings of €133,623 thousand to the income statement, following an upward revaluation of €47,789
in the first half of 2016. In the previous year, losses of €15 thousand were reclassified to the income statement.

The components of retained earnings developed as follows:
Fair value Companies

Remeasure- Exchange Capital Hyper- Cash flow reserve (afs Deferred valued at
in € thousand ments reserve differences hedge inflation hedge1 financial assets) taxes equity
As at 1/1/2015 (27,592) (2,149,474) 62,162 131,400 (16,360) 35,396 338,943 46,454
Unrealized net gains (losses) of the period 4,667 (114,216) 54,929 0 243 45,066 (26,695) (75,917)
Net gains (losses) reclassified to
income statement 0 2,443 0 0 656 9 (2) 0
As at 31/12/2015 (22,925) (2,261,247) 117,091 131,400 (15,461) 80,471 312,246 (29,462)
Unrealized net gains (losses) of the period 8,805 172,185 (26,418) 0 3,921 28,417 (4,078) 23,780
Net gains (losses) reclassified to
income statement 0 9,273 0 0 0 (74,361) 10,668 (49,749)
As at 31/12/2016 (14,120) (2,079,789) 90,673 131,400 (11,539) 34,527 318,836 (55,431)
1 Adjustment of the previous year’s figures due to a capital-neutral shift between group equity and non-controlling interests

Interim results
in € thousand H1/2015 H2/2015 H1/2016 H2/2016
Net interest income 1,827,108 1,796,314 1,586,239 1,631,320
Net provisioning for impairment losses (605,965) (653,084) (403,301) (354,289)
Net interest income after provisioning 1,221,142 1,143,230 1,182,938 1,277,032
Net fee and commission income 782,829 810,976 772,642 826,509
Net trading income (5,676) 21,377 87,951 131,654
Net income from derivatives and liabilities 31,267 (45,724) (200,910) (57,953)
Net income from financial investments 40,220 (72,803) 178,152 (122,625)
General administrative expenses (1,502,298) (1,667,798) (1,540,726) (1,600,462)
Other net operating income (22,998) (48,868) (102,579) (16,189)
Net income from disposal of group assets 4,140 47,853 (77,490) 104,676
Profit/loss before tax 548,627 188,242 299,978 542,642
Income taxes (167,163) (104,352) (177,178) (132,505)
Profit/loss after tax 381,463 83,890 122,800 410,138
Profit attributable to non-controlling interests (170,948) (57,541) (111,132) (169,177)
Consolidated profit/loss 210,515 26,349 11,668 240,961
in € thousand H1/2013 H2/2013 H1/2014 H2/2014

Net interest income 1,939,453 1,991,606 2,097,393 1,926,720
Net provisioning for impairment losses (455,083) (744,773) (586,748) (1,198,973)
Net interest income after provisioning 1,484,370 1,246,832 1,510,645 727,747
Net fee and commission income 788,211 841,924 805,242 841,482
Net trading income 144,390 178,321 7,386 (27,929)
Net income from derivatives and liabilities (183,321) (66,980) (64,509) 86,391
Net income from financial investments 63,634 86,755 99,600 29,990
General administrative expenses (1,663,292) (1,796,414) (1,632,734) (1,661,110)
Other net operating income (55,049) (16,472) (124,759) (643,318)
Net income from disposal of group assets (6,149) 2,222 (10,921) 1,089
Profit/loss before tax 572,794 476,190 589,950 (645,658)
Income taxes (153,687) (139,764) (155,541) (345,154)
Profit/loss after tax 419,107 336,426 434,409 (990,812)
Profit attributable to non-controlling interests (171,366) (162,060) (185,887) 343,518
Consolidated profit/loss 247,741 174,366 248,522 (647,294)

Statement of financial position

Assets
Cash reserve [13,34] 16,838,583 17,401,694 (3.2)%
Loans and advances to banks [14,34,50] 11,023,532 12,113,132 (9.0)%
Loans and advances to customers [15,34,50] 79,769,079 79,457,653 0.4%
Impairment losses on loans and advances [16,34] (5,245,078) (6,399,737) (18.0)%
Trading assets [17,34,50] 4,944,112 5,774,573 (14.4)%
Derivatives [18,34,50] 1,261,015 1,480,256 (14.8)%
Financial investments [19,34,50] 21,430,231 22,448,227 (4.5)%
Investments in associates [20,34,50] 775,035 1,590,384 (51.3)%
Intangible fixed assets [21,23,34] 676,518 703,804 (3.9)%
Tangible fixed assets [22,23,34] 1,842,621 1,790,217 2.9%
Other assets [24,34,50] 1,530,927 2,065,627 (25.9)%
Total assets 134,846,575 138,425,830 (2.6)%
Equity and liabilities

Deposits from banks [25,34,50] 24,059,774 28,113,082 (14.4)%
Deposits from customers [26,34,50] 80,324,996 78,078,973 2.9%
Debt securities issued [27,34,50] 8,527,381 9,353,330 (8.8)%
Provisions for liabilities and charges [28,34,50] 1,035,629 1,085,276 (4.6)%
Trading liabilities [29,34,50] 5,067,584 5,031,949 0.7%
Derivatives [30,34,50] 779,456 978,346 (20.3)%
Other liabilities [31,34,50] 1,020,492 2,284,967 (55.3)%
Subordinated capital [32,34,50] 4,237,503 4,203,781 0.8%
Equity [33,34] 9,793,760 9,296,127 5.4%
Consolidated equity 5,496,297 5,151,102 6.7%
Consolidated profit/loss 252,629 236,864 6.7%
Non-controlling interests 4,044,834 3,908,160 3.5%
Total equity and liabilities 134,846,575 138,425,830 (2.6)%

Statement of changes in equity

Subscribed Capital Retained Consolidated Non-controlling
in € thousand capital reserves earnings profit/loss interests Total
Equity as at 1/1/2015 492,466 1,834,775 3,323,593 (398,772) 3,955,426 9,207,490
Capital increases/decreases 0 0 0 0 62,670 62,670
Transferred to retained earnings 0 0 (398,772) 398,772 0 0
Dividend payments 0 0 0 0 (57,999) (57,999)
Total comprehensive income 0 0 (108,817) 236,864 195,326 323,373
Other changes 0 0 7,856 0 (247,263) (239,407)
Equity as at 31/12/2015 492,466 1,834,775 2,823,860 236,864 3,908,160 9,296,127
Capital increases/decreases 0 0 0 0 0 0
Transferred to retained earnings 0 0 236,864 (236,864) 0 0
Dividend payments 0 0 0 0 (59,058) (59,058)
Total comprehensive income 0 0 102,443 252,629 330,135 685,207
Other changes 0 21 5,867 0 (134,404) (128,516)
Equity as at 31/12/16 492,466 1,834,796 3,169,034 252,629 4,044,834 9,793,760
The change in capital reserves amounting to € 21 thousand is attributable to the merger with Raiffeisen-Landesbanken-Holding
GmbH, Vienna.
Other capital changes related to non-controlling interests mainly concern the partial disposal of shares in UNIQA Insurance
Group AG, Vienna, and the corresponding € 142,308 thousand decrease in non-controlling interests in BL Syndikat Beteiligungs
GmbH in Vienna.
In the previous year, the other changes in equity were mainly due to a € 280,841 thousand loss of non-controlling interests at-
tributable to the acquisition of a 49 per cent interest in Raiffeisen Bausparkasse GmbH, Vienna. In contrast, the initial consolidation
of the Valida Group, after acquisition of an additional 32.7 per cent interest that brought the total interest in the Valida Group to
57.4 per cent, resulted in a positive effect of € 38,334 thousand.
Further details about the above changes are reported in the notes under (33) Equity.

Statement of cash flows

in € thousand Notes 2016 2015
Profit/loss after tax 532,938 465,354
Non-cash positions in profit/loss and transition to net cash from operating activities:
Write-downs/write-ups of tangible fixed assets and financial investments [7, 8, 21, 23] 562,288 476,464
Net provisioning for liabilities and charges and impairment losses [3, 9, 28, 43] 1,225,652 1,533,364
Gains (losses) from disposals of tangible fixed assets and financial investments [7, 9] (264,888) (106,147)
Profit/loss from at-equity [1, 2, 20] 38,522 (69,779)
Other adjustments (net) 140,143 (1,055,107)
Subtotal 2,234,655 1,244,149
Changes in assets and liabilities arising from operating activities after corrections for non-
cash positions:
Loans and advances to banks and customers [12, 14, 15] (853,780) 14,378,208
Trading assets/trading liabilities (net) [12, 17, 18, 29, 40] 1,023,357 535,103
Other assets/other liabilities (net) [12, 19, 24, 31] 835,593 (4,715,726)
Deposits from banks and customers [12, 25, 26] (3,308,291) (674,836)
Usage of provisions [28, 43] (408,293) (435,349)
Debt securities issued [27, 36] (682,888) (3,318,437)
Net cash from operating activities (1,159,647) 7,013,113
Proceeds from sale of:
Financial investments [7, 19] 2,770,477 4,401,724
Tangible and intangible fixed assets [9, 21, 22, 23] 296,303 186,395
Proceeds from disposal of group assets [10, 53] 214,778 118,334
Payments for purchase of:
Financial investments [19] (2,255,944) (2,480,305)
Tangible and intangible fixed assets [23] (372,850) (370,693)
Payments for acquisition of subsidiaries [19, 53] (105,000) (15,851)
Net cash from investing activities 547,764 1,839,604
Capital increases [33] 0 62,670
Inflows/outflows of subordinated capital [32] (109,566) (130,043)
Dividend payments [33] (59,058) (57,999)
Change in non-controlling interests [33] 42 (251,968)
Net cash from financing activities (168,582) (377,340)

Cash and cash equivalents at the end of previous period1 [12, 13] 17,672,271 9,221,481
Cash from disposal of subsidiaries (163,171) 1
Effect of exchange rate changes 109,949 (24,588)
Cash and cash equivalents at the end of period [12, 13] 16,838,583 17,672,271
1 Cash and cash equivalents as at 1 January 2016 deviates from the item cash reserve due to the disclosure of Raiffeisen Banka d.d., Maribor, and ZUNO BANK AG,
Vienna, pursuant to IFRS 5.
Payments for taxes, interest and dividends 2016 2015

Interest received [2] 4,036,324 4,925,000
Dividends received [2] 227,842 134,871
Interest paid [2] (1,199,507) (1,755,707)
Income taxes paid [11] (427,103) (269,626)

The statement of cash flows shows the structure and changes in cash and cash equivalents during the financial year and is broken
down into three sections:
 net cash from operating activities

 net cash from investing activities
 net cash from financing activities
Net cash from operating activities comprises inflows and outflows from loans and advances to banks and customers, from deposits
from banks and customers as well as debt securities issued. Inflows and outflows from trading assets and liabilities, from deriva-
tives, as well as from other assets and other liabilities are also shown in operating activities. The interest, dividend and tax pay-
ments from operating activities are separately stated.
Net cash from investing activities shows inflows and outflows from financial investments, tangible and intangible assets, proceeds
from disposal of Group assets, and payments for acquisition of subsidiaries.
Net cash from financing activities consists of inflows and outflows of equity and subordinated capital. This covers capital increases,
dividend payments, and changes in subordinated capital.
Cash and cash equivalents include the cash reserve recognized in the statement of financial position, which consists of cash in
hand and balances at central banks due at call. It does not include loans and advances to banks that are due on demand, which
belong to operating activities.

Segment reporting
Segment classification
As a rule, internal management reporting at RZB is based on the current organizational structure. Segmentation is based on cash
generating units (CGU). Accordingly, the RZB management bodies – Management Board and Supervisory Board – make key
decisions that determine the resources allocated to any given segment based on its financial strength and profitability. These
reporting criteria were accordingly seen as material in accordance with IFRS 8 for the purpose of segmentation.
Since RZB AG acts primarily as the central institution of Raiffeisen Banking Group (RBG) and as the holding company for partici-
pations, the segments are defined on the basis of the participation structure following the merger of its principal business areas
with Raiffeisen International Bank-Holding AG. Besides the majority holding in the Raiffeisen Bank International AG (RBI AG) and
its activity as the central institution of Raiffeisen Banking Group, RZB AG holds shares in other companies in its participation portfo-
lio.
These three main business areas correspond to the segments as defined. Segmentation is based on the current Group structure.
Since the RBI segment is the largest by far, we refer to segment reporting in the RBI consolidated annual report for maximum
transparency. The consolidated financial statements of RBI largely reflect the RBI segment in the consolidated financial statements
of RZB.
Raiffeisen Bank International Group (RBI)

This segment comprises the profit of the Raiffeisen Bank International AG group. RBI AG is by far the largest participation of RZB.
As the lead bank in the RZB credit institution group, RZB AG has corresponding management and control responsibilities. Together
with representatives of its owners, RZB AG appoints eight of the ten RBI Supervisory Board members. Beside the profit arising
directly from RBI activities, the segment also covers the expenses incurred for services provided by RZB AG in various areas, such
as audit or risk.
Central institution and specialized subsidiaries

This segment consolidates those activities that enable RZB AG to perform its tasks as the central institution of the RBG. This seg-
ment accordingly reports all the net income from the banking business of RZB AG within the RBG. In addition, it shows the net
income of the specialized subsidiaries which operate in building society, factoring, fund management, and pension fund business
as well as in the leasing business with numerous project companies in Austria and abroad. Allocated expenses from Group-wide
services are also attributed to this segment. These include Group services such as Sector Marketing and Sector Services.
Other equity participations

The segment for other equity participations shows profit from participations not connected with the function of RZB AG as the
central institution of the RBG. This equity participation portfolio contains predominantly non-controlling interests from the non-
banking industries, with income from companies valued at equity. These include investments in UNIQA Insurance Group AG and
Leipnik-Lundenburger Invest Beteiligungs AG (holding company with investments in flour and milling industries and vending). Addi-
tionally, the investment in Notartreuhandbank AG is reported in this segment. The segment for other equity participations also
reports the expenses and income from internal allocation and netting.
Assessment of segment profit and loss

The segment reporting according to IFRS 8 shows the segment performance on the basis of internal management reporting, sup-
plemented with the reconciliation of the segment results to the consolidated financial statements. In principle, RZB’s management
reporting is based on IFRS. Therefore, no differences occur in the recognition and measurement principles between segment
reporting and consolidated financial statements.

To keep the presentation of RZB’s segment performance transparent and informative, the following management and reporting
criteria are used to determine the success of a CGU (cash generating unit):
 Return on equity before tax measures the profitability of the CGU and is calculated as the ratio of pre-tax profit to average
capital employed. It shows the return on the capital employed in the segment. Another measure of profitability used for internal
management is the return on risk-adjusted capital (RORAC). This ratio shows the return on risk-weighted equity (economic capi-
tal), but is not a criterion recognized by IFRS.
 The cost/income ratio shows the cost efficiency of the segments. It is the ratio of general administrative expenses to the sum of
net interest income, net fee and commission income, net trading income and other net operating income (less banking levies,
impairment of goodwill, profit/loss from the release of negative goodwill and profit/loss from banking business due to gov-
ernmental measures).
 Risk-weighted assets are an important indicator of the change in business volume. Risk-weighted assets (total RWA) according
to CRR (based on Basel III) are an industry-specific addition for segment assets. They are crucial for the calculation of the regu-
latory minimum capital requirement.
The presentation of segment performance is based on the income statement. Income and expenses are attributed to the segment
in which they are generated. Income comprises net interest income, net fee and commission income, net trading income and
recurring other net operating income. The results are also shown for associated companies recognized at equity. The main ex-
pense items, which are part of segment results, are shown in the income statement. The segment result is shown up to consolidated
profit/loss. Segment assets are represented by total assets and risk-weighted assets. Liabilities include all the items on the liabilities
side of the statement of financial position except the equity.
The reconciliation includes mainly the amounts resulting from the elimination of intra-group results and consolidation between
segments. The income statement is finally supplemented with financial ratios conventionally used within the industry to evaluate
performance.

Financial year 2016 Central institution and Other Equity

in € thousand RBI specialized subsidiaries participations Reconciliation Total
Net interest income 2,919,956 160,969 154,106 (17,472) 3,217,559
Net fee and commission income 1,503,004 99,494 (158) (3,188) 1,599,151
Net trading income 214,586 628 (1) 4,392 219,604
Recurring other net operating income 49,564 68,736 46,958 (69,395) 95,863
Operating income 4,687,109 329,827 200,905 (85,662) 5,132,178
General administrative expenses (2,879,935) (289,326) (45,598) 73,671 (3,141,188)
Operating result 1,807,174 40,501 155,307 (11,991) 1,990,990
Net provisioning for impairment losses (754,387) (751) 0 (2,452) (757,590)
Other results (208,477) (24,222) (153,819) (4,262) (390,780)
Profit/loss before tax 844,311 15,528 1,488 (18,706) 842,620
Income taxes (315,842) 5,230 973 (45) (309,683)
Profit/loss after tax 528,469 20,758 2,461 (18,750) 532,938
Profit attributable to non-controlling interests (291,715) (6,218) 17,625 0 (280,309)
Profit/loss after deduction of non-
controlling interests 236,753 14,540 20,086 (18,750) 252,629
Risk-weighted assets (credit risk) 48,841,245 6,108,991 1,535,572 (219,647) 56,266,161

Risk-weighted assets (total RWA) 60,060,645 6,537,123 1,658,488 (200,978) 68,055,278
Total capital requirement 4,804,852 522,970 132,679 (16,078) 5,444,422
Assets 112,262,446 23,875,558 2,197,543 (3,488,972) 134,846,575
Risk/revenue ratio 25.8% 0.5% – – 23.5%
Cost/income ratio 61.4% 87.7% 22.7% – 61.2%
Average equity 8,335,009 908,741 264,000 (36,670) 9,471,080
Return on equity before tax 10.1% 1.7% 0.6% – 8.9%
Business outlets 2,506 16 0 1 2,523
Financial year 20151 RBI Central institution and Other Equity

in € thousand specialized subsidiaries participations Reconciliation Total
Net interest income 3,311,306 188,281 143,173 (19,338) 3,623,422
Net fee and commission income 1,526,940 66,215 (79) 729 1,593,805
Net trading income 16,415 1,621 (2) (2,333) 15,700
Recurring other net operating income 76,639 56,500 44,359 (77,522) 99,976
Operating income 4,931,299 312,617 187,450 (98,463) 5,332,903
General administrative expenses (2,964,231) (232,131) (47,661) 73,927 (3,170,095)
Operating result 1,967,069 80,486 139,790 (24,537) 2,162,808
Net provisioning for impairment losses (1,263,802) 3,156 0 1,597 (1,259,049)
Other results (44,757) (30,570) (61,632) (29,931) (166,889)
Profit/loss before tax 658,510 53,072 78,158 (52,871) 736,869
Income taxes (261,290) (12,289) 2,076 (13) (271,515)
Profit/loss after tax 397,220 40,783 80,234 (52,884) 465,354
Profit attributable to non-controlling interests (195,892) (15,867) (16,731) 0 (228,489)
Profit/loss after deduction of non-
controlling interests 201,329 24,917 63,503 (52,884) 236,864
Risk-weighted assets (credit risk) 51,458,646 5,858,077 2,576,124 (304,983) 59,587,865

Risk-weighted assets (total RWA) 63,274,685 6,519,676 2,621,376 (285,125) 72,130,611
Total capital requirement 5,061,975 521,574 209,710 (22,810) 5,770,449
Assets 114,587,661 26,119,687 1,801,347 (4,082,865) 138,425,830
Risk/revenue ratio 38.2% (1.7)% – – 34.7%
Cost/income ratio 60.1% 74.3% 25.4% – 59.4%
Average equity 8,590,743 982,264 289,743 (159,015) 9,703,735
Return on equity before tax 7.7% 5.4% 27.0% – 7.6%
Business outlets 2,705 16 0 1 2,722
1
Due to an error, several individual items in the segment reporting of RZB’s annual report for 2015 contained erroneous figures. These were corrected by publishing an
erratum in June 2016.

Notes
Principles underlying the preparation of financial statements
Reporting entity
Raiffeisen Zentralbank Österreich Aktiengesellschaft (RZB AG) is the central institution of the RBG and registered at the Vienna
Commercial Court (Handelsgericht Wien) under Companies Register number FN 58.882 t. The company address is Am Stadt-
park 9, 1030 Vienna.
At the end of September 2016, the ultimate parent company of RZB AG, Raiffeisen-Landesbanken-Holding GmbH, Vienna, and its
wholly owned subsidiary, R-Landesbanken-Beteiligung GmbH, Vienna, which together held 82.4 per cent of the shares in RZB AG,
were merged into RZB AG. Accordingly, RZB AG serves, until its merger into RBI AG, as the ultimate parent company. The core
shareholders of RZB AG are the Raiffeisen-Landesbanken – i.e. the regional Raiffeisen banks, which together hold 90.4 per cent.
RZB specializes in commercial banking and investment banking in Austria and is one of the country’s most important banks for
corporate finance and export and trade financing. Other activities are cash and asset management and treasury. As a highly
specialized financial engineer, RZB focuses primarily on providing services for major domestic and foreign large customers, multi-
national companies and financial service providers. The RZB companies are also active in private banking, capital investment,
leasing and real estate, and other bank-related services. Through its subsidiaries, RZB has a close network of branches throughout
the CEE region. Supplementing this, it has branches, specialized companies and representative offices in the world’s leading
financial centers and selected Western European locations.
The consolidated financial statements were signed by the Management Board on 1 March 2017 and subsequently submitted to
the Supervisory Board for information.
Principles underlying the consolidated financial statements

The consolidated financial statements for the 2016 financial year and the comparative figures for the 2015 financial year were
prepared in accordance with the International Financial Reporting Standards (IFRS) published by the International Accounting
Standards Board (IASB) insofar as they were adopted by the EU on the basis of IAS Regulation (EC) 1606/2002. The interpreta-
tions of the International Financial Reporting Interpretations Committee (IFRIC/SIC) that were already applicable have been
considered. All standards published by the IASB as International Accounting Standards and adopted by the EU have been ap-
plied to consolidated financial statements for 2016. The consolidated financial statements also satisfy the requirements of Section
245a of the Austrian Commercial Code (UGB) and Section 59a of the Austrian Banking Act (BWG) regarding exempting consol-
idated financial statements that comply with internationally accepted accounting principles. IAS 20, IAS 41 and IFRS 6 have not
been applied as there were no relevant business transactions in the Group.
The consolidated financial statements are based on the reporting packages of all fully consolidated Group members, which are
prepared according to IFRS rules and uniform Group standards. All major subsidiaries prepare their annual financial statements as
at and for the year ended 31 December. Figures in these financial statements are stated in € thousand. The following tables may
contain rounding differences.
The consolidated financial statements are based on the going concern principle.
A financial asset is recognized when it is probable that the future economic benefits will flow to the company and the acquisition
or conversion costs or another value can be reliably measured. A financial liability is recognized when it is probable that an
outflow of resources embodying economic benefits will result from the settlement of the obligation and the amount at which the
settlement will take place can be reliably measured. An exception is certain financial instruments which are recognized at fair
value at the reporting date. Revenue is recognized if the conditions of IAS 18 are met and if it is probable that the economic
benefits will flow to the Group and the amount of revenue can be reliably measured.
Foreign currency translation

The consolidated financial statements are prepared in euro, which is the functional currency of RZB AG. The functional currency is
the currency of the principal economic environment in which the company operates. Each entity within the Group determines its
own functional currency taking all factors listed in IAS 21 into account.
All financial statements of fully consolidated companies prepared in a functional currency other than euro were translated into the
reporting currency euro employing the modified closing rate method in accordance with IAS 21. Equity was translated at its histor-

ical exchange rates, while all other assets, liabilities and the notes were translated at the prevailing foreign exchange rates as of
the reporting date. Differences arising from the translation of equity (historical exchange rates) are offset against retained earnings.
The income statement items were translated at the average exchange rates during the year calculated on the basis of month-end
rates. Differences arising between the exchange rate as of the reporting date and the average exchange rate applied in the
income statement are offset against equity (retained earnings). According to IAS 21, in cases of significantly fluctuating exchange
rates, the transaction rate is applied instead of the average rate.
Accumulated exchange differences are reclassified from the item “exchange differences” shown in other comprehensive income to
the income statement under net income from disposal of group assets, in the event of disposal of a foreign business operation
which leads to loss of control, joint management or significant influence over this business operation.
In the case of one subsidiary headquartered outside the euro area, the US dollar was the reporting currency for measurement
purposes given the economic substance of the underlying transactions, as both the transactions and the refinancing were under-
taken in US dollars. In the case of one subsidiary headquartered in the euro area, the Russian rouble was the reporting currency
for measurement purposes given the economic substance of the underlying transactions and for one subsidiary the Swedish krona
was the functional currency.
The following exchange rates were used for currency translation:
2016 2015
As at Average As at Average
Rates in units per € 31/12 1/1-31/12 31/12 1/1-31/12
Albanian lek (ALL) 135.400 137.299 137.280 139.668
Belarusian rouble (BYN) 2.158 2.216 2.030 1.991
Bosnian marka (BAM) 1.956 1.956 1.956 1.956
Bulgarian lev (BGN) 1.956 1.956 1.956 1.956
Croatian kuna (HRK) 7.560 7.544 7.638 7.621
Czech koruna (CZK) 27.021 27.041 27.023 27.305
Malaysian ringgit (MYR)1 - - 4.696 4.338
Hungarian forint (HUF) 309.830 312.222 315.980 310.045
Kazakh tenge (KZT) 352.622 376.831 371.310 249.078
Polish zloty (PLN) 4.410 4.366 4.264 4.191
Romanian leu (RON) 4.539 4.496 4.524 4.444
Russian rouble (RUB) 64.300 73.876 80.674 69.043
Serbian dinar (RSD) 123.410 122.970 121.626 120.779
Singapore dollar (SGD) 1.523 1.526 1.542 1.529
Swiss franc (CHF) 1.074 1.090 1,084 1.075
Turkish lira (TRY)1 - - 3.177 3.024
Swedish krona (SEK) 9.553 9.450 9.190 9.341
Ukrainian hryvna (UAH) 28.599 28.214 26.223 24.016
US-Dollar (USD) 1.054 1.102 1.089 1.113
1 Due to the disposal of Group assets, the Malaysian ringgit and the Turkish lira were no longer in use in the 2016 financial year.
Key sources of estimation uncertainty and critical accounting judgments

If estimates or assessments are necessary for accounting and measuring under IAS/IFRS rules, they are made in accordance with
the respective standards. They are based on past experience and other factors such as planning and expectations or forecasts of
future events that appear likely. The estimates and underlying assumptions are reviewed on an ongoing basis. Alterations to esti-
mates that affect only one period will be taken into account only in that period. If the following reporting periods are also affect-
ed, the alterations will be taken into consideration in the current and following periods. The critical assumptions, estimates and
accounting judgments are as follows:
Risk provisions for loans and advances
At each reporting date, all financial assets, not measured at fair value through profit or loss, are subject to an impairment test to
determine whether an impairment loss is to be recognized through profit or loss. In particular, it is required to determine whether
there is objective evidence of impairment as a result of a loss event occurring after initial recognition and to estimate the amount
and timing of future cash flows when determining an impairment loss. Risk provisions are described in detail in (43) Risks arising
from financial instruments, in the section on credit risk.

Fair value of financial instruments
Fair value is the price received for the sale of an asset or paid to transfer a liability in an orderly transaction between market
participants at the measurement date. This applies regardless of whether the price can be directly observed or was estimated on
the basis of a measurement method. In determining the fair value of an asset or liability, the Group takes account of certain fea-
tures of the asset or liability (e. g. condition and location of the asset or restrictions in the sale and use of an asset) if market partic-
ipants would also take account of such features in determining the price for the acquisition of the respective asset or for the transfer
of the liability at the measurement date. Where the market for a financial instrument is not active, fair value is established using a
valuation technique or pricing model. For valuation methods and models, estimates are generally used depending on the complex-
ity of the instrument and the availability of market-based data. The inputs to these models are derived from observable market data
where possible. Under certain circumstances, valuation adjustments are necessary in order to account for model risk, liquidity risk
or credit risk. The valuation models are described in the notes in the section on financial instruments – Recognition and measure-
ment. In addition, the fair values of financial instruments are shown in the notes under (41) Fair value of financial instruments.
Provisions for pensions and similar obligations
The cost of the defined benefit pension plan is determined using an actuarial valuation. The actuarial valuation involves making
assumptions about discount rates, expected rates of return on assets, future salary increases, mortality rates and future pension
increases. The interest rate used to discount the Group’s defined benefit obligations is determined on the basis of the yields ob-
tained in the market at the reporting date for top-rated fixed-income corporate bonds. Considerable discretion has to be exercised
in this connection in setting the criteria for the selection of the corporate bonds representing the universe from which the yield curve
is derived. Mercer’s recommendation is used to determine the interest rate. The main criteria for the selection of such corporate
bonds are the issuance volumes of the bonds, the quality of the bonds and the identification of outliers, which are not taken into
account. Assumptions and estimates used for the defined benefit obligation calculations are described in the section on pension
obligations and other termination benefits. Quantitative data for long term employee provisions are disclosed in (28) Provisions for
liabilities and charges.
Impairment of non-financial assets
Certain non-financial assets, including goodwill and other intangible assets, are subject to an annual impairment review. Goodwill
and other intangible assets are tested more frequently if events or changes in circumstances, such as an adverse change in busi-
ness climate, indicate that these assets may be impaired. The determination of the recoverable amount requires judgments and
assumptions to be made by management. Because these estimates and assumptions could result in significant differences to the
amounts reported if underlying circumstances were to change, the Group considers these estimates to be critical. Details concern-
ing the impairment review of non-financial assets are disclosed in the section on business combinations. Additionally, the carrying
amounts of goodwill are presented in (21) Intangible fixed assets.
Deferred tax assets
Deferred tax assets are recognized only to the extent that it is probable that sufficient taxable profit will be available against which
those unused tax losses, unused tax credits or deductible temporary differences can be utilized. A planning period of five years is
used to this end. This assessment requires significant management judgments and assumptions. In determining the amount of de-
ferred tax assets, the management uses historical tax capacity and profitability information, and forecasted operating results based
upon approved business plans, including a review of the eligible carry-forward period.
Deferred taxes are not reported separately in the income statement and statement of financial position. Details are provided in the
statement of comprehensive income, and in (11) Income taxes, (24) Other assets, and (28) Provisions for liabilities and charges.

Leasing agreements
To distinguish between finance leases on the one hand and operating leases on the other, judgments have to be made from the
view of the lessor, the main criterion being the transfer of all risks and opportunities from the lessor to the lessee. Details are pro-
vided in (45) Finance leases, and (46) Operating leases.
Control
According to IFRS 10, a Group controls an investee if it is exposed, or has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its power over the entity. IFRS 10 also provides specific information on
the acknowledgement or assessment of potential voting rights, codecision rights or protective rights of third parties and situations
that are characterized by delegated or retained decision-making rights or de-facto control. Whether control exists requires a
comprehensive assessment (i.e. requiring greater discretion) to determine the parent company’s influence over the investee. Details
are provided in (53) Group composition.
Interests in structured entities
According to IFRS 12, structured entities are companies that have been designed so that voting or similar rights are not the domi-
nant factor in deciding who controls the company. This applies, for instance, when any voting rights relate to administrative tasks
only, and the relevant activities are directed by means of contractual arrangements. For the purposes of this IFRS, an interest in
another entity is a contractual and non-contractual involvement that exposes an entity to variability of returns from the performance
of the other entity.
Assessment of which companies are structured entities, and what involvement in such companies actually represents an interest,
requires judgments to be made. Details are provided in (53) Group composition, in the section on “Structured entities”.

Notes to the income statement

(1) Income statement according to measurement categories
Net gains (losses) on financial assets and liabilities held-for-trading 111,819 80,731
Financial assets and liabilities at fair value through profit or loss 190,950 442,253
Interest income 227,376 250,873
Net gains (losses) on financial assets and liabilities at fair value through profit or loss (36,426) 191,380
Financial assets available-for-sale 266,230 67,341
Net realized gains (losses) on financial assets available-for-sale 219,835 18,166
Impairment on financial assets available-for-sale (52,312) (48,438)
Loans and advances 3,005,244 3,109,921
Interest income 3,761,917 4,368,687
Net realized gains (losses) on financial assets not measured at fair value through profit and loss 10,174 10,848
Impairment on financial assets not measured at fair value through profit and loss (766,847) (1,269,614)
Financial assets held-to-maturity 159,490 178,824
Net realized gains (losses) on financial assets not measured at fair value through profit and loss 12,786 10,831
Write-ups/impairment on financial assets not measured at fair value through profit and loss (55) 21
Financial liabilities (1,316,137) (1,844,088)
Interest expenses (1,315,907) (1,847,993)
Income from repurchase of liabilities (230) 3,905
Derivatives (hedging) 154,082 192,693
Net interest income 160,449 194,761
Net gains (losses) from hedge accounting (6,367) (2,068)
Net revaluations from exchange differences 24,565 66,111
Current income from associates 74,375 132,837
Sundry operating income and expenses (1,827,998) (1,689,755)
Profit/loss before tax 842,620 736,869

(2) Net interest income

Net interest income includes interest income and interest expenses from banking business, dividend income, and fees and commis-
sions with interest-like characteristics.

Interest and interest-like income, total 4,459,090 5,338,577
Interest income 4,375,619 5,227,538
from balances at central banks 20,924 35,865
from loans and advances to banks 195,115 220,428
from loans and advances to customers 3,382,647 3,893,419
from financial investments 371,715 417,809
from leasing claims 180,886 206,585
from derivative financial instruments - economic hedge 63,883 258,671
from derivative financial instruments - hedge accounting 160,449 194,761
Current income 101,127 98,650
from shares and other variable-yield securities 2,420 1,037
from shares in affiliated companies 84,509 79,741
from other interests 14,197 17,871
Interest-like income 15,193 19,524
Negative interest from financial assets (32,848) (7,134)
Current income from associates 74,375 132,837
Interest expenses and interest-like expenses, total (1,315,907) (1,847,993)
Interest expenses (1,293,180) (1,784,511)
on deposits from central banks (14,360) (53,964)
on deposits from banks (209,920) (259,040)
on deposits from customers (678,663) (1,005,150)
on debt securities issued (229,739) (279,025)
on subordinated capital (160,497) (187,330)
Interest-like expenses (40,252) (65,941)
Negative interest from financial liabilities 17,526 2,459
Total 3,217,559 3,623,422
Interest income includes interest income (unwinding) from impaired loans to customers and banks in the amount of
€ 186,383 thousand (2015: € 185,612 thousand). Interest income from impaired loans and advances to customers and banks
is recognized with the rate of interest used to discount the future cash flows for the purpose of measuring impairment loss.
The decline in current income from associates was due in particular to lower earnings contributions from UNIQA Insurance Group
AG, Vienna.

(3) Net provisioning for impairment losses

Net provisioning for impairment losses on items reported on and off the statement of financial position is as follows:

Individual loan loss provisions (771,496) (1,326,810)
Allocation to provisions for impairment losses (1,653,537) (2,009,754)
Release of provisions for impairment losses 866,343 674,827
Direct write-downs (112,640) (119,822)
Income received on written-down claims 128,338 127,939
Portfolio-based loan loss provisions 3,732 56,912
Allocation to provisions for impairment losses (182,946) (196,676)
Release of provisions for impairment losses 186,678 253,588
Gains from the sales of loans 10,174 10,848
Total (757,590) (1,259,049)
Details on risk provisions are shown under (16) Impairment losses on loans and advances.
(4) Net fee and commission income

Payment transfer business 655,938 650,998
Loan and guarantee business 150,148 186,850
Securities business 130,563 130,044
Foreign currency, notes/coins, and precious metals business 391,523 380,977
Management of investment and pension funds 162,215 122,759
Sale of own and third party products 59,670 51,783
Other banking services 49,094 70,393
Total 1,599,151 1,593,805
(5) Net trading income

The position net trading income includes interest and dividend income, refinancing costs, commissions and any changes in fair
value of trading portfolios.

Interest-based transactions 123,217 66,002
Currency-based transactions 116,345 (58,641)
Equity-/index-based transactions (18,594) 6,792
Credit derivatives business (3,751) (926)
Other transactions 2,388 2,473
Total 219,604 15,700
The improvement in currency-based transactions was primarily the result of the Ukranian hryvnia devaluation of € 80,987 thou-
sand, which was smaller than the previous year. Another positive effect was attributable to the discontinuation of a hedging trans-
action for Russian rouble denominated dividend income, which had resulted in a € 70,032 thousand reduction in the previous
year. Belarus, in contrast, reported a decline of € 61,299 thousand from ending a strategic currency position.

(6) Net income from derivatives and liabilities

Net income from hedge accounting (6,367) (2,068)
Net income from credit derivatives (48) (74)
Net income from other derivatives (147,056) (127,455)
Net income from liabilities designated at fair value (105,162) 111,235
Income from repurchase of liabilities (230) 3,905
Total (258,863) (14,457)
Net income from hedge accounting includes a valuation result from derivatives in fair value hedges of € 9,200 thousand (2015:
minus € 117,161 thousand) and changes in the carrying amount of the fair value hedged items of minus € 15,778 thousand
(2015: € 115,302 thousand). This item also includes the ineffective portions of the cash flow hedge amounting to € 211 thou-
sand (2015: minus € 208 thousand).
Net income from other derivatives includes valuation results from those derivatives, which are held to hedge against market risks
(except trading assets/liabilities). They are based on a non-homogeneous portfolio and do not satisfy the requirements for hedge
accounting according to IAS 39.
Net income from liabilities designated at fair value comprises a loss from changes in own credit risk amounting to
€ 119,064 thousand (2015: loss of € 2,572 thousand) and a positive effect from changes in market interest rates of € 13,902
thousand (2015: positive effect of € 113,807 thousand).
(7) Net income from financial investments

Net income from financial investments comprises valuation results and net proceeds from sales of securities from the financial
investment portfolio (held-to-maturity), from securities measured at fair value through profit and loss, and equity participations which
include shares in affiliated companies, associated companies, and other companies.

Net income from securities held-to-maturity 12,731 10,851
Net valuations of securities (55) 21
Net proceeds from sales of securities 12,786 10,831
Net income from equity participations 100,155 (34,838)
Net valuations of equity participations (46,078) (50,615)
Net proceeds from sales of equity participations 146,233 15,776
Net income from associates (130,176) (93,591)
Net valuations of associates (194,380) (93,591)
Net proceeds from associates 64,205 0
Net income from securities at fair value through profit and loss 69,653 80,428
Net valuations of securities 70,246 56,728
Net proceeds from sales of securities (594) 23,700
Net income from available-for-sale securities 3,164 4,567
Total 55,527 (32,583)
In the 2016 financial year, most of the net proceeds from sales of equity participations came from the sale of Visa Europe Ltd.
shares to Visa Inc. and the associated reclassification of accumulated gains of € 133,623 thousand to profit or loss.
In the year under review, net income from associates amounted to minus € 130,176 thousand after reaching minus € 93,591
thousand in the previous year. In the course of selling a portion of the equity interest in UNIQA Insurance Group AG, Vienna, the
carrying amount of the equity interest was found to be impaired by € 79,213 thousand in the year under review and the portion
of the equity interest that was held for sale pursuant to IFRS 5 was found to be impaired by € 83,691 thousand during the same
period. An impairment of € 25,240 thousand was applied to the carrying amount of the remaining portion of the equity interest. In
the previous year, an impairment of € 85,658 thousand was recognized for the carrying amount of the equity interest in UNIQA
Insurance Group AG, Vienna.

(8) General administrative expenses

Staff expenses (1,552,216) (1,514,634)
Other administrative expenses (1,214,141) (1,277,034)
hereof operating other administrative expenses (1,062,243) (1,106,640)
hereof regulatory other administrative expenses (151,898) (170,394)
Depreciation of tangible and intangible fixed assets (374,831) (378,427)
Total (3,141,188) (3,170,095)
Staff expenses

Wages and salaries (1,183,202) (1,152,133)
Social security costs and staff-related taxes (271,626) (274,798)
Other voluntary social expenses (45,894) (40,479)
Expenses for defined contribution pension plans (16,325) (16,642)
Expenses for defined benefit pension plans 1,264 301
Expenses for other post-employment benefits (9,785) (7,497)
Expenses for other long-term employee benefits (3,248) (6,505)
Termination benefits (12,860) (11,028)
Expenses on share incentive program (SIP) (1,120) (1,929)
Deferred bonus payments according to Section 39b BWG (9,420) (3,925)
Total (1,552,216) (1,514,634)
Other administrative expenses

Office space expenses (250,949) (279,791)
IT expenses (287,890) (275,141)
Communication expenses (68,643) (71,424)
Legal, advisory and consulting expenses (121,849) (120,333)
Advertising, PR and promotional expenses (120,551) (128,702)
Office supplies (26,526) (28,667)
Car expenses (14,429) (17,899)
Security expenses (35,947) (35,462)
Traveling expenses (17,400) (17,700)
Training expenses for staff (18,139) (17,751)
Sundry administrative expenses (99,920) (113,770)
Operating other administrative expenses (1,062,243) (1,106,640)
Deposit insurance fees (99,832) (128,078)
Resolution fund (52,065) (42,316)
Regulatory other administrative expenses (151,898) (170,394)
Total (1,214,141) (1,277,034)
Legal, advisory and consulting expenses include audit fees of RZB AG and its subsidiaries which comprise expenses for the audit of
financial statements amounting to € 8,444 thousand (2015: € 8,057 thousand) and tax advisory as well as other additional consult-
ing services amounting to € 11,727 thousand (2015: € 7,065 thousand). Thereof, € 3,054 thousand (2015: € 3,099 thousand)
relates to the Group auditor for the audit of the financial statements and other consulting services account for € 4,221 thousand
(2015: € 2,218 thousand).

Depreciation of tangible and intangible fixed assets

Tangible fixed assets (153,682) (165,300)
Intangible fixed assets (183,518) (174,925)
Leased assets (operating lease) (37,631) (38,202)
Total (374,831) (378,427)
Amortization of intangible fixed assets capitalized in the course of initial consolidation amounted to € 4,719 thousand (2015:
€ 5,747 thousand) which relates to scheduled amortization of the customer base.
The depreciation of tangible and intangible fixed assets includes impairments of € 53,837 thousand (2015: € 53,252 thousand).
The impairments comprise impairment losses for buildings and land of € 22,730 thousand (2015: € 17,850 thousand) and impair-
ment losses for intangible assets of € 28,540 thousand (2015: € 31,993 thousand), mainly for the Polbank brand.
Expenses on severance payments and retirement benefits

Members of the management board and senior staff (2,408) (4,343)
Other employees (25,280) (27,543)
Total (27,689) (31,886)
For two members of the Management Board essentially the same rules apply as for employees, which provide for a basic contri-
bution to a pension fund on the part of the company and an additional contribution, if the employee makes his own contributions
in the same amount. One member of the Management Board has a performance-based pension benefit.
In the event of termination of function or employment and retirement from the company, two members of the Management Board
are entitled to severance payments in accordance with the Salaried Employees Act (Angestelltengesetz) in connection with the
Bank Collective Agreement (Bankenkollektivvertrag) and one member in accordance with the Company Retirement Plan Act
(Betriebliches Mitarbeitervorsorgegesetz).
Furthermore, protection is in place against occupational disability risk through one pension fund and/or on the basis of an individ-
ual pension benefit. The contracts for members of the Management Board are concluded for the duration of their functional period
or are limited to a maximum of five years.

(9) Other net operating income

Net income arising from non-banking activities 21,187 15,050
Sales revenues from non-banking activities 131,677 133,601
Expenses arising from non-banking activities (110,490) (118,551)
Net income from additional leasing services 7,368 5,609
Revenues from additional leasing services 79,616 69,800
Expenses from additional leasing services (72,247) (64,191)
Rental income from operating lease (vehicles and equipment) 40,717 41,884
Rental income from investment property incl. operating lease (real estate) 49,906 49,091
Net proceeds from disposal of tangible and intangible fixed assets 5,674 1,457
Other taxes (74,871) (77,075)
Net expense from allocation and release of other provisions (19,880) (4,864)
Sundry operating income 115,953 159,282
Sundry operating expenses (50,191) (90,457)
Recurring other net operating income 95,863 99,976
Impairment of goodwill (10,956) (30,924)
Income from release of negative goodwill 0 18,167
Bank levies (174,407) (139,836)
Profit/loss from banking business due to governmental measures (29,268) (19,249)
Total (118,767) (71,866)
1 Previous year figures adapted to reflect changes in allocation
The item “other taxes” includes the financial transactions tax in Hungary in addition to property taxes.
Other net operating income in the financial year includes impairment of goodwill amounting to € 10,956 thousand for a Group
unit in Austria and the Czech Republic. In the previous year, impairment of goodwill totaling € 30,924 thousand for Group units in
Ukraine, Serbia and Austria was included
The bank levies primarily consist of the levies required under the Austrian Stability Act (StabG) amounting to € 85,440 thousand
(2015: € 84,175 thousand) as well as bank levies in Poland (€ 34,077 thousand, 2015: € 0 thousand), Slovakia (€ 19,365
thousand, 2015: € 17,553 thousand) and Hungary (€ 18,964 thousand, 2015: € 17,372 thousand).
The “Walkaway Law” came into force in Romania in the second quarter of 2016. Expected utilization resulted in a provisioning
requirement of € 26,741 thousand for the reporting period. This new mortgage loan law stipulates that borrowers can sign their
properties over to banks and thereby settle their debts, even if the outstanding volume of the loan exceeds the value of the proper-
ty. The law relates to certain mortgage loans taken out by private individuals in any currency and applies retroactively. Since the
Group is of the opinion that this contravenes the Romanian constitution, proceedings were initiated. In October 2016, the Romani-
an Constitutional Court repealed sections of the law connected with its retroactive application. In the previous year, this item
contained charges of € 81,987 thousand in Croatia and € 3,951 thousand in Serbia, which were offset by a partial release of
provisions of € 66,689 thousand in Hungary.
(10) Net income from disposal of group assets

Net income from disposal of group assets 27,186 104,223
Impairment of assets held for sale 0 (51,772)
Total 27,186 51,993

Net income from the disposal of group assets consisted of the following:
in € thousand RLPL Group RBSI Others Total

Assets 1,580,189 545,114 204,720 2,330,023
Liabilities 1,416,664 489,413 149,513 2,055,590
Total identifiable net assets 163,525 55,701 55,207 274,433
Non-controlling interests 0 156 924 1,080
Net assets after non-controlling interests 163,525 55,544 54,283 273,352
Selling price 192,787 500 65,584 258,872
Effect from deconsolidations 29,263 (55,044) 11,301 (14,480)
Goodwill 0 0 0 0
Usage of provision for assets held for sale 0 51,772 0 51,772
Fair value reserve reclassified to income statement 0 1,212 0 1,212
FX reserve reclassified to income statement (11,663) (3,586) 3,932 (11,317)
Net income from disposal of group assets 17,600 (5,647) 15,233 27,186
RLPL Group: Raiffeisen-Leasing Polska S.A., Warsaw, and subsidiaries
RBSI: Raiffeisen Banka d.d., Maribor
In the reporting period, twelve subsidiaries were excluded from the consolidated group for materiality reasons. Moreover, eight
subsidiaries were excluded due to sale, one subsidiary due to a change in control and four subsidiaries due to the discontinuation
of their business operations. Net income from the disposal of these group assets amounted to € 27,186 thousand.
In the previous year’s period, net income amounted to € 51,993 thousand. The sale of ZAO NPF Raiffeisen, Moscow, resulted in
a gain of € 86,171 thousand. The currency effects of € 4,018 thousand that were realized from this transaction have been reclas-
sified to the income statement. In contrast, a provision of € 51,772 thousand has been recognized for the expected loss on the
sale of Raiffeisen Banka d.d., Maribor.
Details are shown under (53) Group composition.
(11) Income taxes

Current income taxes (281,492) (275,618)
Austria (13,892) (38,028)
Foreign (267,600) (237,590)
Deferred taxes (28,191) 4,102
Total (309,683) (271,515)
RZB AG is the parent company of a tax group comprising 37 subsidiaries and 15 other affiliated companies. This makes it possi-
ble to attribute the negative tax result of group members to the tax result of the parent company. In the previous year, the existing
tax compensation agreement was expanded with a supplementary agreement. If RBI AG has a negative result in the tax accounts
which cannot be used in the group, the group parent is not obliged to pay negative tax contributions to RBI AG. However, the
amount is to be settled in the event of a withdrawal from the tax group. The obligation of the tax group head to pay a negative tax
contribution to RBI AG for usable losses remains.

The following reconciliation shows the relation between profit before tax and the effective tax burden:

Profit/loss before tax 842,620 736,869
Theoretical income tax expense in the financial year based on the domestic income tax rate of 25 per cent (210,655) (184,217)
Effect of divergent foreign tax rates 105,309 78,761
Tax decrease because of tax-exempted income from equity participations and other income 70,988 92,731
Tax increase because of non-deductible expenses (108,860) (209,400)
Impairment/increases on loss carry-forwards 536 (4,284)
Other changes (167,001) (45,106)
Effective tax burden (309,683) (271,515)
Effective tax rate in per cent 36.8% 36.9%
Other changes include € 89,224 thousand unrecognized deferred taxes from temporary differences. They were not capitalized
because there was no utilization based on the current medium-term tax planning.
Notes to the statement of financial

position
(12) Statement of financial position according to measurement categories
Assets according to measurement categories
Cash reserve 16,838,583 17,401,694
Trading assets 5,560,434 6,545,557
Positive fair values of derivative financial instruments 3,241,373 3,573,783
Shares and other variable-yield securities 164,482 203,282
Bonds, notes and other fixed-interest securities 2,154,579 2,768,493
Call/time deposits from trading purposes 0 0
Financial assets at fair value through profit or loss 8,473,211 9,983,551
Investments in associates 775,035 1,590,384
Financial assets available-for-sale 4,738,294 4,482,654
Investments in other affiliated companies 213,924 222,019
Other interests 195,580 249,793
Loans and advances 86,964,094 86,371,223
Loans and advances to banks 11,023,532 12,113,132
Loans and advances to customers 79,769,079 79,457,653
Other non-derivative financial assets 1,416,562 1,200,174
Impairment losses on loans and advances (5,245,078) (6,399,737)
Financial assets held-to-maturity 8,218,726 7,982,022
Positive fair values of derivatives (hedging) 644,693 709,272
Other assets 2,633,505 3,359,474
Intangible and tangible fixed assets 2,519,140 2,494,020
Inventories 85,539 91,314
Assets held for sale (IFRS 5) 28,826 774,139
Total assets 134,846,575 138,425,830

Positive fair values of derivatives not designated as hedging instruments according to IAS 39 hedge accounting are reported in
the measurement category “trading assets”.
Equity and liabilities according to measurement categories

Trading liabilities 5,421,625 5,575,505
Negative fair values of other derivative financial instruments 2,902,215 4,427,187
Short-selling of trading assets 555,346 453,459
Certificates issued 1,964,063 694,859
Financial liabilities 115,386,498 119,445,874
Deposits from banks1 23,308,054 27,274,329
Deposits from customers 80,324,996 78,078,973
Debt securities issued1 7,153,963 8,126,365
Subordinated capital1 3,578,993 3,681,240
Other non-derivative financial liabilities 1,020,492 991,198
Liabilities held for sale (IFRS 5) 0 1,293,769
Liabilities at fair value through profit and loss 2,783,648 2,588,259
Deposits from banks1 751,720 838,753
Debt securities issued1 1,373,418 1,226,965
Subordinated capital1 658,510 522,541
Negative fair values of derivatives (hedging) 425,415 434,791
Provisions for liabilities and charges 1,035,629 1,085,276
Equity 9,793,760 9,296,127
Total equity and liabilities 134,846,575 138,425,830
1 Adaptation of previous year figures
Negative fair values of derivatives not designated as hedging instruments according to IAS 39 hedge accounting are reported in
the measurement category trading liabilities.
(13) Cash reserve

Cash in hand 2,975,502 2,495,488
Balances at central banks 13,863,081 14,906,206
Total 16,838,583 17,401,694
(14) Loans and advances to banks

Giro and clearing business 2,242,840 1,496,485
Money market business 6,556,978 7,696,647
Loans to banks 1,777,599 2,670,594
Purchased loans 257,469 49,781
Leasing claims 34,813 27,036
Claims evidenced by paper 153,833 172,590
Total 11,023,532 12,113,132
The purchased loans amounting to € 257,469 thousand (2015: € 49,781 thousand) are fully assigned to the measurement
category “loans and advances”.

Loans and advances to banks classified regionally (counterparty domicile) are as follows:

Austria 3,361,882 4,643,729
Foreign 7,661,650 7,469,403
Total 11,023,532 12,113,132
Loans and advances to banks break down into the following segments:

Central banks 1,118,191 2,356,843
Commercial banks 9,901,337 9,749,499
Multilateral development banks 4,003 6,790
Total 11,023,532 12,113,132
(15) Loans and advances to customers

Credit business 45,280,907 45,917,322
Mortgage loans 23,794,971 22,988,846
Purchased loans 2,244,986 1,783,525
Leasing claims 2,999,897 4,490,838
Claims evidenced by paper 503,039 657,303
Total 79,769,079 79,457,653
Purchased loans amounting to € 2,244,986 thousand (2015: € 1,783,525 thousand) are fully assigned to the measurement
category “loans and advances”. The drop in leasing claims is primarily due to the sale of the leasing company in Poland. Details
on leasing claims are shown under (45) Finance leases.
Loans and advances to customers break down into asset classes as follows:

Sovereigns 773,015 939,350
Corporate customers – large corporates 43,976,735 44,163,046
Corporate customers – mid market 3,002,869 3,190,375
Retail customers – private individuals 29,807,959 28,311,038
Retail customers – small and medium-sized entities 2,208,500 2,853,843
Total 79,769,079 79,457,653
Loans and advances to customers classified regionally (counterparty domicile) are as follows:

Austria 12,026,757 12,330,774
Foreign 67,742,322 67,126,879
Total 79,769,079 79,457,653

(16) Impairment losses on loans and advances

Provisions for impairment losses are formed in accordance with uniform Group standards and cover all recognizable credit risks. A
table with the development of the impairment losses on loans and advances can be found in the risk report. Provisions for impair-
ment losses are allocated to the following asset classes:

Banks 50,365 119,981
Sovereigns 4,770 5,408
Corporate customers – mid market 266,752 348,398
Retail customers – small and medium-sized entities 238,756 279,738
Total 5,245,078 6,399,737
The reduction in impairment losses on loans and advances was largely caused by the sale of non-performing loans with a nominal
value of € 1,186,945 thousand and the derecognition of uncollectible loans.
Loans and advances and loan loss provisions according to asset classes are as follows:
Portfolio-based
2016 Carrying Individually Individual loan loan loss Net carrying
in € thousand Fair value amount impaired assets loss provisions provisions amount
Banks 10,983,971 11,023,532 50,606 48,300 2,065 10,973,166
Sovereigns 707,975 773,015 5,607 4,347 423 768,245
Corporate customers – large corporates 39,692,933 43,976,735 4,439,125 2,997,775 121,643 40,857,317
Corporate customers – mid market 2,758,153 3,002,869 360,676 258,652 8,100 2,736,117
Retail customers – private individuals 28,807,813 29,807,959 1,747,938 1,348,270 216,746 28,242,943
Retail customers – small and medium-
sized entities 2,085,155 2,208,500 322,648 213,429 25,327 1,969,744
Total 85,036,000 90,792,610 6,926,601 4,870,773 374,305 85,547,532
Portfolio-based
2015 Carrying Individually Individual loan loan loss Net carrying
in € thousand Fair value amount impaired assets loss provisions provisions amount
Banks 12,036,944 12,113,132 120,657 117,672 2,310 11,993,151
Sovereigns 834,758 939,350 7,808 5,027 381 933,942
Corporate customers – large corporates 39,395,403 44,163,046 5,873,198 3,848,988 160,424 40,153,634
Corporate customers – mid market 2,820,763 3,190,375 483,758 337,792 10,606 2,841,978
Retail customers – private individuals 26,956,959 28,311,038 1,881,097 1,458,974 177,825 26,674,238
sized entities 2,709,872 2,853,843 380,006 251,520 28,218 2,574,105
Total 84,754,699 91,570,785 8,746,525 6,019,972 379,765 85,171,049
Impaired financial assets
Impairments and collateral according to asset classes are as follows:
Individually impaired Collateral for Interest on

2016 Individually Individual loan assets after individually individually
in € thousand impaired assets loss provisions deduction of ILLP impaired assets impaired assets
Banks 50,606 48,300 2,306 0 109
Sovereigns 5,607 4,347 1,260 0 6
Corporate customers – large corporates 4,439,125 2,997,775 1,441,350 702,301 94,662
Corporate customers – mid market 360,676 258,652 102,024 117,076 9,873
Retail customers – private individuals 1,747,938 1,348,270 399,668 428,957 61,924
Retail customers – small and medium-sized entities 322,648 213,429 109,220 100,328 19,809
Total 6,926,601 4,870,773 2,055,828 1,348,662 186,383
ILLP Individual loan loss provisions

Individually impaired Collateral for Interest on

2015 Individually Individual loan assets after deduction individually individually
in € thousand impaired assets loss provisions of ILLP impaired assets impaired assets
Banks 120,657 117,672 2,986 183 153
Sovereigns 7,808 5,027 2,781 46 30
Corporate customers – large corporates 5,873,198 3,848,988 2,024,211 1,401,764 96,913
Corporate customers – mid market 483,758 337,792 145,966 82,404 12,898
Retail customers – private individuals 1,881,097 1,458,974 422,123 418,340 58,652
Retail customers – small and medium-sized entities 380,006 251,520 128,486 123,087 16,965
Total 8,746,525 6,019,972 2,726,553 2,025,823 185,612
ILLP Individual loan loss provisions
(17) Trading assets

Treasury bills and bills of public authorities eligible for refinancing 632,054 1,029,632
Other securities issued by the public sector 300,058 299,452
Bonds and notes of non-public issuers 1,222,467 1,439,409
Shares 115,513 173,360
Mutual funds 48,969 29,922
Positive fair values of derivative financial instruments 2,625,051 2,802,799
Interest-based transactions 1,832,175 1,901,487
Currency-based transactions 694,172 829,254
Equity-/index-based transactions 94,938 69,838
Credit derivatives business 648 1,776
Other transactions 3,119 443
Total 4,944,112 5,774,573
Pledged securities which are permitted to be sold or repledged by the transferee shown under the item “trading assets” amounted
to € 63,540 thousand (2015: € 1,079,590 thousand).
(18) Derivatives
Positive fair values of derivatives in fair value hedges (IAS 39) 641,851 691,539
Currency-based transactions 291 0
Positive fair values of derivatives in cash flow hedges (IAS 39) 2,842 1,021
Interest-based transactions 2,842 0
Currency-based transactions 0 1,021
Positive fair values of derivatives in net investment hedge (IAS 39) 0 16,711
Currency-based transactions 0 16,711
Positive fair values of other derivatives 616,322 770,984
Total 1,261,015 1,480,256
As long as the conditions for hedge accounting according to IAS 39 are fulfilled, derivative financial instruments are reported at
their fair values (dirty prices) in their function as hedging instruments. The items hedged by fair value hedges are loans and ad-
vances to customers, deposits from banks and debt securities issued, which are hedged against interest rate risks. The changes in
carrying amount of the hedged underlying transactions in IAS 39 fair value hedges are included in the respective items of the
statement of financial position.

This item also includes the positive fair values of derivative financial instruments which are used for hedging against market risks
(excluding trading assets and trading liabilities) for a non-homogeneous portfolio. These derivatives do not meet the conditions for
IAS 39 hedge accounting.
The time bands in which the hedged cash flows from assets are expected to occur and affect the statement of comprehensive
income are as below:

1 year 351,086 411,398
More than 1 year, up to 5 years 708,454 1,577,255
More than 5 years 4,000,862 3,460,207
(19) Financial investments

This position consists of securities available-for-sale, financial assets at fair value through profit or loss, and securities held-to-
maturity as well as strategic equity participations held on a long-term basis.

Treasury bills and bills of public authorities eligible for refinancing 13,087,704 14,283,121
Other securities issued by the public sector 4,673,461 3,849,438
Bonds and notes of non-public issuers 3,065,351 3,514,122
Other 20,394 20,363
Shares 2,467 3,556
Mutual funds 162,394 296,857
Other variable-yield securities 8,957 8,958
Equity participations 409,504 471,812
Interest in affiliated companies 213,924 222,019
Other interests 195,580 249,793
Total 21,430,231 22,448,227
Pledged securities permitted to be sold or repledged by the transferee shown under item “financial investments” amounted to
€ 598,309 thousand (2015: € 259,526 thousand).
The carrying amount of the securities reclassified into the category “held-to-maturity” amounted at the date of reclassifications to
€ 452,188 thousand. Thereof, reclassifications in 2008 amounted to € 371,686 thousand and in 2011 € 80,502 thousand. As
at 31 December 2016, the carrying amount totaled € 3,314 thousand and the fair value totaled € 3,707 thousand. In 2016, a
result from the reclassified securities of € 213 thousand (2015: € 557 thousand) was shown in the income statement. If the reclas-
sification had not been made, a loss of € 78 thousand (2015: loss of € 355 thousand) would have arisen.
Equity participations valued at amortized cost for which fair values could not be measured reliably amounted to € 379,295
thousand (2015: € 334,096 thousand).

(20) Investments in associates

Investments in associates 775,035 1,590,384
hereof goodwill 79,529 228,107
The decline in investments in associates was partially due to the sale of a portion of the equity interest in UNIQA Insurance Group
AG, Vienna, resulting in a book value reduction of € 696,256 thousand, and partially due to impairment losses. For details, see
(7) Net income from financial investments. UNIQA Insurance Group AG, Vienna, is part of the other equity participations segment.
The decline was also attributable to the sale of Raiffeisen evolution project development GmbH, Vienna, which resulted in a book
value reduction of € 28,000 thousand.
Ownership
Company, domicile (country) Nature of relationship interest 2016
Issue of credit cards and operating giro, guarantee and
card complete Service Bank AG, Vienna (AT) credit business 25.0%
Participation in entities of all kind and industrial, trading
LEIPNIK-LUNDENBURGER INVEST Beteiligungs AG, Vienna (AT) and other entities 33.1%
NOTARTREUHANDBANK AG, Vienna (AT) Business from notarial trusteeships 26.0%
Financial service provider for tourist enterprises and
Österreichische Hotel- und Tourismusbank Ges.m.b.H., Vienna (AT) facilities 31.3%
Österreichische Kontrollbank AG, Vienna (AT) All kind of bank transactions except of deposit business 8.1%
Prva stavebna sporitelna a.s., Bratislava (SK) Building society 32.5%
Services provider for data processing as well as
Raiffeisen Informatik GmbH, Vienna (AT) construction and operation of data processing center 47.6%
UNIQA Insurance Group AG, Vienna (AT) Contract insurance and reinsurance 10.9%
Posojilnica Bank eGen, Klagenfurt (AT) All kind of bank transactions 58.0%
Financial information on associated companies is as follows:
2016 CCSB LLI 1 NTB OEHT OeKB

in € thousand
Assets 623,706 1,200,808 1,974,300 972,543 26,504,821
Operating income 100,316 78,525 15,395 3,027 56,333
Profit or loss from continuing operations 2,402 83,010 0 7,862 42,862
Post-tax profit from discontinued operations 0 0 0 0 0
Other comprehensive income 76,811 (3,571) 0 0 (3,261)
Total comprehensive income 162,036 79,439 0 7,862 40,214
Attributable to non-controlling interests 0 9,517 0 0 285
Attributable to investee's shareholders 0 69,922 0 0 39,928
Current assets 693,746 314,728 1,032,112 171,316 7,861,259
Non-current assets 26,466 886,081 942,188 829,223 18,632,051
Current liabilites (565,780) (272,595) (1,400,907) (245,304) (6,786,190)
Non-current liabilities (21,742) (404,019) (545,734) (722,986) (18,952,489)
Net assets 132,691 524,194 27,659 32,249 754,631
Attributable to non-controlling interests 0 125,335 0 0 4,585
Group's interest in net assets of investee as at 1/1 13,272 119,349 7,230 9,613 60,178
Change in share 0 0 0 0 0
Total comprehensive income attributable to the Group 24,658 19,417 1,521 933 2,352
Dividends received (4,758) (6,903) (1,560) (469) (1,626)
Share in capital increase 0 0 0 0 0
Goodwill 0 57,973 0 0 0
Other adaptations 0 0 0 0 0
Carrying amount 33,173 189,837 7,191 10,078 60,904
1 Consolidated financial statements: profit and equity is after deduction of non-controlling interests.
CCSB: card complete Service Bank AG, Vienna (AT)
LLI: LEIPNIK-LUNDENBURGER INVEST Beteiligungs AG, Vienna (AT)
NTB: NOTARTREUHANDBANK AG, Vienna (AT)
OEHT: Österreichische Hotel- und Tourismusbank GmbH, Vienna (AT)
OeKB: Österreichische Kontrollbank AG, Vienna (AT)

2016 PSS RIZ UNIQA1 PB

in € thousand 30/9/2016
Assets 2,848,383 1,145,600 34,240,212 553,561
Operating income 130,530 15,000 230,593 (1,883)
Profit or loss from continuing operations 20,420 (2,976) 142,408 (11,904)
Post-tax profit from discontinued operations 0 0 7,500 0
Other comprehensive income 2,025 (174) 216,813 (244)
Total comprehensive income 22,445 (3,150) 366,722 (12,148)
Attributable to non-controlling interests 0 57 4,560 0
Attributable to investee's shareholders 0 (3,207) 362,162 0
Current assets 656,668 739,100 1,614,759 181,016
Non-current assets 2,191,714 406,500 32,625,453 372,545
Current liabilites (808,086) (843,500) (1,546,312) (321,090)
Non-current liabilities (1,800,454) (234,400) (29,299,640) (200,830)
Net assets 239,843 67,700 3,394,261 31,641
Attributable to non-controlling interests 0 1,400 26,350 0
Attributable to investee's shareholders 0 66,300 3,367,910 0
Group's interest in net assets of investee as at 1/1 78,049 48,984 1,148,611 7,933
Change in share 0 291 (811,598) 1,145
Total comprehensive income attributable to the Group 7,293 (14,473) 22,689 (799)
Dividends received (7,393) (3,273) (14,353) 0
Share in capital increase 0 0 0 6,206
Group's interest in net assets of investee as at 31/12 77,949 31,528 345,348 14,484
Goodwill 0 0 21,556 0
Other adaptations 0 20 (2,549) (14,484)
Carrying amount 77,949 31,548 364,355 0
1 Consolidated figures as at 30 September 2016, because UNIQA is a listed company and has not yet published 2016 consolidated financial statements. Fair value of
the shares held and based on stock exchange price as at 31 December 2016 amounted to € 241,892 thousand (2015: € 731,962 thousand)
PSS: Prva stavebna sporitelna a.s., Bratislava (SK)
RIZ: Raiffeisen Informatik GmbH, Vienna (AT)
UNIQA: UNIQA Insurance Group AG, Vienna (AT)
PB: Posojilnica Bank eGen, Klagenfurt (AT)

2015 CCSB LLI 1 NTB OEHT OeKB

in € thousand
Assets 536,830 1,209,795 2,424,223 998,359 28,775,190
Operating income 22,183 38,207 16,069 3,206 50,801
Profit or loss from continuing operations 73,705 47,405 7,795 7,198 60,144
Post-tax profit from discontinued operations 0 0 0 0 0
Other comprehensive income 1,260 (24,373) 0 0 749
Total comprehensive income 74,965 23,032 7,795 7,198 60,893
Attributable to non-controlling interests 0 (562) 0 0 228
Current assets 510,369 288,158 1,591,148 169,808 9,913,114
Non-current assets 26,461 921,637 833,075 829,156 18,862,076
Current liabilites (485,252) (344,610) (1,668,644) (246,783) (12,114,013)
Non-current liabilities (51,577) (375,721) (727,771) (722,872) (15,915,633)
Net assets 0 489,464 27,808 29,309 745,544
Attributable to non-controlling interests 0 128,457 0 0 4,439
Change in share 0 0 0 0 0
Total comprehensive income attributable to the Group 5,027 7,036 1,864 709 4,338
Dividends received (3,578) (6,903) (1,874) (469) (1,626)
Share in capital increase 0 531 0 0 0
Goodwill 0 57,973 0 0 0
Other adaptations 0 0 0 0 0
Carrying amount 13,272 177,322 7,230 9,613 60,178
CCSB: card complete Service Bank AG, Vienna (AT)
LLI: LEIPNIK-LUNDENBURGER INVEST Beteiligungs AG, Vienna (AT)
NTB: NOTARTREUHANDBANK AG, Vienna (AT)
OEHT: Österreichische Hotel- und Tourismusbank GmbH, Vienna (AT)
OeKB: Österreichische Kontrollbank AG, Vienna (AT)

2015 PSS REV1 RIZ UNIQA2 PB

in € thousand
Assets 2,719,774 280,772 1,043,270 33,297,873 276,382
Operating income 137,738 (55,035) 33,893 466,242 (3,271)
Profit or loss from continuing operations 22,747 (57,334) 53,218 317,535 (12,855)
Post-tax profit from discontinued operations 0 0 0 23,147 0
Other comprehensive income (761) (5,675) (165) (123,041) (75)
Total comprehensive income 21,985 (63,009) 53,053 217,641 (12,930)
Attributable to non-controlling interests 0 (9) 2 5,585 0
Attributable to investee's shareholders 0 (63,000) 53,051 212,056 0
Current assets 472,091 206,432 704,970 1,888,831 111,637
Non-current assets 2,247,683 74,341 338,300 31,409,043 164,404
Current liabilites (626,993) (215,699) (745,800) (1,563,591) (153,340)
Non-current liabilities (1,852,631) 0 (193,000) (28,567,914) (107,052)
Net assets 240,150 65,073 104,470 3,166,369 15,648
Attributable to non-controlling interests 0 1,150 809 21,853 0
Attributable to investee's shareholders 0 63,923 103,661 3,144,516 0
Group's interest in net assets of investee as at 1/1 78,148 52,758 26,366 1,012,638 0
Change in share 0 0 169 0 8,102
Total comprehensive income attributable to the
Group 7,186 (27,189) 27,175 (14,986) (10,118)
Dividends received (7,285) 0 (4,725) (40,745) 0
Share in capital increase 0 0 0 0 9,948
Goodwill 0 0 0 255,792 0
Other adaptations 0 0 0 0 (7,933)
Carrying amount 78,049 25,569 48,984 1,212,698 0
2 Fair value of the shares held and based on stock exchange price as at 31 December 2015 amounted to € 731,962 thousand (2014: € 756,474 thousand)
PSS: Prva stavebna sporitelna a.s., Bratislava (SK)
REV: Raiffeisen evolution project development GmbH, Vienna (AT)
RIZ: Raiffeisen Informatik GmbH, Vienna (AT)
UNIQA: UNIQA Insurance Group AG, Vienna (AT)
PB: Posojilnica Bank eGen, Klagenfurt (AT)
Further information regarding associated companies is stated under (53) Group composition.
(21) Intangible fixed assets

Software 549,802 548,899
Goodwill 93,673 98,188
Other intangible fixed assets 33,044 56,717
hereof brand 9,272 36,657
hereof customer relationships 17,199 12,643
Total 676,518 703,804
Software
The item “software” comprises acquired software amounting to € 430,626 thousand (2015: € 420,873 thousand) and internally
developed software amounting to € 119,176 thousand (2015: € 126,271 thousand).
Goodwill
The following overview shows the development of the carrying value of goodwill, gross amounts and cumulative impairments of
goodwill, by cash generating units. Main goodwill positions relate to Raiffeisenbank a.s., Prague (RBCZ), and Raiffeisen Kapitalan-
lage-GmbH, Vienna (RKAG).

Development of goodwill
2016
in € thousand RBCZ RKAG Other Total
As at 1/1 37,881 53,728 6,579 98,188
Additions 0 0 8,872 8,872
Impairment 0 0 (13,387) (13,387)
Exchange rate changes 3 0 (3) 0
As at 31/12 37,884 53,728 2,061 93,673
Gross amount 37,884 53,728 572,264 663,876
Cumulative impairment1 0 0 (570,203) (570,203)
1 Calculated at average exchange rate
RBCZ: Raiffeisenbank a.s., Prague (CZ)
RKAG: Raiffeisen Kapitalanlage-GmbH, Vienna (AT)
2015
in € thousand RBCZ RKAG Other Total
As at 1/1 36,908 53,728 38,814 129,359
Additions 0 0 (91) (91)
Impairment 0 0 (30,924) (30,924)
Exchange rate changes 972 0 (1,220) (247)
As at 31/12 37,881 53,728 6,579 98,188
Gross amount 37,881 53,728 555,002 646,611
Cumulative impairment1 0 0 (548,423) (548,423)
In the 2016 financial year, the initial consolidation of Raiffeisen Immobilien Fonds, Vienna, resulted in € 6,442 thousand in good-
will that was impaired. Furthermore, goodwill for KHD a.s., Prague, amounting to € 4,515 thousand was also impaired due to
negative business performance. Goodwill amounting to € 2,431 thousand was acquired and impaired in connection with the
purchase of a Citibank operation in the Czech Republic. The impairment was included in general administrative expenses. The
cumulative impairments resulted from impairments recognized in previous years for Raiffeisen Bank Sh.a., Tirana, Raiffeisen Bank
Polska S.A., Warsaw, and AO Raiffeisenbank, Moscow.
Impairment test for goodwill
At the end of each financial year, goodwill is reviewed by comparing the recoverable value of each cash generating unit for
which goodwill is recognized with the carrying value. The carrying value is equal to net assets considering goodwill and other
intangible assets which are recognized within the framework of business combinations. In line with IAS 36, impairment tests for
goodwill are carried out during the year if a reason for impairment occurs.
Recoverable value
In the course of impairment testing the carrying amount of each cash generating unit (CGU) is compared with the recoverable
amount. If the recoverable amount of a cash generating unit is below its carrying amount, the difference is recognized as impair-
ment in the income statement under other net operating income.
The Group generally identifies the recoverable amount of cash generating units on the basis of the value-in-use concept using a
dividend discount model. The dividend discount model reflects the characteristics of the banking business including the regulatory
framework. The present value of estimated future dividends that can be distributed to shareholders after taking into account rele-
vant regulatory capital requirements represents the recoverable value.
The calculation of the recoverable amount is based on a five -year detailed planning period. The sustainable future growth (stabi-
lization phase) is based on the premise of perpetuity (perpetual annuity); in the majority of cases country nominal growth rates of
earnings are assumed, which are based on the long-term expected rate of inflation. For companies that have a significant overcap-
italization an interim period of five years is defined, but without extending the detailed planning phase. Within this period, it is
possible for these CGUs to make full payments without violating the capital adequacy requirements. In the stabilization phase,
profit retention relating to growth while ensuring compliance with capital requirements is imperative. If, however, zero growth is
assumed in the stabilization phase no profit retention is required.

In the stabilization phase the model is based on a normal economically sustainable earnings situation, whereby convergence of
expected return on equity and cost of equity is assumed (assumption of convergence).
Key assumptions
The following table shows key assumptions that have been made for the individual cash generating units:
2016
Cash generating units RBCZ RKAG
Discount rates (after tax) 9.8-10.9% 9.30%
Growth rates in phase I and II 33.0% 6.1%
Growth rates in phase III 3.0% 2.2%
Planning period 5 years 5 years
In the previous year, the Group used the following key parameters:
2015
Cash generating units RBCZ RKAG
Discount rates (after tax) 9.7-10.7% 7.8-9.3%
Growth rates in phase I and II 9.0% 1.9%
Growth rates in phase III 3.0% 2.0%
Planning period 5 years 5 years
The use value of a cash generating unit is sensitive to various parameters: primarily to the level and development of future divi-
dends, to the discount rates as well as the nominal growth rate in the stabilization phase. The applied discount rates have been
calculated using the capital asset pricing model: they are composed of a risk-free interest rate and a risk premium for entrepreneur-
ial risk taking. The risk premium is calculated as the market risk premium that varies according to the country in which the unit is
registered multiplied by the beta factor for the indebted company. The values for the risk-free interest rate and the market risk
premium are defined using accessible external market data sources. The risk measure beta factor has been derived from a peer
group of financial institutions operating in Western and Eastern Europe. The above-mentioned interest rate parameters represent
market assessments; therefore they are not stable and could in case of a change affect the discount rates.

The following table provides a summary of significant planning assumptions and a description of the management approach to
identify the values that are assigned to each significant assumption taking into account a risk assessment.
Cash generating
unit Significant assumptions Management approach Risk assumption
RBCZ The Czech Republic is a core market for the The assumptions are based on internal as well Weakening of the macroeconomic
Group where selective growth strategy is as external sources. Macroeconomic environment. Possible negative effects of
pursued. Improvement through increased use of assumptions of the research department were changed local capital requirements. Pressure
alternative distribution channels and additional compared with external data sources and the on interest margins through greater competition.
consulting services. Stable costs are assumed. 5-year plans were presented to the
Management Board. Moreover, the detail
planning phase was approved by the
Supervisory Board.
RKAG RKAG is one of the leading Austrian fund The assumptions of planning are based on Possible weakening of the macroeconomic
enterprises with a managed consolidated internal and external sources. Macroeconomic environment. Pressure on net fee and
volume of € 30.3 billion as at year-end 2016 assumptions were compared with external data commission income by aggressive market
and a market share of 17 per cent. RKAG has sources and 5-year plans were presented to the participants can not be excluded.
been active internationally for years and is a managers of the company. Moreover, planning
well-known player in numerous European was approved by the Supervisory Board of
countries. RKAG.

Sensitivity analysis
A sensitivity analysis was carried out based on the above-mentioned assumptions in order to test the stability of the impairment test
for goodwill. From a number of options for this analysis, two parameters were selected, namely the cost of equity and the reduc-
tion in the growth rate. The following overview demonstrates to what extent an increase in the cost of equity or a reduction in the
long-term growth rate could be made without the value in use of cash generating units declining below the respective carrying
value (equity capital plus goodwill).
2016
Maximum sensitivity1 RBCZ RKAG
Increase in discount rate 4.7 PP 1.4 PP
Reduction of the growth rates in phase III 0.0 PP 2.4 PP
1 The respective maximum sensitivity refers to the change of the perpetuity.
The reference values for 2015 are as follows:
2015
Maximum sensitivity1 RBCZ RKAG
Increase in discount rate 0.3 PP 0.7 PP
Reduction of the growth rates in phase III 0.0 PP 0.5 PP
1 The respective maximum sensitivity refers to the change of the perpetuity.
The recoverable values of all other units have been either higher than the respective carrying values or are immaterial.
Brand
Group companies use brands to differentiate their services from the competition. According to IFRS 3, brands of acquired compa-
nies have been recognized separately under the item “intangible fixed assets”. Brands have an indeterminable useful life and are
therefore not subject to scheduled amortization. Brands are tested annually in the course of the impairment test of goodwill per
cash generating unit and additionally whenever indications of impairment arise.
At the Group, brand rights are only recognized for Raiffeisen Bank Polska S.A., Warsaw (RBPL), and for Raiffeisen Bank Aval JSC,
Kiev (AVAL). The carrying values of the brands as well as gross amounts and cumulative impairment losses have developed as
shown below:

2016
in € thousand AVAL RBPL Total
As at 1/1 10,109 26,548 36,657
Impairment1 0 (26,133) (26,133)
Exchange differences (837) (416) (1,252)
As at 31/12 9,272 0 9,272
Gross amount 25,757 45,348 71,106
Cumulative impairment2 (16,485) (45,348) (61,833)
2 Calculated at period-end rate
AVAL: Raiffeisen Bank Aval JSC, Kiev (UA)
RBPL: Raiffeisen Bank Polska S.A., Warsaw (PL)
2015
As at 1/1 15,163 46,803 61,966
Impairment1 (1,102) (20,731) (21,833)
Exchange differences (3,953) 476 (3,477)
As at 31/12 10,109 26,548 36,657
Gross amount 27,073 46,905 73,978
2 Calculated at period-end rate
According to IAS 36.9 at the end of each reporting period, an entity is required to assess whether there is any indication that an
asset may be impaired based on a list of external and internal indicators of impairment. The assumptions underlying the value of
the Polbank brand had to be revisited in light of new information in the third quarter of 2016 in preparation for the planned sale of
Raiffeisen Bank Polska S.A., Warsaw. IAS 36 defines the recoverable amount as the higher of fair value less costs to sell and the
value in use. Both of these perspectives provided strong indications that the brand was impaired since it provided no value in use for
potential buyers. The change was caused by the current consolidation of the Polish banking market. The consolidation process is
being primarily driven by regulatory pressure on capital ratios, the introduction of bank taxes and other losses in the banking busi-
ness due to governmental measures. In this environment, the advantages of a brand (cross selling and client loyalty) appear to be
greatly diminished. As a result, an impairment of € 26,133 thousand was recognized for the brand Polbank.
The brand value of the Raiffeisen Bank Aval JSC, Kiev (AVAL), was determined using the comparable historical cost approach,
because neither immediately comparable transactions nor a market with observable prices was available at the time of purchase
price allocation. Documentation of brand-related marketing expenses in the previous years was taken as the basis for the compa-
rable historical cost approach. In 2016, the impairment test led to no impairment.
Customer relationships
If customer contracts and associated customer relationships are acquired in a business combination, they must be recognized
separately from goodwill, if they are based on contractual or other rights. The acquired companies meet the criteria for a separate
recognition of non-contractual customer relationships for existing customers. The customer base is valued using the multi-period
excess earnings method based on projected future income and expenses allocable to the respective customer base. The projec-
tions are based on planning figures for the corresponding years.
In 2016, new customer relationships were capitalized following the purchase of Citibank’s retail and credit card business in the
Czech Republic. The Group also capitalized customer relationship intangibles in relation to Raiffeisen Bank Polska S.A., Warsaw
(RBPL), and Raiffeisen Bank Aval JSC, Kiev (AVAL). In the reporting year the carrying values of the customer relationships as well as
the gross amount and cumulative impairments developed as follows:

2016
in € thousand AVAL RBPL RBCZ Total
As at 1/1 6,413 6,230 0 12,643
Additions 0 0 9,994 9,994
Depreciation (833) (2,212) (1,674) (4,720)
Impairment1 0 0 0 0
Exchange differences (531) (207) 20 (718)
As at 31/12 5,049 3,811 8,339 17,199
Gross amount 18,311 15,963 10,007 44,280
Cumulative impairment2 (13,262) (12,152) (1,668) (27,082)
2 Calculated at period-end exchange rate
2015
As at 1/1 10,390 9,481 19,872
Depreciation (992) (3,329) (4,321)
Impairment1 (324) 0 (324)
Exchange differences (2,661) 78 (2,583)
As at 31/12 6,413 6,230 12,643
Gross amount 18,171 16,511 34,682
2 Calculated at period-end exchange rate
The impairment test of customer relationships of Raiffeisen Bank Polska S.A., Warsaw (RBPL), Raiffeisenbank a.s., Prague (RBCZ),
and Raiffeisenbank Aval JSC, Kiev (AVAL), identified no impairment need in 2016.
(22) Tangible fixed assets

Land and buildings used by the Group for own purpose 631,434 629,695
Other land and buildings (investment property) 631,738 497,803
Office furniture, equipment and other tangible fixed assets 247,572 244,368
Leased assets (operating lease) 331,878 418,350
Total 1,842,621 1,790,217
The fair value of investment property totaled € 633,846 thousand (2015: € 501,299 thousand).
Details about leased assets are shown under (46) Operating leases.

(23) Development of fixed assets

Cost of acquisition or conversion
As at Change in Exchange As at
in € thousand 1/1/2016 consolidated group differences Additions Disposals Transfers 31/12/2016
Intangible fixed assets 2,350,634 (31,811) 42,069 164,741 (85,258) (484) 2,439,891
Goodwill 646,611 (5,720) 20,554 2,431 0 0 663,876
Software 1,555,930 (25,163) 27,615 151,769 (84,543) (3,793) 1,621,816
Other intangible fixed assets 148,092 (928) (6,100) 10,541 (715) 3,309 154,199
Tangible fixed assets 3,240,816 85,497 41,359 228,832 (308,413) 484 3,288,574
Land and buildings used by the Group for
own purpose 1,028,332 (1,538) 12,766 33,733 (46,055) 1,197 1,028,436
Other land and buildings 587,779 216,854 6,732 15,295 (74,674) 485 752,471
of which land value of developed land 11,557 0 (231) 0 (2,728) 0 8,599
Other tangible fixed assets 989,652 (21,191) 23,960 90,999 (91,193) (1,201) 991,026
Leased assets (operating lease) 635,052 (108,629) (2,099) 88,805 (96,491) 4 516,641
Total 5,591,449 53,686 83,428 393,573 (393,671) 0 5,728,465
Write-ups, amortization, depreciation, impairment Carrying amount

in € thousand Cumulative hereof write-ups of which depreciation 31/12/2016
Intangible fixed assets (1,763,373) 393 (194,475) 676,518
Goodwill (570,203) 0 (13,387) 93,673
Software (1,072,014) 172 (148,282) 549,802
Other intangible fixed assets (121,156) 221 (32,806) 33,044
Tangible fixed assets (1,445,953) 857 (191,312) 1,842,621
Land and buildings used by the Group for own purpose (397,002) 0 (41,707) 631,434
Other land and buildings (120,733) 83 (34,499) 631,738
of which land value of developed land (518) 0 (33) 8,081
Other tangible fixed assets (743,454) 631 (77,476) 247,572
Leased assets (operating lease) (184,764) 143 (37,631) 331,878
Total (3,209,326) 1,250 (385,787) 2,519,140

As at Change in Exchange As at
in € thousand 1/1/2015 consolidated group differences Additions Disposals Transfers 31/12/2015
Intangible fixed assets 2,374,199 (4,565) (130,026) 162,024 (64,667) 13,669 2,350,634
Goodwill 696,685 4,100 (50,074) 0 0 (4,100) 646,611
Software 1,508,125 (8,648) (58,168) 160,753 (63,425) 17,294 1,555,930
Other intangible fixed assets 169,389 (17) (21,784) 1,272 (1,242) 475 148,092
Tangible fixed assets 3,290,907 61,678 (96,784) 232,983 (234,299) (13,669) 3,240,816
Land and buildings used by the Group for
own purpose 1,087,450 295 (71,620) 56,865 (45,211) 553 1,028,332
Other land and buildings 385,315 154,617 59,399 11,721 (18,232) (5,041) 587,779
of which land value of developed land 12,539 (3) (907) 495 (567) 0 11,557
Other tangible fixed assets 1,218,415 (108,374) (76,043) 82,553 (111,955) (14,945) 989,652
Leased assets (operating lease) 599,726 15,140 (8,521) 81,843 (58,901) 5,764 635,052
Total 5,665,105 57,113 (226,810) 395,007 (298,966) 0 5,591,449

Write-ups, amortization, depreciation, impairment Carrying amount

in € thousand Cumulative hereof write-ups of which depreciation 31/12/2015
Intangible fixed assets (1,646,830) 0 (205,850) 703,804
Goodwill (548,423) 0 (30,924) 98,188
Software (1,007,032) 0 (146,728) 548,899
Other intangible fixed assets (91,375) 0 (28,198) 56,717
Tangible fixed assets (1,450,599) 7,502 (203,502) 1,790,217
Land and buildings used by the Group for own purpose (398,637) 2,919 (50,187) 629,695
Other land and buildings (89,976) 667 (21,185) 497,803
of which land value of developed land (530) 0 (578) 11,028
Other tangible fixed assets (745,285) 3,634 (93,928) 244,368
Leased assets (operating lease) (216,702) 282 (38,202) 418,350
Total (3,097,429) 7,502 (409,352) 2,494,020
In the reporting year and the previous year, no single investments exceeded € 10,000 thousand.
(24) Other assets

Tax assets 356,483 407,310
Current tax assets 183,634 111,714
Deferred tax assets 172,849 295,596
Receivables arising from non-banking activities 112,235 93,681
Accruals and deferred items 139,627 146,769
Clearing claims from securities and payment transfer business 327,391 135,568
Lease in progress 46,986 47,791
Assets held for sale (IFRS 5) 28,826 774,139
Inventories 85,539 91,314
Valuation fair value hedge portfolio 37,699 24,058
Other assets 396,140 344,996
Total 1,530,927 2,065,627
Application of IFRS 5
The decline in the item “assets held for sale” is attributable to the fact that Raiffeisen Banka d.d., Maribor, was sold as at
30 June 2016 and ZUNO BANK AG, Vienna, was reclassified because the sales negotiations were unsuccessful.
Deferred taxes

Deferred tax assets 172,849 295,596
Provisions for deferred taxes (88,717) (82,763)
Net deferred taxes 84,132 212,833

The net deferred taxes result from the following items:

Loans and advances to customers 29,579 200,420
Impairment losses on loans and advances 141,092 184,163
Tangible and intangible fixed assets 7,374 12,465
Other assets 15,485 4,633
Provisions for liabilities and charges 60,677 70,420
Trading liabilities 67,180 72,177
Other liabilities 368,516 367,042
Tax loss carry-forwards 28,939 54,444
Other items of the statement of financial position 121,982 285,577
Deferred tax assets 840,822 1,251,341
Loans and advances to banks 10,355 40,791
Impairment losses on loans and advances 49,832 98,371
Trading assets 42,474 85,922
Financial investments 2,317 23,602
Tangible and intangible fixed assets 80,099 84,308
Other assets 495,523 515,971
Deposits from customers 10 603
Provisions for liabilities and charges 1,224 769
Other items of the statement of financial position 19,597 79,636
Deferred tax liabilities 756,690 1,038,508
Net deferred taxes 84,132 212,833
In the consolidated financial statements, deferred tax assets are recognized for unused tax loss carry-forwards which amounted to
€ 28,939 thousand (2015: € 54,444 thousand). Most of the tax losses can be carried forward indefinitely. The Group did not
recognize deferred tax assets of € 383,502 thousand (2015: € 510,591 thousand) because, from a current point of view, there
is no prospect of realizing them within a reasonable period of time.
(25) Deposits from banks

Giro and clearing business 12,397,750 4,904,136
Long-term refinancing 3,612,405 4,736,772
Total 24,059,774 28,113,082
The Group refinances itself periodically with international commercial banks and multinational development banks. These credit
contracts contain ownership clauses normally used in business. These clauses permit the parties to terminate the contracts in the
case of change in direct or indirect control over RBI AG. This can lead to increased refinancing costs for the Group in the future.

Deposits from banks classified regionally (counterparty domicile) break down as follows:

Austria 16,370,490 17,738,079
Foreign 7,689,284 10,375,003
Total 24,059,774 28,113,082
Deposits from banks break down into the following segments:

Central banks 1,081,913 1,241,339
Commercial banks 21,849,325 24,973,657
Multilateral development banks 1,128,536 1,898,085
Total 24,059,774 28,113,082
(26) Deposits from customers

Deposits from customers break down as follows:

Sight deposits 44,332,922 37,431,299
Time deposits 25,312,860 30,878,402
Savings deposits 10,679,214 9,769,272
Total 80,324,996 78,078,973

Sovereigns 1,473,739 1,721,972
Corporate customers – mid market 2,987,327 2,992,483
Retail customers – small and medium-sized entities 5,949,087 5,096,246
Total 80,324,996 78,078,973
Deposits from customers classified regionally (counterparty domicile) are as follows:

Austria 12,714,035 13,957,101
Foreign 67,610,961 64,121,872
Total 80,324,996 78,078,973
(27) Debt securities issued

Bonds and notes issued 8,470,894 9,238,849
Money market instruments issued 38,995 94,024
Other debt securities issued 17,493 20,457
Total 8,527,381 9,353,330

The following table contains debt securities issued amounting to or exceeding € 200,000 thousand nominal value:
Issuer ISIN Type Currency Nominal value in € thousand Coupon Due

RBI AG XS0803117612 Senior public placements EUR 750,000 2.8% 10/7/2017
RBI AG XS0989620694 Senior public placements EUR 500,000 1.9% 8/11/2018
(28) Provisions for liabilities and charges

Change in Transfers,
As at consolidated exchange As at
in € thousand 1/1/2016 group Allocation Release Usage differences 31/12/2016
Severance payments and other 118,783 (5,386) 16,963 (9,763) (2,378) (2,586) 115,633
Retirement benefits 99,724 5 10,011 (18,524) (2,604) 10 88,622
Taxes 170,092 12,982 98,869 (18,245) (103,281) 5,345 165,762
Current 87,329 1,314 87,416 (8,813) (93,304) 3,105 77,046
Deferred 82,763 11,668 11,453 (9,432) (9,977) 2,241 88,717
Contingent liabilities and
commitments 113,804 849 101,355 (72,763) (353) 1,254 144,147
Pending legal issues 81,793 (84) 21,564 (7,258) (16,636) 6,818 86,197
Overdue vacation 52,774 (1,426) 13,697 (16,643) (446) 1,086 49,043
Bonus payments 137,204 (1,028) 122,169 (29,662) (81,783) 7,318 154,218
Restructuring 15,305 (3,101) 13,504 (5,319) (8,709) 2,551 14,231
Provisions for banking business
due to governmental measures 114,762 0 26,741 (7,109) (119,885) (7) 14,503
Other 181,033 (1,835) 129,934 (26,342) (75,816) (3,701) 203,274
Total 1,085,276 975 554,807 (211,628) (411,890) 18,089 1,035,629
The item “severance and other” includes provisions for anniversary bonuses and other payments in the amount of € 33,023 thou-
sand (2015: € 33,794 thousand) and obligations from other benefits due to termination of employment according to IAS 19 in
the amount of € 82,609 thousand (2015: € 84,989 thousand).
The change in provisions for banking business charges due to governmental measures was partly due to the provisioning of €
26,741 thousand for the Walkaway Law in Romania and partly due to the use of the provision relating to the enforced conversion
of loans denominated in Swiss francs at the historic rates at the time of lending in Croatia.
The Group is involved in litigation arising from the banking business. The Group does not expect the litigation to have a material
impact on the financial position of the Group. In the reporting period, Group-wide provisions for pending legal issues amounted to
€ 86,197 thousand (2015: € 81,793 thousand). Single cases exceeding € 10,000 thousand occurred in Austria and Slovakia
(2015: in Austria and in Slovakia).
 Legal steps were taken against Raiffeisen Bank International AG, Vienna, in connection with the early repayment of an Iceland-
ic liability. The amount in dispute is € 25,000 thousand.
 In Slovakia, a customer has taken legal action in relation to a disputed amount of approximately € 71,150 thousand against
Tatra banka a.s., Bratislava. The case revolves around agreed credit facilities and an alleged breach of contract on the part of
Tatra banka a.s. involving the failure to execute payment transfer orders and renew credit facilities, which ultimately led to the
termination of the customer's business activities.
 Another closely related legal action in relation to a disputed amount of € 127,063 thousand was brought by a Cypriot plaintiff
who had purchased the underlying claim from a shareholder of the above Slovakian customer’s holding company.
Pension obligations and other termination benefits

The Group contributes to the following defined benefit pension plans and other post-employment benefits:
 Defined benefit pension plans in Austria and other countries

 Other post-employment benefits in Austria and other countries

These defined benefit plans and other post-employment benefits expose the Group to actuarial risks, such as longevity risk, curren-
cy risk, interest rate risk and market (investment) risk.
Funding
Various types of pension plans are in existence: unfunded, partly funded and fully funded. The partly and fully funded plans are all
placed by the Valida Pension AG, Vienna. Valida Pension AG, Vienna, is a pension fund, and is subject in particular to the provi-
sions of the PKG (Pension Act) and BPG (Company Pension Act).
The Group expects to pay € 331 thousand in contributions to its defined benefit plans in 2017 (2016: € 818 thousand).
Pension obligations/defined benefit pension plans

Financial status

Defined benefit obligation (DBO) 139,192 150,376
Plan assets at fair value (50,570) (50,652)
Net liability/asset 88,622 99,724
The defined benefit obligations developed as follows:

DBO as at 1/1 150,376 159,731
Change in consolidated group 0 676
Current service cost 1,446 1,955
Interest cost 2,935 3,122
Past service costs 21 (1,145)
Payments (6,479) (6,098)
Transfer (170) (2,498)
Remeasurement (8,936) (5,365)
DBO as at 31/12 139,192 150,376
Plan assets developed as follows:

Plan assets as at 1/1 50,652 51,663
Contributions to plan assets 928 1,619
Payments from fund (1,803) (1,831)
Transfer (244) (2,568)
Return on plan assets excluding interest income 37 747
Plan assets as at 31/12 50,570 50,652
The return on plan assets for 2016 was € 962 thousand (2015: € 1,769 thousand). For 2016, the fair value of rights to reim-
bursement recognized as an asset was € 16,758 thousand (2015: € 17,056 thousand).

Structure of plan assets
Plan assets broke down as follows:
Per cent 2016 2015

Bonds 40 51
Shares 35 27
Alternative Investments 3 2
Property 5 4
Cash 17 17
Total 100 100
hereof own financial instruments 0 0
In the reporting year, most of the plan assets were quoted on an active market, less than 10 per cent were not quoted on an
active market.
Asset Liability Matching
The pension provider Valida Pension AG, Vienna, has an asset/risk management process (ARM process). According to this pro-
cess, the risk-bearing capacity of each fund is evaluated once a year. Based on this risk-bearing capacity, the investment structure
of the fund is derived. When defining the investment tolerance of the customer, defined and documented requirements are also
taken into account.
The defined investment structure will be implemented in the two funds named “VRG 60” and “VRG 7”, in which the accrued
amounts for RZB/RBI are invested with an investment concept. The weighting of predefined asset classes move between a band-
width according to objective criteria, which can be derived from market trends. In times of stress, hedges of the equity component
are made.
Actuarial assumptions
The following table shows the actuarial assumptions used to calculate the net defined benefit obligation:
Per cent 2016 2015

Discount rate 1.6 2.0
Future pension basis increase 2.7 3.0
Future pension increase 1.2 2.0
The following table shows the longevity assumptions used to calculate the net defined benefit obligation:
Years 2016 2015

Longevity at age 65 for current pensioners - males 21.1 20.9
Longevity at age 65 for current pensioners - females 23.6 23.5
Longevity at age 65 for current members aged 45 - males 24.6 24.5
Longevity at age 65 for current members aged 45 - females 26.8 26.7
The weighted average duration of the net defined benefit obligation was 15.1 years (2015: 16.0 years).

Changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions constant, would have
affected the defined benefit obligation by the amounts shown below:
2016 2015
in € thousand Addition Decrease Addition Decrease
Discount rate (1 per cent change) (15,693) 19,275 (17,502) 21,572
Future salary growth (0.5 per cent change) 859 (803) 1,100 (1,031)
Future pension increase (0.25 per cent change) 3,819 (3,658) 4,211 (4,016)
Remaining life expactency (change 1 year) 8,110 (8,357) 8,785 (9,386)
Although the analysis does not take account of the full distribution of cash flows expected under the plan, it does provide an
approximation of the sensitivity of the assumptions shown.
Other termination benefits

The other termination benefits developed as follows:

DBO as at 1/1 85,378 84,014
Changes in consolidated group (7,425) 761
Current service cost 5,449 4,914
Interest cost 1,627 1,557
Payments (3,145) (3,488)
Loss/(gain) on DBO due to past service cost (215) (17)
Transfer 2,311 (2,657)
Remeasurement (1,371) 294
DBO as at 31/12 82,609 85,378
Actuarial assumptions
The following table shows the actuarial assumptions used to calculate the other termination benefits:
Per cent 2016 2015

Discount rate 1.6 2.0
Additional future salary increase for employees 2.7 3.0
Reasonably possible changes at the reporting date to one of the relevant actuarial assumptions, holding other assumptions con-
stant, would have affected the defined benefit obligation by the amounts shown below:
2016 2015
in € thousand Addition Decrease Addition Decrease
Discount rate (1 per cent change) (7,902) 9,293 (8,641) 10,230
Future salary growth (0.5 per cent change) 4,370 (4,075) 4,747 (4,485)
Although the analysis does not take account of the full distribution of cash flows expected under the plan, it does provide an
approximation of the sensitivity of the assumptions shown.

Employee benefit expenses
For details of employee benefit expenses (expenses for defined benefit pension plans, other benefits due to termination of em-
ployment) are stated under note (8) General administrative expenses.
(29) Trading liabilities

Negative fair values of derivative financial instruments 2,548,174 3,883,631
Interest-based transactions 1,784,123 1,945,568
Equity-/index-based transactions 164,711 1,024,218
Credit derivatives business 687 1,960
Other transactions 10,547 128,033
Short-selling of trading assets 555,346 453,459
Certificates issued 1,964,063 694,859
Total 5,067,584 5,031,949
The decline in equity-/index-based transactions is attributable to a change in the presentation of certificates issued.
(30) Derivatives
Negative fair values of derivatives in fair value hedges (IAS 39) 132,565 194,932
Currency-based transactions 57 0
Negative fair values of derivatives in cash flow hedges (IAS 39) 275,102 239,858
Negative fair values of derivatives in net investment hedge (IAS 39) 17,749 0
Currency-based transactions 17,749 0
Negative fair values of credit derivatives 0 154
Negative fair values of other derivative financial instruments 354,041 543,402
Total 779,456 978,346
As long as the conditions for hedge accounting according to IAS 39 are fulfilled, derivative financial instruments are measured at
their fair values (dirty prices) in their function as hedging instruments. The hedged items in connection with fair value hedges are
loans and advances to customers, deposits from banks and debt securities issued, which are taken to hedge against interest rate
risk.
The table below shows the expected hedged cash flows from liabilities in their time periods affecting the statement of comprehen-
sive income:

1 year 2,416,321 3,714,123
More than 1 year, up to 5 years 587,577 385,701
More than 5 years 63,196 109,874
Net gains of € 5,788 thousand (2015: net loss of € 435 thousand) relating to the effective portion of cash flow hedges were
recognized in other comprehensive income.

(31) Other liabilities

Liabilities from non-banking activities 134,402 131,780
Liabilities from insurance contracts 82 112
Prepayments and other deferrals 294,147 318,427
Liabilities from dividends 1,094 1,069
Clearing claims from securities and payment transfer business 384,412 171,735
Valuation fair value hedge portfolio 57,564 63,839
Liabilities held for sale (IFRS 5) 0 1,293,769
Total 1,020,492 2,284,967
Application of IFRS 5
The decline in the item “liabilities held for sale” was caused by the sale of Raiffeisen Banka d.d., Maribor, as at 30 June 2016
and the reclassification of ZUNO BANK AG, Vienna, following the failure of the sales negotiations.
(32) Subordinated capital

Hybrid tier 1 capital 396,725 396,725
Subordinated liabilities and supplementary capital 3,840,778 3,807,056
Total 4,237,503 4,203,781
The following table contains subordinated borrowings that exceed 10 per cent of the subordinated capital:
Issuer ISIN Type Currency Nominal value in € thousand Coupon1 Due

RBI AG XS0619437147 Subordinated capital EUR 500,000 6.625% 18/5/2021
RBI AG XS0981632804 Subordinated capital EUR 500,000 6.000% 16/10/2023
RBI AG XS1034950672 Subordinated capital EUR 500,000 4,500% 21/2/2025
1 Current interest rate, interest clauses are agreed
In the reporting period, expenses on subordinated capital totaled € 160,497 thousand (2015: € 187,330 thousand).

(33) Equity
Consolidated equity 5,496,297 5,151,102
Subscribed capital 492,466 492,466
Capital reserves 1,834,796 1,834,775
Retained earnings 3,169,034 2,823,860
Consolidated profit/loss 252,629 236,864
Non-controlling interests 4,044,834 3,908,160
Total 9,793,760 9,296,127
The development of equity is shown under the section statement of changes in equity.
Subscribed capital
As at 31 December 2016, the subscribed capital of Raiffeisen Zentralbank Österreich Aktiengesellschaft (RZB AG) as defined by
the articles of incorporation was unchanged at € 492,466 thousand. The subscribed capital consists of 6,776,750 non-par bear-
er shares.
Dividend proposal
The Management Board intends to propose at the Annual General Meeting that no dividend be distributed for the financial year
2016.
Non-controlling interests
The following table contains financial information on subsidiaries which are held by the Group and in which material non-
controlling interests exist. The decline in net assets in the item “Other” is mainly due to the sale of a portion of the equity interest in
UNIQA Insurance Group AG, Vienna, and the resulting reduction in the non-controlling interest in BL Syndikat Beteiligungs GmbH,
Vienna. In December 2015, RZB purchased the remaining interest in Raiffeisen Bausparkasse GmbH, Vienna. As at year-end
2015, non-controlling interests therefore no longer existed. The amounts reported below refer to the non-controlling interests that
were not eliminated.
2016 Ownership Profit/loss after Other comprehensive Total comprehensive

in € thousand interest Net assets tax income income
Raiffeisen Bank International Group, Vienna (AT) 39% 3,970,844 291,963 64,726 356,689
Other n/a 73,990 (11,654) (14,900) (26,554)
Total 4,044,834 280,309 49,826 330,135
2015 Ownership Profit/loss after Other comprehensive Total comprehensive

in € thousand interest Net assets tax income income
Raiffeisen Bank International Group, Vienna (AT) 39% 3,655,921 204,581 (23,195) 181,386
Raiffeisen Bausparkasse Group, Vienna (AT) – – 12,359 (1,371) 10,988
Other n/a 252,239 11,549 (8,597) 2,952
Total 3,908,160 228,489 (33,163) 195,326

In contrast to the above financial information, which only relates to non-controlling interests, the following table contains summary
financial information of the individual subsidiaries (including non-controlling interests):
2016 2015
in € thousand RBI RBI
Operating income 4,505,109 4,783,447
Profit/loss after tax 573,615 434,991
Other comprehensive income 189,626 (53,269)
Total comprehensive income 762,235 381,722
Current assets 53,604,284 56,755,272
Non-current assets 58,259,561 57,671,311
Current liabilites 81,960,221 81,932,301
Non-current liabilities 20,671,494 23,993,316
Net assets 9,232,130 8,500,967
Cash from disposal of subsidiaries (163,171) 0
Effect of exchange rate changes 109,970 248,748
Net increase in cash and cash equivalents (1,240,132) 6,443,286
Dividends paid to non-controlling interests during the year 1 40,272 50,516
1 Included in net cash from investing activities
RBI: Raiffeisen Bank International Group, Vienna (AT)
Significant restrictions
For Raiffeisenbank a.s., Prague, a syndicate contract exists between RBI AG and the joint shareholder. The syndicate contract in
particular regulates purchase options between direct and indirect shareholders. The syndicate contracts expire automatically if
control over the company changes – also in the case of a takeover bid.
In the course of the approval process for the acquisition of Polbank shares, it was promised – besides other commitments – to the
Polish Financial Market Authority that at least 15 per cent of the shares of the Polish banking unit would be listed on the Warsaw
stock exchange in June 2017 at the latest. Furthermore, it was promised in the course of the approval process that shares of RBI
would be listed on the Warsaw stock exchange (in addition to the listing at the Vienna stock exchange) from June 2018 at the
latest or, alternatively, that the amount of the Polish banking unit’s listed shares would be increased to 25 per cent.
The European Bank for Reconstruction and Development (EBRD) participated in the capital increase of Raiffeisen Bank Aval JSC,
Kiev, which took place in December 2015. Within the course of this transaction, RBI agreed with EBRD that it would endeavor to
offer RBI shares to EBRD in exchange for the AVAL shares held by EBRD after six years of EBRD’s participation in AVAL in a so-
called share swap. However, the execution of such a transaction is subject to approvals from regulatory authorities, the Annual
General Meeting and other committees.
At the end of 2014, the Ukrainian National Bank introduced foreign currency transfer controls. A foreign investor is currently una-
ble to make dividend payments in a foreign currency in Ukraine. This restriction was extended indefinitely in the 2016 financial
year.
Share-based remuneration
In 2014, the share incentive program (SIP) was terminated due to regulatory complexities. The last tranches of the SIP were issued
in 2011, in 2012 and in 2013. The respective duration periods are five years. Therefore, the 2011 tranche matured in 2016. In
accordance with the terms and conditions of the program (published by “euro adhoc” on 14 September 2011), the number of
shares actually transferred was as follows:
Value at share price Number of shares

Share Incentive Program (SIP) 2011 of € 13.92 on actually
Group of persons Number of shares due allocation date transferred
Members of the management board of the company 24,493 340,943 12,809
Members of the management boards of bank subsidiaries affiliated with the
company 30,050 418,296 23,125
Executives of the company and other affiliated companies 19,839 276,159 11,384

To avoid legal uncertainties, eligible employees in three countries were given a cash settlement instead of an allocation of shares
as permitted by the program terms and conditions. In Austria, eligible parties were granted the option of accepting a cash settle-
ment in lieu of half of the shares due in order to offset the income tax payable at the time of transfer. Therefore, fewer shares were
actually transferred than the number that were due. The portfolio of own shares was subsequently reduced by the lower number of
shares actually transferred.
This means that as at the reporting date, contingent shares for two tranches were allocated. As at 31 December 2016, the num-
ber of these contingent shares was 693,462 (of which 367,977 shares were attributable to the 2012 allotment and 325,485
shares to the 2013 allotment). The originally published number of contingently allotted shares changed due to various personnel
changes within Group units. It is shown on an aggregated level in the following table:
Share incentive program (SIP) 2012 – 2013 Number of contingently allotted Minimum of allotment Maximum of
Group of persons shares as at 31/12/2016 of shares allotment of shares
Members of the management board of the company 214,091 64,227 321,137
Members of the management boards of bank subsidiaries affiliated
with the company 291,910 87,573 437,865
Executives of the company and other affiliated companies 187,461 56,238 281,192
In the financial year 2016, no shares were bought back for the share incentive program.
Disclosures to financial instruments

(34) Breakdown of remaining terms to maturity
2016 Short-term assets/liabilities Long-term assets/liabilities
Due at call or Up to More than 3 months, More than 1 year,
in € thousand without maturity 3 months up to 1 year up to 5 years More than 5 years
Cash reserve 16,838,583 0 0 0 0
Loans and advances to banks 4,463,205 3,972,179 1,009,482 923,955 654,711
Loans and advances to customers 7,905,248 10,563,846 10,081,474 26,747,483 24,471,028
Impairment losses on loans and advances (5,245,078) 0 0 0 0
Trading assets 168,555 649,404 658,497 1,758,728 1,708,928
Financial investments 582,990 3,181,884 2,950,341 10,185,223 4,529,792
Investments in associates 775,035 0 0 0 0
Sundry assets 3,004,575 899,859 183,286 871,694 351,668
Total assets 28,493,113 19,267,172 14,883,080 40,487,083 31,716,126
Deposits from banks 11,672,849 3,451,216 2,239,282 4,276,459 2,419,967
Deposits from customers 49,007,342 12,992,544 9,831,675 6,594,985 1,898,451
Debt securities issued 0 506,287 2,326,909 3,936,883 1,757,303
Trading liabilities 281,739 483,253 495,598 2,322,525 1,484,469
Subordinated capital 0 37 60,917 999,723 3,176,826
Sundry liabilities 1,158,342 916,664 175,085 486,721 98,766
Subtotal 62,120,272 18,350,002 15,129,465 18,617,295 10,835,781
Equity 9,793,760 0 0 0 0
Total equity and liabilities 71,914,032 18,350,002 15,129,465 18,617,295 10,835,781

2015 Short-term assets/liabilities Long-term assets/liabilities

Due at call or Up to More than 3 months, More than 1 year,
in € thousand without maturity 3 months up to 1 year up to 5 years More than 5 years
Cash reserve 17,401,694 0 0 0 0
Loans and advances to banks 1,806,826 7,286,494 1,431,939 1,037,009 550,865
Loans and advances to customers 7,843,649 11,789,791 11,047,274 25,255,573 23,521,366
Impairment losses on loans and advances (6,399,737) 0 0 0 0
Trading assets 440,114 405,102 643,079 2,804,192 1,482,085
Financial investments 758,515 4,433,907 3,542,481 9,534,378 4,178,946
Investments in associates 1,590,384 0 0 0 0
Sundry assets 3,194,792 523,658 485,349 987,309 848,796
Total assets 26,636,238 24,438,953 17,150,121 39,618,461 30,582,058
Deposits from banks 4,132,372 12,333,946 3,453,581 5,713,976 2,479,208
Deposits from customers 41,251,133 17,228,830 10,545,654 7,021,850 2,031,506
Debt securities issued 0 732,383 1,191,696 5,804,041 1,625,210
Trading liabilities 412,028 482,034 598,650 2,019,264 1,519,973
Subordinated capital 0 5,807 27,525 514,642 3,655,806
Sundry liabilities 2,043,623 864,670 552,251 591,929 296,116
Subtotal 47,839,156 31,647,670 16,369,357 21,665,702 11,607,818
Equity 9,296,127 0 0 0 0
Total equity and liabilities 57,135,283 31,647,670 16,369,357 21,665,702 11,607,818
(35) Foreign currency volumes

The consolidated financial statements consist of the following volumes of assets and liabilities denominated in foreign currencies:

Assets 63,630,373 58,227,540
Liabilities 51,138,384 51,014,932

(36) Securitization
RZB as originator
Securitization represents a special form of refinancing and credit risk enhancement under which risks from loans or lease agree-
ments are packaged into portfolios and placed with capital market investors. The objective of RZB’s securitization transactions is to
retrieve Group regulatory total capital and to use additional refinancing sources.
The following transactions for all or at least individual tranches were executed with external contractual partners and are still active
in the reporting year and resulted in a reduction in risk-weighted assets. The stated amounts represent the securitized portfolio and
the underlying outstanding portfolio as well as the junior tranche at the transaction closing date.
Seller of claims or Date of End of Securitized Outstanding portfolio Junior

in € thousand secured party contract maturity portfolio (securitized and retained) Portfolio tranche
Synthetic Transaction Raiffeisenbank a.s., December April Company loans
ROOF RBCZ 2015 Prague (CZ) 2015 2024 1,000,000 1,422,446 and guarantees 1.4%
Company loans,
Raiffeisen Bank guarantees,
Synthetic Transaction International AG, December March revolving credit
ROOF Infrastructure 2014 Vienna 2014 2027 978,222 1,413,865 facilities 6.1%
Raiffeisen Bank Company loans
Synthetic Transaction International AG, May (real estate
ROOF Real Estate 2015 Vienna July 2015 2025 552,862 1,067,181 financing) 7.1%
Synthetic Transaction Tatra banka a.s., March June
EIF JEREMIE Slovakia Bratislava (SK) 2014 2025 26,895 38,421 SME loans 25.0%
Synthetic Transaction Raiffeisenbank S.A., December December
EIF JEREMIE Romania Bucharest (RO) 2010 2023 12,597 15,746 SME loans 25.0%
Synthetic Transaction
EIF Western Balkans EDIF Raiffeisenbank Austria April May
Croatia d.d., Zagreb (HR) 2015 2023 4,590 6,557 SME loans 22.0%
SME: Small and medium-sized entities
In the reporting year, no new securitization programs resulting in a significant transfer of risk were initiated with external investors.
The following securitization programs concluded in former years were still active in the reporting year:
In December 2015, a synthetic securitization of € 1,000,000 thousand in loans and advances to corporate customers and pro-
ject finance loans originated by Raiffeisenbank a.s., Prague, was concluded. This synthetic securitization is referred to as “ROOF
RBCZ 2015” and was split into a senior, a mezzanine and a junior tranche. The mezzanine tranche was sold to two institutional
investors, while Raiffeisenbank a.s., Prague, holds the credit risk of the junior and senior tranches.
A synthetic securitization of loans and advances to corporate customers essentially originated by RBI AG has been active since
2014 under “ROOF Infrastructure 2014”. The junior tranche is externally placed and amounted to € 101,497 thousand as at
31 December 2016 (2015: € 98,963 thousand).
A synthetic securitization of real estate loans and advances to corporate customers from Austria and Germany originated by RBI
AG was concluded in July 2015 under “ROOF Real Estate 2015”. The transaction was split into a senior and a junior tranche. The
junior tranche is externally placed and amounted to € 51,445 thousand as at 31 December 2016 (2015: € 49,720 thousand).
Within the scope of further synthetic securitizations, the Group participated in the JEREMIE programs in Romania in 2010 (“EIF
JEREMIE Romania”), as well as in Slovakia from 2013 (“EIF JEREMIE Slovakia SME 2013-1”). The European Investment Fund (EIF)
provides guarantees from EIF under the JEREMIE initiative to subsidiaries granting loans to small and medium-sized enterprises. The
maximum volume of the portfolio under the JEREMIE first loss guarantees amounts to € 172,500 thousand for Raiffeisenbank S.A.,
Bucharest, and € 60,000 thousand for Tatra banka a.s., Bratislava.
In 2015, Raiffeisenbank Austria d.d., Zagreb, signed a portfolio guarantee agreement under the Western Balkans Enterprise
Development and Innovation Facility (EIF Western Balkans EDIF Croatia); the agreement is financed by the EU and aims to sup-
port small and medium-sized enterprises in accessing finance. The maximum volume is € 20,107 thousand.

A securitization transaction placed in 2014 by a leasing subsidiary in Poland under “ROOF Poland Leasing 2014” included a
portfolio of car leasing contracts with an underlying transaction volume of PLN 1,500,000 thousand. The SPV established for this
transaction was fully consolidated within the group until 30 November 2016. Following the sale of the originating Raiffeisen-
Leasing Polska S.A., Warsaw, and ROOF Poland Leasing 2014 Ltd, Dublin (IE), which was closed in December 2016, the securit-
ization transaction was eliminated from the Group.
RZB as investor
Besides the above-mentioned refinancing and packaging of designated portfolios of loans or leasing claims, the Group also acts
as an investor in Asset Backed Securities (ABS) structures. Essentially, this relates to investments in Structured Credit Products, Asset
Based Financing and partly also Diversified Payment Rights. During the financial year, market value changes led to a negative
valuation result of around € 89 thousand (2015: negative valuation result of € 12 thousand) and to a realized result from sale of
€ 679 thousand (2015: € 811 thousand).
Total exposure to structured products (excluding Credit Default Swaps):
2016 2015
in € thousand Outstanding nominal amount Carrying amount Outstanding nominal amount Carrying amount
Asset-backed securities (ABS) 445,868 446,569 450,764 450,913
Asset-based financing (ABF) 248,387 248,387 225,406 225,406
Collateralized debt obligations (CDO) 35,595 74 34,633 159
Other 10,000 6,580 0 0
Total 739,850 701,609 710,803 676,478
(37) Transferred assets

The Group enters into transactions that result in the transfer of trading assets, financial investments and loans and advances to
customers. The transferred financial assets continue to be recognized in their entirety or to the extent of the Group’s continuing
involvement, or are derecognized in their entirety. The Group transfers financial assets that are not derecognized in their entirety or
for which the Group has continuing involvement primarily through sale and repurchase of securities, securities lending and securiti-
zation activities.
Transferred financial assets not derecognized
Sale and repurchase agreements are transactions in which the Group sells a security and simultaneously agrees to repurchase it at
a fixed price on a future date. The Group continues to recognize the securities in their entirety in the statement of financial position
because it retains substantially all of the risks and rewards of ownership. The cash consideration received is recognized as a
financial asset and a financial liability is recognized for the obligation to pay the repurchase price. Because the Group sells the
contractual rights to the cash flows of the securities, it does not have the ability to use the transferred assets during the term of the
arrangement.
Securities lending agreements are transactions in which the Group lends securities for a fee and receives cash as collateral. The
Group continues to recognize the securities in their entirety in the statement of financial position because it retains substantially all
of the risks and rewards of ownership. The cash received is recognized as a financial asset and a financial liability is recognized
for the obligation to repay it. Because as part of the lending arrangement the Group sells the contractual rights to the cash flows
of the securities, it does not have the ability to use the transferred assets during the term of the arrangement.
Loans and advances to customers are sold by the Group to securitization vehicles that in turn issue notes to investors collateralized
by the purchased assets. In the securitizations in which the Group transfers loans and advances to an unconsolidated securitization
vehicle, it retains some credit risk while transferring some credit risk, prepayment and interest rate risk to the vehicle. The Group
therefore does not retain or transfer substantially all of the risks and rewards of such assets.

The table below shows the carrying amounts of financial assets transferred:
2016 Transferred assets Associated liabilities

hereof hereof repurchase hereof hereof repurchase
in € thousand Carrying amount securitizations agreements Carrying amount securitizations agreements
Loans and advances 300,057 0 300,057 292,527 0 292,527
Trading assets 32,783 0 32,783 31,846 0 31,846
Financial investments 49,417 0 49,417 47,748 0 47,748
Total 382,257 0 382,257 372,120 0 372,120
2015 Transferred assets Associated liabilities

hereof hereof repurchase hereof hereof repurchase
in € thousand Carrying amount securitizations agreements Carrying amount securitizations agreements
Loans and advances 390,409 327,669 62,741 323,619 268,322 55,297
Trading assets 288,276 0 288,276 251,613 0 251,613
Financial investments 37,705 0 37,705 36,098 0 36,098
Total 716,391 327,669 388,722 611,330 268,322 343,009
Transferred financial assets that are not entirely derecognized
The Group currently has no securitization transactions in which financial assets are partly derecognized.
(38) Assets pledged as collateral and received financial assets

The Group pledges assets mainly for repurchase agreements, securities lending agreements as well as other lending arrangements
and for margining purposes in relation to derivative liabilities. The table below contains assets from repo business, securities lend-
ing business, securitizations and debentures transferred as collateral of liabilities, or guarantees (this means collateralized depos-
its).

Loans and advances1 6,802,644 6,831,870
Trading assets2 63,540 1,077,547
Total 7,545,900 8,483,221
1 Without loans and andvances from reverse repo and securities lending business
2 Without derivatives
The table below shows the liabilities corresponding to the assets pledged as collateral and contains liabilities from repo business,
securities lending business, securitizations and debentures:

Deposits from banks 2,652,753 3,469,602
Deposits from customers 45,906 561,207
Debt securities issued 1,610,164 1,586,489
Contingent liabilities and commitments 51 115,798
Total 4,509,943 6,378,689
The following table shows securities and other financial assets accepted as collateral:

Securities and other financial assets accepted as collateral which can be sold or repledged 5,139,516 1,780,968
hereof which have been sold or repledged 418,169 307,566
The Group received collateral which can be sold or repledged even if no default occurs in the course of reverse repo business,
securities lending business, derivative and other transactions.

Significant restrictions regarding access to or usage of Group assets
Statutory, contractual or regulatory requirements as well as protective rights of non-controlling interests might restrict the ability of
the Group to access and transfer assets freely to or from other Group entities and settle liabilities. As at the reporting date, the
Group has not granted any material protective rights associated to non-controlling interests and therefore these were not a source
of significant restrictions.
The following products restrict the Group in the use of its assets: repurchase agreements, securities lending contracts as well as
other lending contracts, for margining purposes in relation to derivative liabilities, securitizations and various insurance activities.
The table below shows assets pledged as collateral and otherwise restricted assets with a corresponding liability. These assets
are restricted from usage to secure funding, for legal or other reasons.
2016 2015
in € thousand Pledged Otherwise restricted with liabilities Pledged Otherwise restricted with liabilities
Loans and advances1 6,802,644 1,338,469 6,831,870 1,983,278
Trading assets2 63,540 29,174 1,077,547 56,227
Financial investments 679,715 386,013 573,805 7,327
Total 7,545,900 1,753,656 8,483,221 2,046,832
1 Without loans and advances from reverse repo and securities lending business
2 Without derivatives
(39) Offsetting of financial assets and liabilities

The disclosures set out in the tables below include financial assets and financial liabilities that are offset in the Group’s statement of
financial position or are subject to an enforceable/unenforceable master netting arrangement or similar agreement that covers
similar financial instruments, irrespective of whether they are offset in the statement of financial position or not.
The similar agreements include derivative clearing agreements, global master repurchase agreements, and global master securi-
ties lending agreements. Similar financial instruments include derivatives, sales and repurchase agreements, reverse sale and
repurchase agreements, and securities borrowing and lending agreements.
Some of the agreements are not set-off in the statement of financial position. This is because they create, for the parties to the
agreement, a right to set-off recognized amounts that is enforceable only following an event of default, insolvency or bankruptcy of
the Group or the counterparties or following other predetermined events. In addition, the Group and its counterparties do not
intend to settle on a net basis or to realize the assets and settle the liabilities simultaneously. The Group receives and gives collat-
erals in the form of cash and marketable securities.
2016 Related amounts not set-

off in the statement of
Gross amount Net amount financial position Net amount
of recognized of recognized
assets set-off in liabilities set-off of recognized
the statement of in the statement assets set-off in Cash
financial of financial the statement of Financial collateral
in € thousand position position financial position instruments received
Derivatives (legally enforceable) 4,504,777 733,698 3,771,079 2,634,609 38,683 1,097,787
Reverse repurchase, securities lending & similar
agreements (legally enforceable) 3,681,162 0 3,681,162 3,681,162 0 0
Other financial instruments (legally
enforceable) 510,079 0 510,079 325,016 0 185,063
Total 8,696,018 733,698 7,962,320 6,640,787 38,683 1,282,850

2016 Related amounts not set-

off in the statement of
Gross amount Net amount financial position Net amount
of recognized
liabilities set-off of recognized of recognized
in the statement assets set-off in liabilities set-off in Cash
of financial the statement of the statement of Financial collateral
in € thousand position financial position financial position instruments pledged
Repurchase, securities lending & similar
agreements (legally enforceable) 447,514 0 447,514 433,849 0 13,665
enforceable) 335,217 0 335,217 325,016 0 10,201
Total 4,762,540 733,698 4,028,842 2,748,163 110,345 1,170,334
In 2016, assets which were not subject to legally enforceable netting agreements amounted to € 126,884,255 thousand (2015:
€ 133,182,045 thousand), of which an immaterial part was accounted for by derivative financial instruments and cash balances
from reverse repo business. Liabilities which were not subject to legally enforceable netting agreements totaled € 125,068,962
thousand in 2016 (2015: € 128,933,061 thousand), of which only an immaterial part was accounted for by derivative financial
instruments and cash deposits from repo business.
2015 Related amounts not set-off

in the statement of financial
Gross amount Net amount position Net amount
of recognized
of recognized liabilities set-off of recognized
assets set-off in the in the statement assets set-off in Cash
statement of of financial the statement of Financial collateral
in € thousand financial position position financial position instruments received
Reverse repurchase, securities lending &
similar agreements (legally enforceable) 1,326,950 0 1,326,950 1,310,863 0 16,087
enforceable) 1,966,507 14,427 1,952,079 1,753,855 0 198,224
Total 7,691,821 578,374 7,113,447 5,758,261 33,017 1,322,168
2015 Related amounts not set-off

in the statement of financial
Gross amount Net amount position Net amount
of recognized
of recognized assets set-off in of recognized
liabilities set-off in the statement of liabilities set-off in Cash
the statement of financial the statement of Financial collateral
in € thousand financial position position financial position instruments pledged
Derivatives (legally enforceable) 4,329,171 563,947 3,765,224 2,656,661 170,599 937,964
Repurchase, securities lending & similar
agreements (legally enforceable) 225,431 0 225,431 217,366 0 8,065
enforceable) 1,854,837 14,427 1,840,409 1,753,855 0 86,554
Total 6,409,439 578,374 5,831,064 4,627,883 170,599 1,032,583
The gross amounts of financial assets and financial liabilities and their net amounts disclosed in the above tables have been meas-
ured at either fair value (derivatives, other financial instruments) or amortized cost (loans and advances, deposits and other finan-
cial instruments). All amounts have been reconciled to the line items in the statement of financial position.

(40) Derivative financial instruments

2016 Nominal amount by maturity Fair values
More than 1 year, More than 5
in € thousand Up to 1 year up to 5 years years Total Positive Negative
Total 65,335,214 73,327,784 65,889,273 204,552,271 3,886,066 (3,327,631)
Interest rate contracts 26,525,580 62,252,018 47,129,144 135,906,743 2,876,839 (2,082,177)
OTC products
Interest rate swaps 23,069,895 51,860,752 40,973,866 115,904,513 2,581,781 (1,850,462)
Interest rate futures 824,943 0 0 824,943 34 0
Interest rate options – purchased 1,203,708 5,353,982 3,206,507 9,764,198 294,952 0
Interest rate options – sold 1,096,945 4,933,439 2,862,453 8,892,837 0 (231,089)
Products trading on stock exchange
Interest rate futures 330,089 49,412 38,592 418,093 0 (626)
Interest rate options 0 54,433 47,726 102,160 72 0
Foreign exchange rate and gold
contracts 36,875,577 9,378,193 18,531,807 64,785,577 910,523 (1,069,508)
OTC products
Cross-currency interest rate
swaps 4,909,304 8,324,391 18,531,807 31,765,501 462,063 (729,120)
Forward foreign exchange
contracts 28,748,913 973,379 0 29,722,293 429,818 (320,081)
Currency options – purchased 1,202,723 27,264 0 1,229,987 14,774 0
Currency options – sold 1,402,522 34,639 0 1,437,162 0 (14,003)
Gold commodity contracts 1,431 18,519 0 19,950 492 0
Currency contracts (futures) 610,685 0 0 610,685 3,376 (6,304)
Equity/index contracts 924,565 1,516,131 228,322 2,669,017 94,938 (164,711)
OTC products
Equity-/index-based options -
purchased 48,915 590,584 123,230 762,729 49,563 0
Equity-/index-based options - sold 209,132 901,613 104,595 1,215,340 8,942 (125,233)
Equity/index futures - forward
pricing 405,278 291 497 406,066 31,302 (32,414)
Equity/index futures 261,240 23,643 0 284,883 5,131 (7,065)
Commodities 95,930 95,699 0 191,629 3,119 (9,428)
Credit derivatives 895,537 85,743 0 981,281 648 (687)
Precious metals contracts 18,024 0 0 18,024 0 (1,120)

The surplus of negative market values for equity/index contracts is offset by shares purchased for hedging purposes. These shares
are recorded as trading assets and are not shown in the above table.
2015 Nominal amount by maturity Fair values

More than 1 year, More than 5
in € thousand Up to 1 year up to 5 years years Total Positive Negative
Total 80,580,384 74,772,538 47,597,891 202,950,813 4,283,054 (4,861,977)
Interest rate contracts 31,071,496 61,600,114 44,925,399 137,597,009 3,060,640 (2,325,202)
OTC products
Interest rate swaps 24,020,987 52,939,891 39,024,610 115,985,488 2,774,203 (2,068,327)
Interest rate futures 1,913,964 0 0 1,913,964 1,231 (2,549)
Interest rate options – purchased 979,419 4,442,682 2,944,024 8,366,125 284,805 0
Interest rate options – sold 1,282,299 4,183,344 2,879,449 8,345,092 0 (254,268)
Other similar contracts 2,161 0 0 2,161 0 0
Interest rate futures 2,872,666 34,198 58,945 2,965,809 336 (57)
Interest rate options 0 0 18,371 18,371 64 0
Foreign exchange rate and gold
contracts 47,600,542 10,220,395 2,226,613 60,047,550 1,150,357 (1,382,410)
OTC products
Cross-currency interest rate swaps 6,338,993 9,176,610 2,213,084 17,728,687 734,968 (940,896)
Forward foreign exchange contracts 37,327,296 866,568 0 38,193,865 381,261 (390,292)
Currency options – purchased 1,497,065 105,479 0 1,602,545 31,221 0
Currency options – sold 1,639,230 68,754 0 1,707,984 0 (29,878)
Gold commodity contracts 0 2,984 13,529 16,512 47 (12,240)
Currency contracts (futures) 797,957 0 0 797,957 2,859 (9,103)
Equity/index contracts 1,250,956 1,820,016 401,990 3,472,961 69,838 (1,024,218)
OTC products
Equity-/index-based options - purchased 84,862 505,331 113,035 703,229 39,062 0
Equity-/index-based options - sold 133,298 647,167 161,624 942,088 0 (161,175)
Other similar equity/index contracts 229,331 644,521 127,331 1,001,183 120 (826,338)
Equity/index futures - forward pricing 436,540 0 0 436,540 24,803 (22,172)
Equity/index futures 366,924 22,997 0 389,921 5,853 (14,532)
Commodities 141,386 128,795 43,889 314,071 442 (110,759)
Credit derivatives 494,078 992,305 0 1,486,383 1,776 (2,114)
Precious metals contracts 21,926 10,912 0 32,838 1 (17,274)
The previous year’s surplus of negative market values for equity/index contracts was offset by shares purchased for hedging
purposes. These shares are recorded under trading assets and are not shown in the above table.
(41) Fair value of financial instruments

In the Group fair value is primarily measured based on external data sources (mainly stock exchange prices or broker quotations
in highly liquid markets). Financial instruments which are measured using quoted market prices are mainly listed securities and
derivatives and also liquid bonds which are traded on OTC markets. These financial instruments are assigned to Level I of the fair
value hierarchy.
In the case of a market valuation where the market cannot be considered as an active market because of its restricted liquidity, the
underlying financial instrument is assigned to Level II of the fair value hierarchy. If no market prices are available, these financial
instruments are measured using valuation models based on observable market data. These observable market data are mainly
reproducible yield curves, credit spreads and volatilities. The Group generally uses valuation models which are subject to an
internal audit by the Market Risk Committee in order to ensure appropriate measurement parameters.
If fair value cannot be measured using either sufficiently regularly quoted market prices (Level I) or using valuation models which
are entirely based on observable market prices (Level II), then individual input parameters which are not observable on the market
are estimated using appropriate assumptions. If parameters which are not observable on the market have a significant impact on

the measurement of the underlying financial instrument, it is assigned to Level III of the fair value hierarchy. These measurement
parameters which are not regularly observable are mainly credit spreads derived from internal estimates.
Assigning certain financial instruments to the level categories requires regular assessment, especially if measurement is based on
both observable parameters and also parameters which are not observable on the market. The classification of an instrument can
also change over time because of changes in market liquidity and thus price transparency.
Fair value of financial instruments reported at fair value

Bonds are primarily measured using prices that can be realized in the market. If no quotations are available, the securities are
measured using the discounted cash flow model. The measurement parameters used here are the yield curve and an adequate
credit spread. The credit spread is calculated using comparable financial instruments which are available on the market. For a
small part of the portfolio, a conservative approach was selected and credit default spreads were used for measurement. External
measurements by third parties are also taken into account, all of which are indicative in nature. Items are assigned to levels at the
end of the reporting period.
In the Group, well-known conventional valuation techniques are used to measure OTC derivatives. For example, interest rate
swaps, cross currency swaps or forward rate agreements are measured using the customary discounted cash flow model for these
products. OTC options, such as foreign exchange options or caps and floors, are based on valuation models which are in line with
market standards. For the products mentioned as examples, these would include the Garman-Kohlhagen model, Black-Scholes
1972 and Black 1976. Complex options are measured using binomial tree models and Monte-Carlo simulations.
To determine the fair value a credit value adjustment (CVA) is also necessary to reflect the counterparty risk associated with OTC
derivative transactions, especially of those contractual partners with whom hedging via credit support annexes has not yet been
conducted. This amount represents the respective estimated market value of a security which could be used to hedge against the
credit risk of the counterparties to the Group's OTC derivative portfolios.
For OTC derivatives, credit value adjustments (CVA) and debit value adjustments (DVA) are used to cover expected losses from
lending business. The CVA will depend on the expected future exposure (expected positive exposure) and the probability of
default of the contractual partner. The DVA is determined based on the expected negative exposure and on RBI's credit quality.
The expected positive exposure is calculated by simulating a large number of scenarios for future points in time, taking into ac-
count all available risk factors (e.g. currency and yield curves). OTC derivatives are measured at market values taking into account
these scenarios at the respective future points in time and are aggregated at counterparty level in order to then ascertain the
expected positive exposure for all points in time. Counterparties with CSA contracts (credit support annex contracts) are taken into
account in the calculation for the first time from 31 December 2014. Here, the expected exposures are not calculated directly
from simulated market values, but from a future expected change in market values based on a "margin period of risk" of 10 days.
A further element of the CVA involves determining a probability of default for each counterparty. Where direct credit default swap
(CDS) quotations are available, the Group calculates the market-based probability of default and, implicitly, the loss-given-default
(LGD) for the respective counterparty. The probability of default for counterparties which are not actively traded on the market is
calculated by assigning a counterparty's internal rating to a sector and rating-specific CDS curve. The valuation result due to
changed credit risk of the counterparty is disclosed in the notes under (5) Net trading income, interest-based transactions.
The DVA is determined by the expected negative exposure and by RBI's credit quality and represents the value adjustment for own
probability of default. The method of calculation is similar to that for the CVA, but the expected negative market value is used
instead of the expected positive market value. Instead of the expected positive exposures, expected negative exposures are
calculated from the simulated future aggregated counterparty market values; these represent the expected debt which the Group
has to the counterparty at the respective future points in time. Values implied by the market are also used to calculate the own
probability of default. Direct CDS quotations are used where available. If no CDS quotation is available, the own probability of
default is calculated by assigning the own rating to a sector and rating-specific CDS curve.
No funding value adjustment (FVA) was considered to measure OTC derivatives. The Group is observing market developments
and will develop a method to calculate the FVA where appropriate

In the following tables, the financial instruments reported at fair value in the statement of financial position are grouped according
to items in the statement of financial position and classified according to measurement category. A distinction is made as to
whether the measurement is based on quoted market prices (Level I), or whether the valuation models are based on observable
market data (Level II) or on parameters which are not observable on the market (Level III). Items are assigned to levels at the end
of the reporting period.
2016 2015
in € thousand Level I Level II Level III Level I Level II Level III
Trading assets 2,030,638 3,457,576 72,220 2,758,057 3,763,285 24,214
Positive fair values of derivatives1 93,900 3,146,622 852 64,453 3,507,009 2,320
Shares and other variable-yield securities 164,159 257 65 202,596 449 237
Bonds, notes and other fixed-interest securities 1,772,579 310,697 71,303 2,491,009 255,827 21,657
Financial assets at fair value through profit or loss 6,447,870 1,972,834 52,507 6,845,476 3,072,102 65,973
Shares and other variable-yield securities 118,414 121 1,186 256,283 0 1,209
Bonds, notes and other fixed-interest securities 6,329,456 1,972,712 51,322 6,589,193 3,072,102 64,764
Financial assets available-for-sale 4,066,393 219,021 73,585 3,441,965 536,074 170,518
Other interests2 1,536 28,673 0 48,279 0 89,436
Bonds, notes and other fixed-interest securities 4,013,481 190,348 70,865 3,344,302 536,074 78,586
Shares and other variable-yield securities 51,376 0 2,721 49,384 0 2,496
Derivatives (hedging) 0 644,693 0 0 709,272 0
Positive fair values of derivatives from hedge accounting 0 644,693 0 0 709,272 0
1 Including other derivatives
2 Includes securities traded on the stock exchange and also shares measured according to income approach
Level I Quoted market prices

Level II Valuation techniques based on market data
Level III Valuation techniques not based on market data
2016 2015
in € thousand Level I Level II Level III Level I Level II Level III
Trading liabilities 618,955 4,794,887 7,783 524,973 5,021,550 28,982
Negative fair values of derivative financial instruments1 135,334 2,766,545 337 161,769 4,243,504 21,914
Short-selling of trading assets 483,236 72,111 0 363,204 90,255 0
Certificates issued 386 1,956,232 7,446 0 687,791 7,068
Liabilities at fair value through profit and loss 0 2,783,648 0 0 2,588,259 0
Deposits from banks2 0 751,720 0 0 838,753 0
Debt securities issued2 0 1,373,418 0 0 1,226,965 0
Subordinated capital2 0 658,510 0 0 522,541 0
Derivatives (hedging) 0 425,415 0 0 434,791 0
Negative fair values of derivatives from hedge
accounting 0 425,415 0 0 434,791 0
1 Including other derivatives
Level I Quoted market prices

Level II Valuation techniques based on market data
Level III Valuation techniques not based on market data
Movements between Level I and Level II
For each financial instrument, a check is made whether quoted market prices are available on an active market (Level I). For finan-
cial instruments where there are no quoted market prices, observable market data, for instance yield curves, are used to calculate
fair value (Level II). Reclassification takes place if this estimate changes.
If instruments are reclassified from Level I to Level II, this means that market quotations were previously available for these instru-
ments but are no longer so. These securities are now measured using the discounted cash flow model, using the respective valid
yield curve and the appropriate credit spread.

If instruments are reclassified from Level II to Level I, this means that the measurement results were previously calculated using the
discounted cash flow model but that market quotations are now available and can be used for measurement.
Compared to year-end, the share of financial assets classified as Level II decreased. The decrease resulted mainly from divestitures
from the category “Financial assets at fair value through profit or loss”, particularly the category “Bonds, notes and other fixed-
interest securities”. Compared to year-end, Level I assets also decreased. Moreover, there was a slight shift from Level I to Level II.
This was due to the fact that no directly quoted market prices for these financial instruments were available at the reporting date.
Movements in Level III of financial instruments at fair value
The following tables show the changes in the fair value of financial instruments whose fair value cannot be calculated on the basis
of observable market data and which are therefore subject to other measurement models. Financial instruments in this category
have a value component which is unobservable on the market and which therefore has a material impact on the fair value. Due to
a change in the observable valuation parameters, certain financial instruments were reclassified from Level III. The reclassified
financial instruments are shown under Level II as they are valued on the basis of market input parameters.
As at Change in Exchange Sales,

in € thousand 1/1/2016 consolidated group differences Purchases repayment
Trading assets 24,214 0 (790) 70,261 (19,691)
Financial assets at fair value through profit or loss 65,973 0 4,667 18,586 (45,287)
Financial assets available-for-sale 170,518 0 (2,277) 14,619 (149,215)
Derivatives (hedging) 0 0 146 0 (28)
Gains/loss in other Transfer to Transfer As at

in € thousand Gains/loss in P/L comprehensive income level III from level III 31/12/2016
Trading assets (1,775) 0 0 0 72,220
Financial assets at fair value through profit or loss 8,569 0 0 0 52,507
Financial assets available-for-sale 129,399 (89,459) 0 0 73,585
Derivatives (hedging) (118) 0 0 0 0
As at Change in Exchange Sales,

in € thousand 1/1/2016 consolidated group differences Purchases repayment
Trading liabilities 28,982 0 (1) 12,849 (19,984)
Gains/loss in other Transfer to Transfer As at

in € thousand Gains/loss in P/L comprehensive income level III from level III 31/12/2016
Trading liabilities (258) 0 0 (13,806) 7,783
In the reporting year, gains resulting from financial instruments of the Level III fair value hierarchy amounted to € 135,817 thousand
(2015: € 34,227 thousand).

Qualitative information for the measurement of Level III financial instruments
Fair value in Valuation Significant unobservable Range of

Financial assets Type € thousand technique inputs unobservable inputs
Closed end real
Shares and other variable-yield securities estate fund 65 Net asset value Haircuts 40-90%
Cost of
Shares, floating aquisition, DCF - Realization rate
Shares and other variable-yield securities rate notes 3,906 method Credit spread 10-40%
Income
Other interests Shares 0 approach Forecasted cash flows -
Bonds, notes and other fixed-interest Fixed coupon Discounted cash
securities bonds 186,680 flow method Credit spread 0.4-50%
Bonds, notes and other fixed-interest Asset backed Discounted cash Realization rate
securities securities 6,810 flow method Credit spread 10-20%
Net present Interest rate 10-30%
Positive fair value of banking book Forward foreign value method PD 0.25-100%
derivatives without hedge accounting exchange contracts 852 Internal model LGD 37-64%
Total 198,313
Fair value in Valuation Significant unobservable Range of

Financial liabilities Type € thousand technique inputs unobservable inputs
Closing period 2-5%
Currency risk 0-5%
LT volatility 0-3%
Negative fair value of banking book Index category 0-5%
derivatives without hedge accounting OTC options 337 Option model Net interest rate 10-30%
Closing period 0-3%
Bid-Ask spread 0-3%
LT volatility 0-3%
Issued certificates for trading purposes Certificates 7,446 Option model Index category 0-2.5%
Total 7,783
Fair value of financial instruments not reported at fair value

Fair values which are different from the carrying amount are calculated for fixed-interest loans and advances to and deposits from
banks or customers, if the remaining maturity is more than one year. Variable-interest loans and advances and deposits are taken
into account if they have an interest rollover period of more than one year. The fair value of loans and advances is calculated by
discounting future cash flows and using interest rates at which similar loans and advances with the same maturities could have
been granted to customers with similar creditworthiness. Moreover, the specific credit risk and collateral are considered for the
calculation of fair values for loans and advances.
2016
in € thousand Level I Level II Level III Fair value Carrying amount Difference
Assets
Cash reserve 0 16,838,583 0 16,838,583 16,838,583 0
Loans and advances to banks 0 8,275,700 2,708,271 10,983,971 10,973,166 10,805
Loans and advances to customers 0 17,053,879 56,998,151 74,052,029 74,574,366 (522,337)
Financial investments 6,242,120 2,206,434 1,140,615 9,589,169 9,374,591 214,578
Liabilities
Deposits from banks 0 9,806,023 13,707,862 23,513,884 23,308,054 205,830
Deposits from customers 0 26,623,836 53,817,826 80,441,662 80,324,996 116,666
Debt securities issued 2,044,884 4,562,477 1,485,259 8,092,620 7,812,473 280,147
Subordinated capital 0 3,409,412 431,636 3,841,047 3,578,993 262,055

2015
in € thousand Level I Level II Level III Fair value Carrying amount Difference
Assets
Cash reserve 0 17,401,694 0 17,401,694 17,401,694 0
Loans and advances to banks 0 6,275,003 5,761,941 12,036,944 11,993,151 43,793
Loans and advances to customers 0 15,617,281 57,100,474 72,717,755 73,177,898 (460,142)
Financial investments 5,876,839 2,389,865 2,013,225 10,279,929 9,954,782 325,147
Liabilities
Deposits from banks1 0 12,160,297 15,352,481 27,512,778 27,274,329 238,449
Deposits from customers 0 26,977,038 51,559,426 78,536,465 78,078,973 457,492
Debt securities issued 2,174,292 4,314,378 1,806,157 8,294,827 8,126,365 168,463
Subordinated capital1 0 3,624,851 441,623 4,066,474 3,681,240 385,234
(42) Contingent liabilities and commitments

Contingent liabilities 9,780,465 10,030,100
Acceptances and endorsements 0 26,180
Credit guarantees 5,624,327 4,939,167
Other guarantees 2,626,927 3,079,943
Letters of credit (documentary business) 993,936 1,237,908
Other contingent liabilities 535,274 746,901
Commitments 10,732,550 10,481,542
Irrevocable credit lines and stand-by facilities 10,732,550 10,481,542
Up to 1 year 2,863,167 2,993,998
More than 1 year 7,869,383 7,487,543
The following table contains revocable credit lines:

Revocable credit lines 16,110,254 16,186,591
Up to 1 year 9,823,208 9,988,236
More than 1 year 4,090,360 4,124,391
Without maturity 2,196,686 2,073,964
Raiffeisen-Kundengarantiegemeinschaft Österreich
RZB AG and RBI AG are members of the Raiffeisen-Kundengarantiegemeinschaft Österreich (RKÖ). The members of this associa-
tion assume a contractually agreed liability stating that together, they will guarantee to fulfill all customer deposits and own issues
of an insolvent member up to the limit which results from the total of the financial strength of each individual member institution
within the corresponding deadlines. The financial strength of a member institution depends on its freely available reserves taking
into account the relevant rules according to the Austrian Banking Act (BWG).
Institutional Protection Scheme
The introduction of the Capital Requirements Regulation (CRR) in 2014 resulted in some significant adjustments to the provisions
contained thus far in Austrian Banking Act (BWG) for decentralized cooperative banking groups. According to this EU regulation,
cooperative banking groups with holdings of equity instruments of banks outside the banking group, should deduct these holdings
from equity, unless an exemption though an Institutional Protection Scheme (IPS) exists. For this reason an IPS was established in
the Raiffeisen Banking Group, and contractual and statutory guarantees agreed upon, which cover participating institutions and in
particular maintain, when needed, liquidity and solvency in order to avoid bank failure. Based on the structure of the Raiffeisen
Banking Group the IPS has been designed in two stages, and applications were submitted to the competent supervisory authority
and approved in October and November 2014.

RZB AG, as the central institution of the Raiffeisen Banking Group, is a participant in the federal IPS alongside the Raiffeisenland-
esbanken, Raiffeisen-Holding Niederösterreich-Wien reg. GmbH, Vienna, Posojilnica Bank eGen, Klagenfurt, Raiffeisen
Wohnbaubank AG, Vienna, and the Raiffeisen Bausparkasse GmbH, Vienna. Furthermore, in most of the Austrian federal states
there is a regional IPS.
The participants in the regional IPS are the regional Raiffeisen banks of the individual federal states and local Raiffeisen banks.
The core of the federal IPS is a uniform and joint risk monitoring within the framework of the early warning system of the Austrian
Raiffeisen Deposit Guarantee scheme (ÖRE). The IPS thus supplements the system of mutual cooperation in the framework of the
Raiffeisen Banking Group, which comes into effect when members run into financial difficulties. In 2015 and 2016, the scheme
was used in the case of Posojilnica Bank eGen, Vienna, when the affected institution received equity and a subordinated loan
from fund assets.
Risk report
(43) Risks arising from financial instruments
Active risk management is a core competency of the Group. In order to effectively identify, measure, and manage risks the Group
continues to develop its comprehensive risk management system. Risk management is an integral part of overall bank manage-
ment. In particular, in addition to legal and regulatory requirements, it takes into account the nature, scale, and complexity of the
business activities and the resulting risks. The risk report describes the principles and organization of risk management and explains
the current risk exposures in all material risk categories.
Risk management principles

The Group has a system of risk principles and procedures in place for measuring and monitoring risk, which is aimed at controlling
and managing material risks at all banks and specialist companies in the Group. The risk policies and risk management principles
are laid out by the Management Board of RZB AG. The principles include the following risk policies:
 Integrated risk management: Credit and country risks, participation, market and liquidity risks, and operational risks are
managed as main risks on a Group-wide basis. For this purpose, these risks are measured, limited, aggregated, and compared
to available risk coverage capital.
 Standardized methodologies: Risk measurement and risk limitation methods are standardized Group-wide in order to ensure
a consistent and coherent approach to risk management. This is efficient for the development of risk management methods and
it forms the basis for consistent overall bank management across all countries and business segments.
 Continuous planning: Risk strategies and risk capital are reviewed and approved in the course of the annual budgeting and
planning process, whereby special attention is also paid to preventing risk concentrations.
 Independent control: A clear personnel and organizational separation is maintained between business operations and any
risk management or risk controlling activities.
 Ex ante and ex post control: Risks are consistently measured within the scope of product selling and in risk-adjusted perfor-
mance measurement. Thereby it is ensured that business in general is conducted only under risk-return considerations and that
there are no incentives for taking high risks.
Individual risk management units of the Group create detailed risk strategies, which set more concrete risk targets and specific
standards in compliance with these general principles. The overall Group risk strategy is derived from the Group’s business strate-
gy and the risk appetite and adds risk relevant aspects to the planned business structure and strategic development. These aspects
include for example structural limits and capital ratio targets which have to be met in the budgeting process and which frame
upcoming business decisions. More specific targets for individual risk categories are set in detailed risk strategies. The credit risk
strategy of the Group, for instance, sets credit portfolio limits for individual countries and segments and defines the credit approval
authority for limit applications.

Organization of risk management

The Management Board of the Group ensures the proper organization and ongoing development of risk management. It decides
which procedures are to be employed for identifying, measuring, and monitoring risks, and makes steering decisions according to
the created risk reports and analyses. The Management Board is supported in implementing these tasks by independent risk
management units and special committees.
Basically, risk management functions are performed on different levels in the Group. RZB AG as the parent credit institution con-
cluded several Service Level Agreements with risk management units of RBI AG which develop and implement the relevant con-
cepts in coordination with the subsidiaries of the Group. The central risk management units are responsible for the adequate and
appropriate implementation of the Group’s risk management processes. In particular, they establish common Group directives and
set business-specific standards, tools, and practices for all Group entities.
In addition, local risk management units are established in the different Group entities. They implement the risk policies for specific
risk types and take active steering decisions within the approved risk budgets in order to achieve the targets set in the business
policy. For this purpose, they monitor resulting risks using standardized measurement tools and report them to central risk manage-
ment units via defined interfaces.
The central Risk Controlling division assumes the independent risk controlling function required by banking law. Its responsibilities
include developing the Group-wide framework for overall bank risk management (integrating all risk types) and preparing inde-
pendent reports on the risk profile for the Risk Committee of the Supervisory Board, for the Management Board and the heads of
individual business units. It also measures required risk coverage capital for different Group units and calculates the utilization of
the allocated risk capital budgets in the internal capital adequacy framework.

Risk committees
The Group Risk Committee is the highest decision-making body for all risk-relevant issues of the Group. It determines the risk man-
agement methods and steering concepts to be implemented for the Group as a whole and its key parts. These include risk appe-
tite, various risk budgets, limits at overall bank level and monitoring the current risk situation, with appropriate management
measures.
The Risk Management Committee is responsible for ongoing development and implementation of methods and parameters for risk
quantification models and for refining steering instruments. The committee also analyzes the current risk situation with respect to
internal capital adequacy and the corresponding risk limits. It approves risk management and controlling activities (like the alloca-
tion of risk capital) and advises the Management Board in these matters.
The Group Asset/Liability Committee assesses and manages statement of financial position structure and liquidity risks and per-
forms in this context key functions relating to refinancing planning and determining measures for safeguarding against structural
risks. The Capital Hedge Committee is a sub-committee of the Group Asset/Liability Committee and manages the currency risk of
the capital position.
The Market Risk Committee controls market risks of trading and banking book transactions of the Group and establishes corre-
sponding limits and processes. In particular, it relies on profit and loss reports, the risks calculated and the limit utilization, as well
as the results of scenario analyses and stress tests with respect to market risks.
The Credit Committees are staffed by front office and back office representatives with different participants depending on the type
of customer (corporate customers, banks, sovereigns and retail). They decide upon the specific lending criteria for different cus-
tomer segments and countries and approve all credit decisions concerning them according to the credit approval authority (de-
pending on rating and exposure size).
The Problem Loan Committee (PLC) is the most important committee in the evaluation and decision-making process concerning
problem loans. It comprises primarily decision making bodies (members of the Management Board of RZB and RBI). Its chairman
is the Chief Risk Officer (CRO) of RBI. Further members with voting rights are those members of the Management Board responsi-
ble for the customer divisions, the Chief Financial Officer (CFO) and the relevant division and department managers from risk
management and special exposure management (workout).
The Securitization Committee is the decision-making committee for limit requests in relation to securitization positions within the
specific decision-making authority framework and develops proposals for modifications to the securitization strategy for the Man-
agement Board. In addition, the Securitization Committee is a platform for exchanging information regarding securitization posi-
tions and market developments.
The Operational Risk Management Committee comprises representatives of the business divisions (retail, market and corporate
customers) and representatives from Compliance (including financial crime), Internal control system (IKS), Operations, Security and
Risk Controlling, under chairmanship of the CRO. This committee is responsible for controlling operational risk (including conduct
risk) of the Group. It derives and sets the operational risk strategy from the risk profile and the business strategy and also makes
decisions regarding measures, controls and risk acceptance.
The Contingency/Recovery Committee is a decision-making body convened by the Management Board. The composition of the
committee varies, where applicable depending on the intensity or focus of the specific requirements pertaining to the situation (e.g.
capital and/or liquidity). The core task of the committee is to maintain or recover financial stability in accordance with BaSAG
(Austrian Bank Recovery and Resolution Act) and BRRD (Banking Recovery and Resolution Directive) in the event of a critical
financial situation.
Quality assurance and auditing

Quality assurance with respect to risk management refers to ensuring the integrity, soundness, and accuracy of processes, models,
calculations, and data sources. This should make sure that the Group adheres to all legal requirements and that it can achieve the
highest standards in risk management related operations.
All these aspects are coordinated by the division Group Compliance which analyzes the internal control system on an ongoing
basis and – if actions are necessary for addressing any deficiencies – is also responsible for tracking their implementation.
Two important functions in assuring independent oversight are performed by the divisions Audit and Compliance. Independent
internal auditing is a legal requirement and a central pillar of the internal control system. Audit periodically assesses all business
processes and contributes considerably to securing and improving them. It sends its reports directly to the Management Board of
RZB AG which discusses them on a regular basis in its board meetings.

The Compliance Office is responsible for all issues concerning compliance with legal requirements in addition to and as integral
part of the internal control system. Thus, compliance with existing regulations in daily operations is monitored.
Moreover, an independent and objective audit, free of potential conflicts of interest, is carried out during the audit of the annual
financial statements by the auditing companies. Finally, the Group is continuously supervised by the European Central Bank, the
Austrian Financial Markets Authority and by the local supervisor in those countries, where it is represented by branches or subsidi-
aries.
Overall bank risk management

Maintaining an adequate level of capital is a core objective of the Group. Capital requirements are monitored regularly based on
the actual risk level as measured by internal models, and in choosing appropriate models the materiality of risks annually assessed
is taken into account. This concept of overall bank risk management provides for capital requirements from a regulatory point of
view (sustainability and going concern perspective) and from an economic point of view (target rating perspective). Thus, it covers
the quantitative aspects of the internal capital adequacy assessment process (ICAAP) as legally required. The full ICAAP process
of the Group is audited during the supervisory review process for RZB credit institution group (RZB-Kreditinstitutsgruppe) on an
annual basis.
The Risk Appetite Framework (RAF) limits the Group’s overall risk in accordance with the strategic business objectives and allo-
cates these to the different risk categories and divisions. The primary aim of the RAF is to limit risk, particularly in adverse scenarios
and for major singular risks, in such a way as to ensure compliance with regulatory minimum ratios. The RAF is therefore based on
the ICAAP’s three pillars (target rating, going concern, sustainability perspective) and sets concentration risk limits for the risk types
identified as significant in the risk assessment. In addition, the risk appetite decided by the Management Board and the group’s
risk strategy and its implementation are reported regularly to the Supervisory Board’s Risk Committee.
Objective Description of risk Measurement technique Confidence level

Target rating Risk of not being able to satisfy Unexpected losses on an annual basis 99.92 per cent as derived from the default
perspective claims of the Group´s senior (“economic capital”) must not exceed the present probability implied by the target rating
lenders value of equity and subordinated liabilities
Going concern Risk of not meeting the capital Risk-taking capacity (projected earnings plus 95 per cent presuming the owners´
perspective requirement as defined in the CRR capital exceeding regulatory requirements) must willingness to inject additional capital
regulations not fall below the annualized value-at-risk of the
Group
Sustainability Risk of falling short of a Capital and net income projection for a three- 70–90 per cent based on the
perspective sustainable tier 1 ratio over a full year planning period based on a severe management decision that the Group
business cycle macroeconomic downturn scenario might be required to temporarily reduce
risks or raise additional capital
Target rating perspective
Risks in the target rating perspective are measured based on economic capital which represents a comparable measure across all
types of risks. It is calculated as the sum of unexpected losses stemming from different Group units and different risk categories
(credit, participation, market, liquidity, macroeconomic and operational risk as well as risk resulting from other tangible fixed as-
sets). In addition, a general buffer for other risk types not explicitly quantified is held.
The objective of calculating economic capital is to determine the amount of capital that would be required for servicing all of the
claims of customers and creditors even in the case of such an extremely rare loss event. The Group uses a confidence level of
99.92 per cent for calculating economic capital. This confidence level is derived from the probability of default implied by the
target rating. Based on the empirical analysis of rating agencies, the selected confidence level corresponds to a rating of “Single
A”.
During the year, the economic capital of the Group decreased 6 per cent, or € 389,036 thousand, to € 6,197,708 thousand. As
at end of reporting date, credit risk accounted for around 58 per cent (2015: 56 per cent) of economic capital. Additionally, a
general buffer for other risks, unchanged at 5 per cent of calculated economic capital, is added. In the breakdown of economic
capital as at 31 December 2016, the largest share of economic capital, at around 33 per cent (2015: 32 per cent), is allocated
to Group units located in Austria, followed by Central Europe at around 29 per cent (2015: 33 per cent).
The economic capital is compared to internal capital, which mainly comprises equity and subordinated capital of the Group. This
capital form serves as a primary provision for risk coverage for servicing claims of senior lenders if the bank should incur losses. As
at year-end 2016, total utilization of available risk capital (the ratio of economic capital to internal capital) amounted to 52.4 per
cent (2015: 56.8 per cent).

Economic capital is an important instrument in overall bank risk management. Economic capital limits are allocated to individual
business areas during the annual budgeting process and are supplemented for day-to-day management by volume, sensitivity, or
value-at-risk limits. This planning is undertaken on a revolving basis for the upcoming three years and incorporates the future devel-
opment of economic capital as well as available internal capital. Economic capital thus substantially influences the plans for future
lending activities and the overall limit for taking market risks.
Risk-adjusted performance measurement also is based on this risk measure. The profitability of business units is examined in relation
to the amount of economic capital attributed to these units (risk-adjusted profit on risk-adjusted capital, RORAC), which yields a
comparable performance measure for all business units of the Group. This measure is used in turn as a key figure for overall bank
management, for future capital allocations to business units, and influences the remuneration of the Group’s executive manage-
ment.
Risk distribution of individual risk types to economic capital:
in € thousand 2016 Share 20151 Share

Credit risk corporate customers 1,591,783 25.7% 1,757,551 26.7%
Credit risk retail customers 1,236,674 20.0% 1,279,394 19.4%
Operational risk 624,815 10.1% 671,084 10.2%
Credit risk sovereigns 519,082 8.4% 445,733 6.8%
Macroeconomic risk 418,805 6.8% 737,885 11.2%
Participation risk 402,658 6.5% 384,696 5.8%
Market risk 320,369 5.2% 241,599 3.7%
FX risk capital position 275,745 4.4% 246,621 3.7%
Credit risk banks 242,917 3.9% 200,529 3.0%
Other tangible fixed assets 222,314 3.6% 237,269 3.6%
CVA risk 31,108 0.5% 32,483 0.5%
Liquidity risk 16,308 0.3% 38,245 0.6%
Risk buffer 295,129 4.8% 313,654 4.8%
Total 6,197,708 100.0% 6,586,744 100.0%
The risk position “FX risk capital position” was shown separately for the first time as at 30 June 2016. It represents the risk from the
foreign currency capital positions. A longer holding period (one year) is assumed for non-hedgeable currencies. The breakdown
also eliminates diversification effects between the two risk types shown. The comparative values for 31 December 2015 for mar-
ket risk and FX risk capital position were adapted based on the methodology used as at 30 June 2016.
Going concern perspective
Parallel to the target rating perspective, internal capital adequacy is assessed with focus on the uninterrupted operation of the
Group on a going concern basis. In this perspective, risks again are compared to risk taking capacity –with a focus on regulatory
capital and total capital requirements.
In line with this target, risk taking capacity is calculated as the amount of expected profits, expected impairment losses, and the
excess of total capital (taking into account various limits on eligible capital). This capital amount is compared to the overall value-
at-risk (including expected losses). Quantitative models used in the calculation thereof are mostly comparable to the target rating
perspective, (albeit on a lower 95 per cent confidence level). Using this perspective the Group ensures adequate regulatory
capitalization (going concern) with the given probability.
Sustainability perspective
The main goal of the sustainability perspective is to ensure that the Group can maintain a sufficiently high tier 1 ratio at the end of
the multi-year planning period, also in a severe macroeconomic downturn scenario. This analysis is based on a multi-year macroe-
conomic stress test where hypothetical market developments in a severe but realistic economic downturn scenario are simulated.
The risk parameters considered include: interest rates, foreign exchange rates and securities prices, as well as changes in default
probabilities and rating migrations in the credit portfolio.

The main focus of this integrated stress test is the resulting tier 1 ratio at the end of the multi-year period. It should not fall below a
sustainable level and thus neither requires the bank to substantially increase capital nor to significantly reduce business activities.
The current minimum amount of tier 1 capital is therefore determined by the size of the potential economic downturn. In this down-
turn scenario the need for allocating loan loss provisions, potential pro-cyclical effects that increase minimum regulatory capital
requirements, the impact of foreign exchange rate fluctuations as well as other valuation and earnings effects are incorporated.
This perspective thus also complements traditional risk measurement based on the value-at-risk concept, which is in general based
on historical data. Therefore, it can incorporate exceptional market situations that have not been observed in the past and it is
possible to estimate the potential impact of such developments. The stress test also allows for analyzing risk concentrations (e.g.,
individual positions, industries, or geographical regions) and gives insight into the profitability, liquidity situation, and solvency
under extreme situations. Based on these analyses, risk management in the Group enhances portfolio diversification, for example
via limits for the total exposure of individual industry segments and countries and through ongoing updates to its lending standards.
Credit risk
In the Group, credit risk stems mainly from default risks that arise from business with retail and corporate customers, other banks
and sovereign borrowers. It is by far the most important risk category in the Group, as also indicated by internal and regulatory
capital requirements. Thus, credit risk is analyzed and monitored both on an individual loan and customer basis as well as on a
portfolio basis in the Group. Credit risk management and lending decisions are based on the respective credit risk policies, credit
risk manuals, and the corresponding tools and processes which have been developed for this purpose.
The internal control system for credit risks includes different types of monitoring measures, which are tightly integrated into the
workflows to be monitored – from the customer’s initial credit application, to the bank’s credit approval, and finally to the repay-
ment of the loan.
Limit application process
In the non-retail division, each lending transaction runs through the limit application process beforehand. This process covers –
besides new lending – increases in existing limits, rollovers, overdrafts, and changes in the risk profile of a borrower (e.g. with
respect to the financial situation of the borrower, the terms and conditions, or collateral) compared to the time of the original
lending decision. It is also used when setting counterparty limits in trading and new issuance operations, other credit limits, and for
equity participations.
Credit decisions are made within the context of a competence authority hierarchy based on the size and type of a loan. It always
requires the approval of the business and the credit risk management divisions for individual limit decisions or when performing
regular rating renewals. If the individual decision-making parties disagree, the potential transaction is decided upon by the next
higher-ranking credit authority.
The whole limit application process is based on defined uniform principles and rules. Account management for multinational cus-
tomers doing business simultaneously with more than one member of the Group, is supported by the Global Account Manage-
ment System (GAMS), for example. This is made possible by Group-wide unique customer identification in non-retail asset classes.
The limit application process in the retail division is to a larger extent automated due to the high number of applications and lower
exposure amounts. Limit applications often are assessed and approved in central processing centers based on credit score cards.
This process is facilitated by the respective IT systems.
Credit portfolio management
Credit portfolio management in the Group is, among other aspects, based on the credit portfolio strategy which is in turn based
on the business and risk strategy. By means of the selected strategy, the exposure amount in different countries, industries or prod-
uct types is limited and thus prevents undesired risk concentrations. Additionally, the long-term potentials of different markets are
continuously analyzed. This allows for an early strategic repositioning of future lending activities.

Reconciliation of figures from the IFRS consolidated financial statements to total credit exposure (according to CRR)
The following table translates items of the statement of financial position (bank and trading book positions) into the total credit
exposure, which is used in portfolio management. It includes exposures on and off the statement of financial position before the
application of credit-conversion factors and thus represents the total credit exposure. It is not reduced by the effects of credit risk
mitigation such as guarantees and physical collateral, effects that are, however, considered in the total assessment of credit risks.
The total credit exposure is used – if not explicitly stated otherwise – for showing exposures in all subsequent tables in the risk
report. The reasons for different values used for internal portfolio management and external financial accounting are the different
scope of consolidation (regulatory vs. accounting rules according to IFRS, i.e. corporate legal basis), different classifications and
presentation of exposure volumes.
In 2016, the presentation of the total credit exposure was extended to include the loans and advances contained in synthetic
securitizations. The values of the comparative period were adapted accordingly.

Cash reserve 13,863,081 14,906,206
Loans and advances to banks 11,023,532 12,113,132
Loans and advances to customers 79,769,079 79,457,653
Trading assets 4,944,112 5,774,573
Derivatives 1,261,015 1,480,256
Financial investments 20,846,909 21,667,044
Other assets 1,022,403 1,761,724
Contingent liabilities 9,780,465 10,030,100
Commitments 10,732,550 10,481,542
Revocable credit lines 16,110,254 16,186,591
Disclosure differences (1,282,156) (961,003)
Total1 168,071,244 172,897,819
1 Items on the statement of financial position contain only credit risk amounts
A more detailed credit portfolio analysis is based on individual customer ratings. Ratings are performed separately for different
asset classes using internal risk classification models (rating and scoring models), which are validated by a central organization
unit. Default probabilities assigned to individual rating grades are estimated for each asset class separately. As a consequence,
the default probability of the same ordinal rating grade (e.g. corporates good credit standing 4, banks A3, and sovereigns A3) is
not directly comparable between these asset classes.
Rating models in the main non-retail asset classes – corporates, banks, and sovereigns – are uniform in all Group units and rank
creditworthiness in 27 grades for corporate customers and banks and ten grades for sovereigns. For retail asset classes, country
specific scorecards are developed based on uniform Group standards. Customer rating, as well as validation is supported by
specific software tools (e.g. business valuation, rating and default database).
Credit portfolio – Corporates
The internal rating models for corporate customers take into account qualitative parameters and several ratios of the statement of
financial position and profit ratios covering different aspects of customer credit-worthiness for various industries and countries. In
addition, the model for smaller corporates also includes an account behavior component.

The following table shows the total credit exposure according to internal corporate ratings (large corporates and SMEs). For
presentation purposes, the individual grades of the rating scale are summarized to the nine main rating grades.

1 Minimal risk 6,053,900 8.7% 3,855,198 5.3%
2 Excellent credit standing 7,116,932 10.3% 8,968,139 12.4%
3 Very good credit standing 8,082,536 11.7% 8,735,531 12.1%
4 Good credit standing 10,855,403 15.7% 11,566,620 16.0%
5 Sound credit standing 13,842,375 20.0% 12,304,371 17.0%
6 Acceptable credit standing 11,682,388 16.9% 11,371,346 15.7%
7 Marginal credit standing 4,620,857 6.7% 5,926,695 8.2%
8 Weak credit standing/sub-standard 1,544,525 2.2% 2,320,798 3.2%
9 Very weak credit standing/doubtful 695,727 1.0% 1,010,910 1.4%
10 Default 4,377,323 6.3% 6,036,839 8.3%
NR Not rated 441,911 0.6% 359,009 0.5%
Total 69,313,877 100.0% 72,455,456 100.0%
The total credit exposure to corporates decreased € 3,141,579 thousand to € 69,313,877 thousand at year-end 2016 (2015:
€ 72,455,456 thousand). At 94.9 per cent or € 65,759,242 thousand (2015: € 68,749,895 thousand) the subgroup Raiffeisen
Bank International was the largest segment.
The increase in rating grade 1 resulted from a rating upgrade of individual financial service providers and customers in rating
grade 2. The decline of € 711,217 thousand in rating grade 4 good credit standing was largely due to a reduction in credit
financing. The increase of € 1,538,004 thousand in rating grade 5 sound credit standing was due to growth in credit and facility
financing in Austria, Switzerland, Croatia, Romania and Russia. The € 1,305,838 thousand decline in rating grade 7 marginal
credit standing mainly resulted from credit and facility financing in China, Austria, Poland and Ukraine, and from guarantees issued
in Albania, Romania and the Czech Republic and from deposits in Albania. Rating grade 8 weak credit standing/sub-standard
recorded a fall of € 776,273 thousand, largely due to a reduction in repo transactions in Cyprus and credit financing in Austria,
Croatia, Hungary, Poland, Slovakia and Ukraine. Rating grade 10 recorded a € 1,659,516 thousand decline to € 4,377,323
thousand. The decline was attributable to the reduction in exposure and the sales of non-performing loans in several countries,
notably in Group Corporates, Asia, Russia and Hungary, and to the sales of Raiffeisen Banka d.d., Maribor, and Raiffeisen-Leasing
Polska S.A., Warsaw.
The rating model for project finance has five different grades which take both individual default probabilities and collateral into
consideration. The project finance volume is composed as shown in the table below:

6.1 Excellent project risk profile – very low risk 4,613,570 55.8% 4,024,647 48.0%
6.2 Good project risk profile – low risk 1,862,137 22.5% 2,226,255 26.6%
6.3 Acceptable project risk profile – average risk 868,490 10.5% 733,737 8.8%
6.4 Poor project risk profile – high risk 285,740 3.5% 475,503 5.7%
6.5 Default 615,071 7.4% 911,151 10.9%
NR Not rated 20,760 0.3% 12,055 0.1%
Total 8,265,770 100.0% 8,383,348 100.0%
The credit exposure in project finance amounted to € 8,265,770 thousand (2015: € 8,383,348 thousand) at year-end 2016. At
78.3 per cent (2015: 74.6 per cent), projects rated in the two best rating grades excellent project risk profile – very low risk
(rating 6.1) or good project risk profile – low risk (rating 6.2) accounted for the highest share of the portfolio. This was mainly
attributable to the high collateralization of these special finance transactions. The increase in rating grade 6.1 mainly resulted from
an increase in project financing in Slovakia, Austria, the Czech Republic and Hungary. Rating grade 6.2 recorded the largest
decline, due to a reduction in project financing in Russia.

The following table provides a breakdown by country of risk of the total credit exposure for corporate customers and project
finance structured by regions:

Central Europe 21,201,888 27.3% 23,198,438 28.7%
Austria 15,424,291 19.9% 17,124,512 21.2%
Eastern Europe 12,321,429 15.9% 11,874,760 14.7%
Southeastern Europe 11,143,086 14.4% 10,357,736 12.8%
Western Europe 11,716,005 15.1% 10,143,349 12.5%
Asia 1,944,042 2.5% 3,551,114 4.4%
Other 3,828,906 4.9% 4,588,895 5.7%
Total 77,579,647 100.0% 80,838,804 100.0%
The credit exposure for corporate customers and project financing declined € 3,259,157 thousand to € 77,579,647 thousand.
Central Europe recorded a € 1,996,550 thousand decline, which was attributable to facility financing and to a reduction in the
bond portfolio. The decrease of € 1,700,221 thousand in the Austrian region resulted mainly from facility financing. Western
Europe recorded an increase of € 1,572,656 thousand due to an increase in repo and swap transactions and to money market
business. As a result of the decision to discontinue business operations as part of the transformation program, Asia recorded a
decline of € 1,607,072 thousand.
The table below provides a breakdown of the total credit exposure for corporates and project finance by industries:

Manufacturing 17,107,032 22.1% 17,294,187 21.4%
Wholesale and retail trade 16,022,420 20.7% 17,221,444 21.3%
Real estate 10,002,407 12.9% 10,328,610 12.8%
Financial intermediation 7,980,721 10.3% 7,853,226 9.7%
Construction 5,759,879 7.4% 5,954,974 7.4%
Freelance/technical services 4,364,144 5.6% 4,345,235 5.4%
Transport, storage and communication 3,517,668 4.5% 3,737,534 4.6%
Electricity, gas, steam and hot water supply 3,103,706 4.0% 3,799,951 4.7%
Other industries 9,721,669 12.5% 10,303,641 12.7%
Total 77,579,647 100.0% 80,838,804 100.0%
Credit portfolio – Retail customers
Retail customers are subdivided into private individuals and SME. For retail customers a two-fold scoring system is used – consist-
ing of the initial and ad-hoc scoring based on customer data and of the behavioral scoring based on account data. The table
below provides a breakdown of the maximum retail credit exposure of the Group:

Retail customers – private individuals 33,049,526 92.3% 31,085,492 90.3%
Retail customers – small and medium-sized entities 2,766,139 7.7% 3,325,216 9.7%
Total 35,815,665 100.0% 34,410,708 100.0%
hereof non-performing loans 2,211,745 6.2% 2,375,292 6.9%
hereof individual loan loss provision 1,566,737 4.4% 1,720,489 5.0%
hereof portfolio-based loan loss provision 254,812 0.7% 210,180 0.6%
Compared to year-end 2015, the retail credit portfolio increased € 1,404,957 thousand to € 35,815,665 thousand (2015:
€ 34,410,708 thousand). This increase was mainly due to the Czech Republic, Russia and Slovakia. The increase in the Czech
Republic resulted from organic growth and from the purchase of a credit portfolio. Russia recorded an increase due to the appre-
ciation of the Russian rouble, while the credit volume rose in Slovakia.
The highest volume of € 18,022,070 thousand (2015: € 17,506,416 thousand) was shown in the CE region, thus representing
an increase of € 515,654 thousand compared to the previous year. This was mainly due to an increase in credit portfolio of
private individuals in the Czech Republic. The increase was offset by a decline in Poland due to the sale of Raiffeisen-Leasing
Polska S.A., Warsaw. SEE ranks second at € 8,100,934 thousand (2015: € 7,819,979 thousand). The increase was due to an
increase in the credit portfolio of private individuals in Romania and Bulgaria.

In the table below the total retail exposure by products is shown:

Mortgage loans 21,214,062 59.2% 20,543,031 59.7%
Personal loans 7,219,830 20.2% 6,901,299 20.1%
Credit cards 3,196,821 8.9% 2,441,433 7.1%
SME financing 2,040,757 5.7% 1,573,858 4.6%
Overdraft 1,647,468 4.6% 1,699,054 4.9%
Car loans 496,727 1.4% 1,252,033 3.6%
Total 35,815,665 100.0% 34,410,708 100.0%
The increase in mortgage loans and credit cards was mainly attributable to the Czech Republic and Russia. SME financing rec-
orded an increase of € 466,899 thousand, due to the Czech Republic and Poland. Car loans declined € 755,306 thousand, on
the one hand due to the decision, taken in 2015, to withdraw from this product category in Russia and on the other due to the
sale of Raiffeisen-Leasing Polska S.A., Warsaw.
The share of foreign currency loans in retail portfolio provides an indication for the potential change in default rates if the ex-
change rate of the domestic currency changes. The internal risk assessment thus takes into account the share of foreign currency
loans, but also the usually stricter lending criteria at loan distribution and – in some countries – the customers’ matching foreign
currency income.

Swiss franc 3,099,078 43.7% 3,584,587 44.7%
Euro 3,402,789 48.0% 3,616,814 45.1%
US-Dollar 580,088 8.2% 816,245 10.2%
Other foreign currencies 1,987 0.0% 3,290 0.0%
Loans in foreign currencies 7,083,943 100.0% 8,020,937 100.0%
Share of total loans 19.8% 23.3%
Compared to year-end 2015, loans denominated in Swiss francs, Euros and US-Dollars decreased. The decrease in foreign
currency loans denominated in Swiss francs was mainly due to the statutory provisions concerning the mandatory conversion at
historical rates for loans granted in Croatia.
Credit portfolio – Banks
The banks asset class mainly contains banks and securities firms. The internal rating model for banks was revised in 2015. Both
internal and external data were used and the same statistical methods that were applied to develop the successful rating models
for corporate customers were used. The revised internal rating model for banks was approved by the ECB in October 2016 and
has been used in all risk management processes since November 2016.
The structure of the revised rating model for banks is based on the procedure used by external rating agencies. The rating is ar-
rived at in three steps:
1. Viability rating
Quantitative factors (statement of financial position ratios), qualitative factors and the financial sector risk are combined to create a
viability rating using a statistically developed risk function. The viability rating represents the risk assessment without considering
support from an owner and/or a government.
Quantitative factors Qualitative factors Risk in the financial sector

 Profitability  Market position Risk in the financial sector is assessed in a separate module based
 Quality of assets  Quality of assets on macroeconomic indicators. The main focus is on the assessment
of risk liability and the stability of the economic environment in which
 Liquidity  Funding & liquidity the bank operates.
 Development of the statement of financial  Capitalization
position
 Income structure  Profitability
 Outlook

2. Final rating
The final rating includes the potential support from an owner and/or by a government. An assessment is made as to whether the
owner or government would support the bank in question in the event of difficulties and whether it would be able to support it.
Based on this assessment and a strict algorithm, the viability rating is improved and a final rating is determined.
3. Country ceiling
A country ceiling is used in order to consider the transfer risk for cross-border transactions. The default probability applied for the
bank must be at least as high as the default probability of the relevant country.
The revised rating model for banks permits better differentiation of risk and offers improved forecasting quality.
At the end of 2013, a 25-step master scale was introduced in conjunction with the rating models for corporate customers. This
master scale comprises nine principal grades with up to three sub-grades A, B or C, i.e. 1C, 2A, 2B, 2C, 3A,…, 9A, 9B, 9C. Each
grade is linked to a fixed PD band which represents the risk associated with the respective grade. The same 25-step master scale
(i.e. both the same designations for the rating grades and also the same PD bands) is also used for the revised rating model for
banks. This offers the advantage that, in future, risk ratings of corporate customers can be directly compared with ratings for banks.
This will make it possible to improve the management of the portfolio and significantly simplify reporting.The following table shows
the credit exposure for banks in the nine principal grades of the new master scale:
in € thousand 2016 Share

1 Minimal risk 3,417,964 17.1%
2 Excellent credit standing 3,361,272 16.8%
3 Very good credit standing 9,747,853 48.7%
4 Good credit standing 1,517,858 7.6%
5 Sound credit standing 1,162,768 5.8%
6 Acceptable credit standing 218,373 1.1%
7 Marginal credit standing 186,097 0.9%
8 Weak credit standing / sub-standard 245,432 1.2%
9 Very weak credit standing / doubtful 77,456 0.4%
10 Default 83,767 0.4%
NR Not rated 9,141 0.0%
Total 20,027,982 100.0%
The following table shows the credit exposure for banks based on the previously used rating scale:
in € thousand 2015 Share

A1 Excellent credit standing 0 0.0%
A2 Very good credit standing 2,441,364 13.0%
A3 Good credit standing 2,545,996 13.5%
B1 Sound credit standing 9,603,114 51.0%
B2 Average credit standing 1,305,967 6.9%
B3 Mediocre credit standing 1,034,455 5.5%
B4 Weak credit standing 1,320,821 7.0%
B5 Very weak credit standing 289,400 1.5%
C Doubtful/high default risk 158,099 0.8%
D Default 137,493 0.7%
NR Not rated 6,081 0.0%
Total 18,842,790 100.0%
Due to the switch to the internal rating model for banks, it is not possible to make a direct comparison with the previous year
2015.

The following table provides a breakdown of the total credit exposure by country of risk grouped into regions:

Western Europe 9,277,377 46.3% 8,154,948 43.3%
Austria 5,079,072 25.4% 6,518,062 34.6%
Asia 1,128,700 5.6% 1,232,447 6.5%
Eastern Europe 1,793,563 9.0% 1,003,535 5.3%
Central Europe 897,428 4.5% 674,585 3.6%
Southeastern Europe 147,063 0.7% 108,093 0.6%
Other 1,704,778 8.5% 1,151,119 6.1%
Total 20,027,982 100.0% 18,842,790 100.0%
The total credit exposure to banks amounted to € 20,027,982 thousand (2015: € 18,842,790 thousand) at year-end 2016.
Compared to year-end 2015, this represented an increase of € 1,185,192 thousand. The largest increase of € 1,122,429 thou-
sand was recorded in Western Europe due to an increase in repo business with French and British banks. However, this was partly
offset by a decline in deposits at banks in Italy, France and Great Britain. The largest decline of € 1,438,990 thousand was
recorded in the Austrian region, due to a reduction in short-term money market business. The EE region recorded an increase of
€ 790,028 thousand, due to an increase in repo transactions in Russia. The increase in Other mainly resulted from deposits at
banks, facility financing and repo transactions.
Time deposits, securities lending business, potential future exposures from derivatives, sight deposits, and bonds are the main
product categories in this asset class. These exposures therefore have high collateralization grades (e.g. in securities lending
business or through netting agreements) depending on the type of product.
The table below shows the total credit exposure to banks (excluding central banks) by products:

Loans 3,968,992 19.8% 3,719,462 19.7%
Bonds 3,842,426 19.2% 4,002,594 21.2%
Repo 3,754,785 18.7% 1,157,084 6.1%
Derivatives 3,566,412 17.8% 3,732,340 19.8%
Money market 2,449,153 12.2% 3,601,648 19.1%
Other 2,446,213 12.2% 2,629,662 14.0%
Total 20,027,982 100.0% 18,842,790 100.0%
Credit exposure – Sovereigns
Another asset class is formed by central governments, central banks, and regional municipalities as well as other public sector
entities. The table below provides a breakdown of the credit exposure to sovereigns (including central banks) by internal rating.
Since defaults in this asset class are historically very rare, default probabilities are estimated using full data sets provided by exter-
nal rating agencies.

A1 Excellent credit standing 2,064,944 6.0% 13,833,598 35.6%
A2 Very good credit standing 9,036,539 26.1% 983,802 2.5%
A3 Good credit standing 7,098,097 20.5% 5,829,338 15.0%
B1 Sound credit standing 4,594,354 13.3% 4,922,665 12.7%
B2 Average credit standing 3,893,873 11.2% 4,815,592 12.4%
B3 Mediocre credit standing 4,842,387 14.0% 2,850,059 7.3%
B4 Weak credit standing 1,565,070 4.5% 4,178,438 10.8%
B5 Very weak credit standing 837,488 2.4% 735,627 1.9%
C Doubtful/high default risk 711,850 2.1% 618,117 1.6%
D Default 1,669 0.0% 3,305 0.0%
NR Not rated 1,679 0.0% 34,975 0.1%
Total 34,647,950 100.0% 38,805,517 100.0%

The credit exposure to sovereigns amounted to € 34,647,950 thousand (2015: € 38,805,517 thousand) at year-end 2016. It
represented 20.6 per cent (2015: 22.4 per cent) of the total credit exposure.
The rating grade excellent credit standing (rating A1) showed a decrease of € 11,768,654 thousand, while the rating grade very
good credit standing (rating A2) increased € 8,052,737 thousand. This shift was mainly due to the internal rating downgrade of
the Republic of Austria.
The medium rating grades good credit standing (rating A3) to mediocre credit standing (rating B3) represented a share at
59.0 per cent (2015: 47.5 per cent). The high exposure in the medium rating grades resulted amongst other factors from bonds of
central banks and central governments. The medium rating grades were also characterized by minimum reserves and money
market transactions. The increase in rating grade A3 was mainly based on an increase in money market transactions in the Czech
Republic, which was, however, partly offset by a decline in bond portfolios in the Czech Republic. The rating shift in the rating
grades B3 and B4 was due, on the one hand, to a rating upgrade of Hungary and, on the other, to the decline in deposits at the
Hungarian National Bank.
The table below shows the total credit exposure to sovereigns (including central banks) by products:

Bonds 18,139,345 52.4% 19,775,193 51.0%
Loans 15,983,656 46.1% 18,273,408 47.1%
Derivatives 487,999 1.4% 718,848 1.9%
Other 36,950 0.1% 38,068 0.1%
Total 34,647,950 100.0% 38,805,517 100.0%
The table below shows the credit exposure to sovereigns in non-investment grade (rating B3 and below):

Hungary 2,120,403 26.6% 2,624,900 31.2%
Croatia 1,047,445 13.2% 994,753 11.8%
Bulgaria 864,326 10.9% 953,359 11.3%
Albania 792,225 10.0% 856,583 10.2%
Russia 555,157 7.0% 604,315 7.2%
Serbia 500,992 6.3% 503,747 6.0%
Bosnia and Herzegovina 491,937 6.2% 477,723 5.7%
Ukraine 494,194 6.2% 396,901 4.7%
Belarus 188,830 2.4% 210,800 2.5%
Vietnam 163,728 2.1% 160,226 1.9%
Other 740,907 9.3% 637,216 7.6%
Total 7,960,143 100.0% 8,420,521 100.0%
Compared to year-end 2015, the credit exposure to sovereigns in non-investment grade decreased € 460,378 thousand to
€ 7,960,143 thousand. This decrease resulted primarily from a reduction in short-term money market business.
The credit exposure mainly resulted from deposits of Group units with the local central banks in Central and Southeastern Europe.
They are used for meeting the respective minimum reserve requirements and for managing the short-term investment of excess
liquidity, and are therefore inextricably linked to the business activities in these countries.

Credit risk mitigation

Collateral types
Assignment of receivables Collateralization is one of the main strategies and an actively
3% (2015: 3%) pursued measure for reducing potential credit risks. The value of
collateral and the effect of other risk mitigation techniques are
Guarantees
27% (2015: 27%) Mortgages
determined within each limit application. The risk mitigation
52% (2015: 50%) effect taken into account is the value that the Group expects to
receive when selling the collateral within a reasonable liquida-
tion period. Eligible collaterals are defined in the Group’s col-
Pledging of lateral catalog and corresponding evaluation guidelines for
other assets
Pledging of assets
collateral. The collateral value is calculated according to speci-
9% (2015: 12%)
and securities fied methods which include standardized calculation formulas
9% (2015: 8%)
based on market values, predefined discounts, and expert
assessments.
Collateral is divided into pledges (e. g. guarantees) and physi-

cal collateral. In the Group, liens on residential or commercial properties are the main types of collateral used.
Loans and advances to banks and customers net of allocated loan loss provisions (net exposure), the additional exposure off the
statement of financial position (contingent liabilities, commitments, and revocable credit lines), and the market prices (fair value) of
collateral pledged in favor of the Group are shown in the following table:
2016 Maximum credit exposure Fair value of collateral

in € thousand Net exposure Commitments/guarantees issued
Banks 10,973,166 2,889,643 2,937,606
Sovereigns 768,245 765,329 485,542
Corporate customers – large corporates 40,857,317 27,772,426 25,069,194
Corporate customers – mid market 2,736,117 1,086,902 2,123,459
Retail customers – private individuals 28,242,943 3,873,877 18,408,914
Retail customers – small and medium-sized entities 1,969,744 718,747 1,335,742
Total 85,547,532 37,106,924 50,360,457
2015 Maximum credit exposure Fair value of collateral

in € thousand Net exposure Commitments/guarantees issued
Banks 11,993,151 2,588,957 1,989,231
Sovereigns 933,942 438,732 499,671
Corporate customers – large corporates 40,153,646 29,035,389 27,572,621
Corporate customers – mid market 2,841,978 1,041,942 2,424,180
Retail customers – private individuals 26,674,238 3,162,935 17,773,004
Retail customers – small and medium-sized entities 2,574,105 495,495 1,939,840
Total 85,171,060 36,763,451 52,198,546
Problem loan management
The credit portfolio and individual borrowers are subject to constant monitoring. The main purpose of monitoring is to ensure that
the borrower meets the terms and conditions of the contract, as well as following the obligor’s economic development. Such a
review is conducted at least once annually in the non-retail asset classes corporates, banks, and sovereigns. This includes a rating
review and the re-evaluation of financial and tangible collateral.
Problem loans (where debtors might run into material financial difficulties or a delayed payment is expected) need special treat-
ment. In non-retail divisions, problem loan committees in individual Group units make decisions on problematic exposures. If the
need for intensified treatment and workout is identified, then problem loans are assigned either to a designated specialist or to a
restructuring unit (workout department). Employees of the workout units are specially trained and have extensive experience. They
typically handle medium-sized to large cases and are assisted by in-house legal departments or by external specialists as well.
Workout units play a decisive role in accounting and analyzing as well as booking provisions for impairment losses (write-offs,
value adjustments or provisioning). Their early involvement can help reduce losses resulting from problem loans.

Problem loan management standards in the retail area comprise the whole restructuring and collection process for private individ-
uals and small and medium-sized entities. A restructuring guideline defines the Group’s restructuring framework including uniform
strategy, organization, methods, monitoring and controlling. In the workout process customers are classified into three categories
“early,” “late,” and “recovery,” for which a standardized customer handling process is defined.
The assessment of the expected recovery value is heavily influenced by the number of days payments are late. The following table
shows the amount of overdue – not impaired – loans and advances to banks and customers for different time bands.
2016 Current Overdue Collateral

received for
Up to 31 days, up 91 days, up 181 days, up More than assets which
in € thousand 30 days to 90 days to 180 days to 1 year 1 year are past due
Banks 10,972,281 638 2 0 0 4 0
Sovereigns 764,884 750 371 1,401 1 2 0
Corporate customers – large
corporates 38,709,473 674,307 126,623 5,540 9,643 12,126 444,442
Corporate customers – mid market 2,586,944 31,016 8,847 2,395 2,882 10,110 34,070
Retail customers – private individuals 26,427,034 1,294,973 265,644 25,683 15,637 31,050 618,068
sized entities 1,770,988 76,353 28,096 3,811 1,427 5,176 61,032
Total 81,231,605 2,078,037 429,582 38,830 29,590 58,468 1,157,613
2015 Current Overdue Collateral

received for
Up to 30 31 days, up 91 days, up 181 days, up More than assets which
in € thousand days to 90 days to 180 days to 1 year 1 year are past due
Banks 11,992,471 0 1 0 0 3 0
Sovereigns 892,413 39,048 62 0 1 17 1,682
Corporate customers – large
corporates 37,379,416 752,241 60,768 14,275 43,685 29,199 588,491
Corporate customers – mid market 2,622,016 64,631 13,710 3,590 2,754 7,878 70,091
Retail customers – private individuals 24,479,432 1,448,509 321,039 113,757 27,964 39,240 772,017
sized entities 2,197,653 217,675 44,923 8,948 2,830 4,112 213,588
Total 79,563,402 2,522,104 440,502 140,570 77,233 80,449 1,645,870
Non-performing exposure not failed (NPE)
This section refers exclusively to exposure without grounds for default according to Article 178 CRR. In the corporate division,
when loan terms or conditions are altered in favor of the customer, the Group distinguishes between modified and forborne loans
according to the applicable definition of the EBA document “Implementing Technical Standard (ITS) on Supervisory Reporting
(Forbearance and non-performing exposures)”.
The crucial aspect deciding a loan is forborne in the non-retail segment is the financial situation of a customer at the time the
terms and conditions are altered. Loans are defined as foreborne loans if at the time of altering the terms and conditions of a
loan the customer, due to its creditworthiness (considering the internal rating and other information available at this point of
date), is assessed to be in financial difficulties and the modification is assessed as concession. If such a modification for a loan
previously considered as non-performing is carried out, then the loan is assessed as non-performing exposure independent of
whether a reason for default according to Article 178 CRR exists. The classification as forborne/NPE does not lead to an indi-
vidual loan loss provision; this is based on the default definition of CRD IV/CRR.
In the retail customers business, restructured loans are subject to an observation period of at least three months in order to be sure
that the customer meets the newly agreed terms.
For retail portfolios which are subject to PD/LGD calculation (Probability of Default/Loss Given Default) of portfolio-based loan
loss provisions, it is necessary to avoid artificial improvement of the PD estimates for the restructured non-performing exposure. This
is achieved either by, despite the restructuring, continuing to use those variables based on the days past due (DPD) before restruc-
turing which were foreseen for overdue payments prior to restructuring or by using a separate calibration for the partial volume of
restructured loans. In exceptional cases, if neither of the aforementioned methods is technically possible, the PD of the next worse
rating grade is used for the duration of the observation period. For retail portfolios where the amount of the portfolio-based loan
loss provision is determined based on product portfolios and/or delinquencies, whether or not the loan was more than 180 days

overdue prior to the renegotiation is taken into account. In those cases where the customer concerned meets the newly agreed
terms and credit exposure was not overdue for 180 days before the new agreement, it is transferred from the portfolio under
observation to the living portfolio. Those credit exposures already overdue for 180 days before the new agreements or those
customers who did not meet the newly agreed terms remain in the portfolio which is fully impaired.
The following table shows the non-performing exposure according to asset classes:
Instruments with modified time and

Refinancing modified conditions NPE total
in € thousand 2016 2015 2016 2015 2016 2015
Corporate customers 11,897 15,357 72,698 159,467 84,595 174,824
Retail customers 23,565 29,547 187,851 188,188 211,416 217,735
Banks 0 0 0 0 0 0
Sovereigns 0 0 0 0 0 0
Total 35,462 44,904 260,549 347,654 296,011 392,559
Non-performing loans (NPL) and provisioning
A default and thus non-performing loan (NPL) is according to Article 178 CRR defined as the event where a specific debtor be-
comes unlikely to pay its credit obligations to the bank in full, or the debtor is overdue at least 90 days on any material credit
obligation. For non-retail customers, twelve indicators are used to identify a default event. These include the insolvency or similar
proceedings of a customer, if an impairment provision has been allocated or a direct write-off has been carried out, if credit risk
management has judged a customer account receivable to be not wholly recoverable, or the workout unit is considering stepping
in to help a company restore its financial soundness.
Within the Group, a Group-wide default database is used for collecting and documenting customer defaults. The database tracks
defaults and the reasons for defaults, which enables default probabilities to be calculated and validated.
Provisions for impairment losses are formed on the basis of Group-wide standards according to IFRS accounting principles and
cover all identifiable credit risks. In the non-retail segments, problem loan committees from each Group unit decide on allocating
individual loan loss provisions. In the retail area, provisioning is determined by retail risk departments in individual Group units.
They compute loan loss provisions according to defined calculation methods on a monthly basis. The provisioning amount is then
approved by local accounting departments.
The following tables show the development of NPLs in the defined asset classes loans and advances to banks and loans and
advances to customers as reported in the statement of financial position (excluding items off the statement of financial position):
As at Change in consolidated group/ As at

in € thousand 1/1/2016 Exchange differences Additions Disposals 31/12/2016
Corporate customers 6,459,896 14,768 1,222,560 (3,003,030) 4,694,194
Retail customers 2,354,024 42,868 545,613 (727,514) 2,214,991
Sovereigns 3,305 (1,395) 271 (513) 1,669
Total non-banks 8,817,225 56,241 1,768,445 (3,731,057) 6,910,854
Banks 127,496 1,337 2,268 (53,824) 77,277
Total 8,944,721 57,577 1,770,713 (3,784,881) 6,988,131
As at Change in consolidated group/ As at

in € thousand 1/1/2015 Exchange differences Additions Disposals 31/12/2015
Corporate customers 6,802,120 112,492 1,528,494 (1,983,210) 6,459,896
Retail customers 2,687,943 90,334 551,299 (975,553) 2,354,024
Sovereigns 229 22 3,305 (251) 3,305
Total non-banks 9,490,293 202,848 2,083,098 (2,959,013) 8,817,225
Banks 129,909 4,837 0 (7,250) 127,496
Total 9,620,202 207,685 2,083,098 (2,966,264) 8,944,721
The following table shows the share of NPL in the defined asset classes loans and advances to customers and loans and advanc-
es to banks as reported in the statement of financial position (excluding items off the statement of financial position):

NPL NPL ratio NPL coverage ratio

in € thousand 2016 20151 2016 20151 2016 20151
Corporate customers 4,694,194 6,459,896 9.3% 12.2% 71.5% 69.1%
Retail customers 2,214,991 2,354,024 6.9% 7.6% 81.2% 79.8%
Sovereigns 1,669 3,305 0.4% 0.6% 284.9% 130.3%
Total non-banks 6,910,854 8,817,225 8.7% 11.1% 75.2% 71.2%
Banks 77,277 127,496 0.5% 0.7% 65.4% 94.1%
Total 6,988,131 8,944,721 7.7% 8.8% 75.8% 75.1%
The volume of NPLs to non-banks fell € 1,956,590 thousand, in particular due to the sale of NPLs with a nominal value of
€ 1,186,945 thousand and the derecognition of economically uncollectible claims. The NPL ratio based on loans to non-banks
declined 2.4 percentage points to 8.7 per cent.
In 2016, in the asset class corporate customers, NPLs decreased 27.3 per cent, or € 1,765,702 thousand, to € 4,694,194
thousand (2015: € 6,459,896 thousand), notably due to the derecognition of uncollectible claims in the amount of € 938,618
thousand.
The ratio of NPLs to credit exposure fell 2.9 percentage points to 9.3 per cent; the NPL coverage ratio went up 2.4 percentage
points to 71.5 per cent.
In the retail portfolio, NPLs sank 5.9 per cent, or € 139,033 thousand, to € 2,214,991 thousand (2015: € 2,354,024 thousand).
The ratio of NPLs to credit exposure fell to 6.9 per cent, however the NPL coverage ratio increased 1.4 percentage points to
81.2 per cent.
The portfolio of NPLs to banks amounted to € 77,277 thousand (2015: € 127,496 thousand) at year-end, the NPL coverage
ratio fell 28.7 percentage points to 65.4 per cent.
The following table shows the development of impairment losses on loans and provisions for liabilities off the statement of financial
position and the corresponding items of the statement of financial position:
1 2
Individual loan loss provisions 6,107,132 (55,027) 1,637,839 (866,343) (1,931,058) 91,555 4,984,097
Banks 117,672 0 6,533 (8,489) (42,254) (25,162) 48,300
Corporate customers 4,185,762 (33,863) 974,681 (434,915) (1,512,336) 77,097 3,256,427
Retail customers 1,711,510 (21,963) 566,622 (358,753) (376,003) 40,286 1,561,699
Sovereigns 5,028 0 954 (477) (112) (1,044) 4,347
Off-balance sheet obligations 87,160 798 89,049 (63,708) (353) 378 113,324
Portfolio-based loan loss
provisions 406,410 (5,665) 182,946 (186,678) (55) 8,170 405,128
Banks 2,310 0 1,216 (1,533) 0 72 2,065
Corporate customers 171,031 (2,587) 40,902 (80,478) (18) 894 129,744
Retail customers 206,044 (3,128) 128,365 (95,253) (37) 6,083 242,073
Sovereigns 380 0 153 (355) 0 244 422
Off-balance sheet obligations 26,644 51 12,310 (9,059) 0 877 30,823
Total 6,513,541 (60,692) 1,820,785 (1,053,021) (1,931,114) 99,725 5,389,225
1 Allocation including direct write-downs and income on written down claims
2 Usage including direct write-downs and income on written down claims
Usage was mainly based on the sale and derecognition of uncollectible claims.

1 2
Individual loan loss provisions 6,125,022 438 2,001,637 (674,827) (1,394,056) 48,919 6,107,132
Banks 111,768 0 (6,462) (224) 8,151 4,439 117,672
Corporate customers 4,020,224 (15,236) 1,304,706 (361,545) (768,870) 6,484 4,185,762
Retail customers 1,909,798 6,646 683,816 (281,049) (642,211) 34,510 1,711,510
Sovereigns 35 2,528 (20,703) (90) 22,412 845 5,028
Off-balance sheet obligations 83,197 6,500 40,279 (31,918) (13,539) 2,642 87,160
Portfolio-based loan loss
provisions 468,227 648 196,676 (253,588) (1,021) (4,532) 406,410
Banks 2,869 (16) 1,551 (2,071) 0 (23) 2,310
Corporate customers 232,288 413 53,407 (114,567) (126) (383) 171,031
Retail customers 203,147 156 131,952 (124,024) (895) (4,293) 206,044
Sovereigns 972 (67) 117 (659) 0 18 380
Off-balance sheet obligations 28,952 161 9,649 (12,267) 0 149 26,644
Total 6,593,249 1,085 2,198,313 (928,415) (1,395,078) 44,387 6,513,541
1 Allocation including direct write-downs and income on written down claims
2 Usage including direct write-downs and income on written down claims
Country risk
Country risk includes transfer and convertibility risks as well as political risk. It arises from cross-border transactions and direct
investments in foreign countries. The Group is exposed to this risk due to its business activities in the CEE markets. In these markets
political and economic risks to some extent are still seen as comparatively significant.
Active country risk management in the Group is based on the country risk policy which is set by the Management Board. This
policy is part of the credit portfolio limit system and sets a strict limitation on cross-border risk exposure to individual countries.
Consequently, in day-to-day work, business units have to submit limit applications for the respective countries for all cross-border
transactions in addition to complying with customer limits. The
limit size for individual countries is set by using a model which
takes into account the internal rating for the sovereign, the size
Credit exposure to customers by region
of the country, and the Group’s own capitalization.
Country risk also is reflected via the internal funds transfer pric-
Austria ing system in product pricing and in risk-adjusted performance
Other
20% measurement. Business units therefore can benefit from country
6% risk mitigation by seeking insurance (e.g. from export credit
insurance organizations) or guarantors in third countries. The
insights gained from the country risk analysis are not only used
Other European Union
15%
Central Europe for limiting the total cross-border exposure, but also for limiting
32%
the total credit exposure in each individual country (i.e. including
the exposure that is funded by local deposits). The Group there-
Eastern Europe by realigns its business activities according to the expected
12%
Southeastern Europe macro economic development within different markets and
15%
enhances the broad diversification of its credit portfolio.

Concentration risk
The credit portfolio of the Group is well diversified in terms of geographical region and industry. Single name concentrations are also
actively managed (based on the concept of groups of connected customers) by limits and regular reporting. As a consequence, portfolio
granularity is high.
As part of the strategic realignment the limit structures related to concentration risk for each customer segment were reviewed.
The regional breakdown of the loans reflects the broad diversification of credit business in the Group’s markets. The following table
shows the distribution of the credit exposure of all asset classes by the borrower’s home country grouped by regions.

Austria 34,290,467 20.4% 41,076,763 23.8%
Central Europe 53,208,175 31.7% 54,452,322 31.5%
Poland 14,476,079 8.6% 16,775,231 9.7%
Czech Republic 17,592,241 10.5% 15,127,048 8.7%
Slovakia 14,194,861 8.4% 13,924,098 8.1%
Hungary 6,496,944 3.9% 7,584,673 4.4%
Other 448,050 0.3% 1,041,273 0.6%
Other European Union 24,677,322 14.7% 22,935,519 13.3%
Germany 7,655,817 4.6% 6,868,125 4.0%
Great Britain 5,279,122 3.1% 4,554,303 2.6%
France 3,208,041 1.9% 2,321,097 1.3%
Netherlands 1,853,212 1.1% 1,789,595 1.0%
Italy 1,376,239 0.8% 1,993,545 1.2%
Spain 1,107,283 0.7% 2,311,797 1.3%
Other 4,197,608 2.5% 3,097,056 1.8%
Southeastern Europe 25,894,677 15.4% 24,737,630 14.3%
Romania 9,658,708 5.7% 9,110,070 5.3%
Croatia 5,109,278 3.0% 5,031,868 2.9%
Bulgaria 4,008,782 2.4% 3,917,155 2.3%
Serbia 2,467,399 1.5% 1,953,501 1.1%
Bosnia and Herzegovina 2,076,931 1.2% 2,123,749 1.2%
Albania 1,830,351 1.1% 1,912,134 1.1%
Other 743,226 0.4% 689,152 0.4%
Asia 3,510,726 2.1% 5,293,804 3.1%
China 935,942 0.6% 1,779,777 1.0%
Singapore 494,529 0.3% 685,576 0.4%
Other 2,080,255 1.2% 2,828,451 1.6%
Eastern Europe 19,813,775 11.8% 18,017,025 10.4%
Russia 14,262,299 8.5% 12,522,077 7.2%
Ukraine 3,379,948 2.0% 3,546,669 2.1%
Belarus 1,635,031 1.0% 1,470,571 0.9%
Other 536,498 0.3% 477,707 0.3%
North America 3,059,174 1.8% 3,065,770 1.8%
Switzerland 2,328,959 1.4% 2,068,035 1.2%
Rest of World 1,287,969 0.8% 1,250,950 0.7%
Total 168,071,244 100.0% 172,897,819 100.0%
At € 6,786,296 thousand, the largest decline, in Austria, was attributable to the reduction in deposits at the Austrian National
Bank and in Austrian government bonds. Overall, CE showed a fall of € 1,244,147 thousand, with the decline in Poland due to
the sale of Raiffeisen-Leasing-Polska S.A., Warsaw, offset by new business in Slovakia and in the Czech Republic and by the
purchase of a loan portfolio in the Czech Republic. As a result of the decision, taken within the framework of the transformation
program, to downscale operations, Asia showed a fall of € 1,783,078 thousand.
Risk policies and credit assessments in the Group take into account the industry class of customers as well. Banking represents the
largest industry class. The second largest class is private households, primarily consisting of loans and advances to retail customers
in CE and SEE.

The following table shows the total credit exposure of the Group by the customers’ industry classification:

Banking and insurance 45,085,859 26.8% 48,683,740 28.2%
Private households 33,111,330 19.7% 30,038,292 17.4%
Public administration and defence and social insurance institutions 16,929,183 10.1% 17,118,562 9.9%
Wholesale trade and commission trade (except car trading) 12,034,746 7.2% 13,094,264 7.6%
Other manufacturing 11,645,894 6.9% 11,761,062 6.8%
Real estate activities 10,161,173 6.0% 10,542,168 6.1%
Construction 5,933,708 3.5% 6,147,200 3.6%
Other business activities 4,592,824 2.7% 4,610,444 2.7%
Retail trade except repair of motor vehicles 3,699,957 2.2% 3,712,606 2.1%
Electricity, gas, steam and hot water supply 3,113,312 1.9% 3,805,575 2.2%
Land transport, transport via pipelines 1,923,472 1.1% 1,959,135 1.1%
Manufacture of basic metals 2,194,937 1.3% 2,249,922 1.3%
Other transport 2,048,650 1.2% 2,294,464 1.3%
Manufacture of food products and beverages 1,860,743 1.1% 1,997,008 1.2%
Manufacture of machinery and equipment 1,704,977 1.0% 1,675,580 1.0%
Sale of motor vehicles 966,056 0.6% 1,156,452 0.7%
Extraction of crude petroleum and natural gas 776,215 0.5% 686,746 0.4%
Other industries 10,288,207 6.1% 11,364,599 6.6%
Total 168,071,244 100.0% 172,897,819 100.0%
Structured credit portfolio
The Group invests in structured products. The total exposure to structured products is shown under (36) Securitization. Around
55 per cent of this portfolio (2015: 67 per cent) is rated A or better by external rating agencies. The pools mainly contain loans
and advances to European customers.
Counterparty credit risk
The default of a counterparty in a derivative, repurchase, securities lending or borrowing transaction can lead to losses from re-
establishing an equivalent contract. In the Group, this risk is measured by the mark-to-market approach where a predefined add-on
is added to the current positive fair value of the contract in order to account for potential future changes. For internal management
purposes, potential price changes, which affect the fair value of an instrument, are calculated specifically for different contract
types based on historical market price changes.
For derivative contracts, the standard limit approval process applies, where the same risk classification, limitation, and monitoring
process is used as for traditional lending. In doing so, the weighted nominal exposure of derivative contracts is added to the cus-
tomers’ total exposure in the limit application and monitoring process as well as in the calculation and allocation of internal capital.
An important strategy for reducing counterparty credit risk is utilization of credit risk mitigation techniques such as netting agree-
ments and collateralization. In general, the Group strives to establish standardized ISDA master agreements with all major coun-
terparties for derivative transactions in order to be able to perform close-out netting and credit support annexes (CSA) for full risk
coverage for positive fair values on a daily basis.
Market risk
The Group defines market risk as the risk of possible losses arising from changes in market prices of trading and investment posi-
tions. Market risk estimates are based on changes in exchange rates, interest rates, credit spreads, equity and commodity prices,
and other market parameters (e.g. implied volatilities).
Market risks are transferred to the Treasury division by using the transfer price method. Treasury is responsible for managing struc-
tural market risks and for complying with the Group’s overall limit. The Capital Markets division is responsible for proprietary trad-
ing, market making, and customer business with money market and capital market products.

Organization of market risk management
All market risks are measured, monitored, and managed on Group level.
The Market Risk Committee is responsible for strategic market risk management issues. It is responsible for managing and control-
ling all market risks in the Group. The Group’s overall limit is set by the Management Board on the basis of the risk-taking capacity
and income budget. This limit is apportioned to sub-limits in coordination with business divisions according to the strategy, business
model and risk appetite.
The Market Risk Management department ensures that the business volume and product range comply with the defined strategy
of the Group. It is responsible for implementing and enhancing risk management processes, risk management infrastructure and
systems, manuals and measurement techniques for all market risk categories and credit risks arising from market price changes in
derivative transactions. Furthermore, this department independently measures and reports market risks on a daily basis.
All products in which open positions can be held are listed in the product catalog. New products are added to this list only after
completing the product approval process successfully. Product applications are investigated thoroughly for any risks. They are
approved only if the new products can be implemented in the bank’s front- and back-office and risk management systems respec-
tively.
Limit system
The Group uses a comprehensive risk management approach for both the trading and banking book (total-return approach).
Market risks are managed therefore consistently in all trading and banking books. The following values are measured and limited
on a daily basis in the market risk management system:
 Value-At-Risk (VaR) confidence level 99 per cent, risk horizon 1 day

VaR is the main steering instrument in liquid markets and normal market situations. VaR is measured based on a hybrid simula-
tion approach, where 5,000 scenarios are calculated. The approach combines the advantages of a historical simulation and a
Monte Carlo simulation and derives market parameters from 500 days historical data. Distribution assumptions include modern
features like volatility declustering and random time. This helps in reproducing fat-tailed and asymmetric distributions accurately.
The Austrian Financial Market Authority approved this model so that it can be used for calculating total capital requirements for
market risks. Value-at-risk results are not only used for limiting risk, but also in the internal capital allocation.
 Sensitivities (to changes in exchange rates, interest rates, gamma, vega, equity and commodity prices)
Sensitivity limits shall ensure that concentrations are avoided in normal market situations and are the main steering instrument
under extreme market situations and in illiquid markets or in markets that are structurally difficult to measure.
 Stop Loss
This limit strengthens the discipline of traders such that they do not allow losses to accumulate on their own proprietary posi-
tions, but strictly limit them instead.
A comprehensive stress testing concept complements this multi-level limit system. It simulates potential present value changes of
defined scenarios for the total portfolio. The results on market risk concentrations shown by these stress tests are reported to the
Market Risk Committee and taken into account when setting limits. Stress test reports for individual portfolios are included in daily
market risk reporting.

Value-at-Risk (VaR)
The following tables show the VaR (99 per cent, 1 day) for individual market risk categories of the trading and banking book. The
Group’s VaR mainly results from structural capital positions, structural interest rate risks, and credit spread risks of bonds, which are
held as liquidity buffer.
Trading book VaR 99% 1d VaR as at VaR as at

in € thousand 31/12/2016 Average VaR Minimum VaR Maximum VaR 31/12/2015
Currency risk 3,503 2,986 1,770 5,983 2,381
Interest rate risk 3,522 2,423 1,275 4,461 1,534
Credit spread risk 692 2,133 496 6,375 3,869
Share price risk 909 724 474 951 676
Vega risk 255 482 121 1,333 779
Total 5,014 5,578 3,367 9,726 9,168
Banking book VaR 99% 1d VaR as at VaR as at

Currency risk 22,878 25,643 16,828 41,850 27,593
Credit spread risk 12,177 13,394 8,959 20,974 17,699
Share price risk 187 132 85 190 180
Vega risk 3,447 5,360 1,319 20,189 6,194
Total 41,039 40,671 27,415 60,109 38,579
Total VaR 99% 1d VaR as at VaR as at

Currency risk 23,679 25,184 16,613 38,976 28,919
Credit spread risk 12,553 14,555 9,199 23,181 20,525
Share price risk 1,095 855 601 1,095 1,037
Vega risk 3,413 5,258 1,357 19,513 6,490
Total 41,636 42,704 29,325 63,255 41,808
The risk measurement approaches employed are verified – besides analyzing returns qualitatively – on an ongoing basis through
backtesting and statistical validation techniques. If model weaknesses are identified, then they are improved accordingly. The
following chart compares VaR and theoretical profits and losses on a daily basis. VaR denotes the maximum loss that will not be
exceeded with a 99 per cent confidence level on the next day. It is compared to the respective theoretical profits and losses,
which would arise on the following day due to actual market conditions at the time. In the reporting year, no backtesting exceed-
ings arose.

Value-at-Risk and theoretical market price changes of the trading book

in € million
4.0
2.0
0.0
-2.0
-4.0
-6.0
-8.0
January February March April May June July August September October November December
Profit and loss VaR - hypthetisch profit and loss
Exchange rate risk and capital (ratio) hedge
Market risk in the Group results primarily from exchange rate risk, which stems from foreign-currency denominated equity invest-
ments made in foreign Group units and the corresponding hedging positions entered into by the Group Asset/Liability Committee.
In a narrow sense, exchange rate risk denotes the risk that losses are incurred due to open foreign exchange positions. However,
exchange rate fluctuations also influence current revenues and expenses. They also affect capital requirements of assets denomi-
nated in foreign currencies, even if they are financed in the same currency and thus do not create an open foreign exchange
position.
The Group holds several material equity participations located outside the euro area with equity denominated in the correspond-
ing local currency. Also, a significant share of risk-weighted assets in the Group is denominated in foreign currencies. Changes in
foreign exchange rates thus lead to changes in the consolidated capital in the Group and to changes in the total capital require-
ment for credit risks as well.
Basically, there are two different approaches for managing exchange rate risks:
 Preserve equity: With this hedging strategy an offsetting capital position is held on Group level for local currency denominat-
ed equity positions. However, the necessary hedging positions cannot be established in all currencies in the required size.
Moreover, these hedges might be inefficient for some currencies if they carry a high interest rate differential.
 Stable capital ratio: The goal of this hedging strategy is to balance tier 1 capital and risk-weighted assets in all currencies
according to the targeted tier 1 ratio (i.e. reduce excess capital or deficits in relation to risk-weighted assets for each currency)
such that the tier ratio remains stable even if foreign exchange rates change.
The Group aims at stabilizing its capital ratio when managing exchange rate risks. Changes in foreign exchange rates thus lead to
changes in the consolidated equity amount; however, the regulatory capital requirement for credit risks stemming from assets
denominated in foreign currencies also changes correspondingly. This risk is managed on a monthly basis in the Group As-
set/Liability Committee based on historical foreign exchange volatilities, exchange rate forecasts, and the sensitivity of the tier 1
ratio to changes in individual foreign exchange rates.

The following table shows all material open foreign exchange rate positions as at 31 December 2016 and the corresponding
values for the previous year. Those numbers include both trading positions as well as capital positions of the subsidiaries with
foreign currency denominated statements of financial position.

ALL 9,238 77,775
BAM 147,906 118,140
BGN 305,709 285,101
BYR 253,524 118,937
CHF (240,017) (13,911)
CNY 11,637 49,720
CZK 392,783 231,894
HRK 557,109 398,544
HUF 364,272 169,923
PLN 747,372 734,121
RON 505,480 478,732
RSD 378,831 384,463
RUB 566,157 368,721
UAH 11,036 (184,372)
USD (417,415) 501,983
The changes in the UAH and USD positions were attributable to the change in the capital position and hedging strategy.
Interest rate risk in the trading book
The following tables show the largest present value changes for the trading book of the Group given a one-basis-point interest rate
increase for the whole yield curve in € thousand for the reporting dates 31 December 2016 and 31 December 2015. Currencies
where the total interest rate sensitivity exceeds € 1 thousand are shown separately. There are only minor changes in the risk factors
within the reporting period.
2016 <3 > 3 to > 6 to > 1 to > 2 to > 3 to > 5 to > 7 to > 10 to > 15 to
in € thousand Total m 6m 12 m 2y 3y 5y 7y 10 y 15 y 20 y >20y
ALL (14) 0 (1) (1) (2) (5) (5) 0 0 0 0 0
CHF (9) 0 1 (6) (9) 1 9 (5) (1) (1) 1 0
CNY 5 4 1 0 0 0 0 0 0 0 0 0
CZK 26 2 1 7 (4) 0 22 (4) 3 (2) 0 0
EUR (162) 18 8 (6) 5 (8) (37) (87) 37 (89) 10 (12)
HRK (14) 0 0 (1) (4) (4) (2) (3) 0 0 0 0
HUF 36 0 (8) 4 14 9 19 0 0 (2) 0 0
NOK 1 0 1 0 0 0 0 1 0 0 0 0
PLN (10) (3) 4 (13) (1) 3 5 (3) (3) 0 0 0
RON (24) 1 (3) 1 0 (8) (5) (4) (6) 0 0 0
RUB (5) (6) (7) (12) 16 1 19 3 1 (20) 0 0
UAH (5) 0 0 0 (3) (1) (1) 0 0 0 0 0
USD (62) (16) 12 (19) (15) (13) (3) (17) (24) 6 15 12
Other 0 (1) (1) 0 1 0 0 0 1 0 0 0
The presentation of currencies changed year-on-year depending on the absolute amount of interest rate sensitivity.

ALL (21) 0 (2) (1) (4) (2) (11) 0 0 0 0 0
BGN (4) 0 0 0 (1) (1) (2) 0 0 0 0 0
CHF 2 6 (2) 3 (3) (3) 1 (4) 3 (1) 1 0
CNY 12 2 0 10 0 0 0 0 0 0 0 0
CZK 18 (1) 9 4 (9) (3) 2 5 14 (2) 0 0
EUR (173) (6) (15) (10) (85) (8) 56 (40) (88) 11 27 (15)
GBP 6 0 0 0 1 0 0 0 5 0 0 0
HRK (12) (1) 0 (2) (5) 0 (3) 0 0 0 0 0
HUF (8) (2) 0 2 0 (2) 4 (1) (8) 1 0 0
PLN (4) (4) 7 6 (4) (1) 2 (10) 0 0 0 0
RON (26) 1 (1) 0 0 (2) (14) (4) (5) 0 0 0
RUB (9) (2) (2) 0 (18) 2 (3) 1 6 6 0 0
USD 57 0 6 (49) 33 (6) (4) 38 33 (23) 4 25
Other 1 0 0 (1) (2) 0 1 0 1 0 1 0
Interest rate risk in the banking book
Different maturities and repricing schedules of assets and the corresponding liabilities (i.e. deposits and financing on debt and
capital markets) cause interest rate risk in the Group. This risk arises in particular from different interest rate sensitivities, rate adjust-
ments, and other optionality of expected cash flows. Interest rate risk in the banking book is material for the Euro and US-Dollar as
major currencies as well as for local currencies of Group units located in Austria and CEE.
This risk is mainly hedged by a combination of transactions on and off the statement of financial position where in particular inter-
est rate swaps and – to a smaller extent – also interest rate forwards and interest rate options are used. Management of the
statement of financial position is a core task of the central Global Treasury division and of individual network banks, which are
supported by asset/liability management committees. They base their decisions on various interest income analyses and simula-
tions that ensure proper interest rate sensitivity in line with expected changes in market rates and the overall risk appetite.
Interest rate risk in the banking book is not only measured in a value-at-risk framework, but also managed by the traditional tools of
nominal and interest rate gap analyses. Since 2002, interest rate risk is subject to quarterly reporting in the context of the interest
rate risk statistic submitted to the banking supervisor. This report shows the change in the present value of the banking book as a
percentage of total capital in line with the CRR requirements. Maturity assumptions needed in this analysis are defined as specified
by regulatory authorities or based on internal statistics and empirical values.
The following tables show the change in the present value of the Group’s banking book given a one-basis-point interest rate in-
crease for the whole yield curve in € thousand for reporting dates 31 December 2016 and 31 December 2015. The table con-
tains currencies where the total interest rate sensitivity exceeds € 1 thousand.
2016 > 3 to > 6 to > 1 to > 2 to > 3 to > 5 to > 7 to > 10 to > 15 to
in € thousand Total <3m 6m 12 m 2y 3y 5y 7y 10 y 15 y 20 y >20y
ALL (38) 3 (6) (5) (21) (7) (4) 0 1 1 0 1
BGN (11) (2) 2 (3) (9) 11 42 (22) (14) (11) (4) (1)
BYN (34) (1) (2) (6) (12) (6) (5) (1) (1) 0 0 0
CHF (242) 13 4 (1) (4) (4) (5) (22) (60) (109) (48) (7)
CNY (4) (2) (2) 0 0 0 0 0 0 0 0 0
CZK (49) 17 (11) (5) 18 42 138 (82) (54) (72) (32) (7)
EUR 448 (45) (17) 75 135 37 379 370 (141) (201) (64) (79)
GBP (4) (1) 0 1 0 0 (1) (1) (2) 0 0 0
HRK (29) 2 (1) (5) (22) 3 14 (9) (12) 3 (1) 0
HUF (107) 1 (13) 7 1 6 (41) (39) (8) (15) (6) (1)
PLN (51) (6) (25) 29 (1) (4) (7) (6) (11) (12) (6) (1)
RON 52 (3) 0 6 33 31 (6) (4) (2) (1) 0 0
RSD (45) (1) (2) 3 (20) (6) (13) (5) 0 0 0 0
RUB (670) 12 (16) (25) (193) (121) (90) (80) (85) (62) (8) (2)
SGD 1 1 0 1 0 0 0 0 0 0 0 0
UAH (10) 1 (1) 0 (6) 10 (1) (5) (5) (2) 0 0
USD 108 28 17 46 23 (1) 26 (29) 2 29 (5) (28)
Other 1 5 (2) (4) (1) (1) 0 1 3 0 0 0

The increase in the RUB interest rate sensitivities was based on two factors:
 The strategic investment position in the Russian subsidiary bank was expanded.
 The measurement method was adapted to the Group standard under which all interest rate cash flows are considered in the
measurement.
The representation of currencies changed year-on-year depending on the absolute amount of interest rate sensitivity:
2015 > 3 to > 6 to > 1 to > 2 to > 3 to > 5 to > 7 to > 10 to > 15 to
in € thousand Total <3m 6m 12 m 2y 3y 5y 7y 10 y 15 y 20 y >20y
ALL (31) 2 (4) (3) (14) (5) (4) (4) 0 0 0 0
AUD 1 0 0 1 0 0 0 0 0 0 0 0
BAM 2 2 (1) (5) 0 0 (1) 2 3 1 0 0
BGN 26 (1) 0 (7) (2) 8 56 (9) (8) (7) (2) 0
BYR (28) 0 (1) (8) (10) (5) (2) (1) (1) 0 0 0
CHF (351) 15 (3) (20) (9) (6) (18) (15) (71) (138) (71) (13)
CNY 2 (4) 1 5 0 0 0 0 0 0 0 0
CZK 179 (3) (15) 38 35 (7) (132) 120 141 (1) 3 2
EUR (862) (91) (181) (653) 217 376 151 229 219 (634) (346) (150)
GBP (2) 1 0 2 0 0 (1) (1) (2) 0 0 0
HRK (21) 0 0 0 (11) 0 13 (12) (8) (3) 0 0
HUF 16 1 (5) 12 (5) (13) 2 (11) 4 22 8 1
PLN (29) 7 24 14 (29) 0 (1) (9) (13) (15) (7) (1)
RON 39 4 (8) (2) (39) 7 95 (11) (5) (2) 0 0
RSD (26) (1) (2) (2) (7) (3) (5) (5) 0 0 0 0
RUB (82) (3) (16) (9) (35) (1) 32 (12) (25) (12) (1) 0
SGD (7) 1 0 (8) 0 0 0 0 0 0 0 0
UAH (1) (1) 0 (1) (3) 3 9 (4) (4) (1) 0 0
USD 84 17 19 43 (30) 33 (7) 6 9 8 (3) (10)
Other 1 0 0 1 0 0 0 0 0 0 0 0
Credit spread risk
The market risk management framework uses time-dependent bond and CDS-spread curves as risk factors in order to measure
credit spread risks. It captures the specific all capital market instruments in the trading and banking book.
Liquidity management
Funding structure
The Group’s funding structure is highly focused on retail business in CEE. In addition, as a result of the Austrian RBG’s strong local
market presence, the Group also benefits from funding through the regional Raiffeisen banks. Different funding sources are secured
in accordance with the principle of diversification. These include the issue of international bonds by RBI AG, the issue of local
bonds by the Group units and the use of third-party financing loans (including supranationals). The Group units also use interbank
loans with third-party banks, partly due to tight country limits and partly due to beneficial pricing.

Principles
Internal liquidity management is an important business process within general bank management because it ensures the continuous
availability of funds required to cover day-to-day debt obligations.
Liquidity adequacy is guaranteed from both an economic and also a regulatory perspective. In economic terms, the Group has
established a governance framework comprising internal limits and control measures which complies with the Principles for Sound
Liquidity Risk Management and Supervision established by the Basel Committee on Banking Supervision and the credit institutions
risk management directive (KI-RMV) issued by the Austrian regulatory authority.
The regulatory component is addressed by compliance with the reporting requirements under Basel III (Liquidity Coverage Ratio
and Net Stable Funding Ratio and additional liquidity monitoring metrics) and also by compliance with the regulatory limits. In
addition, additional liquidity and reporting requirements established by local regulatory authorities apply to some Group units.
Organization and responsibility
Responsibility for ensuring adequate levels of liquidity lies with the overall Management Board. In terms of functions, the responsi-
ble Management Board members are the Chief Financial Officer (Treasury) and the Chief Risk Officer (Risk Controlling). Conse-
quently, the processes relating to liquidity risk are mainly carried out by two divisions within the bank. Firstly, Treasury units control
the liquidity risk positions within the strategy, guidelines and parameters set by decision-making bodies. Secondly, these are moni-
tored and supported by independent Risk Controlling units. The risk units measure and model liquidity risk positions, set limits and
monitor their compliance. In addition to the aforementioned line functions, all Group units have Asset/Liability Committees
(ALCOs). These committees act as decision-making bodies for all matters affecting management of a unit’s liquidity position and
the structure of its statement of financial position, including determining strategies and guidelines for handling liquidity risks. The
ALCOs make decisions and report to the respective management boards on at least a monthly basis using standardized liquidity
risk reports. At Group level, this function is assumed by the Group ALCO and the Group Risk Committee. The work performed by
Treasury and the corresponding ALCO and Group Risk Committee decisions are mainly based on Group-wide, standardized
Group rules and their local supplements, which take special regional factors into account.

Liquidity strategy
Treasury is obliged to comply with certain performance ratios and risk-based principles. The current performance ratios include
general targets (e.g. for return on risk adjusted capital (RORAC) or coverage ratios), as well as specific Treasury targets for liquidi-
ty (such as a minimum survival horizon in defined stress scenarios or diversification of the financing structure). Besides achieving a
structural contribution by means of maturity transformation which reflects the liquidity and market risk assumed by the bank, Treas-
ury must pursue a prudent and sustainable risk policy in its management of the statement of financial position. Strategic objectives
include reducing the parent company’s funding to the Group subsidiaries, further stabilization of the investor base and ongoing
compliance with regulatory requirements and with internal rules and limits.
Liquidity risk framework
Regulatory and internal liquidity reports and ratios are generated and determined based on certain modeling approaches.
Whereas the regulatory reports are generated in accordance with the requirements of the authorities, the internal reports are
based on assumptions from empirical observations.
The Group has a substantial database along with expertise for forecasting capital flows arising from all material items on and off
the statement of financial position. Cash inflows and outflows are modelled in a sufficiently detailed manner which, as a minimum,
distinguishes between products, customer segments and, where applicable, currencies. Modeling of retail and corporate customer
deposits includes assumptions concerning the retention times for deposits after maturity. The modeling approaches are prudent, in
that they do not, for example, assume “rollover” of deposits from financial institutions and all financing channels and liquidity buff-
ers are subject to simultaneous stress testing, without considering the mitigating effects of diversification.
The mainstays of the economic liquidity risk framework are the going concern (GC) and the time to wall scenario (TTW). The
going concern report shows the structural liquidity position and covers all main risk drivers which could detrimentally affect the
Group in a normal business environment (“business as usual”). The going concern models are also the main input factors for the
cost contribution for the funds transfer pricing model. The time to wall report, on the other hand, shows the survival horizon for
defined adverse scenarios and stress models (market, reputational and combined crisis) and determines the minimum level of the
liquidity buffer (and/or the balancing capacity) of the Group and its individual units.
The liquidity scenarios are modelled using a Group-wide approach which considers local specifics where these are justified by
influencing factors such as the market or the legal environment or certain business characteristics; calculation is performed at
Group head office. When modeling cash inflows and outflows a minimum distinction is made between products, customer seg-
ments and individual currencies (where applicable). For products without a contractual maturity, cash inflows and outflows are
allocated using a geometric Brownian motion which derives statistical forecasts for future daily balances from the observed, expo-
nentially weighted historical volatility of the corresponding products.
The liquidity risk framework is continuously developed at both Group level and also at the level of the individual Group units. The
technical infrastructure is enhanced in numerous Group-wide projects and data availability is improved in order to meet the new
reporting and management requirements for this area of risk.
Risk appetite and liquidity limits
The liquidity position is monitored at Group level and at the level of the individual units and is restricted by means of a comprehen-
sive limit system. The limits are determined both for a normal business environment and also for stress scenarios. In accordance
with the defined risk appetite, each Group unit must demonstrate a survival horizon of up to 90 days (TTW) in a difficult, com-
bined stress scenario (reputational and market stress). This can be ensured either by a structurally positive liquidity profile or by a
sufficiently high liquidity buffer. In a normal going concern environment, maturity transformation must be fully covered by the avail-
able liquidity buffer in the medium term. This means that the cumulative liquidity position over a period of up to one year must be
positive. In the long term (one year or more), maturity transformation is permitted up to a certain level. For internal models, these
limits are supplemented by limits on compliance with regulatory liquidity ratios, such as the liquidity coverage ratio (LCR). All limits
must be complied with on a daily basis.

Liquidity monitoring
The bank uses a series of customized measuring instruments and early warning indicators which provide the Management Board
and corporate management with timely and forward-looking information. Compliance with the liquidity risk framework ensures that
the bank can continue its business activities even under high degree of stress.
Monitoring and reporting on compliance with the limits is conducted regularly and effectively, and the corresponding escalation
channels function and are used as intended. The defined limits are generally complied with in a very disciplined manner through-
out the Group, and any breach by Group units is reported to the Group ALCO and the Group Risk Committee and escalated. In
such cases, appropriate steps are undertaken in consultation with the relevant unit or contentious matters are escalated on to the
next highest responsible body.
Liquidity stress test
Stress tests are conducted on a daily basis for the individual Group units and for the Liquidity Union Vienna (comprising Raiffeisen
Bank International AG, Vienna, Raiffeisen Zentralbank Österreich AG, Vienna, ZUNO BANK AG, Vienna, Kathrein Privatbank AG,
Vienna, RB International Finance (USA) LLC, New York, Raiffeisen Centrobank AG, Vienna) and on a weekly basis at Group level.
The tests cover three scenarios (market, reputational and combined crisis), consider the effects of the scenarios for a period of up
to three months and demonstrate that stress events can simultaneously result in a time-critical liquidity requirement in several curren-
cies. The stress scenarios include the principal funding and market liquidity risks, without considering beneficial diversification
effects (i.e. that in the stress tests of the Group, all network units are simultaneously subject to a pronounced combined crisis for all
their major products). The results of the stress tests are reported to the CROs, CFOs and other members of the corporate manage-
ment on a weekly basis; they also form a key component of the monthly ALCO and Group Risk Committee meetings and are
included in the bank’s strategic planning and contingency planning.
A conservative approach is adopted when establishing outflow ratios based on historical data and expert opinions. The simulation
assumes a lack of access to the money or capital market and also simultaneous significant outflows of customer deposits. In this
respect, the deposit concentration risk is considered by assigning even higher outflow ratios to large customers. Furthermore, stress
assumptions are formulated for the drawdown of guarantees and credit obligations. In addition, the liquidity buffer positions are
adapted by haircuts in order to cover the risk of disadvantageous market movements, and the potential outflows resulting from
collateralized derivative transactions are estimated. The bank continuously monitors whether the formulated stress assumptions are
still appropriate or whether new risks need to be considered.
The time to wall concept has established itself as the main controlling instrument for day-to-day liquidity management and is there-
fore a central component of funding planning and budgeting. It is also fundamental to determining performance ratios relating to
liquidity.
Liquidity buffer
As shown by the daily liquidity risk reports, each Group unit actively maintains and manages liquidity buffers, including high quality
liquid assets (HQLA) which are always sufficient to cover the net outflows expected in crisis scenarios. The Group has sizeable,
unencumbered and liquid securities portfolios and favors securities eligible for Central Bank tender transactions in order to ensure
sufficient liquidity in various currencies. Each Group unit ensures the availability of liquidity buffers, tests its ability to utilize central
bank funds, constantly evaluates its collateral positions as regards their market value and encumbrance and examines their coun-
ter-balancing capacity, including the secured and unsecured funding potential and the liquidity of the assets.
Generally, a haircut is applied to all liquidity buffer positions. These haircuts include a market-risk-specific haircut and a central
bank haircut. While the market risk haircut represents the potential price volatility of the assets-side securities as part of the liquidity
buffer, the central bank haircut represents an additional haircut by the central bank for each individual relevant security offered as
collateral.
Contingency funding plan
Under difficult liquidity conditions, the units switch to a contingency process in which they follow predefined contingency funding
plans. These contingency plans also constitute an element of the liquidity management framework and are mandatory for all
significant Group units. The contingency management process is designed so that the Group can retain a strong liquidity position
even in serious crisis situations.

Liability structure and liquidity position
Group funding is founded on a strong customer deposit base supplemented by wholesale funding (mainly via Group head office
and the Group units). The funding instruments are appropriately diversified and are used regularly. The ability to procure funds is
precisely monitored and evaluated by the Treasury ALM units and the ALCOS.
In the past year and to date, the Group’s excess liquidity was significantly above all regulatory and internal limits. The result of the
internal time to wall stress test demonstrates that the Group would continuously survive the modelled stress phase of 90 days even
without applying contingency measures.
The results of the going concern scenario are shown in the following table. It illustrates excess liquidity and the ratio of expected
cash inflows plus counterbalancing capacity to cash outflows (liquidity ratio) for selected maturities on a cumulative basis. Based
on assumptions employing expert opinions, statistical analyses and country specifics, this calculation also incorporates estimates
on the sediment of customer deposits, outflows from items off the statement of financial position and downward market movements
in relation to positions which influence the liquidity counterbalancing capacity.

Maturity 1 month 1 year 1 month 1 year
Liquidity gap 23,551,501 26,300,319 21,762,918 25,838,768
Liquidity ratio 154% 130% 143% 127%
Liquidity coverage ratio (LCR)
The liquidity coverage ratio (LCR) supports the short-term resilience of banks by ensuring that they have an adequate stock of
unencumbered high-quality liquid assets (HQLA) to meet potential liability run offs that might occur in a crisis, which can be con-
verted into cash to meet liquidity needs for a minimum of 30 calendar days in a liquidity stress scenario.
The calculation of expected cash inflows and outflows as well as HQLAs is based on regulatory guidelines.
In 2016, the regulatory minimum ratio for the LCR was 70 per cent, which will be raised to 100 per cent by 2018.

Average liquid assets 22,024,950 24,673,520
Net outflows 14,827,173 17,343,569
Inflows 11,820,526 11,447,251
Outflows 26,647,699 28,790,820
Liquidity Coverage Ratio 149% 142%
In 2016, the LCR rose slightly year-on-year, firstly as a result of the implementation of objectives under the transformation program
and secondly as a result of the strategy of maintaining a higher liquidity position during the Group’s planned restructuring. The
HQLA portfolio was reduced by replacing ECB facilities with repos. Net outflows fell due to lower deposits from banks, unsched-
uled higher customer deposits and unscheduled reduced granting of loans.
Net Stable Funding Ratio, NSFR
The NSFR is defined as the ratio between available stable funding and required stable funding. This ratio should continuously be
at least 100 per cent, although no regulatory limit has been set. Available stable funding is defined as the part of equity and debt
which is expected to be a reliable source of funds over the time horizon of one year covered by the NSFR. A bank’s required
stable funding depends on the liquidity characteristics and residual maturities of the various assets held and of commitments off the

RZB targets a balanced funding position. The regulatory provisions are currently being revised by the regulatory authorities.
in € thousand 2016
Required stable funding 106,619,268
Available stable funding 119,777,243
Net Stable Funding Ratio 112%
The NSFR is not shown for year-end 2015 due to limited comparability.
Funding liquidity risk
Funding liquidity risk is mainly driven by changes in the risk strategy of lenders or by deterioration in the creditworthiness of a bank
that needs external funding. Funding rates and supply rise and fall with credit spreads, which change due to the market- or bank-
specific situation.
As a consequence, long-term funding depends on restoring confidence in banks and increased efforts in collecting customer
deposits. The Group’s banking activities are financed by combining wholesale funding and the retail franchise of deposit-taking
subsidiary banks. It is the central liquidity balancing agent for the local Group units in CEE.
In the Group’s funding plans, special attention is paid to a diversified structure of funding to mitigate funding liquidity risk. In the
Group, funds are not only raised by RBI AG as the Group’s largest single institution, but also individually by different banking
subsidiaries. Those efforts are coordinated and optimized through a joint funding plan. Moreover, the Group arranges medium-
term and long-term funding for its subsidiaries through syndicated loans, bilateral funding agreements with banks, and financing
facilities provided by supranational institutions. These funding sources are based on long-term business relationships.
For managing and limiting liquidity risks, the targets for loan/deposit ratios (the ratio of customer loans to customer deposits) in the
individual subsidiary banks take into account the planned future business volumes as well as the feasibility of increasing customer
deposits in different countries. On the one hand, this initiative reduces external funding requirements. On the other hand, it also
reduces the need for internal funding operations and the risk associated with such liquidity transfers.
The following table shows a breakdown of cash flows according to the contractual maturity of financial liabilities:
2016 Carrying Contractual Up to 3 More than 3 months, More than 1 year, More than
in € thousand amount cash flows months up to 1 year up to 5 years 5 years
Non-derivative liabilities 120,689,556 128,240,627 80,010,549 14,312,073 25,745,704 8,172,300
Deposits from banks 24,059,774 27,877,118 15,225,328 3,188,934 6,729,659 2,733,197
Deposits from customers 80,324,996 82,138,203 61,804,915 8,070,955 10,866,484 1,395,850
Debt securities issued 8,527,381 9,236,876 1,024,148 2,589,226 4,022,315 1,601,186
Other liabilities 3,539,902 4,001,091 1,921,573 315,787 1,311,122 452,608
Subordinated capital 4,237,503 4,987,339 34,585 147,171 2,816,124 1,989,459
Derivatives 3,327,630 8,050,121 4,124,225 1,691,843 1,685,326 548,727
Derivatives in the trading book 2,548,174 6,240,973 3,153,299 1,523,451 1,110,747 453,477
Hedging derivatives 425,415 272,198 15,711 29,287 222,309 4,891
Other derivatives 354,041 1,536,950 955,215 139,105 352,270 90,359
Credit derivatives 0 0 0 0 0 0
Contingent liabilities 9,780,464 1,602,037 900,309 424,683 239,507 37,538
Credit guarantees 5,624,327 288,391 82,608 65,511 103,361 36,911
Other guarantees 2,626,927 242,648 129,400 68,599 44,022 627
Letters of credit (documentary business) 993,936 1,033,747 651,050 290,573 92,124 0
Other contingent liabilities 535,274 37,251 37,251 0 0 0
Commitments 10,732,550 11,148,754 4,699,956 1,072,591 4,963,501 412,706
Irrevocable credit lines 10,732,550 11,148,754 4,699,956 1,072,591 4,963,501 412,706

2015 Carrying Contractual Up to 3 More than 3 months, More than 1 year, More than
in € thousand amount cash flows months up to 1 year up to 5 years 5 years
Non-derivative liabilities 123,182,451 129,879,676 80,032,761 17,188,701 24,980,368 7,677,847
Deposits from banks 28,113,082 31,807,393 17,025,923 4,467,967 8,060,527 2,252,976
Deposits from customers 78,078,973 79,758,948 60,417,473 10,914,498 7,509,142 917,835
Debt securities issued 9,353,330 10,588,917 913,498 1,479,390 6,527,438 1,668,592
Other liabilities 3,433,285 2,561,034 1,646,154 172,699 493,576 248,605
Subordinated capital 4,203,781 5,163,384 29,713 154,147 2,389,685 2,589,839
Derivatives 4,861,978 10,639,092 3,664,022 2,088,620 3,246,526 1,639,924
Derivatives in the trading book 3,883,631 8,647,584 3,015,915 1,793,715 2,282,827 1,555,127
Hedging derivatives 434,791 261,907 30,076 13,782 243,506 (25,457)
Other derivatives 543,402 1,729,395 617,963 280,985 720,193 110,254
Credit derivatives 154 206 68 138 0 0
Contingent liabilities 10,030,099 1,176,796 667,453 306,735 163,070 39,538
Credit guarantees 4,965,347 164,257 70,380 70,545 21,413 1,919
Other guarantees 3,079,943 297,240 193,652 68,501 34,466 621
Letters of credit (documentary
business) 1,237,908 676,857 401,977 167,689 107,191 0
Other contingent liabilities 746,901 38,442 1,444 0 0 36,998
Commitments 10,481,542 10,637,565 4,888,866 1,765,380 3,724,109 259,211
Irrevocable credit lines 10,481,542 10,637,565 4,888,866 1,765,380 3,724,109 259,211
Operational risk
Operational risk is defined as the risk of unexpected losses resulting from inadequate or failed internal processes, people and
systems or from external events, including legal risk. In this risk category internal risk drivers such as unauthorized activities, fraud or
theft, conduct-related losses, modeling errors, execution and process errors, or business disruption and system failures are man-
aged. External factors such as damage to physical assets or consciously conducted human fraud are managed and controlled as
well.
This risk category is analyzed and managed based on own historical loss data and the results of risk assessments.
As with other risk types, the principle of firewalling of risk management and risk controlling is also applied to operational risk in the
Group. To this end, individuals are designated and trained as Operational Risk Managers for each division. Operational Risk
Managers provide central Operational Risk Controlling with reports on risk assessments, loss events, indicators and measures.
They are supported in their work by Dedicated Operational Risk Specialists (DORS).
Operational risk controlling units are responsible for reporting, implementing the framework, developing control measures and
monitoring compliance with requirements. Within the framework of the annual risk management cycle, they also coordinate the
participation of the relevant second line of defense departments (Financial Crime Management, Compliance, Vendor Manage-
ment, Outsourcing Management, Insurance Management, Information Security, Physical Security, BCM, Internal Control System)
and all first line of defense contacts (Operational Risk Managers).
Risk identification
Identifying and evaluating risks that might endanger the Group’s existence (but the occurrence of which is highly improbable) and
areas where losses are more likely to arise more frequently (but have only limited impact) are important aspects of operational risk
management.
Operational risk assessment is executed in a structured and Group-wide uniform manner according to risk categories such as
business processes and event types. Moreover, risk assessment applies to new products as well. All Group units grade the impact
of high probability/low impact events and low probability/high impact incidents according to their estimation of the loss potential
for the next year and in the next ten years. Low probability/high impact events are quantified by a Group-wide analytical tool
using scenarios. The internal risk profile, losses arising and external changes determine which cases are dealt with in detail.
Monitoring
In order to monitor operational risks, early warning indicators are used that allow prompt identification and mitigation of opera-
tional risks.

Loss data is collected in a central database called ORCA (Operational Risk Controlling Application) in a structured manner and
on a Group-wide basis according to the event type and the business line. In addition to the requirements for internal and external
reporting, information on loss events is exchanged with international data pools to further develop advanced operational risk
management tools as well as to track measures and control effectiveness of. Since 2010, the Group has been a participant in the
ORX data pool (Operational Risk Data Exchange Association), whose data are currently used for internal benchmark purposes
and analyses and as part of the operational risk model. The ORX data consortium is an association of banks and insurance
groups for statistical purposes. The results of the analyses as well as events resulting from operational risks are reported in a com-
prehensive manner to the relevant Operational Risk Management Committee on a regular basis.
Quantification and mitigation
Since October 2016, the Group has calculated the capital requirement for a significant part of the Group using the Advanced
Measurement Approach (AMA). This includes units in Bulgaria, Romania, Russia, Slovakia and major banks in Austria (Raiffeisen
Bank International AG, Vienna, Raiffeisen Zentralbank Österreich AG, Vienna, Kathrein Privatbank AG, Vienna, Raiffeisen Cen-
trobank AG, Vienna, Raiffeisen Bausparkasse GmbH, Vienna, Raiffeisen Kapitalanlage-GmbH, Vienna).
The Standardized Approach (STA) is still used to calculate the operational risk of the remaining units in the CRR scope of consoli-
dation.
Operational risk reduction is initiated by business managers who decide on preventive actions like risk mitigation or risk transfer.
Progress and success of these actions is monitored by risk controlling. The former also define contingency plans and nominate
responsible persons or departments for initiating the defined actions if losses in fact occur. In addition, several dedicated organiza-
tional units provide support to business units for reducing operational risks. An important role in connection with operational risk
activities is taken on by financial crime management. Financial crime management provides support for the prevention and identifi-
cation of fraud. The Group also conducts an extensive staff training program and has different contingency plans and back-up
systems in place.
Other disclosures
(44) Fiduciary business
Fiduciary business not recognized in the statement of financial position was concluded with the following volumes on the reporting date:

Loans and advances to banks 0 11,168
Other fiduciary assets 68,651 76,869
Fiduciary assets 327,210 372,429
Deposits from banks 136,611 148,028
Deposits from customers 112,467 143,252
Other fiduciary liabilities 78,131 81,149
Fiduciary liabilities 327,210 372,429

Fiduciary income and expenses break down as follows:

Fiduciary income 15,083 14,191
Fiduciary expenses (2,140) (352)
The following table contains the funds managed by the Group:

Retail investment funds 23,844,217 22,866,753
Equity-based and balanced funds 12,759,729 11,468,451
Bond-based funds 10,809,360 11,094,921
Other 275,129 303,382
Special funds 9,309,015 9,093,808
Property-based funds 244,036 242,143
Total 33,397,267 32,202,704
(45) Finance leases

Gross investment value 3,376,335 5,072,885
Minimum lease payments 2,960,254 4,614,687
Up to 3 months 273,884 435,560
More than 3 months, up to 1 year 542,719 1,002,114
More than 1 year, up to 5 years 1,591,074 2,461,895
More than 5 years 552,578 715,117
Non-guaranteed residual value 416,081 458,198
Unearned finance income 397,318 611,934
Up to 3 months 37,050 58,622
More than 3 months, up to 1 year 78,966 126,542
Net investment value 2,979,016 4,460,952
The reduction in the net investment value in finance leases is mainly attributable to the sale of the leasing company in Poland.
As at 31 December 2016, write-offs on unrecoverable minimum lease payments totaled € 9,633 thousand (2015: € 65,618
thousand).
Assets under finance leases break down as follows:

Vehicles leasing 1,052,080 1,976,266
Real estate leasing 1,316,896 1,777,128
Equipment leasing 610,041 707,558
Total 2,979,016 4,460,952

(46) Operating leases

Operating leases from view of lessor
Future minimum lease payments under non-cancelable operating leases are as follows:

Up to 1 year 39,873 44,722
Total 135,304 162,910
Operating leases from view of lessee
Future minimum lease payments under non-cancelable operating leases are as follows:

Up to 1 year 62,776 77,781
Total 218,397 263,154
(47) Other disclosures according to BWG

Geographical markets
2016 Operating hereof net Profit/loss before Current income Employees as at

Monetary values in € thousand income interest income tax taxes reporting date
Central Europe 1,016,411 629,441 354,356 (63,524) 9,051
Czech Republic 380,460 247,177 136,234 (26,920) 3,158
Hungary 209,896 106,635 52,453 139 1,983
Slovakia 426,552 274,774 165,670 (36,743) 3,910
Southeastern Europe 1,202,953 738,218 362,627 (61,919) 14,831
Albania 77,872 55,632 (32,250) (289) 1,291
Bosnia and Herzegovina 106,407 67,007 34,777 (5,640) 1,268
Bulgaria 156,359 111,909 77,896 (7,390) 2,569
Croatia 224,427 126,379 77,910 (18,711) 2,128
Kosovo 48,786 37,577 19,826 (2,371) 731
Romania 462,719 259,239 125,492 (21,036) 5,322
Serbia 126,434 80,434 58,976 (6,483) 1,522
Eastern Europe 1,314,919 866,320 649,271 (125,685) 17,827
Belarus 184,894 127,918 95,135 (22,837) 2,005
Kazakhstan 396 468 113 (65) 7
Russia 869,097 566,773 404,235 (87,795) 7,742
Ukraine 260,532 171,071 149,788 (14,989) 8,073
Non-Core 479,564 330,777 (203,041) (40,609) 4,573
Asia 28,256 37,484 (198,027) (1,040) 108
Poland 413,509 262,473 46,710 (40,794) 4,242
Slovenia 9,069 3,495 1,114 (475) 16
USA 17,597 14,071 (36,671) 1,708 32
ZUNO 11,134 13,253 (16,168) (8) 175
Austria 3,370,904 2,812,679 1,522,841 (12,424) 3,539
Rest of World 147,654 81,015 52,418 (8,557) 382
Reconciliation (2,400,226) (2,240,890) (1,895,852) 3,036 0
Total 5,132,178 3,217,559 842,620 (309,683) 50,203

2015 Operating hereof net Profit/loss before Current income Employees as at

Monetary values in € thousand income interest income tax taxes reporting date
Central Europe 1,048,134 654,409 309,943 (65,813) 8,623
Czech Republic 362,680 234,950 127,100 (25,251) 2,753
Hungary 220,112 120,892 18,765 (539) 2,016
Slowakei 465,516 298,189 164,078 (40,023) 3,854
Southeastern Europe 1,213,972 780,220 260,174 (32,686) 15,041
Albania 90,430 69,880 14,872 (2,428) 1,349
Bosnia and Herzegovina 103,914 66,066 36,346 (4,169) 1,311
Bulgaria 158,217 116,144 34,275 (3,410) 2,546
Croatia 232,475 135,882 (14,028) 2,746 2,133
Kosovo 49,434 39,675 21,703 (2,278) 715
Romania 446,533 263,938 118,935 (18,933) 5,437
Serbia 133,352 88,637 48,072 (4,214) 1,550
Eastern Europe 1,360,673 948,557 549,515 (127,589) 19,369
Belarus 256,348 124,975 156,759 (38,185) 2,086
Kazakhstan 2,985 863 406 185 9
Russia 923,451 646,666 483,751 (96,331) 7,635
Ukraine 177,889 175,810 (91,401) 6,742 9,639
Non-Core 576,677 384,908 (262,817) (23,541) 5,797
Asia 82,227 84,425 (269,316) (6,669) 197
Poland 428,604 253,299 41,632 (16,209) 5,128
Slovenia 22,401 10,601 (14,722) (15) 218
USA 31,915 25,476 (3,163) (639) 56
ZUNO 11,605 11,107 (17,248) (8) 198
Austria 3,140,157 2,524,656 915,860 (39,390) 3,857
Rest of World 165,929 89,101 25,922 (9,646) 409
Reconciliation (2,172,639) (1,758,430) (1,061,728) 27,151 0
Total 5,332,903 3,623,422 736,869 (271,515) 53,096
Foreign assets/liabilities
Assets and liabilities with counterparties outside Austria are as follows:

Assets 93,534,758 88,115,058
Liabilities 74,028,877 74,897,921
Securities admitted for trading on a stock exchange
2016 2015
in € thousand listed unlisted listed unlisted
Bonds, notes and other fixed-interest securities 15,141,888 276,540 16,417,261 452,546
Shares and other variable-yield securities 158,495 106,115 243,330 127,212
Equity participations 7,485 247,682 1,544 297,436
Volume of the securities trading book

Securities, equity investments 4,757,352 5,792,650
Other financial instruments 144,980,986 152,544,462
Total 149,738,337 158,337,113

Subordinated assets

Loans and advances to banks 10,645 8,064
Trading assets 15,133 13,687
Total 264,080 376,889
(48) Capital management and regulatory total capital according

to CRR/CRD IV and BWG respectively
Capital management
Capital continues to be an integral part of the control procedures throughout the Group. RZB as an international Group takes
various control parameters into consideration.
Regulatory values for RZB are defined on a consolidated and an individual basis by the BWG based on the corresponding EU
directives and on the applicable regulations of the European Parliament. Moreover, RBI as subgroup of RZB is supervised accord-
ing to Article 11 paragraph 5 CRR (Capital Requirements Regulation) based on the FMA (Finanzmarktaufsicht Austria) decision of
24 October 2014. There are also – often deviating with regard to content – guidelines in the individual countries in which the
Group operates. Such guidelines have to be adhered to by the local units separately.
For internal regulation, the Group uses target values, which comprise all relevant risk types, for the capital requirements. Control on
a Group level is undertaken by the Group Regulatory & Transformation Office in coordination with the financial division. The
individual Group units are responsible for the observation of the capital targets in coordination with central departments responsi-
ble for the participation management of the respective unit.
The main focus in the control is on the regulatory (minimum) capital ratios and the economic capital within the framework of ICAAP
(Internal Capital Adequacy Assessment Process, a quantitative method used to assess the adequacy of internal capital). Moreo-
ver, the optimal mixture of capital instruments (e. g. additional tier 1 capital and tier 2 capital) plays an important role and is con-
tinuously analyzed and optimized.
In addition, risk taking capacity is calculated in the framework of regulatory limits. It is defined as the maximum loss which the bank
or the banking group may incur during the next twelve months without falling short of the regulatory minimum capital ratios and is
the responsibility of Risk Controlling.
The determination of the target values in relation to the compulsory minimum requirements necessitates additional internal control
calculations. The Risk Controlling department calculates the value-at-risk in relation to the above defined risk taking capacity.
Moreover, a comparison between economic capital and internal capital is drawn. Further details regarding this calculation are
contained in the risk report.
Capital management in 2016 was marked by several measures to strengthen the capital position. The main measures were the
mergers of the financial holding company Raiffeisen-Landesbanken-Holding at the top of the Group, the partial sale of the stake in
UNIQA Insurance Group AG, Vienna, and the sale of the Polish leasing company (Raiffeisen Leasing Polska S.A.). In addition,
further steps were taken to reduce total RWAs in selected Group units. Overall, these measures significantly improved the capital
ratios.
Regulatory capital
RZB calculates the regulatory total capital and total capital requirement according to Basel III. The implementation of these re-
quirements in the EU was carried out via a regulation (CRR, Capital Requirements Regulation) and a directive (CRD IV, Capital
Requirements Directive IV).

Moreover, based on the SSM (Single Supervisory Mechanism) regulation, the European Central Bank (ECB) took over supervi-
sion of large banks in the euro area in November 2014, whose total assets exceed € 30 billion or 20 per cent of a country’s
economic output. Both RZB and RBI are defined as large banks. Based on an annually undertaken Supervisory Review and Eval-
uation Process (SREP), the ECB instructs RZB and also RBI by way of an official notification to hold additional capital to cover risks
which are not or not adequately considered under pillar I. A draft proposal from the Basel Committee to tighten up the definition
of the basis for the calculation of risk-weighted assets is currently in preparation.
The so-called SREP requirement represents an add-on to the minimum requirements of the CRR, CRD IV and the BWG. In addition,
the capital conservation buffer and other implemented buffers (see below) must be adhered to. A breach of the combined buffer
requirement would result in constraints, for example in relation to dividend distributions and coupon payments on certain capital
instruments. The capital requirements applicable in the course of the year were met on a subgroup and consolidated level.
National supervisors can determine a systemic risk buffer (up to 5 per cent) as well as an additional capital add-on for systemic
banks (up to 3.5 per cent). In the event that a systemic risk buffer as well as an add-on for systemic banks are determined for a
banking institution, only the higher of the two values is applicable. In September 2015, the responsible financial market stability
committee of the FMA recommended the requirement of a systemic risk buffer for twelve large banks located in Austria, including
RZB and RBI. This recommendation was put into effect as of the beginning of 2016 by the FMA. The systemic risk buffer was set
at 0.25 per cent for RZB and RBI as of 1 January 2016 and progressively increases to 2 per cent by 2019. A countercyclical
buffer can be implemented by member states in order to curb excessive lending growth. The current countercyclical buffer was set
at 0 per cent for Austria due to restrained lending growth and the stable macroeconomic environment.
Further expected regulatory changes or developments are continuously monitored and displayed and analyzed in scenario calcu-
lations by the Group Regulatory & Transformation Office in coordination with the financial division. Possible effects are included in
planning and steering, insofar as the extent and implementation are foreseeable.
Calculation of total capital
The determination of eligible total capital, taking in account the profit of 2016, is in accordance with the applicable regulations
based on international accounting standards. Further details can be found in the regulatory disclosure report pursuant to Article
431 ff CRR which can be found on RZB’s website. The consolidated total capital of RZB is shown as follows.

The total capital breaks down as follows:

Paid-in capital 2,327,263 2,327,241
Earned capital 3,099,275 2,760,808
Non-controlling interests 3,382,428 3,389,150
Common equity tier 1 (before deductions) 8,808,966 8,477,199
Deduction intangible fixed assets/goodwill (639,226) (628,903)
Deduction provision shortage for IRB positions (33,761) (55,272)
Deduction securitizations (20,693) (14,184)
Deduction deferred taxes 0 0
Deduction loss carry-forwards (2,961) (3,311)
Deduction insurance and other investments 0 (295,835)
Common equity tier 1 (after deductions) 8,112,325 7,479,694
Additional tier 1 90,475 308,876
Non-controlling interests (8,853) (14,008)
Deduction intangible fixed assets/goodwill (70,368) (253,414)
Deduction provision shortage for IRB positions (11,254) (41,454)
Deduction securitizations 0 0
Deduction insurance and other investments 0 0
Tier 1 8,112,325 7,479,694
Long-term subordinated capital 3,048,144 3,167,941
Non-controlling interests (1,233,483) (864,698)
Provision excess of internal rating approach positions 161,082 135,781
Provision excess of standardized approach positions 0 0
Deduction securitizations 0 0
Deduction insurance and other investments 0 (98,612)
Tier 2 (after deductions) 1,975,743 2,340,412
Total capital 10,088,068 9,820,106
Total capital requirement 5,444,422 5,763,006
Common equity tier 1 ratio (transitional) 11.9% 10.4%
Common equity tier 1 ratio (fully loaded) 11.9% 9.9%
Tier 1 ratio (transitional) 11.9% 10.4%
Tier 1 ratio (fully loaded) 11.9% 10.0%
Total capital ratio (transitional) 14.8% 13.6%
Total capital ratio (fully loaded) 14.0% 13.2%
1 The regulatory treatment of the shareholding in UNIQA Insurance Group AG, Vienna, and the provision shortage for internal ratings-based approach positions were
adjusted in the course of the regular consultation process with the supervisory authority resulting in a change in the regulatory ratios as at 31 December 2015.
The transitional ratios are the currently applicable ratios according to the requirements of the CRR having regard to the transitional
rules for the current calendar year under Part Ten of the CRR. The fully loaded ratios are for information purposes only and calculat-
ed on the hypothetical assumption of full implementation without the transitional rules. In addition, the systemic risk buffer of 2 per
cent is applied in full. As a result, the minority deduction is considerably decreased and the ratios are improved.

The basis for the assessment of credit risk by asset class was as follows:

Risk-weighted assets according to standardized approach 27,154,707 29,549,609
Central governments and central banks 1,924,568 2,208,828
Regional governments 61,842 50,618
Public administration and non-profit organizations 67,086 24,157
Multilateral development banks 0 0
Banks 359,470 437,995
Corporate customers 9,823,080 11,236,790
Retail customers 9,808,257 10,014,310
Equity exposures 2,376,977 2,620,668
Covered bonds 23,994 24,778
Mutual funds 41,754 123,423
Securitization position 0 0
Other positions 2,667,679 2,808,043
Risk-weighted assets according to internal rating approach 28,722,603 29,539,181
Central governments and central banks 243,971 311,112
Banks 2,071,355 2,141,725
Corporate customers 21,642,453 22,531,724
Retail customers 4,389,683 4,140,911
Equity exposures 146,018 154,913
Securitization position 229,122 258,795
CVA risk 388,852 406,044
Risk-weighted assets (credit risk) 56,266,161 59,494,834
Total capital requirement (credit risk) 4,501,293 4,759,587
The total capital requirement composition is as follows:

Total capital requirement for credit risk 4,501,293 4,759,587
Internal rating approach 2,297,808 2,363,134
Standardized approach 2,172,377 2,363,969
CVA risk 31,108 32,483
Total capital requirement for position risk in bonds, equities, commodities and open currency positions 215,913 241,297
Total capital requirement for operational risk 727,216 762,123
Risk-weighted assets (total RWA) 68,055,278 72,037,580
Total capital requirement 5,444,422 5,763,006
Leverage ratio
Within the framework of CRR and in addition to the total capital requirements the leverage ratio was implemented as a new in-
strument to limit the risk of excessive indebtedness. According to Article 429 CRR, the leverage ratio is the ratio of capital to the
leverage exposure. This means tier 1 capital in relation to unweighted exposure on and off the statement of financial position. The
Basel Committee set a minimum ratio of 3 per cent. After a test period in which the credit institutions are required to publish the
figures and possible modification of the minimum ratio, the leverage ratio is set to become effective as of 1 January 2018.

Leverage exposure 147,882,132 163,149,520
Tier 1 8,112,325 7,479,694
Leverage ratio (transitional) 5.5% 4.6%
Leverage ratio (fully loaded) 5.5% 4.5%
The increase in the leverage ratio of 0.9 percentage points (transitional) and 1.0 percentage points (fully loaded) compared to
the previous year is attributable to the increase in tier 1 capital and a reduced leverage exposure – largely due to the changed
classification of transactions off the statement of financial position under Annex I of the CRR and the lower credit conversion factors
(CCF) that were applied as a result.

The following table provides an overview on the calculation methods that are applied to determine total capital requirements in
the subsidiaries:
Credit risk Market risk Operational

Unit Non-Retail Retail risk
Raiffeisen Zentralbank Österreich AG, Vienna (AT) IRB n.a. STA AMA
Raiffeisen Bank International AG, Vienna (AT) IRB n.a. Internal Model AMA
RBI Finance (USA) LLC, New York (USA) IRB n.a. STA STA
Raiffeisenbank a.s., Prague (CZ) IRB IRB STA STA
Raiffeisen Bank Zrt., Budapest (HU) IRB IRB STA STA
Tatra banka a.s., Bratislava (SK) IRB IRB STA AMA
Raiffeisen Bank S.A., Bucharest (RO) IRB IRB STA AMA
Raiffeisenbank Austria d.d., Zagreb (HR) IRB STA STA STA
Raiffeisenbank Russia d.d., Moscow (RU) IRB STA STA AMA
Raiffeisenbank (Bulgaria) EAD, Sofia (BG) IRB IRB STA AMA
Raiffeisen Centrobank AG, Vienna (AT) STA n/a STA AMA
Kathrein Privatbank Aktiengesellschaft, Vienna (AT) STA STA n/a AMA
Raiffeisen Bausparkasse Gesellschaft m.b.H., Vienna (AT) STA STA n/a AMA
Raiffeisen Kapitalanlage-Gesellschaft mit beschränkter Haftung,
Vienna (AT) STA n/a n/a AMA
All other units STA STA STA STA
IRB: internal ratings-based approach
Internal model for open currency positions and general interest rate risk in the trading book
STA: standardized approach
AMA: advanced measurement approach
(49) Average number of staff

Full-time equivalents 2016 2015
Salaried employees 51,067 54,749
Wage earners 743 946
Total 51,810 55,695
Full-time equivalents 2016 2015

Austria 3,139 3,716
Foreign 48,671 51,979
Total 51,810 55,695
(50) Related parties

Companies can carry out business with related parties that may affect the entity’s asset, financial and earnings position.
The following tables show the relations to related parties. At the end of September 2016, the previous parent company, Raiffeisen-
Landesbanken-Holding GmbH, Vienna, and its wholly owned subsidiary R-Landesbanken-Beteiligung GmbH, Vienna, merged into
Raiffeisen Zentralbank Österreich AG, Vienna. As of that date, there has been no parent company.
Companies with significant influence are primarily Raiffeisenlandesbank Niederösterreich-Wien AG, Vienna, as the largest indirect
shareholder, and its parent company Raiffeisen-Holding Niederösterreich-Wien registrierte Genossenschaft mit beschränkter Haf-
tung, Vienna. Affiliated companies are the 306 subsidiaries not included in the consolidated financial statements for reasons of
materiality. Disclosures on RZB relations to key management are reported under (51) Relations to key management.

2016 Parent Companies with Affiliated Companies

in € thousand companies significant influence companies valued at equity Other interests
Loans and advances to banks 0 393,966 0 381,620 46,764
Loans and advances to customers 0 0 234,554 36,990 171,777
Trading assets 0 10,091 58 14 1,908
Financial investments 0 500 216,149 0 197,799
Investments in associates 0 0 0 775,035 0
Other assets (incl. derivatives) 0 1,108 13,375 1,778 123,720
Total receivables 0 405,665 464,136 1,195,437 541,968
Deposits from banks 0 3,131,460 (18,045) 3,174,742 401,177
Deposits from customers 0 0 158,827 401,928 89,725
Debt securities issued 0 0 1,355 0 0
Provisions for liabilities and charges 0 0 0 3,313 0
Trading liabilities 0 0 13,333 5,920 0
Other liabilities including derivatives 0 925 1,812 1,777 1,152
Subordinated capital 0 0 390 3,611 364
Total liabilities 0 3,132,385 157,672 3,591,291 492,418
Guarantees given 0 26,090 112,014 274,730 22,653
Guarantees received 0 22,481 0 46,809 37,828

Loans and advances to banks 10 2,106,167 0 159,706 57,281
Loans and advances to customers 0 941 377,866 163,805 178,094
Trading assets 0 12,737 46 190 1,337
Financial investments 0 5,053 222,019 0 252,012
Investments in associates 0 0 0 1,590,384 0
Other assets (incl. derivatives) 0 805 15,099 1,880 66,992
Total receivables 10 2,125,703 615,030 1,915,965 555,716
Deposits from banks 0 3,632,683 0 3,094,500 421,967
Deposits from customers 23 0 157,293 719,037 52,069
Debt securities issued 0 0 1,980 0 0
Provisions for liabilities and charges 0 0 625 9,778 12
Trading liabilities 0 0 12,057 8,329 0
Other liabilities including derivatives 0 10,305 944 214 573
Subordinated capital 0 0 387 3,611 360
Total liabilities 23 3,642,988 173,286 3,835,469 474,981
Guarantees given 0 48,930 149,129 362,061 0
Guarantees received 0 22,168 0 164,083 36,277

Interest income 0 10,220 5,739 8,982 8,844
Interest expenses 0 (27,717) (1,087) (31,824) (1,440)
Dividends income 0 0 84,509 74,375 14,197
Fee and commission income 0 2,148 24,160 9,995 5,580
Fee and commission expense 0 (1,527) (719) (9,504) (3,649)

Interest income 0 8,174 15,199 10,787 12,749
Interest expenses 0 (35,373) (3,310) (61,275) (2,213)
Dividends income 0 0 86,334 132,837 11,279
Fee and commission income 0 20,571 27,024 7,129 5,515
Fee and commission expense 0 (1,288) (769) (5,960) (3,291)

(51) Relations to key management

Group relations of key management
Key management refers to the members of the Management Board and Supervisory Board of the Group parent Raiffeisen Zen-
tralbank Österreich AG and the managers of the holding company Raiffeisen-Landesbanken-Holding GmbH. Relations of key
management to RZB are as follows (at fair values):

Sight deposits 43 13
Bonds 1,219 1,236
Shares 447 318
Savings deposits 178 75
Other loans 18 114
Loans liabilities 5 389
Leasing liabilities 957 578
Other liabilities 19 0
The following table shows relations of close family members of key management to RZB:

Sight deposits 11 8
Bonds 0 0
Shares 48 0
Time deposits 8 57
Savings deposits 83 67
Other loans 13 0
Leasing liabilities 0 0
The Group has no further relations with key management.
Remuneration of members of the Management Board
The following table shows total remuneration of the members of the Management Board according to IAS 24.17. The expenses
according to IAS 24 were recognized on an accrual basis and according to the rules of the underlying standards (IAS 19 and
IFRS 2).

Short-term employee benefits 2,813 3,286
Post-employment benefits (340) 411
Other long-term benefits 8 (57)
Termination benefits 0 0
Share based payments 0 75
Total 2,482 3,715
Short-term employee benefits shown in the above table contain salaries, functional allowances, benefits in kind and other benefits,
remunerations for membership of board in affiliated companies and those parts of the bonuses which become due for the short-
term. Furthermore, changes possibly arising from the difference between the bonus provision and the later awarded bonus are
also contained.
Post-employment benefits comprise payments to pension funds, business insurances and payments according to Retirement Plan Act
(Mitarbeitervorsorgegesetz) as well as net allocations to provisions for retirement benefits and severance payments.
Other long-term benefits contain portions of the provision for bonus payments regarding deferred bonus portions in cash and
retained portion payable in instruments. For the latter, valuation changes due to currency fluctuations are taken into account. It also
contains allocations to provisions for anniversary bonuses.
All figures posted relating to bonus and share-based payments concern one member of the Management Board who was a
member of the RZB Management Board until 30 June 2015 and is now a member of the RBI Management Board, € 631 thou-
sand (2015: € 628 thousand) was paid to former members of the Management Board and to their surviving dependants in the
financial year.

Remuneration of other boards
The members of the Supervisory Board and other boards are remunerated as follows:

Supervisory board 415 430
Federal Advisory Board (Länderkuratorium) 146 146
Moreover, no contracts subject to approval within the meaning of Section 95 (5) Z 12 of the Austrian Stock Corporation Act
(AktG) were concluded with the members of the Supervisory Board in the financial year 2016.
(52) Boards
In accordance with Section 70 (1) of the Austrian Joint Stock Company Act (AktG), the members of the Management Board are
personally responsible for leading the company to the best benefit of RZB AG and its Group, taking into account shareholders’
and employees’ interests as well as public interests.
According to Austrian Joint Stock Company Act, the Supervisory Board is responsible for monitoring and supporting the Man-
agement Board in fundamental strategic company decisions. The Supervisory Board established the Personnel Committee, Audit
Committee, Working Committee, Remuneration Committee, Nomination Committee and Risk Committee as sub-committees and
staffed these from its own ranks.
 The authorizations of the Supervisory Board’s Personnel Committee stretch to the legal relationships between the company
and the active as well as the retired members of the Management Board, but exclude their appointment or their termination of
contract.
 The Supervisory Board’s Audit Committee supervises the accounting process, the effectiveness of the internal audit system and
risk management system as well as the annual statutory audit and the consolidated financial statements audit. It prepares the
recommendation of the Supervisory Board for the selection of the external auditor and bank auditor. The Audit Committee
checks and supervises the independence of the Group’s auditor and bank auditor, particularly with respect to the additional
work performed for the audited company. The Audit Committee is also responsible for auditing the annual financial statements
and preparing its findings, assessing the profit appropriation proposal, management report and, if required, corporate govern-
ance report as well as reporting on the audit results to the Supervisory Board and auditing the consolidated financial state-
ments and management report, including reporting on the audit results to the Supervisory Board of the parent company.
 The Supervisory Board’s Working Committee holds a monitoring and authorization function. This particularly applies when
taking on risks arising from banking transactions (including the acquisition and sale of securities). It also authorizes risk limits for
customers or a group of related customers as from a limit specified by the articles of association. This also applies when estab-
lishing, discontinuing or closing subsidiaries and when acquiring investments, directly or indirectly, if the limits set in the articles
of association are exceeded.
 The Supervisory Board’s Remuneration Committee monitors the remuneration policy, remuneration practices and remuneration-
related incentive structures, each in connection with steering, monitoring and limitation of risks pursuant to Section 39 (2b) 1 to
10 Austrian Banking Act (BWG), with the capital adequacy and liquidity. Also the long-term interests of shareholders, investors
and employees of the company had to be taken into account. The Supervisory Board’s Remuneration Committee approves the
general regulations of the remuneration policy, reviews them on a regular basis and is responsible for the implementation of the
remuneration policy and practices approved as well as the direct review of the remuneration of higher management in the risk
management and in compliance functions.
 The Supervisory Board’s Nomination Committee is responsible for the evaluation of the structure, size, composition and per-
formance of the Management Board and the Supervisory Board and for preparing suggestions for modifications if necessary.
At least annually, the Nomination Committee evaluates the knowledge, abilities and experience for both individual members of
the Management Board and Supervisory Board as well as the boards as a whole and reports then to the Supervisory Board.
Moreover, it is responsible for monitoring the procedure of the Management Board regarding the selection of the higher man-
agement and the determination of target rates as well as the strategy for female rate. Furthermore, the Nomination Committee
has to pay attention to the decision finding process of the Mangement Board and the Supervisory Board that this is not domi-
nated by only one person or a smaller group of persons in the matter of running contrary to the company’s interests.

 The Supervisory Board’s Risk Committee advises the Management Board concerning the current and future risk disposition
and strategy and monitors the implementation. In addition it reviews the pricing of offered services and products insofar as they
adequately take into account the business model. Furthermore, the Risk Committee judges if the internal remuneration system
adequately considers risk. The head of risk management department participates in the meetings of the Risk Committee and he
reports the current risk situation and material developments.
Finally, the Supervisory Board authorizes the appointments of members of the Management Board and employees of the Bank to
the bodies of associated companies and in the case of the Management Board, it also issues authorizations to suspend the non-
competition clause regarding the acceptance of Supervisory Board memberships within the company, which are unconnected to
the Group or in whose operations the company does not participate within the meaning of Section 228 (1) of the Austrian Com-
mercial Code (UGB). The conclusion of special employment contracts with pension commitments – with exception of the legal
relationship stated for the Supervisory Board in Section 7 para 4 lid d of the rules of procedure – also requires the approval of the
Supervisory Board.
The Federal Advisory Board (Länderkuratorium) of the Supervisory Board has been set up as an additional body in accordance
with the articles of association. It has an advisory function and is authorized to submit proposals to the Supervisory Board at any
time.

Management Board Delegated by the Works Council
 Walter Rothensteiner, since1 January 1995, Chairman and CEO; Chairman  Gebhard Muster, since 20 November 2008, since 14 June 2011
of the Austrian Raiffeisen Association Chairman of the Works Council, PrüfA, AA, VergA, NA, RA
 Michael Höllerer, since 1 July 2015  Désirée Preining, since 14 June 2011 Deputy Chairwoman of
the Works Council, PrüfA, AA, VergA, NA, RA
 Johannes Schuster, since 10 October 2010
 Walter Demel, since 28 November 2013
Supervisory Board  Doris Reinsperger, since 14 June 2011
 Tanja Daumann, since 27 March 2015
Executive Committee
State Commissioner
 Erwin Hameseder, since 23 May 2012, President, PersA, PrüfA, AA, VergA,
NA, RA, Chairman of Raiffeisen-Holding Niederösterreich-Wien reg. Gen.m.b.H.  Alfred Lejsek, since 1 September 1996, State Commissioner
 Martin Schaller, since 10 October 2013, first Vice President, PersA, PrüfA, AA,  Gerhard Popp, since 1 Dezember 2009, Deputy State
VergA, NA, RA, General Director of Raiffeisen-Landesbank Steiermark AG Commissioner
 Heinrich Schaller, since 23 May 2012, second Vice President, PersA, PrüfA,
AA, VergA, NA, RA, General Director of Raiffeisenlandesbank Oberösterreich AG
Federal Advisory Board (Länderkuratorium)
 Wilfried Hopfner, since 18 June 2009 member, since 22 January 2016 third
Vice President, PersA, PrüfA, AA, VergA, NA, RA, CEO of Raiffeisenlandesbank Vorarl-
 Walter Hörburger, since 22 June 2010, until 8 June 2016 1
berg Waren- und Revisionsverband Gen.m.b.H.

Chairman, Chairman of the Supervisory Board of Raiffeisenlandesbank
Vorarlberg Waren- und Revisionsverband reg. Gen.m.b.H.
Members  Sebastian Schönbuchner, since 20 June 2002, since
8 June 2016 Chairman, until 8 June 20161 Deputy Chairman, Chair-
 Klaus Buchleitner, since 25 June 2003, CEO of Raiffeisenlandesbank man of Raiffeisenverband Salzburg reg. Gen.m.b.H.
Niederösterreich-Wien AG and Raiffeisen-Holding NÖ Wien  Jakob Auer, since 13 June 2000, President of the Supervisory
 Peter Gauper, since 24 June 2008, Spokesman of the Management Board of Board of Raiffeisenlandesbank Oberösterreich AG
Raiffeisenlandesbank Kärnten – Rechenzentrum und Revisionsverband, reg. Gen.m.b.H.
 Robert Lutschounig, since 12 June 2009, Chairman of the
 Johannes Ortner, since 15 June 2016, Chairman of the Board of Raiffeisen- Supervisory Board of Raiffeisenlandesbank Kärnten- Rechenzentrum
Landesbank Tirol AG
und Revisionsverband, reg. Gen.m.b.H.
 Günther Reibersdorfer, since 23 June 2005, CEO of Raiffeisenverband  Michael Misslinger, since 3 June 2014, Chairman of the
Salzburg reg. Gen.m.b.H.
Supervisory Board of Raiffeisen Landesbank Tirol AG
 Rudolf Könighofer, since 1 August 2013, CEO of Raiffeisenlandesbank  Helmut Tacho, since 3 June 2014, since 8 June 2016 Deputy 1
Burgenland und Revisionsverband reg. Gen.m.b.H. Chairman, Chairman of the Supervisory Board of Raiffeisen Holding
 Reinhard Wolf, since 23 May 2012, CEO of RWA Raiffeisen Ware Austria AG Niederösterreich-Wien reg. Gen.m.b.H.
 Wilfried Thoma, since 25. June 2003, President of the Supervi-
All of the above members of the Supervisory Board have sory Board of Raiffeisen-Landesbank Steiermark AG
been appointed until the Annual General Meeting regarding  Erwin Tinhof, since 20 June 2007, President of the Supervisory
the 2018 financial year. Board of Raiffeisenlandesbank Burgenland und Revisionsverband reg.
Gen.m.b.H.
PersA Member of the Personnel Committee
PrüfA Member of the Audit Committee

AA Member of the Working Committee
VergA Member of the Remuneration Committee
NA Member of the Nomination Committee
RA Member of the Risk Committee
1 A new Chairman and his/her Deputy are appointed each year.

Events after the reporting date

Extraordinary General Meeting approves merger with RBI
On 23 January, and respectively on 24 January 2017, Extraordinary General Meetings of RZB AG as well as RBI AG took place
passing a resolution on the merger of the two institutes. For passing the resolution a three-fourths majority of the capital represented
was required and was approved by a clear majority in both cases. The shareholders also approved the capital increase related to
the merger. RBI's share capital will be increased by € 109,679,778.15, from € 893,586,065.90 to € 1,003,265,844.05,
through the issuance of 35,960,583 new no par value common bearer shares. The regional Raiffeisen banks, who are the core
shareholders of RZB, hold around 58,8 per cent of the combined institute.
The merged company will operate under the name of Raiffeisen Bank International AG, as previously the case for RBI, and RBI
shares will continue to be listed on the Vienna Stock Exchange. The number of shares issued will increase to 328,939,621.

(53) Group composition

Consolidated group
Fully consolidated Equity method
Number of units 2016 2015 2016 2015
As at beginning of period 305 337 10 10
Included for the first time in the financial period 5 19 0 0
Merged in the financial period (2) (4) 0 0
Excluded in the financial period (25) (47) (1) 0
As at end of period 283 305 9 10
Of the 283 entities in the Group, 150 are domiciled in Austria (2015: 155) and 133 abroad (2015: 150). They comprise 27
banks (2015: 28), 168 financial institutions (2015: 185), 20 companies rendering bank-related ancillary services (2015: 24), 18
financial holding companies (2015: 14) and 50 other companies (2015: 54).
Included units
Name Share Included as of Reason

Financial institutions
Ados Immobilienleasing GmbH, Eschborn (DE) 45.6% 1/1 Materiality
Raiffeisen Immobilienfonds, Vienna (AT) 88.2% 31/3 Purchase
RBI eins Leasing Holding GmbH, Vienna (AT) 45.6% 1/6 Materiality
RBI ITS Leasing-Immobilien GmbH, Vienna (AT) 45.6% 1/6 Materiality
Other companies
RL Wohnbau-Projektentwicklungs GmbH, Vienna (AT) 100.0% 1/12 Materiality
Business combinations
By gradually buying shares, Raiffeisen Zentralbank AG acquired a majority of the shares in Raiffeisen Immobilienfonds, Vienna, in
the first quarter of 2016 and now holds 88.2 per cent of the shares. As a result of the control in accordance with IFRS 10, Raiffeisen
Immobilienfonds was fully consolidated for the first time as of 31 March 2016.
The total cash price for the 88.2 per cent holding amounted to € 125,065 thousand; of that amount, € 105,000 thousand related
to the current financial year.

The following table shows the total consideration paid for the purchase of the shares and the acquired assets and liabilities recog-
nized at the date of first-time consolidation:
in € thousand Raiffeisen Immobilienfonds

Cash reserve 0
Loans and advances to banks 19,847
Loans and advances to customers (less impairment losses) 0
Financial investments 0
Intangible fixed assets 0
Tangible fixed assets 218,910
Other assets 16,393
Assets 255,149
Deposits from banks 92,641
Deposits from customers 0
Debt securities issued 0
Provisions for liabilities and charges 17,586
Trading liabilities 0
Other liabilities 10,452
Subordinated capital 0
Total identifiable net assets 134,470
Non-controlling interests 15,847
Net assets after non-controlling interests 118,623
Total consideration transferred 125,065
Previously acquired other investments 0
Goodwill/Badwill 6,442
Excluded units
Name Share Included as of Reason
Raiffeisen Banka d.d., Maribor (SI) 60.7% 30/6 Sale
Golden Rainbow International Limited, Tortola (VG) 60.8% 1/1 Immaterial
Roof Russia DPR Finance Company S.A., Luxembourg (LU) <0.1% 1/1 Immaterial
SCTF Szentendre Ingatlanforgalmazó és Ingatlanfejlesztő Kft., Budapest (HU) 60.8% 1/1 Immaterial
BRL Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Eisenstadt (AT) 100.0% 1/1 Immaterial
Queens Garden Sp z.o.o., Warsaw (PL) 100.0% 1/1 Immaterial
Eastern European Invest GmbH, Vienna (AT) 60.8% 1/1 Immaterial
Eastern European Invest Holding GmbH, Vienna (AT) 60.8% 1/1 Immaterial
RAIFFEISEN-LEASING REAL ESTATE Sp. z o.o., Warsaw (PL) 60.8% 1/1 Immaterial
RI Eastern European Finance B.V., Amsterdam (NL) 100.0% 1/1 Immaterial
Adessentia Immobilienleasing GmbH, Eschborn (DE) 100.0% 1/4 End of operations
Kepler Fonds 777, Vienna (AT) <0.1% 1/5 End of operations
THETIS Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 100.0% 1/7 End of operations
COL Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 100.0% 1/7 Sale
PALADIOS Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 100.0% 1/7 End of operations
Raiffeisen Lízing Zrt., Budapest (HU) 60.8% 2/8 Sale
BL Syndikat Beteiligungs Gesellschaft m.b.H., Vienna (AT) 77.5% 1/12 Merger
Raiffeisen-Leasing Polska S.A., Warsaw (PL) 60.8% 1/12 Sale
ROOF Poland Leasing 2014 Ltd, Dublin (IE) <0.1% 1/12 Sale
Laomedon Immobilienleasing GmbH, Eschborn (DE) 100.0% 1/12 Sale
Companies rendering bank-related ancillary services
Raiffeisen Ingatlan Vagyonkezelő Kft., Budapest (HU) 60.8% 1/4 Immaterial
Tatra Residence, s. r. o., Bratislava (SK) 78.8% 31/10 Merger
Raiffeisen Insurance Agency Sp.z.o.o, Warsaw (PL) 60.8% 1/12 Sale
RSC Raiffeisen Service Center GmbH, Vienna (AT) 47.3% 1/12 Change in control
Other companies
Raiffeisen Energiaszolgáltató Kft., Budapest (HU) 60.8% 1/1 Immaterial
ÖKO-Drive Fuhrparkmanagement GmbH, Vienna (AT) 100.0% 1/1 Immaterial
Bondy Centrum, s.r.o., Prague (CZ) 79.1% 1/2 Sale

Consolidated subsidiaries where RZB holds, indirectly, less than 50 per cent of the
ordinary voting shares
The Group controls the following types of entities, even though it holds less than half of the voting rights.
Structured entities
Name Share of voting rights Reason

Raiffeisen Real Estate Fund, Budapest (HU) <0.1% Funds
CJSC Mortgage Agent Raiffeisen 01, Moscow (RU) <0.1% SPV
Raiffeisen Immobilienfonds, Vienna (AT) <0.1% Funds
FWR Russia Funding B.V., Amsterdam (NL) <0.1% SPV
The above entities are consolidated as they are either special purpose vehicles (SPV) or funds set up by the Group. The Group is
exposed to variability in returns from the vehicles from activities such as holding securities in the vehicles or issuing financial guaran-
tees and the Group has the power to influence the relevant activities of these entities. These entities primarily run on ‘auto-pilot’
with the day to day business activities being performed by the Group by way of a Service Agreement.
Subsidiaries not consolidated where RZB holds, indirectly, more than 50 per cent of the
ordinary voting shares
Because of their minor importance in giving a view of the Group’s assets, financial and earnings position 301 subsidiaries were
not included in the consolidated financial statements (2015: 329). They are recognized at cost under financial investments and
are assigned to measurement category available-for-sale. Total assets of the companies not included came to less than 1 per cent
of RZB’s aggregated total assets.

List of fully consolidated companies
Company, domicile (country) Subscribed capital1 in local currency Share1 Type2

"Raiffeisen-Rent" Vermögensberatung und Treuhand Gesellschaft m.b.H., Vienna (AT) 364,000 EUR 100.0% FI
Abade Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Abade Immobilienleasing GmbH & Co Projekt Lauterbach KG, Eschborn (DE) 5,000 EUR 6.0% FI
Abakus Immobilienleasing GmbH & Co Projekt Leese KG, Eschborn (DE) 5,000 EUR 6.0% FI
Abrawiza Immobilienleasing GmbH & Co. Projekt Fernwald KG, Eschborn (DE) 5,000 EUR 6.0% OT
Abura Immobilienleasing GmbH & Co. Projekt Seniorenhaus Boppard KG, Eschborn (DE) 5,000 EUR 6.0% FI
Abutilon Immobilienleasing GmbH & Co. Projekt Autohof Ibbenbüren KG, Eschborn (DE) 5,000 EUR 6.0% FI
ACB Ponava, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Achat Immobilienleasing GmbH & Co. Projekt Hochtaunus-Stift KG, Eschborn (DE) 10,000 EUR 1.0% FI
Acridin Immobilienleasing GmbH & Co. Projekt Marienfeld KG, Eschborn (DE) 5,000 EUR 100.0% FI
Adagium Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Adamas Immobilienleasing GmbH & Co. Projekt Pflegeheim Werdau KG, Eschborn (DE) 5,000 EUR 100.0% FI
Adiantum Immobilienleasing GmbH & Co. Projekt Schillerhöhe Weimar KG, Eschborn (DE) 5,000 EUR 6.0% FI
Adipes Immobilienleasing GmbH & Co. Projekt Bremervörde KG, Frankfurt am Main (DE) 5,000 EUR 100.0% FI
Adorant Immobilienleasing GmbH & Co. Projekt Heilsbronn und Neuendettelsau KG, Eschborn (DE) 5,000 EUR 6.0% OT
Ados Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 45.6% FI
Adrittura Immobilienleasing GmbH & Co. Projekt Eiching KG, Eschborn (DE) 5,000 EUR 70.0% FI
Adular Immobilienleasing GmbH & Co. Projekt Rödermark KG, Eschborn (DE) 5,000 EUR 100.0% FI
Agamemnon Immobilienleasing GmbH & Co. Projekt Pflegeheim Freiberg KG, Eschborn (DE) 5,000 EUR 100.0% FI
AGITO Immobilien-Leasing GesmbH, Vienna (AT) 36,400 EUR 100.0% FI
AKRISIOS Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
AL Taunussteiner Grundstücks-GmbH & Co KG, Eschborn (DE) 10,000 EUR 88.0% FI
A-Leasing SpA, Treviso (IT) 68,410,000 EUR 100.0% FI
Am Hafen" Sutterlüty GmbH & Co KG, Vienna (AT) 100,000 EUR 50.0% FI
AMYKOS RBI Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% FI
AO Raiffeisenbank, Moscow (RU) 36,711,260,000 RUB 60.8% BA
APUS Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
ARCANA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
A-Real Estate S.p.A., Bozen (IT) 600,000 EUR 100.0% FI
AURIGA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Austria Leasing Beteiligungsgesellschaft mbH, Eschborn (DE) 25,000 EUR 100.0% FI
Austria Leasing GmbH, Eschborn (DE) 1,000,000 EUR 100.0% FI
Austria Leasing GmbH & Co. Immobilienverwaltung Projekt Hannover KG, Eschborn (DE) 10,000 EUR 100.0% FI
Austria Leasing GmbH & Co. KG Immobilienverwaltung CURA, Eschborn (DE) 10,000 EUR 100.0% FI
Austria Leasing Immobilienverwaltungsgesellschaft mbH, Eschborn (DE) 25,000 EUR 100.0% OT
B52 RBI Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% OT
BAILE Handels- und Beteiligungsgesellschaft m.b.H., Vienna (AT) 40,000 EUR 60.8% FI
Baumgartner Höhe RBI Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% FI
BUILDING BUSINESS CENTER DOO NOVI SAD, Novi Sad (RS) 559,220,792 RSD 60.8% FI
Bukovina Residential SRL, Timisoara (RO) 1,901,600 RON 100.0% OT
Bulevard Centar BBC Holding d.o.o., Belgrade (RS) 63,708 RSD 60.8% BR
Burgenländische Kommunalgebäudeleasing Gesellschaft m.b.H., Eisenstadt (AT) 35,000 EUR 100.0% FI
CADO Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Canopa Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
CARNUNTUM Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
CERES Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
CINOVA RBI Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% FI
CJSC Mortgage Agent Raiffeisen 01, Moscow (RU) 10,000 RUB <0.1% BR
CP Inlandsimmobilien-Holding GmbH, Vienna (AT) 364,000 EUR 61.2% OT
CUPIDO Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
1 Less own shares
2 Company type: BA Bank, BR Company rendering banking-related ancilliary services, FH Financial holding, FI Financial institutions, OT Other companies, SC Securities
firms, VV Insurance


CURO Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
CZ Invest GmbH, Vienna (AT) 35,000 EUR 100.0% OT
DAV Holding Ltd., Budapest (HU) 3,030,000 HUF 60.8% FI
DAV-PROPERTY Kft., Budapest (HU) 3,010,000 HUF 60.8% OT
DOROS Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
EPPA Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
ETEOKLES Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Expo 2000 Real Estate EOOD, Sofia (BG) 10,000 BGN 60.8% OT
FCC Office Building SRL, Bucharest (RO) 30,298,500 RON 60.8% BR
FEBRIS Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
First Leasing Service Center GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Floreasca City Center Verwaltung Kft., Budapest (HU) 41,000 HUF 60.8% FI
FMK Fachmarktcenter Kohlbruck Betriebs GmbH, Eschborn (DE) 30,678 EUR 94.4% FI
FMZ PRIMUS Ingatlanfejlesztö Kft., Budapest (HU) 3,000,000 HUF 100.0% OT
FWR Russia Funding B.V., Amsterdam (NL) 1 EUR <0.1% FI
GENO Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
HABITO Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Harmadik Vagyonkezelő Kft., Budapest (HU) 3,100,000 HUF 60.8% BR
Hietzinger-Spitz Projektentwicklung GmbH, Vienna (AT) 35,000 EUR 100.0% FI
HSL INVEST S.R.L., Ploiesti (RO) 27,207,600 RON 100.0% FI
IGNIS Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Immoservice Polska Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% OT
Infrastruktur Heilbad Sauerbrunn GmbH, Vienna (AT) 35,000 EUR 45.6% FI
Infrastruktur Heilbad Sauerbrunn RBI-Leasing GmbH & Co.KG., Bad Sauerbrunn (AT) 0 EUR 45.6% FI
INPROX Split d.o.o., Zagreb (HR) 100,000 HRK 100.0% OT
Inprox Zagreb Sesvete d.o.o., Zagreb (HR) 10,236,400 HRK 100.0% OT
Invest Vermögensverwaltungs-GmbH, Vienna (AT) 73,000 EUR 61.6% OT
JLLC "Raiffeisen-leasing", Minsk (BY) 430,025 BYN 55.6% FI
Kathrein Privatbank Aktiengesellschaft, Vienna (AT) 20,000,000 EUR 60.8% BA
KAURI Handels und Beteiligungs GmbH, Vienna (AT) 50,000 EUR 88.0% FI
KHD a.s., Prague (CZ) 2,000,000 CZK 100.0% OT
Kiinteistö Oy Automaatiotie 1, Helsinki (FI) 360,000 EUR 100.0% OT
Kiinteistö Oy Rovaniemen tietotekniikkakeskus, Helsinki (FI) 100,000 EUR 100.0% FI
Kiinteistö Oy Seinäjoen Joupinkatu 1, Helsinki (FI) 100,000 EUR 100.0% FI
Konevova s.r.o., Prague (CZ) 50,000,000 CZK 94.6% BR
Körlog Logistika Építö és Kivitelezö Korlátolt Feleösségü Társaság, Budapest (HU) 3,000,000 HUF 100.0% OT
KOTTO Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
LARENTIA Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Lentia Immobilienleasing GmbH & Co. Albert-Osswald-Haus KG, Eschborn (DE) 5,000 EUR 6.0% FI
Lexxus Services Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FH
LIBRA Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 36,400 EUR 100.0% FI
Limited Liability Company Raiffeisen Leasing Aval, Kiev (UA) 180,208,527 UAH 44.0% FI
LLC "ARES Nedvizhimost", Moscow (RU) 10,000 RUB 30.4% BR
Lucius Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
LYRA Raiffeisen Immobilien Leasing GmbH, Vienna (AT) 36,400 EUR 100.0% FI
MIRA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
MOBIX Raiffeisen-Mobilien-Leasing AG, Vienna (AT) 125,000 EUR 95.5% FI
MOBIX Vermögensverwaltungsges.m.b.H., Vienna (AT) 36,400 EUR 95.5% FI
MP Real Invest a.s., Bratislava (SK) 140,000,000 EUR 60.8% OT
Niederösterreichische Landes-Landwirtschaftskammer Errichtungs- und Betriebsgesellschaft m.b.H.,
Vienna (AT) 36,400 EUR 100.0% FI
1 Less own shares
firms, VV Insurance


Objekt Linser Areal Immobilienerrichtungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Objekt Linser Areal Immoblilienerrichtungs GmbH & Co. KG, Vienna (AT) 1,000 EUR 100.0% OT
OOO Raiffeisen-Leasing, Moscow (RU) 1,071,000,000 RUB 60.8% FI
OPORA Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Orestes Immobilienleasing GmbH & Co. Projekt Wiesbaden KG, Eschborn (DE) 5,000 EUR 6.0% FI
Ostarrichi Immobilienleasing GmbH & Co. Projekt Langenbach KG, Eschborn (DE) 5,000 EUR 100.0% FI
Park City real estate Holding d.o.o., Novi Sad (RS) 63,708 RSD 60.8% BR
PARO Raiffeisen Immobilien Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
PELIAS Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 36,400 EUR 100.0% FI
PERSES RBI Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% FI
PLANA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Pointon Investment Limited, Limassol (CY) 77,446 RUB 60.8% BR
Priamos Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Priorbank JSC, Minsk (BY) 86,147,909 BYN 53.4% BA
Propria Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 90.0% FI
R Karpo Immobilien Linie S.R.L., Bucharest (RO) 200 RON 100.0% OT
R.B.T. Beteiligungsgesellschaft m.b.H, Vienna (AT) 36,336 EUR 100.0% OT
R.P.I. Handels- und Beteiligungsgesellschaft m.b.H., Vienna (AT) 36,336 EUR 100.0% OT
Raiffeisen Banca pentru Locuinte S.A., Bucharest (RO) 131,074,560 RON 53.6% BA
Raiffeisen Bank Aval JSC, Kiev (UA) 6,154,516,258 UAH 41.4% BA
Raiffeisen Bank d.d. Bosna i Hercegovina, Sarajevo (BA) 247,167,000 BAM 60.8% BA
Raiffeisen Bank International AG, Vienna (AT) 893,586,066 EUR 60.8% BA
Raiffeisen Bank Kosovo J.S.C., Pristina (KO) 63,000,000 EUR 60.8% BA
Raiffeisen Bank Polska S.A., Warsaw (PL) 2,256,683,400 PLN 60.8% BA
Raiffeisen Bank S.A., Bucharest (RO) 1,200,000,000 RON 60.8% BA
Raiffeisen Bank Sh.a., Tirana (AL) 14,178,593,030 ALL 60.8% BA
Raiffeisen Bank Zrt., Budapest (HU) 50,000,090,000 HUF 60.8% BA
Raiffeisen banka a.d., Belgrade (RS) 27,466,157,580 RSD 60.8% BA
Raiffeisen Bausparkasse Gesellschaft m.b.H., Vienna (AT) 35,000,000 EUR 100.0% BA
Raiffeisen Bausparkassen Holding GmbH, Vienna (AT) 10,000,000 EUR 100.0% FH
Raiffeisen Burgenland Leasing GmbH, Vienna (AT) 38,000 EUR 100.0% FI
Raiffeisen CEE Region Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FH
Raiffeisen Centrobank AG, Vienna (AT) 47,598,850 EUR 60.8% BA
Raiffeisen CIS Region Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FH
Raiffeisen consulting d.o.o., Zagreb (HR) 105,347,000 HRK 60.8% FI
Raiffeisen Corporate Lízing Zrt., Budapest (HU) 50,100,000 HUF 60.8% BR
Raiffeisen Factor Bank AG, Vienna (AT) 10,000,000 EUR 100.0% FI
Raiffeisen Factoring Ltd., Zagreb (HR) 15,000,000 HRK 60.8% FI
Raiffeisen FinCorp, s.r.o., Prague (CZ) 200,000 CZK 53.2% FI
Raiffeisen Immobilienfonds, Vienna (AT) 0 EUR <0.1% FI
Raiffeisen International Beteiligungs GmbH, Vienna (AT) 1,000,000 EUR 100.0% FH
Raiffeisen International Invest Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FH
Raiffeisen International Liegenschaftsbesitz GmbH, Vienna (AT) 35,000 EUR 60.8% BR
Raiffeisen Kapitalanlage-Gesellschaft mit beschränkter Haftung, Vienna (AT) 15,000,000 EUR 100.0% BA
Raiffeisen Leasing Bulgaria OOD, Sofia (BG) 5,900,000 BGN 60.8% FI
Raiffeisen Leasing d.o.o., Belgrade (RS) 226,389,900 RSD 60.8% FI
Raiffeisen Leasing d.o.o., Ljubljana (SI) 3,738,107 EUR 60.8% FI
Raiffeisen Leasing d.o.o. Sarajevo, Sarajevo (BA) 15,405,899 BAM 60.8% FI
Raiffeisen Leasing IFN S.A., Bucharest (RO) 14,935,400 RON 60.8% FI
Raiffeisen Leasing Kosovo LLC, Pristina (KO) 642,857 EUR 60.8% FI
1 Less own shares
firms, VV Insurance


Raiffeisen Leasing sh.a., Tirana (AL) 263,520,134 ALL 60.8% FI
Raiffeisen Leasing-Projektfinanzierung Gesellschaft m.b.H., Vienna (AT) 72,673 EUR 100.0% FI
Raiffeisen Mandatory and Voluntary Pension Funds Management Company Plc., Zagreb (HR) 143,445,300 HRK 60.8% FI
Raiffeisen ÖHT Beteiligungs GmbH, Vienna (AT) 35,000 EUR 88.0% FI
Raiffeisen Pension Insurance d.d., Zagreb (HR) 23,100,000 HRK 60.8% VV
Raiffeisen Property Holding International GmbH, Vienna (AT) 35,000 EUR 60.8% FI
Raiffeisen Property International GmbH, Vienna (AT) 40,000 EUR 60.8% OT
Raiffeisen Property Management GmbH, Vienna (AT) 40,000 EUR 60.8% OT
Raiffeisen Real Estate Fund, Budapest (HU) 0 HUF <0.1% FI
Raiffeisen Rent DOO, Belgrade (RS) 243,099,913 RSD 60.8% FI
Raiffeisen RS Beteiligungs GmbH, Vienna (AT) 35,000 EUR 60.8% FH
Raiffeisen SEE Region Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FH
Raiffeisen stambena stedionica d.d., Zagreb (HR) 180,000,000 HRK 60.8% BA
Raiffeisen stavebni sporitelna, a.s., Prague (CZ) 650,000,000 CZK 94.6% BA
Raiffeisen Wohnbaubank Aktiengesellschaft, Vienna (AT) 5,100,000 EUR 100.0% BA
Raiffeisen-Anlagenvermietung Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Raiffeisenbank (Bulgaria) EAD, Sofia (BG) 603,447,952 BGN 60.8% BA
Raiffeisenbank a.s., Prague (CZ) 11,060,800,000 CZK 45.6% BA
Raiffeisenbank Austria d.d., Zagreb (HR) 3,621,432,000 HRK 60.8% BA
Raiffeisen-Gemeindegebäudeleasing Gesellschaft m.b.H., Vienna (AT) 35,000 EUR 100.0% FI
Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Raiffeisen-Invest-Gesellschaft m.b.H., Vienna (AT) 40,000 EUR 100.0% FI
Raiffeisen-Kommunalgebäudeleasing Gesellschaft m.b.H., Vienna (AT) 35,000 EUR 100.0% FI
Raiffeisen-Leasing Aircraft Finance GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Raiffeisen-Leasing Bank Aktiengesellschaft, Vienna (AT) 5,000,000 EUR 100.0% BA
Raiffeisen-Leasing Beteiligung GesmbH, Vienna (AT) 36,400 EUR 100.0% FI
Raiffeisen-Leasing d.o.o., Zagreb (HR) 30,000,000 HRK 60.8% FI
Raiffeisen-Leasing Fuhrparkmanagement Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% OT
Raiffeisen-Leasing Gesellschaft m.b.H., Vienna (AT) 363,364 EUR 100.0% FI
Raiffeisen-Leasing Immobilienmanagement Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FH
Raiffeisen-Leasing Immobilienverwaltung Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% OT
Raiffeisen-Leasing International Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 60.8% FI
Raiffeisen-Leasing Liegenschaftsverwaltung Kraußstraße Gesellschaft m.b.H., Vienna (AT) 35,000 EUR 70.0% FI
Raiffeisen-Leasing Lithuania UAB, Vilnius (LT) 100,000 EUR 56.1% FI
Raiffeisen-Leasing, s.r.o., Prague (CZ) 450,000,000 CZK 53.2% FI
Raiffeisen-RBHU Holding GmbH, Vienna (AT) 236,640 EUR 60.8% FH
Raiffeisen-Rent Immobilienprojektentwicklung Gesellschaft m.b.H. Objekt Wallgasse 12 KG, Vienna
(AT) 4,886,449 EUR 30.0% OT
Raiffeisen-Rent-ImmobilienprojektentwicklungsgmbH.,Objekt Lenaugasse 11 KG, Vienna (AT) 6,169,924 EUR 30.0% OT
Raiffeisen-Wagramer Straße 120 Projektentwicklungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RALT Raiffeisen-Leasing Gesellschaft m.b.H., Vienna (AT) 218,500 EUR 100.0% FI
RALT Raiffeisen-Leasing Gesellschaft m.b.H. & Co. KG, Vienna (AT) 20,348,394 EUR 100.0% BR
RAN elf Raiffeisen-Anlagenvermietung Ges.m.b.H., Vienna (AT) 36,336 EUR 100.0% FI
RAN vierzehn Raiffeisen-Anlagevermietung GmbH, Vienna (AT) 36,336 EUR 100.0% FI
RAN zehn Raiffeisen-Anlagenvermietung Ges.m.b.H., Vienna (AT) 36,336 EUR 100.0% FI
RB International Finance (Hong Kong) Ltd., Hong Kong (HK) 10,000,000 HKD 60.8% FI
RB International Finance (USA) LLC, New York (US) 1,510,000 USD 60.8% FI
RB International Investment Asia Limited, Labuan (MY) 1 USD 60.8% FI
RB International Markets (USA) LLC, New York (US) 8,000,000 USD 60.8% FI
RBI KI Beteiligungs GmbH, Vienna (AT) 48,000 EUR 60.8% FH
RBI eins Leasing Holding GmbH, Vienna (AT) 35,000 EUR 45.6% FI
1 Less own shares
firms, VV Insurance


RBI IB Beteiligungs GmbH, Vienna (AT) 35,000 EUR 60.8% FH
RBI ITS Leasing-Immobilien GmbH, Vienna (AT) 35,000 EUR 45.6% FI
RBI LEA Beteiligungs GmbH, Vienna (AT) 70,000 EUR 60.8% FI
RBI Leasing GmbH, Vienna (AT) 100,000 EUR 45.6% FI
RBI LGG Holding GmbH, Vienna (AT) 35,000 EUR 60.8% FI
RBI PE Handels- und Beteiligungs GmbH, Vienna (AT) 150,000 EUR 60.8% FI
REC Alpha LLC, Kiev (UA) 267,643,204 UAH 60.8% BR
Regional Card Processing Center s.r.o., Bratislava (SK) 539,465 EUR 60.8% BR
REMUS Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Rent Impex, s.r.o., Bratislava (SK) 6,639 EUR 100.0% FI
RIL IV Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RIL VII Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RIL XIII Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RIL XIV Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RIRE Holding GmbH, Vienna (AT) 35,000 EUR 60.8% BR
RL Anlagenvermietung Gesellschaft m.b.H., Eschborn (DE) 50,000 DEM 100.0% FI
RL Flussschifffahrts GmbH & Co KG, Vienna (AT) 5,000 EUR <0.1% FI
RL Gamma d.o.o., Zagreb (HR) 20,000 HRK 100.0% FI
RL Grundstückverwaltung Klagenfurt-Süd GmbH, Vienna (AT) 35,000 EUR 100.0% FI
RL Hotel Palace Wien Besitz GmbH, Vienna (AT) 36,336 EUR 99.0% FI
RL LUX Holding S.a.r.l., Luxembourg (LU) 12,500 EUR 100.0% OT
RL Retail Holding GmbH, Vienna (AT) 36,000 EUR 100.0% FI
RL Thermal Beteiligungen GmbH, Vienna (AT) 35,000 EUR 100.0% FI
RL Thermal GmbH, Vienna (AT) 36,336 EUR 100.0% FI
RL Thermal GmbH & Co Liegenschaftsverwaltung KG, Vienna (AT) 1,453,457 EUR 100.0% FI
RL Wohnbau-Projektentwicklungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-ALPHA Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-BETA Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-Epsilon Holding GmbH, Vienna (AT) 35,000 EUR 100.0% FI
RL-Epsilon Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% FI
RL-Gamma Holding GmbH, Vienna (AT) 35,000 EUR 100.0% FI
RLI Holding Gesellschaft m.b.H., Vienna (AT) 40,000 EUR 60.8% FI
RL-Jota Holding GmbH, Vienna (AT) 35,000 EUR 100.0% FI
RL-Jota Sp.z o.o., Warsaw (PL) 50,000 PLN 100.0% FI
RL-Mörby AB, Stockholm (SE) 100,000 SEK 100.0% FI
RL-Nordic AB, Stockholm (SE) 50,000,000 SEK 100.0% FI
RL-Nordic Finans AB, Stockholm (SE) 100,000 SEK 100.0% FI
RL-Nordic OY, Helsinki (FI) 100,000 EUR 100.0% FI
RL-Pro Auxo Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% FI
RL-PROMITOR Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-PROMITOR Spolka z.o.o., Warsaw (PL) 50,000 PLN 100.0% OT
RL-Prom-Wald Sp. Z.o.o, Warsaw (PL) 50,000 PLN 100.0% OT
RLX Dvorak S.A., Luxembourg (LU) 31,000 EUR 100.0% OT
RUBRA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RZB - BLS Holding GmbH, Vienna (AT) 500,000 EUR 100.0% FI
RZB Finance (Jersey) III Ltd, St Helier (JE) 1,000 EUR 60.8% FI
RZB Finance (Jersey) IV Limited, St Helier (JE) 2,000 EUR 60.8% FI
RZB Invest Holding GmbH, Vienna (AT) 500,000 EUR 100.0% FH
RZB Sektorbeteiligung GmbH, Vienna (AT) 100,000 EUR 100.0% FH
RZB Versicherungsbeteiligung GmbH, Vienna (AT) 500,000 EUR 100.0% FI
1 Less own shares
firms, VV Insurance


S.C. PLUSFINANCE ESTATE 1 S.R.L., Bucharest (RO) 13,743,340 RON 60.8% BR
SALVELINUS Handels- und Beteiligungsgesellschaft m.b.H, Vienna (AT) 40,000 EUR 100.0% FI
SAMARA Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
SCTE Elsö Ingatlanfejlesztö és Ingatlanhasznosító Kft., Budapest (HU) 3,000,000 HUF 100.0% OT
SF Hotelerrichtungsgesellschaft m.b.H., Vienna (AT) 36,336 EUR 100.0% FI
SINIS Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 35,000 EUR 100.0% FI
Sky Tower Immobilien- und Verwaltung Kft, Budapest (HU) 41,000 HUF 60.8% OT
Skytower Building SRL, Bucharest (RO) 126,661,500 RON 60.8% OT
SOLAR II Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
SOLIDA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 50.5% FI
SPICA Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
'S-SPV'' d.o.o. Sarajevo, Sarajevo (BA) 2,000 BAM 60.8% FI
Styria Immobilienleasing GmbH & Co. Projekt Ahlen KG, Eschborn (DE) 5,000 EUR 6.0% FI
Tatra Asset Management, správ. spol., a.s., Bratislava (SK) 1,659,700 EUR 47.9% FI
Tatra banka, a.s., Bratislava (SK) 64,326,228 EUR 47.9% BA
Tatra Residence, a.s., Bratislava (SK) 21,420,423 EUR 47.9% BR
Tatra-Leasing, s.r.o., Bratislava (SK) 6,638,785 EUR 47.9% FI
THYMO Raiffeisen-Leasing Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 100.0% FI
TOO Raiffeisen Leasing Kazakhstan, Almaty (KZ) 85,800,000 KZT 60.8% FI
Ukrainian Processing Center PJSC, Kiev (UA) 180,000 UAH 60.8% BR
Unterinntaler Raiffeisen-Leasing GmbH & Co KG, Vienna (AT) 36,336 EUR 100.0% FI
URSA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Valida Holding AG, Vienna (AT) 5,000,000 EUR 57.4% FI
Valida Industrie Pensionskasse AG, Vienna (AT) 5,000,062 EUR 57.4% OT
Valida Pension AG, Vienna (AT) 10,200,000 EUR 57.4% OT
Valida Plus AG, Vienna (AT) 5,500,000 EUR 57.4% BA
Viktor Property, s.r.o., Prague (CZ) 200,000 CZK 53.2% OT
Vindalo Properties Limited, Limassol (CY) 67,998 RUB 60.8% BR
Vindobona Immobilienleasing GmbH & Co. Projekt Autohaus KG, Eschborn (DE) 5,000 EUR 6.0% FI
WEGA Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
ZHS Office- & Facilitymanagement GmbH, Vienna (AT) 36,336 EUR 98.1% BR
ZUNO BANK AG, Vienna (AT) 5,000,000 EUR 60.8% BA
1 Less own shares
firms, VV Insurance
Structured units
The following tables show, by type of structured entity, the carrying amounts of the Group’s interests recognized in the consolidat-
ed statement of financial position as well as the maximum exposure to loss resulting from these interests. The carrying amounts
presented below do not reflect the true variability of returns faced by the Group because they do not take into account the effects
of collateral or hedges.
Assets
2016
in € thousand Loans and advances Equity instuments Debt Instruments Derivatives
Securitization vehicles 315,147 0 389,813 0
Third party funding entities 225,368 2,689 0 0
Funds 0 48,004 0 0
Total 540,514 50,693 389,813 0
2015
in € thousand Loans and advances Equity instuments Debt Instruments Derivatives
Third party funding entities 183,032 18,274 0 0
Funds 0 29,922 0 0
Total 408,211 48,195 451,637 0

Liabilities
2016
in € thousand Deposits Equity instuments Debt securities issued Derivatives
Securitization vehicles 330 0 0 0
Third party funding entities 22,219 0 0 1,051
Funds 0 0 0 956
Total 22,550 0 0 2,007
2015
in € thousand Deposits Equity instuments Debt securities issued Derivatives
Third party funding entities 31,925 0 0 1,118
Total 32,987 0 22,628 1,118
Nature, purpose and extent of the Group’s interests in non-consolidated structured entities
RZB engages in various business activities with structured entities which are designed to achieve a specific business purpose. A
structured entity is one that has been set up so that any voting rights or similar rights are not the dominant factor in deciding who
controls the entity. An example is when voting rights relate only to administrative tasks and the relevant activities are directed by
contractual arrangements.
A structured entity often has some or all of the following features or attributes:
 Restricted activities;
 A narrow and well defined objective;
 Insufficient equity to permit the structured entity to finance its activities without subordinated financial support;
 Financing in the form of multiple contractually linked instruments to investors that create concentrations of credit or other risks
(tranches).
The principal uses of structured entities are to provide clients with access to specific portfolios of assets and to provide market
liquidity for clients through securitizing financial assets. Structured entities may be established as corporations, trusts or partner-
ships. Structured entities generally finance the purchase of assets by issuing debt and equity securities that are collateralized by
and/or indexed to the assets held by the structured entities.
Structured entities are consolidated when the substance of the relationship between the Group and the structured entities indicate
that the structured entities are controlled by the Group.
Below is a description of the Group’s involvements in unconsolidated structured entities by type.
Third party funding entities
The Group provides funding to structured entities that hold a variety of assets. These entities may take the form of funding entities,
trusts and private investment companies. The funding is collateralized by the asset in the structured entities. The group’s involvement
involves predominantly lending.
Securitization vehicles
The Group establishes securitization vehicles which purchase diversified pools of assets, including fixed income securities, corpo-
rate loans, and asset backed securities (predominantly commercial and residential mortgage-backed securities and credit card
receivables). The vehicles fund these purchases by issuing multiple tranches of debt and equity securities, the repayment of which is
linked to the performance of the assets in the vehicles.
The Group often transfers assets to these securitization vehicles and provide financial support to these entities in the form of liquidi-
ty facilities.

Funds
The Group establishes structured entities to accommodate client requirements to hold investments in specific assets. The Group
also invests in funds that are sponsored by third parties. A group entity may act as fund manager, custodian or some other capaci-
ty and provide funding and liquidity facilities to both group sponsored and third party funds. The funding provided is collateralized
by the underlying assets held by the fund.
Maximum exposure to and size of non-consolidated structured entities
The maximum exposure to loss is determined by considering the nature of the interest in the unconsolidated structured entity. The
maximum exposure for loans and trading instruments is reflected by their carrying amounts in the consolidated balance sheet. The
maximum exposure for derivatives and off balance sheet instruments such as guarantees, liquidity facilities and loan commitments
under IFRS 12, as interpreted by the Group, is reflected by the notional amounts. Such amounts do not reflect the economic risks
faced by the Group because they take into account neither the effects of collateral or hedges nor the probability of such losses
being incurred. At 31 December 2016, the notional related replacement values of derivatives and off balance sheet instruments
were € 27,822 thousand (2015: € 29,064 thousand) and € 95,292 thousand (2015: € 104,682 thousand) respectively. Size
information of Structured Entities is not always publically available therefore the Group has determined that its exposure is an
appropriate guide to size.
Financial support
The Group provided contractual support during the year to unconsolidated structured entities which has a carrying value of
€ 3,420 thousand as at 31 December 2016.
Sponsored structured entities
As a sponsor, the Group is often involved in the legal set up and marketing of the entity and supports the entity in different ways
such as providing operational support to ensure the entity’s continued operation.
The Group is also deemed a sponsor for a structured entity if market participants would reasonably associate the entity with the
Group. Additionally, the use of the “Raiffeisen” name for the structured entity often indicates that the Group has acted as a sponsor.
The gross revenues from sponsored entities for the year ending 31 December 2016 was € 185,587 thousand (2015: € 215,882
thousand) consisting primarily of management fees earned as Investment Manager of a number of funds.
No assets were transferred to sponsored unconsolidated structured entities in 2016 or 2015.
(54) List of equity participations

Companies valued at equity
Company, domicile (country) Subscribed capital in local currency Share Type1

card complete Service Bank AG, Vienna (AT) 6,000,000 EUR 25.0% BA
LEIPNIK-LUNDENBURGER INVEST Beteiligungs Aktiengesellschaft, Vienna (AT) 32,624,283 EUR 33.1% OT
NOTARTREUHANDBANK AG, Vienna (AT) 8,030,000 EUR 26.0% BA
Oesterreichische Kontrollbank Aktiengesellschaft, Vienna (AT) 130,000,000 EUR 8.1% BA
Österreichische Hotel- und Tourismusbank Gesellschaft m.b.H., Vienna (AT) 11,627,653 EUR 31.3% BA
Posojilnica Bank eGen, Klagenfurt (AT) 39,129,606 EUR 58.0% BA
Prva stavebna sporitelna a.s., Bratislava (SK) 66,500,000 EUR 32.5% BA
Raiffeisen Informatik GmbH, Vienna (AT) 1,460,000 EUR 47.6% BR
UNIQA Insurance Group AG, Vienna (AT) 309,000,000 EUR 10.9% VV
firms, VV Insurance

Other affiliated companies

"A-SPV" d.o.o. Sarajevo, Sarajevo (BA) 2,000 BAM 100.0% FI
"Immobilien Invest" Limited Liability Company, Moscow (RU) 10,000 RUB 100.0% BR
"K-SPV" d.o.o. Sarajevo, Sarajevo (BA) 2,000 BAM 100.0% FI
Abakus Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Abrawiza Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Abri Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Abri Immobilienleasing GmbH & Co. Projekt Hotel Heidelberg KG, Eschborn (DE) 10,000 EUR 50.0% OT
Abura Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Abutilon Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Achat Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Acridin Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adamas Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adessentia Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Adiantum Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adipes Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Adorant Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adrett Immobilienleasing GmbH, Eschborn (DE) 125,000 EUR 100.0% OT
Adrittura Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adufe Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Adular Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
AELLO Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Afrodite Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Agamemnon Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
ALT POHLEDY s.r.o., Prague (CZ) 84,657,000 CZK 100.0% OT
Amfion Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Angaga Handels- und Beteiligungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Appolon Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
ARTEMIA Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Aspius Immobilien Holding International GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Astra Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Athena Property, s.r.o. v likvidaci, Prague (CZ) 200,000 CZK 100.0% OT
Austria Leasing GmbH & Co KG Immobilienverwaltung Projekt EKZ Meitingen, Eschborn (DE) 10,000 EUR 100.0% OT
Austria Leasing GmbH & Co. KG Immobilienverwaltung Projekt Eberdingen, Eschborn (DE) 10,000 EUR 100.0% FI
BA Development II., s.r.o., Bratislava (SK) 6,639 EUR 100.0% OT
BA Development, s.r.o., Bratislava (SK) 6,639 EUR 100.0% OT
Bandos Handels- und Beteiligungs GmbH, Vienna (AT) 40,000 EUR 100.0% OT
Boreas Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
BRL Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Eisenstadt (AT) 73,000 EUR 100.0% FI
BUXUS Handels- und Beteiligungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Centralised Raiffeisen International Services & Payments S.R.L., Bucharest (RO) 2,820,000 RON 100.0% BR
Centrotrade Chemicals AG - in liquidation, Zug (CH) 5,000,000 CHF 100.0% OT
Centrotrade Holding GmbH, Vienna (AT) 3,000,000 EUR 100.0% OT
Chronos Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
CP Linzerstraße 221-227 Projektentwicklungs GmbH, Vienna (AT) 37,000 EUR 100.0% OT
CP Logistikcenter Errichtungs- und Verwaltungs GmbH, Vienna (AT) 37,000 EUR 100.0% OT
CP Projekte Muthgasse Entwicklungs GmbH, Vienna (AT) 40,000 EUR 100.0% OT
Credibilis a.s., Prague (CZ) 2,000,000 CZK 100.0% OT
CRISTAL PALACE Property s.r.o., Prague (CZ) 400,000 CZK 100.0% FI
Dafne Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
DAV Depo Projekt Korlátolt Felelősségű Társaság, Budapest (HU) 3,000,000 HUF 100.0% OT
firms, VV Insurance


DAV Management Kft., Budapest (HU) 3,010,000 HUF 100.0% BR
DAV-ESTATE Kft., Budapest (HU) 3,030,000 HUF 100.0% BR
DAV-LAND Kft., Budapest (HU) 3,020,000 HUF 100.0% BR
DAV-OUTLET Kft., Budapest (HU) 3,020,000 HUF 100.0% OT
Dike Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Dobré Bývanie s.r.o., Bratislava (SK) 6,639 EUR 100.0% OT
Dom-office 2000, Minsk (BY) 283,478 BYN 100.0% OT
Don Giovanni Properties, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Doplnková dôchodková spoločnosť Tatra banky, a.s., Bratislava (SK) 1,659,700 EUR 100.0% FI
DORISCUS ENTERPRISES LTD., Limassol (CY) 18,643,400 EUR 86.6% OT
Dúbravčice, s.r.o., Bratislava (SK) 5,000 EUR 100.0% FI
Eastern European Invest GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Eastern European Invest Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Easy Develop s.r.o., Prague (CZ) 200,000 CZK 100.0% SC
Eos Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Erato Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Eris Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Euro Green Energy Fejlesztő és Szolgáltató Kft., Budapest (HU) 14,490,000 HUF 100.0% OT
Eurolease RE Leasing, s. r. o., Bratislava (SK) 6,125,256 EUR 100.0% OT
Euros Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Euterpe Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Exit 90 SPV s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Extra Year Investments Limited, Tortola (VG) 50,000 USD 100.0% FH
FARIO Handels- und Beteiligungsgesellschaft m.b.H., Vienna (AT) 40,000 EUR 100.0% OT
Faru Handels- und Beteiligungs GmbH, Vienna (AT) 80,000 EUR 100.0% OT
Forkys Property, s.r.o., Prague (CZ) 0 CZK <0.1% OT
FORZA SOLE s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
FURIAE Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
FVE Cihelna s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Gaia Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Gala Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Gergely u. Ingatlanfejlesztő Kft., Budapest (HU) 3,010,000 HUF 100.0% OT
Golden Rainbow International Limited, Tortola (VG) 1 SGD 100.0% FI
Grainulos s.r.o., Prague (CZ) 1 CZK 100.0% FI
GS55 Sazovice s.r.o., Prague (CZ) 15,558,000 CZK 90.0% OT
Harmonia Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Hebe Property, s.r.o., Prague (CZ) 200,000 CZK 95.0% OT
HERA Raiffeisen Immobilien Leasing GmbH, Vienna (AT) 36,400 EUR 49.0% FI
Hermes Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Hestia Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
HESTIA Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 36,400 EUR 50.5% FI
Holeckova Property s.r.o., Prague (CZ) 210,000 CZK 100.0% FI
Humanitarian Fund ''Budimir Bosko Kostic'', Belgrade (RS) 30,000 RSD 100.0% OT
Hyperion Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Hypnos Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
ICS Raiffeisen Leasing s.r.l, Chisinau (MD) 8,307,535 MDL 100.0% FI
ICTALURUS Handels- und Beteiligungs GmbH, Vienna (AT) 36,336 EUR 100.0% FI
IDUS Handels- und Beteiligungs GmbH, Vienna (AT) 40,000 EUR 100.0% OT
INFRA MI 1 Immobilien Gesellschaft mbH, Vienna (AT) 1,000,000 EUR 100.0% OT
Ino Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
firms, VV Insurance


Iris Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
ISIS Raiffeisen Immobilien Leasing GmbH, Vienna (AT) 36,400 EUR 100.0% FI
Janus Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Kalypso Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
KAPMC s.r.o., Prague (CZ) 100,000 CZK 100.0% OT
Kappa Estates s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Kathrein & Co Life Settlement Gesellschaft m.b.H., Vienna (AT) 35,000 EUR 100.0% OT
Kathrein & Co. Private Equity I AG, Vienna (AT) 190,000 EUR 100.0% OT
Kathrein & Co. Trust Holding GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Kathrein Capital Management GmbH, Vienna (AT) 1,000,000 EUR 100.0% FI
KIWANDA Handels- und Beteiligungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Kleio Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Laomedon Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% FI
Leasing Poland Sp.z.o.o., Warsaw (PL) 19,769,500 PLN 100.0% FI
LENTIA Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Leto Property, s.r.o., Prague (CZ) 200,000 CZK 77.0% OT
Limited Liability Company European Insurance Agency, Moscow (RU) 120,000 RUB 100.0% OT
Limited Liability Company REC GAMMA, Kiev (UA) 49,015,000 UAH 100.0% BR
LOTA Handels- und Beteiligungs-GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Luna Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Lysithea a.s., Prague (CZ) 2,000,000 CZK 100.0% OT
Mall Varna EAD, Sofia (BG) 146,700,000 BGN 100.0% OT
MAMONT GmbH, Kiev (UA) 44,000 UAH 100.0% OT
Medea Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Melete Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
MELIKERTES Raiffeisen-Mobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 80.0% FI
Melpomene Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
MENARAI Holding GmbH, Vienna (AT) 35,000 EUR <0.1% OT
Michalka - Sun s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Morfeus Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
MORHUA Handels- und Beteiligungs GmbH, Vienna (AT) 36,336 EUR 100.0% OT
MOVEO Raiffeisen-Leasing GmbH, Vienna (AT) 35,000 EUR 51.0% FI
Na Starce, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
NAURU Handels- und Beteiligungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
NC Ivancice, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Neptun Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Nike Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Niobe Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Nußdorf Immobilienverwaltung GmbH, Vienna (AT) 36,336 EUR 100.0% OT
OCTANOS Raiffeisen Immobilien Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Ofion Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
ÖKO-Drive Fuhrparkmanagement GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Onyx Energy Projekt II s.r.o., Prague (CZ) 210,000 CZK 100.0% OT
Onyx Energy s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
OOO "Vneshleasing", Moscow (RU) 131,770 RUB 100.0% FI
OOO Raiffeisen Capital Asset Management Company, Moscow (RU) 225,000,000 RUB 100.0% FI
OOO SB "Studia Strahovania", Minsk (BY) 34,924 BYN 100.0% OT
Orchideus Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Orestes Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
ORION Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
firms, VV Insurance


OSTARRICHI Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Ötödik Vagyonkezelő Kft., Budapest (HU) 9,510,000 HUF 100.0% FI
P & C Beteiligungs Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 100.0% OT
Palace Holding s.r.o., Prague (CZ) 2,700,000 CZK 90.0% FI
PEGA Raiffeisen-Immobilien Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Peito Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Photon Energie s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Photon SPV 10 s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
PHOXIUS Handels- und Beteiligungsgesellschaft m.b.H., Vienna (AT) 40,000 EUR 100.0% OT
PILSENINEST SICAV, a.s., Prague (CZ) 212,000,000 CZK 100.0% OT
PLUSFINANCE LAND S.R.L., Bucharest (RO) 1,000 RON 100.0% BR
PLUSFINANCE OFFICE S.R.L., Bucharest (RO) 1,000 RON 100.0% BR
PLUSFINANCE RESIDENTIAL S.R.L., Bucharest (RO) 1,000 RON 100.0% BR
Pontos Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Priapos Property, s.r.o., Prague (CZ) 0 CZK <0.1% OT
Pro Invest da Vinci e.o.o.d., Sofia (BG) 5,000 BGN 100.0% OT
PRODEAL, a.s., Bratislava (SK) 796,654 EUR 100.0% FI
Production unitary enterprise "PriortransAgro", Minsk (BY) 50,000 BYN 100.0% OT
PROKNE Raiffeisen-Immobilien-Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
PZ PROJEKT a.s., Prague (CZ) 2,000,000 CZK 100.0% OT
Queens Garden Sp z.o.o., Warsaw (PL) 100,000 PLN 100.0% FI
R LUX IMMOBILIEN LINIE S.R.L., Timisoara (RO) 50,000 RON 100.0% OT
R MORMO IMMOBILIEN LINIE S.R.L., Bucharest (RO) 50,000 RON 100.0% OT
R.L.H. Holding GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Raiffeisen (Beijing) Investment Management Co., Ltd., Beijing (CN) 2,000,000 CNH 100.0% FI
Raiffeisen Asset Management (Bulgaria) EAD, Sofia (BG) 250,000 BGN 100.0% FI
Raiffeisen Assistance D.O.O., Beograd, Belgrade (RS) 4,307,115 RSD 100.0% OT
Raiffeisen Assistance doo Sarajevo, Sarajevo (BA) 4,000 BAM 100.0% BR
Raiffeisen Autó Lízing Kft., Budapest (HU) 3,000,000 HUF 100.0% FI
Raiffeisen Befektetési Alapkezelõ Zrt., Budapest (HU) 100,000,000 HUF 100.0% FI
Raiffeisen Biztosításközvetítö Kft., Budapest (HU) 5,000,000 HUF 100.0% BR
Raiffeisen Bonus Ltd., Zagreb (HR) 200,000 HRK 100.0% BR
Raiffeisen Capital a.d. Banja Luka, Banja Luka (BA) 355,000 BAM 100.0% BR
Raiffeisen Direct Investments CZ s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
Raiffeisen Energiaszolgáltató Kft., Budapest (HU) 3,000,000 HUF 100.0% OT
Raiffeisen Financial Services Polska Sp. z o.o., Warsaw (PL) 4,657,500 PLN 100.0% FI
Raiffeisen Future AD Beograd drustvo za upravljanje dobrovoljnim penzijskim fondom, Belgrade (RS) 143,204,921 RSD 100.0% FI
Raiffeisen Gazdasági Szolgáltató Zrt., Budapest (HU) 20,099,879 HUF 100.0% FI
Raiffeisen Immobilien Kapitalanlage-Gesellschaft m.b.H., Vienna (AT) 5,000,000 EUR 100.0% BA
Raiffeisen Ingatlan Üzemeltető Kft., Budapest (HU) 3,000,000 HUF 100.0% OT
Raiffeisen Ingatlan Vagyonkezelő Kft., Budapest (HU) 3,110,000 HUF 100.0% BR
Raiffeisen Insurance and Reinsurance Broker S.R.L, Bucharest (RO) 180,000 RON 100.0% BR
RAIFFEISEN INSURANCE BROKER EOOD, Sofia (BG) 5,000 BGN 100.0% BR
Raiffeisen Insurance Broker Kosovo L.L.C., Pristina (KO) 10,000 EUR 100.0% BR
RAIFFEISEN INVEST AD DRUSTVO ZA UPRAVLJANJE INVESTICIONIM FONDOVIMA
BEOGRAD, Belgrade (RS) 47,662,692 RSD 100.0% FI
firms, VV Insurance


Raiffeisen Invest d.o.o., Zagreb (HR) 8,000,000 HRK 100.0% FI
Raiffeisen Invest Drustvo za upravljanje fondovima d.o.o Sarajevo, Sarajevo (BA) 945,424 BAM 100.0% BR
Raiffeisen INVEST Sh.a., Tirana (AL) 90,000,000 ALL 100.0% FI
Raiffeisen investicni spolecnost a.s., Prague (CZ) 40,000,000 CZK 100.0% SC
Raiffeisen Investment Advisory GmbH, Vienna (AT) 730,000 EUR 100.0% FI
Raiffeisen Investment Financial Advisory Services Ltd. Co., Istanbul (TR) 2,930,000 TRY 99.0% FI
Raiffeisen Investment Polska sp.z.o.o., Warsaw (PL) 3,024,000 PLN 100.0% FI
Raiffeisen Investment Ukraine TOV - in liquidation, Kiev (UA) 3,733,213 UAH 100.0% FI
Raiffeisen KOIOS Leasing GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Raiffeisen Property Management Bulgaria EOOD, Sofia (BG) 80,000 BGN 100.0% OT
Raiffeisen Property Management spol.s.r.o., Prague (CZ) 100,000 CZK 100.0% OT
Raiffeisen Quality Living WEST GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Raiffeisen Salzburg Invest Kapitalanlage GmbH, Salzburg (AT) 2,600,000 EUR 75.0% BA
RAIFFEISEN SERVICE EOOD, Sofia (BG) 4,220,000 BGL 100.0% OT
Raiffeisen Services SRL, Bucharest (RO) 30,000 RON 100.0% OT
Raiffeisen Solutions Spółka z ograniczoną odpowiedzialnością, Warsaw (PL) 550,000 PLN 100.0% FI
RAIFFEISEN SPECIAL ASSETS COMPANY d.o.o. Sarajevo (in liquidation), Sarajevo (BA) 1,982,591 BAM 100.0% FI
Raiffeisen Towarzystwo Funduszy Inwestycyjnych S.A., Warsaw (PL) 4,000,000 PLN 100.0% OT
Raiffeisen Verbundunternehmen-IT GmbH, Vienna (AT) 100,000 EUR 100.0% BR
Raiffeisen Windpark Zistersdorf GmbH, Vienna (AT) 37,000 EUR 100.0% OT
Raiffeisen Wohnbauleasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
Raiffeisen-Leasing Gesellschaft m.b.H. & Co KG, Vienna (AT) 581,383 EUR 100.0% OT
Raiffeisen-Leasing Wärmeversorgungsanlagenbetriebs GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Raiffeisen-Wohnbauleasing Österreich GmbH, Vienna (AT) 35,000 EUR 100.0% FI
Rail-Rent-Holding GmbH in Liqu., Vienna (AT) 40,000 EUR 100.0% OT
Ratio Holding Gesellschaft mit beschränkter Haftung, Vienna (AT) 40,000 EUR 100.0% OT
RB Kereskedhőáz Kft., Budapest (HU) 4,000,000 HUF 100.0% BR
RB Szolgáltató Központ Kft. - RBSC Kft., Nyíregyháza (HU) 3,000,000 HUF 100.0% BR
RBI Vajnoria spol.s.r.o., Bratislava (SK) 5,000 EUR 100.0% OT
RBM Wohnbau Ges.m.b.H., Vienna (AT) 37,000 EUR 100.0% OT
RCR Ukraine LLC, Kiev (UA) 282,699 UAH 100.0% BR
RDI Czech 1 s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
RDI Czech 3 s.r.o, Prague (CZ) 200,000 CZK 100.0% OT
RDI Czech 6 s.r.o, Prague (CZ) 3,700,000 CZK 100.0% OT
RDI Management s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Real Estate Rent 4 DOO, Belgrade (RS) 40,310 RSD 100.0% FI
Realplan Alpha Liegenschaftsverwaltung Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 100.0% OT
Rent CC, s.r.o., Bratislava (SK) 6,639 EUR 100.0% FI
Rent GRJ, s.r.o., Bratislava (SK) 6,639 EUR 100.0% OT
Rent PO, s.r.o., Bratislava (SK) 6,639 EUR 100.0% FI
Residence Park Trebes, s.r.o., Prague (CZ) 20,000,000 CZK 100.0% OT
Rheia Property, s.r.o., Prague (CZ) 200,000 CZK 95.0% OT
RIL VI Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
RILREU Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 100.0% FI
RIRBRO ESTATE MANAGEMENT S.R.L., Bucharest (RO) 1,000 RON 100.0% BR
RL Jankomir d.o.o., Zagreb (HR) 20,000 HRK 100.0% OT
RL Leasing Gesellschaft m.b.H., Eschborn (DE) 25,565 EUR 85.0% FI
RL Schiffvermietungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
firms, VV Insurance


RL-Assets Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% OT
RL-ATTIS Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-Attis Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% OT
RL-Delta Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-ETA d.o.o., Zagreb (HR) 20,000 HRK 100.0% OT
RL-ETA Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-FONTUS Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-Fontus Sp.z.o.o., Warsaw (PL) 50,000 PLN 100.0% OT
RL-Lamda s.r.o., Bratislava (SK) 6,639 EUR 100.0% FI
RL-Lux Ingatlan Kft., Budapest (HU) 3,100,000 HUF 100.0% OT
RL-Opis Holding GmbH, Vienna (AT) 35,000 EUR 100.0% OT
RL-OPIS SPOLKA Z OGRANICZONA ODPOWIEDZIALNOSCIA, Warsaw (PL) 50,000 PLN 100.0% OT
RLRE Beta Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
RLRE Carina Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
RLRE Dorado Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
RLRE Eta Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
RLRE Hotel Ellen, s.r.o., Prague (CZ) 100,000 CZK 100.0% FI
RLRE Jota Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
RLRE Orion Property s.r.o., Prague (CZ) 465,000 CZK <0.1% FI
RLRE Ypsilon Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
Robert Károly Körút Irodaház Kft., Budapest (HU) 3,000,000 HUF 100.0% OT
Rogofield Property Limited, Nicosia (CY) 2,174 USD 100.0% OT
ROOF Poland Leasing 2014 Ltd, Dublin (IE) 1 EUR <0.1% FI
Roof Russia DPR Finance Company S.A., Luxembourg (LU) 50,000 EUR <0.1% FI
RPM Budapest KFT, Budapest (HU) 3,000,000 HUF 100.0% OT
RPN Verwaltungs GmbH, Vienna (AT) 37,464 EUR 100.0% OT
S.A.I. Raiffeisen Asset Management S.A., Bucharest (RO) 10,656,000 RON 100.0% FI
SAM-House Kft, Budapest (HU) 3,000,000 HUF 100.0% BR
SASSK Ltd., Kiev (UA) 152,322,000 UAH 88.7% OT
SCT Kárász utca Ingatlankezelő Kft., Budapest (HU) 3,000,000 HUF 100.0% FI
SCTB Ingatlanfejlesztés Ingatlanhasznosító Kft., Budapest (HU) 3,010,000 HUF 100.0% OT
SCTF Szentendre Ingatlanforgalmazó és Ingatlanfejlesztő Kft., Budapest (HU) 3,000,000 HUF 100.0% FI
SCTP Biatorbágy Ingatlanfejlesztő és Ingatlanhasznosító Kft., Budapest (HU) 3,000,000 HUF 75.3% OT
SCTS Kft., Budapest (HU) 3,100,000 HUF 100.0% OT
Selene Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Sirius Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
Sky Solar Distribuce s.r.o., Prague (CZ) 200,000 CZK 77.0% OT
SORANIS Raiffeisen Portfolio Management GmbH, Vienna (AT) 35,000 EUR <0.1% OT
St. Marx-Immobilien Verwertungs- und Verwaltungs GmbH, Vienna (AT) 36,336 EUR 100.0% OT
Stadtpark Hotelreal GmbH, Vienna (AT) 6,543,000 EUR 100.0% OT
Stadtpark Liegenschaftsbeteiligung GmbH, Vienna (AT) 35,000 EUR 100.0% OT
STYRIA Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
Szentkiraly utca 18 Kft., Budapest (HU) 5,000,000 HUF 100.0% OT
Tatra Office, s.r.o., Bratislava (SK) 185,886 EUR 100.0% BR
TAURUS Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H. in Liqu., Vienna (AT) 36,336 EUR 100.0% FI
TB Invest Ingatlanforgalmazó Zrt., Budapest (HU) 20,000,000 HUF 50.0% OT
Theia Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
Triton Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
UMBRA Handels- und Beteiligungsgesellschaft m.b.H., Vienna (AT) 40,000 EUR 100.0% OT
UNIQA Immobilien-Projekterrichtungs GmbH, Vienna (AT) 35,000 EUR <0.1% FI
firms, VV Insurance


Unitary insurance enterprise "Priorlife", Minsk (BY) 4,689,500 BYN 100.0% VV
UPC Real, s.r.o., Prague (CZ) 200,000 CZK 100.0% FI
Urania Property, s.r.o., Prague (CZ) 50,000 CZK 100.0% FI
Valida Consulting GmbH, Vienna (AT) 500,000 ATS 100.0% OT
VALOG Vorsorge Systementwicklung GmbH, Vienna (AT) 35,000 EUR 76.0% OT
VANELLA Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
Villa Atrium Bubenec, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
VINAGRIUM Borászati és Kereskedelmi Kft., Budapest (HU) 3,010,000 HUF 100.0% OT
VINDOBONA Immobilienleasing GmbH, Eschborn (DE) 25,000 EUR 100.0% OT
VN-Industrie Immobilien GmbH, Vienna (AT) 35,000 EUR 74.0% OT
VN-Wohn Immobilien GmbH, Vienna (AT) 35,000 EUR 74.0% OT
VUWG Verwaltung und Verwertung von Gewerbeimmobilien GmbH, Vienna (AT) 35,000 EUR 100.0% OT
Zefyros Property, s.r.o., Prague (CZ) 200,000 CZK 100.0% OT
Zeleny Zlonin s.r.o., Prague (CZ) 50,000 CZK 100.0% OT
ZRB 17 Errichtungs GmbH, Vienna (AT) 35,000 EUR 100.0% OT
firms, VV Insurance

Other non-consolidated subsidiaries and equity participations

Accession Mezzanine Capital II L.P., Bermuda (BM) 2,613 EUR 5.7% OT
Accession Mezzanine Capital III L.P., Hamilton (BM) 134,125,000 EUR 3.7% OT
Accession Mezzanine Capital L.P. in Liquidation, Bermuda (BM) 1,147 EUR 2.6% OT
ACG Bor Glasworks, Bor (RU) 418,956,270 RUB 0.0% OT
Adoria Grundstückvermietungs Gesellschaft m.b.H., Vienna (AT) 36,360 EUR 24.5% FI
AGIOS Raiffeisen-Immobilien Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 49.0% FI
Agricultural Open Joint Stock Company Illintsi Livestock Breeding Enterprise,
Illinci (UA) 703,100 UAH 4.7% OT
AIL Swiss-Austria Leasing AG, Glattbrug (CH) 5,000,000 CHF 50.0% FI
ALCS Association of Leasing Companies in Serbia, Belgrade (RS) 853,710 RSD 12.5% OT
Alpenbank Aktiengesellschaft, Innsbruck (AT) 10,220,000 EUR <0.1% FI
Am Hafen" Garagenerrichtungs- und Betriebs GmbH & Co KG, Bregenz (AT) 3,660,000 EUR 0.3% FI
A-Trust Gesellschaft für Sicherheitssysteme im elektronischen Datenverkehr GmbH, Vienna
(AT) 5,290,013 EUR 12.1% OT
Austrian Reporting Services GmbH, Vienna (AT) 41,176 EUR 15.0% BR
Aventin Grundstücksverwaltungs Gesellschaft m.b.H., Horn (AT) 36,400 EUR 24.5% FI
AVION-Grundverwertungsgesellschaft m.b.H., Vienna (AT) 36,336 EUR 49.0% FI
bat-groupware GmbH, Vienna (AT) 50,000 EUR <0.1% BR
Belarussian currency and stock exchange JSC, Minsk (BY) 9,006,584 BYN <0.1% SC
Biroul de Credit S.A., Bucharest (RO) 4,114,615 RON 13.2% FI
BRD-Groupe Société Générale S.A., Bucharest (RO) 696,901,518 RON <0.1% BA
BTS Holding a.s. "v likvidácii", Bratislava (SK) 35,700 EUR 19.0% OT
Bucharest Stock Exchange, Bucharest (RO) 76,741,980 RON 1.0% OT
Budapest Stock Exchange, Budapest (HU) 541,348,100 HUF <0.1% SC
Burza cennych papierov v. Bratislave, a.s., Bratislava (SK) 11,404,927,296 EUR 0.1% SC
Cards & Systems EDV-Dienstleistungs GmbH, Vienna (AT) 75,000 EUR 42.0% OT
CASA DE COMPENSARE S.A., Bucharest (RO) 239,255 RON 0.1% OT
Cash Service Company AD, Sofia (BG) 12,500,000 BGN 20.0% BR
CEESEG Aktiengesellschaft, Vienna (AT) 18,620,720 EUR 7.0% SC
CELL MED Research GmbH, Vienna (AT) 1,898,418 EUR 4.5% OT
Central Depository and Clearing Company, Inc., Zagreb (HR) 86,925,000 HRK 0.1% FI
Closed Joint Stock Company Truskavets Valeological Innovative Centre,
Truskavets (UA) 100,000 UAH 5.0% OT
Closed Joint Stock Company Vinegar-yeast Factory, Uzyn (UA) 9,450,000 UAH 33.8% OT
Commodity Exchange Crimean Interbank Currency Exchange, Simferopol (UA) 440,000 UAH 4.5% SC
Commodity Exchange of the Agroindustrial Complex of Central Regions of Ukraine, Cherkassy (UA) 90,000 UAH 11.1% OT
CONATUS Grundstückvermietungs Ges.m.b.H., St Pölten (AT) 36,360 EUR 24.5% FI
CULINA Grundstückvermietungs Gesellschaft m.b.H., St Pölten (AT) 36,360 EUR 25.0% FI
Czech Real Estate Fund (CREF) B.V., Amsterdam (NL) 18,000 EUR 20.0% FI
D. Trust Certifikacná Autorita, a.s., Bratislava (SK) 331,939 EUR 10.0% OT
Die Niederösterreichische Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 35.0% OT
Die Niederösterreichische Leasing GmbH & Co KG, Vienna (AT) 72,673 EUR 40.0% FI
DZ BANK AG Deutsche Zentral-Genossenschaftsbank, Frankfurt am Main (DE) 3,646,266,910 EUR 0.1% BA
Easdaq NV, Leuven (BE) 128,526,849 EUR <0.1% OT
Einlagensicherung der Banken und Bankiers Gesellschaft m.b.H., Vienna (AT) 70,000 EUR 0.1% FI
EMCOM Beteiligungs GmbH, Vienna (AT) 37,000 EUR 33.6% FI
EMERGING EUROPE GROWTH FUND II, L.P., Delaware (US) 370,000,000 USD 1.9% OT
Epsilon - Grundverwertungsgesellschaft m.b.H., Vienna (AT) 36,336 EUR 24.0% FI
ESQUILIN Grundstücksverwaltungs GmbH, Vienna (AT) 36,336 EUR 24.5% FI
Euro Banking Association (ABE Clearing S.A.S.), Paris (FR) 53,000 EUR 1.9% FI
European Investment Fund S.A., Luxembourg (LU) 3,000,000,000 EUR 0.2% FI
Export and Industry Bank Inc., Makati City (PH) 4,734,452,540 PHP 9.5% BA
FACILITAS Grundstücksvermietungs GmbH, St. Pölten (AT) 36,360 EUR 50.0% FI
firms, VV Insurance


Flex-space Plzen I, s.r.o., Prague (CZ) 200,000 CZK <0.1% OT
Fondul de Garantare a Creditului Rural S.A., Bucharest (RO) 15,940,890 RON 33.3% FI
FORIS Grundstückvermietungs Ges.m.b.H., Vienna (AT) 36,360 EUR 24.5% FI
G + R Leasing Gesellschaft m.b.H., Graz (AT) 36,400 EUR 1.8% OT
G + R Leasing Gesellschaft m.b.H. & Co. KG., Graz (AT) 72,673 EUR 50.0% FI
Garantiqa Hitelgarancia ZRt., Budapest (HU) 7,839,600,000 HUF 0.2% FI
GELDSERVICE AUSTRIA Logistik für Wertgestionierung und Transportkoordination
G.m.b.H., Vienna (AT) 3,336,336 EUR 0.2% OT
Gersthoferstraße 100 Bauprojektentwicklungs GmbH in Liqu., Vienna (AT) 35,000 EUR 50.0% OT
Greenix Limited, Tortola (VG) 100,000 USD 25.0% OT
HOBEX AG, Salzburg (AT) 1,000,000 EUR 8.5% FI
Hrvatski registar obveza po kreditima d.o.o., Zagreb (HR) 13,500,000 HRK 10.5% BR
immigon portfolioabbau ag, Vienna (AT) 577,328,623 EUR <0.1% BA
International Factors Group S.C. in liquidation, Brussels (BE) 53,650 EUR <0.1% FI
INVESTOR COMPENSATION FUND, Bucharest (RO) 344,350 RON 0.4% SC
K & D Progetto s.r.l., Bozen (IT) 50,000 EUR 25.0% FI
Kommunal-Infrastruktur & Immobilien Zeltweg GmbH, Zeltweg (AT) 35,000 EUR 20.0% FI
Limited Liability Company Scientific-Production Enterprise Assembling and
Implementation of Telecommunication Sytems, Dnepropetrovsk (UA) 500,000 UAH 10.0% OT
LITUS Grundstückvermietungs Gesellschaft m.b.H., St Pölten (AT) 36,360 EUR 24.5% FI
LLC "Insurance Company 'Raiffeisen Life", Moscow (RU) 240,000,000 RUB 25.0% VV
LUXTEN LIGHTING COMPANY S.A., Bucharest (RO) 42,126,043 RON <0.1% OT
MasterCard Inc, New York (US) 13,518 USD <0.1% BA
Medicur - Holding Gesellschaft m.b.H., Vienna (AT) 4,360,500 EUR 25.0% OT
N.Ö. Kommunalgebäudeleasing GmbH, Vienna (AT) 37,400 EUR 33.3% FI
N.Ö. Gemeindegebäudeleasing GmbH, Vienna (AT) 37,400 EUR 33.3% FI
National Settlement Depositary, Moscow (RU) 1,180,675,000 RUB <0.1% FI
NÖ Raiffeisen Kommunalprojekte Service Gesellschaft m.b.H., Vienna (AT) 50,000 EUR 26.0% FI
NÖ Raiffeisen-Leasing Gemeindeprojekte Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 1.0% FI
NÖ. HYPO Leasing und Raiffeisen-Immobilien-Leasing Traisenhaus GesmbH & Co
OG, St Pölten (AT) 100,000 EUR 50.0% FI
NÖ-KL Kommunalgebäudeleasing GmbH, Vienna (AT) 37,400 EUR 33.3% FI
O.Ö. Leasing für Gebietskörperschaften Ges.m.b.H., Linz (AT) 510,000 ATS 16.7% FI
O.Ö. Leasing für öffentliche Bauten Ges.m.b.H., Linz (AT) 510,000 ATS 16.7% FI
ÖAMTC-Leasing GmbH, Vienna (AT) 36,400 EUR 49.0% OT
ÖAMTC-Leasing GmbH & Co KG, Vienna (AT) 14,535 EUR 49.0% FI
Oberpinzg. Fremdenverkehrförderungs- und Bergbahnen AG, Vienna (AT) 3,297,530 EUR <0.1% OT
Open Joint Stock Company Kiev Special Project and Design Bureau Menas, Kiev (UA) 3,383,218 UAH 4.7% OT
Open Joint Stock Company Volodymyr-Volynskyi Sugar Refinery, Volodymyr-Volynskyi
(UA) 13,068,010 UAH 2.6% OT
Österreichische Raiffeisen-Einlagensicherung eGen, Vienna (AT) 3,100 EUR 35.5% OT
Österreichische Wertpapierdaten Service GmbH, Vienna (AT) 36,336 EUR 25.3% OT
OT-Optima Telekom d.d., Zagreb (HR) 635,568,080 HRK 3.3% OT
OVIS Raiffeisen-Immobilien-Leasing Gesellschaft m.b.H., Vienna (AT) 36,400 EUR 1.0% FI
Pannon Lúd Kft, Mezokovácsháza (HU) 852,750,000 HUF 0.6% OT
Petrom S.A., Bucharest (RO) 5,664,410,834 RON <0.1% OT
Polish Real Estate Investment Limited, Limassol (CY) 911,926 EUR 11.2% OT
Private Joint Stock Company First All-Ukrainian Credit Bureau, Kiev (UA) 11,750,000 UAH 5.1% OT
Private Joint Stock Company Sumy Enterprise Agrotechservice, Sumy (UA) 1,545,000 UAH 0.6% OT
Private Joint Stock Company Ukrainian Interbank Currency Exchange, Kiev (UA) 36,000,000 UAH 3.1% SC
PSA Payment Services Austria GmbH, Vienna (AT) 285,000 EUR 11.2% FI
Public Joint Stock Company Bird Farm Bershadskyi, Viytivka (UA) 6,691,141 UAH 0.5% OT
Public Joint Stock Company National Depositary of Ukraine, Kiev (UA) 103,200,000 UAH 0.1% BR
Public Joint Stock Company Settlement Center for Servicing of Contracts in Financial
Markets, Kiev (UA) 153,100,000 UAH <0.1% FI
firms, VV Insurance


Public Joint Stock Company Stock Exchange PFTS, Kiev (UA) 32,010,000 UAH 0.2% SC
QUIRINAL Grundstücksverwaltungs GmbH, Vienna (AT) 37,063 EUR 33.3% FI
Raiffeisen e-force GmbH, Vienna (AT) 145,346 EUR 28.2% OT
Raiffeisen Rehazentrum Schruns Immobilienleasing GmbH, Vienna (AT) 36,400 EUR 50.0% FI
Raiffeisen Salzburg Leasing GmbH, Salzburg (AT) 35,000 EUR 19.0% FI
Raiffeisen Software GmbH, Linz (AT) 150,000 EUR 1.2% OT
Raiffeisen-Bezirksbank - Jennersdorf registrierte Genossenschaft mit beschränkter Haftung,
Jennersdorf (AT) 716,757 EUR 34.6% BA
Raiffeisenbezirksbank Mattersburg reg.Gen.m.b.H., Mattersburg (AT) 836,523 EUR 23.7% BA
Raiffeisenbezirksbank Oberpullendorf eGen, Oberpullendorf (AT) 693,922 EUR 8.9% BA
Raiffeisen-IMPULS-Immobilien Leasing Ges.m.b.H., Linz (AT) 500,000 ATS 25.0% FI
Raiffeisen-IMPULS-Liegenschaftsverwaltung Ges.m.b.H., Linz (AT) 500,000 ATS 25.0% FI
Raiffeisen-Impuls-Zeta Immobilien GmbH, Linz (AT) 58,333 EUR 40.0% FI
Raiffeisenlandesbank Kärnten - Rechenzentrum und Revisionsverband, registrierte
Genossenschaft mit beschränkter Haftung, Klagenfurt (AT) 6,930,600 EUR 5.9% BA
Raiffeisen-Leasing Anlagen und KFZ Vermietungs GmbH, Vienna (AT) 35,000 EUR 53.1% FI
Raiffeisen-Leasing BOT s.r.o., Prague (CZ) 100,000 CZK 20.0% OT
Raiffeisen-Leasing Management GmbH, Vienna (AT) 300,000 EUR 50.0% OT
Raiffeisen-Leasing Mobilien und KFZ GmbH, Vienna (AT) 35,000 EUR 15.0% FI
RC Gazdasági és Adótanácsadó Zrt., Budapest (HU) 20,000,000 HUF 22.2% FI
Realplan Beta Liegenschaftsverwaltung GmbH, Vienna (AT) 36,400 EUR 50.0% FI
Registry of Securities in FBH, Sarajevo (BA) 2,052,300 BAM 1.4% OT
Rehazentrum Kitzbühel Immobilien-Leasing GmbH, Innsbruck (AT) 35,000 EUR 19.0% OT
REPEF Holding GmbH in Liquidation, Vienna (AT) 400,000 EUR 3.5% OT
RL Skand AB, Stockholm (SE) 100,000 SEK 50.0% FI
RLKG Raiffeisen-Leasing GmbH, Vienna (AT) 40,000 EUR 12.5% FI
RSAL Raiffeisen Steiermark Anlagenleasing GmbH, Graz (AT) 38,000 EUR 19.0% OT
RSC Raiffeisen Service Center GmbH, Vienna (AT) 2,000,000 EUR 66.9% BR
RSIL Immobilienleasing Raiffeisen Steiermark GmbH, Graz (AT) 38,000 EUR 19.0% OT
RVS, a. s., Bratislava (SK) 6,852,480 EUR 0.7% OT
S.C. DEPOZITARUL CENTRAL S.A., Budapest (RO) 25,291,953 RON 2.6% OT
Sarajevska berza-burza vrijednosnih papira dd Sarajevo, Sarajevo (BA) 1,975,680 BAM 5.2% OT
Scanviwood Co. Ltd., Ho Chi Minh City (VN) 2,500,000 USD 6.0% OT
Seilbahnleasing GmbH, Innsbruck (AT) 36,000 EUR 33.3% FI
SELENE Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 1.0% FI
Slovak Banking Credit Bureau, s.r.o., Bratislava (SK) 9,958 EUR 33.3% BR
Societatea de Transfer de Fonduri si Decontari-TRANSFOND S.A, Bucharest (RO) 6,720,000 RON 3.4% BR
Society for Worldwide Interbank Financial Telekommunication scrl, La Hulpe (BE) 13,781,250 EUR 0.5% FI
Steirische Gemeindegebäude Leasing Gesellschaft m.b.H., Graz (AT) 36,336 EUR 50.0% FI
Steirische Kommunalgebäudeleasing GmbH, Graz (AT) 36,336 EUR 50.0% FI
Steirische Leasing für Gebietskörperschaften Ges.m.b.H., Graz (AT) 36,336 EUR 3.6% FI
Steirische Leasing für öffentliche Bauten Ges.m.b.H., Graz (AT) 36,336 EUR 50.0% FI
Stemcor Global Holdings Limited, St Helier (JE) 100,000 USD 3.2% OT
Studiengesellschaft für Zusammenarbeit im Zahlungsverkehr (STUZZA) GmbH, Vienna (AT) 100,000 EUR 10.7% OT
SUPRIA Raiffeisen-Immobilien-Leasing Ges.m.b.H., Vienna (AT) 36,400 EUR 50.0% FI
SWO Kommunalgebäudeleasing Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 50.0% FI
Syrena Immobilien Holding AG, Spittal an der Drau (AT) 22,600,370 EUR 21.0% OT
The Zagreb Stock Exchange joint stock company, Zagreb (HR) 46,357,000 HRK 2.9% SC
Therme Amade Badbetriebsführungsgesellschaft mbH, Altenmarkt (AT) 35,000 EUR <0.1% OT
Therme Amade Errichtungs- und Betriebsgesellschaft m.b.H., Altenmarkt (AT) 36,000 EUR 1.0% OT
Tiroler Kommunalgebäudeleasing Gesellschaft m.b.H., Innsbruck (AT) 42,000 EUR 8.3% FI
Tiroler Landesprojekte Grundverwertungs GmbH, Innsbruck (AT) 39,000 EUR 33.3% FI
firms, VV Insurance


TKL II. Grundverwertungsgesellschaft m.b.H., Innsbruck (AT) 39,000 EUR 8.3% FI
TKL V Grundverwertungs GmbH, Innsbruck (AT) 39,000 EUR 33.3% FI
TKL VI Grundverwertungs GmbH, Innsbruck (AT) 39,000 EUR 33.3% FI
TKL VII Grundverwertungsgesellschaft m.b.H., Innsbruck (AT) 39,000 EUR 33.3% FI
TKL VIII Grundverwertungs GmbH, Innsbruck (AT) 39,000 EUR 33.3% FI
Top Vorsorge-Management GmbH, Vienna (AT) 35,000 EUR 25.0% OT
TRABITUS Grundstücksvermietungs Ges.m.b.H., Vienna (AT) 36,360 EUR 25.0% FI
Transilvania LEASING SI CREDIT IFN S.A., Brasov (RO) 51,569,000 RON 0.6% FI
UNDA Grundstücksvermietungs Gesellschaft m.b.H., St Pölten (AT) 36,360 EUR 25.0% FI
UNIQA Raiffeisen Software Service Kft., Budapest (HU) 19,900,000 HUF 1.0% OT
VALET Grundstücksverwaltungsges.m.b.H., St Pölten (AT) 36,360 EUR 24.5% FI
VERMREAL Liegenschaftserwerbs- und -betriebs GmbH, Vienna (AT) 36,336 EUR 17.0% OT
Viminal Grundstückverwaltungs Gesellschaft m.b.H., Vienna (AT) 36,336 EUR 25.0% FI
Visa Inc., San Francisco (US) 192,964 USD <0.1% BR
VKL II Grundverwertungs GesmbH, Dornbirn (AT) 42,000 EUR 33.3% FI
VKL III Gebäudeleasing-Gesellschaft m.b.H., Dornbirn (AT) 42,000 EUR <0.1% FI
VKL IV Leasinggesellschaft mbH, Dornbirn (AT) 42,000 EUR <0.1% FI
VKL V Immobilien Leasinggesellschaft m.b.H., Dornbirn (AT) 42,000 EUR <0.1% FI
Vorarlberger Kommunalgebäudeleasing Ges.m.b.H., Dornbirn (AT) 42,000 EUR 33.3% FI
W 3 Errichtungs- und Betriebs-Aktiengesellschaft, Vienna (AT) 800,000 EUR 20.0% OT
Zentrum Puntigam" Errichtungs- und Betriebsgesellschaft m.b.H., Vienna (AT) 35,000 EUR 50.0% OT
Zhytomyr Commodity Agroindustrial Exchange, Zhitomir (UA) 476,615 UAH 3.1% OT
Ziloti Holding S.A., Luxembourg (LU) 48,963 EUR 0.9% OT
firms, VV Insurance

Recognition and measurement

principles
Financial instruments: Recognition and measurement (IAS 39)
According to IAS 39, all financial assets, financial liabilities and derivative financial instruments are to be recognized in the state-
ment of financial position. A financial instrument is defined as any contract that gives rise to a financial asset of one entity and a
financial liability or equity instrument of another entity. On initial recognition, financial instruments are to be measured at fair value,
which generally corresponds to the transaction price at the time of acquisition or issue. According to IFRS 13, the fair value is
defined as the exit price. This is the price that would be received on sale of an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. For subsequent measurement, financial instruments are recog-
nized in the statement of financial position according to the respective measurement category pursuant to IAS 39, either at (amor-
tized) cost or at fair value.
Categorization of financial assets and financial liabilities and their measurement
The measurement categories for financial instruments pursuant to IAS 39 do not equate to the principal line items in the statement
of financial position. Relationships between the principal line items in the statement of financial position and the measurement
standard applied are described in the table "Categories of financial instruments according to IFRS 7" and in the notes under (1)
Income statement according to measurement categories and (12) Statement of financial position according to measurement
categories.
1. Financial assets or liabilities at fair value through profit and loss
On initial recognition, the Group categorizes certain financial assets and liabilities as held-for-trading or measured at fair value.
These financial assets and liabilities are recognized at fair value and shown as financial assets and liabilities at fair value.
a. Trading assets/liabilities
Trading assets/liabilities are acquired or incurred principally for the purpose of generating profit from short-term fluctuations in
market prices. Securities (including short selling of securities) and derivative financial instruments held-for-trading are recognized at
their fair values. If securities are listed, the fair value is based on stock exchange prices. Where such prices are not available,
internal prices based on present value calculations for originated financial instruments and futures or option pricing models for
options are applied. Present value calculations are based on an interest rate curve which consists of money market rates, future
rates and swap rates. Option price formulas Black-Scholes 1972, Black 1976 or Garman-Kohlhagen are applied depending on
the kind of option. The measurement for complex options is based on a binominal tree model and Monte Carlo simulations. Deriv-
ative financial instruments held-for-trading are shown under the item "trading assets" or "trading liabilities". Positive fair values
including accrued interest (dirty price) are shown under trading assets. Negative fair values are recorded under trading liabilities.
Positive and negative fair values are not netted. Changes in dirty prices are recognized in net trading income. Derivatives that are
used neither for trading purposes nor for hedging purposes are recorded under the item "derivatives". Any liabilities from the short-
selling of securities are shown in "trading liabilities".
Capital-guaranteed products (guarantee funds and pension plans) are shown as sold put options on the respective funds to be
guaranteed, in accordance with statutory requirements. The valuation is based on a Monte-Carlo simulation. The Group has
provided capital guarantee obligations as part of the government-funded state-sponsored pension plans according to Section
108h (1) item 3 EStG (Austrian Income Tax Act). The bank guarantees that the retirement annuity, available for the payment
amount, is not less than the sum of the amounts paid by the taxpayer plus credits for such taxable premiums within the meaning of
Section 108g EStG.
b. Designated financial instruments at fair value
This category comprises mainly all those financial assets that are irrevocably designated as financial instruments at fair value (so-
called fair value option) upon initial recognition in the statement of financial position independent of any intention to trade. An
entity may use this designation only when doing so results in more relevant information for the user of the financial statements. This
is the case for those financial assets, which belong to a portfolio, which is managed and its performance evaluated on a fair value
basis.

These instruments are bonds, notes and other fixed-interest securities as well as shares and other variable-yield securities. These
financial instruments are valued at fair value under IAS 39. In the statement of financial position, they are shown under the item
"financial investments". Current income is shown under net interest income, valuation results and proceeds from disposals are
shown in net income from financial investments.
Financial liabilities are also designated as financial instruments at fair value, to avoid valuation discrepancies with related deriva-
tives. The fair value of financial obligations under the fair value option in this category reflects all market risk factors, including
those related to the credit risk of the issuer.
In 2016, as in 2015, observable market prices were used for the valuation of liabilities of subordinated issues measured at fair
value. The financial liabilities are mostly structured bonds. The fair value of these financial liabilities is calculated by discounting the
contractual cash flows with a credit-risk-adjusted yield curve, which reflects the level at which the Group could issue similar finan-
cial instruments at the reporting date. The market risk parameters are evaluated according to similar financial instruments that are
held as financial assets. Valuation results for liabilities that are designated as a financial instrument at fair value are recognized in
income from derivatives and liabilities.
2. Financial assets held-to-maturity
Non-derivative financial assets (securities with fixed or determinable payments and a fixed maturity) purchased with the intention
and ability to hold them to maturity are reported under the item "financial investments". They are recognized at amortized cost and
differences are amortized over the term to maturity and recognized in the income statement under net interest income. If impair-
ment occurs, it is taken into account when determining the amortized cost and shown in net income from financial investments.
Coupon payments are recognized under net interest income. A sale of these financial instruments is only allowed in certain cases
explicitly stated in IAS 39.
3. Loans and advances
Non-derivative financial assets with fixed or determinable payment entitlements for which there is no active market are allocated to
this category. These financial instruments are mainly recorded in the items "loans and advances to banks" and "loans and ad-
vances to customers". Moreover, loans and advances relating to finance lease business, which are recognized in accordance
with IAS 17, are stated in the items "loans and advances to banks" and "loans and advances to customers".
They are measured at amortized cost. If there is a difference between the amount paid and face value – and this has an interest
character – the effective interest method is used and the amount is stated under net interest income. If impairment occurs it is taken
account of when determining the amortized cost. Impairment provisions and provisions for losses that have occurred but have not
yet been recognized are reported in the statement of financial position under the item "impairment losses on loans and advances".
Profits from the sale of impaired loans are recognized in the income statement in the item "net provisioning for impairment losses".
Moreover, debt instruments are also allocated to this category if there is no active market for them. Derecognition of financial
assets within the framework of securitizations is – after checking if the securitized special purpose vehicle has to be integrated into
the consolidated accounts – undertaken on the basis of a risk and rewards or control test according to IAS 39 after identifying
loss of control over the contractual rights relating to the asset.
4. Financial assets available-for-sale
The category of financial assets available-for-sale contains financial instruments including non-consolidated equity participations
that were not allocated to any of the other three categories. They are stated at fair value, if a fair value is reliably measurable.
Valuation differences are shown directly in equity in other comprehensive income and only recognized in the income statement
under net income from financial investments if there is an objective indication of impairment or if the financial asset available-for-
sale is sold.
For equity instruments impairment exists, among other indicators, if the fair value is either significantly or permanently below cost. In
the Group, equity instruments classified as available-for-sale are impaired when the fair value over the last six months before the
reporting date was consistently more than 20 per cent below carrying value, or in the last twelve months, on average, more than
10 per cent below carrying value. In addition to these quantitative indications (trigger events), qualitative indications from
IAS 39.59 are considered. It is not permitted to include any appreciation in value in the income statement for equity instruments
classified as available-for-sale, but rather this should be recognized in other comprehensive income under the item fair value re-
serve (available-for-sale financial assets). This means that only impairments or disposals are to be shown in the income statement.

Unquoted equity instruments which, due to a lack of materiality, are not fully consolidated are measured at cost of acquisition
because the fair values do not represent a better approximation of the fully consolidated values. Other unquoted equity instru-
ments for which reliable fair values cannot be assessed regularly are valued at cost of acquisition less impairment losses. It is not
permitted to show an appreciation in the value. Reliable fair values cannot be regularly assessed in emerging countries due to the
absence of comparative yardsticks for the “market approach” and due to the inherent difficulties when using the “income ap-
proach”. This kind of financial instrument is reported under the item “financial investments”.
Interest and dividend income from financial assets available-for-sale are recorded in net interest income.
5. Financial liabilities
Liabilities are predominantly recognized at amortized cost. Discounted debt securities issued and similar obligations are measured
at their present value. Financial liabilities are reported in the statement of financial position under the items "deposits from banks",
“deposits from customers", "debt securities issued" or "subordinated capital". Financial liabilities measured at fair value are shown
in the category "liabilities at fair value through profit and loss". Interest expenses are stated under net interest income.
Derecognition of financial assets and liabilities

Derecognition of financial assets
A financial asset is derecognized when the contractual rights to the cash flows arising from a financial asset have expired, when
the Group has transferred the rights to the cash flows, or if the Group has the obligation, in case that certain criteria occur, to
transfer the cash flows to one or more receivers. A transferred asset is also derecognized if all material risks and rewards of own-
ership of the assets are transferred.
Securitization transactions
The Group securitizes various financial assets from transactions with retail and commercial customers by selling them to a special
purpose vehicle (SPV) that issues securities to investors. The assets transferred may be derecognized fully or partly. Rights to securit-
ized financial assets can be retained in the form of senior or subordinated tranches, interest claims or other residual claims (re-
tained rights).
Derecognition of financial liabilities
The Group derecognizes a financial liability if the obligations of the Group have been paid, expired or revoked. The income or
expense from the repurchase of own liabilities is shown in the notes under (6) Net income from derivatives and liabilities. The
repurchase of own bonds also falls under derecognition of financial liabilities. Differences on repurchase between the carrying
value of the liability (including premiums and discounts) and the purchase price are reported in the income statement in net income
from derivatives and liabilities.
Reclassification
In accordance with IAS 39.50, non-derivative financial instruments classified as trading assets and available-for-sale financial
instruments can be reclassified as financial assets held-to-maturity and loans and advances in exceptional circumstances. The
effects resulting from such reclassifications are shown in the notes under (19) Financial investments.
Offsetting of financial instruments

Where the borrower and lender are the same, offsetting of loans and liabilities with matching maturities and currencies occurs only
if a legal right, by contract or otherwise, exists and offsetting is in line with the actually expected course of the business. Infor-
mation on offsetting of financial instruments is provided in the notes under (39) Offsetting financial assets and liabilities.

Derivatives
Within the operating activity, the Group carries out different transactions with derivative financial instruments for trading and hedg-
ing purposes. The Group uses derivatives including swaps, standardized forward contracts, futures, credit derivatives, options and
similar contracts. The Group uses derivatives in order to meet client requirements concerning their risk management, to manage
and hedge risks and to generate profit in proprietary trading. Derivatives are initially recognized at the time of the transaction at
fair value and subsequently revalued to fair value. The resulting valuation gain or loss is recognized immediately in net income
from derivatives and liabilities, unless the derivative is designated as a hedging instrument for hedge accounting purposes and the
hedge is effective. Here the timing of the recognition of the gain or loss on the hedging instrument depends on the type of hedging
relationship.
Derivatives which are used for hedging against market risk (excluding trading assets/liabilities) for a non-homogeneous portfolio
do not meet the conditions for IAS 39 hedge accounting. These are recognized as follows: the dirty price is booked under the
item "derivatives" in the statement of financial position (positive fair values under assets and negative fair values under liabilities).
The change in value of these derivatives, on the basis of the clean price, is shown in net income from derivatives and liabilities (net
income from other derivatives) and interest is shown in net interest income.
Credit derivatives, the value of which is dependent on future specified credit (non-)events are shown at fair value under the item
"derivatives" (positive fair values under assets and negative fair values under liabilities). Changes in valuation are recognized
under net income from derivatives and liabilities.
Additional information on derivatives is provided in the notes under (40) Derivative financial instruments.
Hedge Accounting
If derivatives are held for the purpose of risk management and if the respective transactions meet specific criteria, the Group uses
hedge accounting. The Group designates certain hedging instruments as fair value hedges, cash flow hedges or capital hedges.
Most of these are derivatives. At the beginning of the hedging relationship, the relationship between underlying and hedging
instrument, including the risk management objectives, is documented. Furthermore, it is necessary to regularly document from the
beginning and during the lifetime of the hedging relationship that the fair value or cash flow hedge is highly effective.
a. Fair value hedge
Hedge accounting according to IAS 39 applies to those derivatives that are used to hedge the fair values of financial assets and
liabilities. The credit business is especially subject to such fair value risks if it deals with fixed-interest loans. Interest rate swaps that
satisfy the prerequisites for hedge accounting are contracted to hedge against the interest-rate risks arising from individual loans or
refinancing. Thus, hedges are formally documented, continuously assessed, and tested to be highly effective. Throughout the term
of a hedge it can therefore be assumed that changes in the fair value of a hedged item will be nearly completely offset by a
change in the fair value of the hedging instrument and that the actual effectiveness outcome will lie within a band of 80 to
125 per cent.
Derivative instruments held to hedge the fair values of individual items in the statement of financial position (except trading as-
sets/liabilities) are recognized at their fair values (dirty prices) under the item "derivatives" (for assets: positive dirty prices; for
liabilities: negative dirty prices). Changes in the carrying amounts of hedged items (assets or liabilities) are allocated directly to the
corresponding items of the statement of financial position and reported separately in the notes.
Both the effect of changes in the carrying values of positions requiring hedging and the effects of changes in the clean prices of
the derivative instruments are recorded under “net income from derivatives and liabilities” (net income from hedge accounting).
Within the management of interest rate risks, the hedging of interest rate risk is also undertaken on the portfolio level. Individual
transactions or groups of transactions with similar risk structures, divided into maturities according to the expected repayment and
interest rate adjustment date in a portfolio, are hedged. Portfolios can contain assets only, liabilities only, or both. For hedge ac-
counting, the change in the value of the hedged asset or liability is shown as a separate item in other assets/liabilities. The
hedged amount of the hedged items is determined in the consolidated financial statements including sight deposits (the rules of the
EU carve-out are therefore applied).

b. Cash flow hedge
Cash flow hedge accounting according to IAS 39 applies for those derivatives that are used to hedge against the risk of fluctuat-
ing future cash flows. Variable-interest loans and liabilities, as well as expected transactions such as expected borrowing or in-
vestment, are especially subject to such cash flow risks. Interest rate swaps used to hedge against the risk of fluctuating cash flows
arising from specific variable interest-rate items are recognized as follows: The hedging instrument is recognized at fair value,
changes in its clean price are recorded in other comprehensive income. Any ineffective portion is recognized in the income state-
ment in net income from derivatives and liabilities.
c. Hedge of a net investment in an economically independent operation (capital hedge)
In the Group, foreign exchange hedges of investments in economically independent sub-units (IAS 39.102) are executed in order
to reduce differences arising from the foreign currency translation of equity components. Currency swaps are mainly used as
hedging instruments. Where the hedge is effective the resulting gains or losses from foreign currency translation are recognized in
other comprehensive income and shown separately in the statement of comprehensive income. Any ineffective part of the hedge is
recognized in net trading income. The related interest components are shown in net interest income.
Fair value
The fair value is the price that would be received for the sale of an asset or paid for the transfer of a liability, in an orderly business
transaction between market participants on the measurement reference date. This applies irrespective of whether the price is
directly observable or has been estimated using a valuation method. In accordance with IFRS 13, the Group uses the following
hierarchy to determine and report the fair value for financial instruments.
Quotation on an active market (Level I)
If market prices are available, the fair value is reflected best by the market price. This category contains equity instruments traded
on the stock exchange, debt instruments traded on the interbank market, and derivatives traded on the stock exchange. The valua-
tion is mainly based on external data sources (stock exchange prices or broker quotes in liquid market segments). In an active
market, transactions involving financial assets and liabilities are traded in sufficient frequency and volumes, so that price information
is continuously available. Indicators for active markets are the number, the frequency of update or the quality of quotations (e.g.
banks or stock exchanges). Moreover, narrow bid/ask spreads and quotations from market participants within a certain corridor
are also indicators of an active liquid market.
Measurement techniques based on observable market data (Level II)
When quoted prices for financial instruments are unavailable, the prices of similar financial instruments are used to determine the
current fair value or accepted measurement methods utilizing observable prices or parameters (in particular present value calcula-
tions or option price models) are employed. These methods concern the majority of the OTC-derivatives and non-quoted debt
instruments.
Measurement techniques not based on observable market data (Level III)
If no sufficient current verifiable market data is available for the measurement with measurement models, parameters which are not
observable in the market are also used. These input parameters may include data which is calculated in terms of approximated
values from historical data among other factors (fair value hierarchy level III). The utilization of these models requires assumptions
and estimates of the Management. The scope of the assumptions and estimates depends on the price transparency of the finan-
cial instrument, its market and the complexity of the instrument.
For financial instruments valued at amortized cost (this comprises loans and advances, deposits, other short-term borrowings and
long-term liabilities), the Group publishes the fair value. In principle, there is low or no trading activity for these instruments, there-
fore a significant degree of assessment by the Management is necessary for determining the fair value.
Further information on measurement methods and quantitative information for determination of fair value is shown in the notes
under (41) Fair value of financial instruments.

Amortized cost
The effective interest rate method is a method of calculating the amortized cost of a financial instrument and allocating interest
expenses and interest income to the relevant periods. The effective interest rate is the interest rate used to discount the forecast
future cash inflows and outflows (including all fees which form part of the effective interest rate, transaction costs and other premi-
ums and discounts) over the expected term of the financial instrument or a shorter period, where applicable, to arrive at the net
carrying amount from initial recognition.
Categories of financial instruments according to IFRS 7

As the nature of the financial instruments is already shown by the classification of the items of the statement of financial position, the
formation of categories was built in line with these items, which include financial instruments. Categories of financial instruments on
the asset side of the statement of financial position are primarily cash reserve, loans and advances to banks, loans and advances
to customers, trading assets, derivative financial instruments, derivatives for hedging, and financial investments (within this category
are separately financial assets not traded on an active market and which are shown at cost of acquisition). Categories of financial
instruments on the liability side are most notably trading liabilities, derivative financial instruments, derivatives for hedge accounting,
deposits from banks, deposits from customers, debt securities issued and subordinated capital.
Measurement Category according

Assets/liabilities Fair Value Amortized Cost Others IAS 391
Asset classes
Cash reserve Nominal value n/a
Trading assets X TA
Derivatives X TA
Loans and advances to banks X LAR
Loans and advances to customers X LAR
of which finance lease business to IAS 17 n/a
Financial investments X AFVTPL
Financial investments X AfS
Financial investments X HTM
of which not traded on an active market At Cost AfS
Positive fair values of derivatives for hedge accounting (IAS 39) X n/a
Liability classes
Trading liabilities X TL
Derivatives X TL
Deposits from banks X FL
Deposits from customers X FL
Subordinated capital X FL
Debt securities issued X FL
Debt securities issued X AFVTPL
Negative fair values of derivatives for hedge accounting (IAS 39) X n/a
1 AfS Available-for-sale HTM Held to maturity
AFVTPL At fair value through profit and loss LAR Loans and advances
FL Financial liabilities TA Trading assets
TL Trading liabilities
Impairment losses on loans and advances

At each reporting date an assessment is made as to whether there is any objective evidence that a financial asset or group of
financial assets is impaired. A financial asset or a group of financial assets is impaired and impairment losses are incurred, when:
 there is objective evidence of impairment as a result of a loss event that occurred after the initial recognition of the financial
asset up until the reporting date (a "loss event");
 that loss event has an impact on the estimated future cash flows of the financial asset or group of financial assets, and
 the amount can be reliably estimated.

Objective evidence for an impairment may exist when the issuer or the counterparty faces considerable financial difficulties, a
breach of contract occurs (for example, default or delay in interest or principal payments) or it can be assumed with high probabil-
ity that insolvency or other restructuring proceedings will be instituted against the borrower.
Credit risk is accounted for by forming individual loan loss provisions and portfolio-based loan loss provisions. The latter comprise
impairment provisions for portfolios of loans with the same risk profiles that are formed under certain conditions for IBNR losses
(incurred but not reported). This involves cases where there is not yet any objective evidence of an individual impairment of a
financial asset and for this reason groups of financial assets with a similar default risk profile are collectively examined for impair-
ment. The underlying rating models for corporate customers are distinguished between “corporate large” and “corporate regular”
as well as “SME large” and “SME regular”. Moreover, portfolios for which the “financial institutions” or “project finance” rating
models are applied are separately evaluated. A Group-wide uniform approach is in place for calculation of portfolio-based provi-
sions in that centrally calculated historical Group default rates (“Group HDRs”) for each rating class are evaluated and applied.
These Group HDRs show the average actually observed probability of default over the last five years. In the retail segment, with
the exception of one Group unit where the amount of the portfolio impairment is calculated according to product portfolio and
past due days, provisions are formed using a PD/LGD-based calculation (probability of default/loss given default). Individual and
portfolio-based impairment provisions are not netted against corresponding receivables but are stated separately in the statement
of financial position.
For credit risks related to loans and advances to customers and banks, provisions are formed in the amount of expected loss
according to homogeneous Group-wide standards. Risk of loss is deemed to exist if the discounted projected repayment amounts
and interest payments are below the carrying value of the loan – taking collateral into account. Portfolio-based impairments are
calculated using valuation models that estimate expected future cash flows for the loans in the respective loan portfolio based on
loss experience history.
The total provision for impairment losses arising from loans reported in the statement of financial position comprising individual loan
loss provisions and portfolio-based loan loss provisions is shown as a separate item "Impairment losses on loans and advances"
under assets, below loans and advances to banks and customers.
Genuine sale and repurchase agreements

In a genuine sale and repurchase transaction, the Group sells assets to a third party and agrees at the same time to repurchase
these assets at an agreed price and time. The assets remain on the statement of financial position of the Group and are measured
according to the standards applied to the item in the statement of financial position under which they are shown. The securities are
not derecognized since all the risks and rewards associated with the ownership of the repurchased securities are retained. Cash
inflows arising from a sale and repurchase transaction are recognized in the statement of financial position as “deposits from
banks” or “deposits from customers” depending on the counterparty.
Under reverse repurchase agreements, assets are acquired with the obligation to sell them in the future. The purchased securities
on which the financial transaction is based are not reported in the statement of financial position and accordingly not measured.
Cash outflows arising from reverse repurchase agreements are recorded in the statement of financial position under the item "loans
and advances to banks" or "loans and advances to customers”.
Interest expense from sale and repurchase agreements and interest income from reverse sale and repurchase agreements is ac-
crued in a straight line over their term to maturity and shown under net interest income.
Securities lending
The Group concludes securities lending transactions with banks or customers in order to meet delivery obligations or to conduct
security sale and repurchase agreements. Securities lending transactions are shown in the same way as genuine sale and repur-
chase agreements. This means loaned securities continue to remain in the securities portfolio and are valued according to IAS 39.
Borrowed securities are not recognized and not valued. Cash collateral provided by the Group for securities lending transactions
is shown as a claim under the item "loans and advances to banks" or "loans and advances to customers" while collateral re-
ceived is shown as deposits from banks or deposits from customers in the statement of financial position.
Leasing
Leases are classified according to their contractual structure as follows:

Finance leases
When nearly all the risks and rewards of a leased asset are transferred to the lessee, the Group as lessor recognizes a loan to
banks or a loan to customers. The loan amount is the amount of the net investment. The income from the finance lease is spread
over periods in such a way as to represent a constant periodic rate of interest on the outstanding net investment in the leases.
Interest income is reported under net interest income.
If the Group holds assets under a finance lease as lessee, these are shown under the relevant tangible fixed asset item, which
corresponds to a lease liability. Interest expenditure is reported under net interest income.
Operating leases
An operating lease exists when the risks and rewards of ownership remain with the lessor. The leased assets are allocated to the
Group under the item "tangible fixed assets" and depreciated in accordance with the principles applicable to the type of fixed
assets. Rental income from the corresponding lease object is spread on a straight-line basis over the term of the leasing contract
and reported in other net operating income. Expenses for operating leases are generally amortized on a straight-line basis over
the term of the leasing contract and reported as administrative expenses.
Consolidation principles
Subsidiaries
All material subsidiaries over which RZB AG directly or indirectly has control are fully consolidated. The Group has control over an
entity when it is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those
returns through its power over the investee.
Structured entities are entities in which the voting or similar rights are not the dominant factor for determining control, e.g. if the
voting rights are solely related to administration activities and the relevant activities are governed by contractual agreements.
Similar to subsidiaries, consolidation of structured entities is necessary, if the Group has control over the entity. In the Group, the
need to consolidate structured entities is reviewed as part of the securitization transaction process, where the structured entity is
either formed by the Group with or without participation of third parties, or, in which the Group with or without participation of
third parties enters into contractual relationships with already existing structured entities. Whether an entity should be consolidated
or not is reviewed at least quarterly. All fully consolidated structured entities and interests in non-consolidated structured entities are
to be found in the notes under (53) Group composition.
In order to determine when an entity has to be consolidated, a series of control factors have to be checked. These include an
examination of
 the purpose and the constitution of the entity,

 the relevant activities and how they are determined,
 if the Group has the ability to determine the relevant activity through its rights,
 if the Group is exposed to risks of or has rights to variable returns, and
 if the Group has the ability to use its power over the investee in order to affect the amount of variable returns.
If voting rights are relevant, the Group has control over an entity in which it directly or indirectly holds more than 50 per cent of
the voting rights; except when there are indicators that another investee has the ability to determine unilaterally the relevant activi-
ties of the entity. One or more of the following points may be such an indicator:
 Another investor has control over more than half of the voting rights due to an agreement with the Group,
 Another investor has the ability to control financial policy and operational activities of the equity participation due to legal
provisions or an agreement,
 Another investor has control over the equity participation due to its possibility to appoint and withdraw the majority of members
of the Board or members of an equivalent governing body,
 Another investor has control over the entity due to its possibility to possess the majority of the delivered voting rights in a meet-
ing of members of the Board or of members an equivalent governing body.

When judging control, also potential voting rights are considered as far as they are material.
The Group assesses evidence of control in cases in which it does not hold the majority of voting rights but has the ability to unilat-
erally govern the relevant activities of the entity. This ability may occur in cases in which the Group has the ability to control the
relevant activities due to the extent and distribution of voting rights of the investees.
In principle, subsidiaries are initially integrated into the consolidated group on the date when the Group obtains control of the
company and are excluded from the date on when it no longer has control of the company. The results from subsidiaries acquired
or disposed of during the year are recorded in the consolidated income statement, either from the actual date of acquisition or up
to the actual date of disposal. The Group reviews the adequacy of previous decisions on which companies to consolidate at least
every quarter. Accordingly, any organizational changes are immediately taken into account. Apart from changes in ownership,
these also include any changes to the Group’s existing contractual arrangements or new contractual arrangements with a unit.
Non-controlling interests are shown in the consolidated statement of financial position as part of equity, but separately from
RZB AG's equity. The profit attributable to non-controlling interests is shown separately in the consolidated income statement.
In debt consolidation, intra-group loans and liabilities are eliminated. Remaining temporary differences are recognized under the
items "other assets/other liabilities" in the consolidated statement of financial position.
Intra-group income and expenses are also eliminated and temporary differences resulting from bank business transactions are
included partly in net interest income and partly in net trading income. Other differences are shown in the item "other net operating
income".
Intra-group results are eliminated insofar as they have a material effect on the income statement items. Transactions between
Group members are executed on an arm's length basis.
Changes in the Group’s ownership interests of existing subsidiaries
If, in the case of existing control, further shares are acquired or sold without loss of control, in subsequent consolidation such trans-
actions are recognized directly in equity. The carrying amount of the shares held by the Group and the non-controlling interests are
adjusted in such a way as to reflect changes in existing shareholdings in subsidiaries. Any difference between the amount which is
adjusted for the non-controlling interests and the fair value of the consideration paid or received is recognized directly in equity
and is assigned to the shareholders of the parent company.
If the company loses control over a subsidiary, the income/loss from disposal of group assets is shown in the income statement.
This is calculated as the difference between
 the total amount of fair value of the received consideration and fair value of the shares retained and
 the carrying amount of assets (including goodwill), liabilities of the subsidiary and all non-controlling interests
All amounts related to these subsidiaries and shown in other comprehensive income are recognized in the same way as would be the case for
the sale of assets. This means the amounts are reclassified to the income statement or directly transferred to retained earnings.
Associated companies
An associated company is an entity over which the Group has significant influence. Significant influence is the power to participate in
the financial and operating policy decisions of an entity in which shares are held. No control or joint management of decision making
processes exists. As a rule, significant influence is assumed if the Group holds 20 to 50 per cent of the voting rights. When judging
whether the Group has the ability to exert a significant influence on another entity, the existence and the effect of potential voting rights
which are actually usable or convertible are taken into account. Further parameters for judging significant influence are, for example,
the representation in executive committees and supervisory boards (Supervisory Board in Austrian Joint Stock companies) of the entity
and material business transactions with the entity. Shares in associated companies are valued at equity and shown in the statement of
financial position under the item “investments in associates”.

The acquisition cost of these investments including goodwill is determined at the time of their initial consolidation, applying by analogy
the same rules as for subsidiaries (offsetting acquisition costs against proportional fair net asset value). If associated companies are
material, appropriate adjustments are made to the carrying value in the accounts, in accordance with developments in the company’s
equity. Profit or losses of companies valued at equity are netted and recognized in the item “current income from associates”. Losses
attributable to companies accounted for using the equity method are only recognised up to the level of the carrying value. Losses in
excess of this amount are not recognised, since there is no obligation to offset excess losses. Further, any amounts recognised by the
associate through other comprehensive income will be recognised in the other comprehensive Income statement of RZB. This is espe-
cially relevant for valuation effects seen from financial assets available-for-sale.
At each reporting date, the Group reviews to what extent there is objective evidence for impairment of an equity participation in
an associated company. If there is objective evidence of impairment, an impairment test is carried out, in which the recoverable
value of the participation – this is higher of the usable value and the fair value less selling costs – is compared to the carrying
amount. An impairment made in previous periods is reversed only if the assumptions underlying the determination of the recovera-
ble value have been changed since recognition of the last impairment. In this case the carrying amount is written up to the higher
recoverable value.
Shares in subsidiaries not included in the consolidated financial statements because of their minor significance and shares in
associated companies that have not been valued at equity are included under the item “financial investments” and assigned to the
measurement category “financial assets available-for-sale”. They are measured at acquisition cost.
Business combinations
The acquisition of business operations is recognized according to the acquisition method. The consideration transferred in a busi-
ness combination is measured at fair value. This is calculated as the aggregate of the acquisition-date fair value of all assets trans-
ferred, liabilities assumed from former owners of the acquired business combination and equity instruments issued by the Group in
exchange for control of the business combination. Transaction costs related to business combinations are recognized in the income
statement when incurred.
Goodwill is measured as the excess of the aggregate of the value of the consideration transferred, the amount of any non-
controlling interest and the acquisition-date fair value of the acquirer’s previously-held equity interest in the acquiree (if any), and
the net of the acquisition-date amounts of the fair values of identifiable assets acquired and the liabilities assumed. In the event that
the difference is negative after further review, the resulting gain is recognized immediately in the income statement.
Non-controlling interests which confer ownership rights and grant the right to the owner to receive a proportionate share of the net
assets of the entity in the event of liquidation, are measured either at fair value or at the non-controlling interest’s proportionate
share of net assets of the acquiree at the acquisition date. This accounting policy choice can be newly made for every business
combination. Other components of non-controlling interests are measured at fair value or with measurement values derived from
other standards.
If the consideration transferred includes a contingent consideration, this is measured at the acquisition-date fair value. Changes in
the fair value of the contingent consideration within the measurement period are adjusted retroactively and are booked against
goodwill. Adjustments within the measurement period are corrections to reflect additional information about facts and circumstanc-
es already existing at the acquisition date. The measurement period may not exceed one year from the acquisition date.
Recognition of changes in the fair value of the contingent consideration which do not represent corrections within the measurement
period is dependent on how the contingent consideration is to be classified. If the contingent consideration is classified as equity, it
is not re-measured on the following reporting date. Its settlement is recognized within equity. A contingent consideration classified
as assets or liabilities is measured on the following reporting dates according to IAS 39 or IAS 37 Provisions for liabilities and
charges, contingent liabilities or contingent receivables if applicable and a resulting profit or loss is recognized in the income
statement.

Cash reserve
The cash reserve includes cash in hand and balances at central banks that are due on call. They are shown with their nominal
value.
Equity participations
Shareholdings in subsidiaries not included in the consolidated financial statements because of their minor significance, sharehold-
ings in associated companies that are not valued at equity and other equity participations are shown under financial investments.
These are categorized as "financial assets available-for-sale" upon initial recognition and – if no share prices are available – are
measured at cost. Changes in value are recognized in other comprehensive income. Impairment is shown in net income from
financial investments.
Intangible fixed assets

Separately acquired intangible fixed assets
Separately acquired intangible fixed assets, i.e. those with a definite useful life not acquired in a business combination, are capital-
ized at acquisition cost less accumulated amortization and impairment. Amortization is accrued in a straight line over the expected
useful life and reported as an expense in the income statement. The expected useful life and the depreciation method are re-
viewed at each reporting date and any possible changes in measurement taken into account prospectively. Separately acquired
intangible fixed assets with an indefinite useful life are capitalized at acquisition cost less accumulated impairment. The normal
useful life of software is between four and six years. The normal useful life for large software projects may extend over a longer
period.
Internally developed intangible fixed assets – research and development costs
Internally developed intangible assets comprise exclusively software and are capitalized if it is probable that the future economic
benefits attributable to the asset will accrue to the Group and the cost of the asset can be measured reliably. Expenses for re-
search are recognized as an expense when they are incurred.
An internally developed intangible fixed asset resulting from development activities or from the development stage of an internal
project is capitalized when the following evidence is provided:
 The final completion of the intangible fixed asset is technically feasible so that it will be available for use or sale.
 It is intended to finally complete the intangible fixed asset and to use or to sell it.
 The ability exists to use or to sell the intangible fixed asset. The intangible fixed asset is likely to generate future economic
benefit.
 The availability of adequate technical, financial and other resources required in order to complete development and to use or
sell the intangible fixed asset is assured.
 The ability exists to reliably determine the expenditure incurred during the development of the intangible fixed asset.
The amount at which an internally developed intangible fixed asset is initially capitalized is the sum of all expenses incurred begin-
ning from the day on which the aforementioned conditions are initially met. If an internally developed intangible fixed asset cannot
be capitalized, or if there is as yet no intangible fixed asset, the development costs are reported in the income statement for the
reporting period in which they are incurred.
Capitalized development costs are generally amortized in the Group in a straight line over a useful life of five years. The normal
useful life of software is between four and six years. The normal useful life for large software projects may extend over a longer
period.
Intangible fixed assets acquired in a business combination
Intangible fixed assets acquired in a business combination are reported separately from goodwill and measured at fair value.
Goodwill and other intangible fixed assets without definite useful lives are tested for impairment at each reporting date. Impair-
ment tests are performed whenever certain events (trigger events) occur during the year. Whenever circumstances indicate that the
expected benefit no longer exists, impairment must be recognized pursuant to IAS 36.

Intangible fixed assets with a definite useful life are amortized over the period during which the intangible fixed asset can be used.
The useful life of the acquired customer base was set at 20 years in the retail business of Raiffeisen Bank Aval JSC. For the cus-
tomer base of Polbank EFG S.A. a useful life of ten years was set for the purchase price allocation.
Group companies use brands to differentiate their services from the competition. According to IFRS 3, brands of acquired compa-
nies are recognized separately under the item "intangible fixed assets." Brands have an indeterminable useful life and are there-
fore not subject to scheduled amortization. Brands have to be tested annually for impairment and additionally whenever
indications of impairment arise. Details on impairment testing can be found in the notes under (21) Intangible fixed assets.
Tangible fixed assets

The land and buildings as well as office furniture and equipment reported under tangible fixed assets are measured at cost of
acquisition or conversion less depreciation. Depreciation is recorded under the item "general administrative expenses". The
straight-line method is used for depreciation and is based on the following useful life figures:
Useful life Years

Buildings 25–50
Office furniture and equipment 5–10
Hardware 3–5
Land is not subject to depreciation.
Expected useful lives, residual values and depreciation methods are reviewed annually. Any necessary future change of estimates
is taken into account. Any anticipated permanent impairment is reported in the income statement and shown under the item "gen-
eral administrative expenses". In the event that the reason for the write-down no longer applies, a write-up will take place up to a
maximum of the amount of the amortized cost of the asset.
A tangible fixed asset is derecognized on disposal or when no future economic benefit can be expected from the continued use
of the asset. The resulting gain or loss from the sale or retirement of any asset is determined as the difference between the pro-
ceeds and the carrying value of the asset and is recognized in other net operating income.
Investment property
This is property that is held to earn rental income and/or for capital appreciation. Investment property is reported at amortized
cost using the cost model permitted by IAS 40 and is shown under tangible fixed assets because of minor importance. Straight line
depreciation is applied on the basis of useful life. The normal useful life of investment property is identical to that of buildings
recognized under tangible fixed assets. Depreciation is recorded under the item "general administrative expenses".
Investment property is derecognized on disposal or when it is no longer to be used and no future economic benefit can be ex-
pected from disposal. The resulting gain or loss from the disposal is determined as the difference between the net proceeds from
the disposal and the carrying value of the asset and is recognized in other net operating income in the reporting period in which
the asset was sold.
Impairment of non-financial assets (tangible fixed assets, investment property and

intangible fixed assets)
Impairment test for goodwill
On each reporting date, goodwill is examined with a view to its future economic utility on the basis of cash generating units
(CGUs). A cash generating unit is defined by the management and represents the smallest identifiable group of assets of a com-
pany that generates cash inflows from operations. Within RZB, all segments according to segment reporting are determined as
cash generating units. Legal entities within the segments form their own CGU for the purpose of impairment testing of goodwill.
The carrying value of the relevant entity (including any assigned goodwill) is compared with its recoverable amount. This is, as a
general principle, defined as the amount resulting from its value in use and based on expected potential dividends discounted
using a rate of interest reflecting the risk involved. The estimation of the future results requires an assessment of previous as well as
future performance. The latter must take into account the likely development of the relevant markets and the overall macroeconom-
ic environment.

Impairment tests for goodwill based on cash-generating units use a multi-year plan drawn up by the relevant management team
and approved by the bodies responsible. This covers the CGU's medium-term prospects for success taking into account its busi-
ness strategy, overall macroeconomic conditions (gross domestic product, inflation expectations, etc.) and the specific market
circumstances. The data is then used to capture the terminal value based on a going concern concept. Discounting of the earnings
relevant for the measurement, i.e. potential dividends, is undertaken using risk-adapted and country-specific equity capital cost
rates determined by means of the capital asset pricing model. The individual interest rate parameters (risk-free interest rate, inflation
difference, market risk premium, country-specific risks and beta factors) were defined by using external information sources. The
entire planning horizon is divided into three phases with phase I covering the management planning period of three years. De-
tailed planning, including macroeconomic planning data, is extrapolated in phase II, which lasts another two years. The terminal
value is then calculated in phase III based on the assumption of a going concern. Details on impairment testing can be found in
the notes under (21) Intangible fixed assets.
Inventory
Inventories are measured at the lower of cost or net realizable value. Write-downs are made if the acquisition cost is above the net
realizable value as of the reporting date or if limited usage or longer storage periods have impaired the value of the inventory.
Non-current assets held for sale and discontinued operations

Non-current assets and disposal groups are classified as held for sale when the related carrying amount will be recovered princi-
pally through a sale transaction rather than through continuing use. This condition is only considered met if the sale is highly prob-
able and the asset (or disposal groups) is immediately available for sale and furthermore that the Management Board has
committed itself to a sale. Moreover, the sale transaction must be due to be completed within twelve months.
Non-current assets and disposal groups classified as held for sale are valued at the lower amount of their original carrying value
or fair value less costs to sell and are reported under other assets. Income from non-current assets held for sale and discontinued
operations is reported under other net operating income. If the impairment expense of the discontinued operations exceeds the
carrying value of the assets which fall under the scope of IFRS 5 (Measurement), there is no special provision in the IFRS on how
to deal with this difference. This difference is recognized as other provisions in the item “provisions for liabilities and charges” in the
In the event that the Group has committed to a sale involving the loss of control over a subsidiary, all assets and liabilities of the
subsidiary concerned are classified as held for sale provided the aforementioned conditions for this are met. This applies irrespec-
tive of whether the Group retains a non-controlling interest in the former subsidiary after the sale or not. Results from discontinued
business operations are reported separately in the income statement as result from discontinued business operations.
Details on assets held for sale pursuant to IFRS 5 are included in the notes under (24) Other assets.
Provisions for liabilities and charges

Provisions are recognized when the Group has a present obligation from a past event, where it is likely that it will be obliged to
settle, and a reliable estimate of the amount is possible. The level of provisions is the best possible estimate of expected outflow of
economic benefits at the reporting date while taking into account the risks and uncertainties underlying the commitment to fulfill the
obligation. Risks and uncertainties are taken into account in the estimate. If a provision is formed based on cash flows estimated to
fulfill an obligation, the cash flows must be discounted if the interest effect is material.
These types of provision are reported in the statement of financial position under the item "provisions for liabilities and charges".
Allocation to the various types of provision is booked through different line items in the income statement depending on the nature
of the provision. Allocation of loan loss provisions for contingent liabilities are recorded under net provisioning for impairment
losses, restructuring provisioning, provisioning for legal risks and other employee benefits are recorded in general administrative
expenses. Provision allocations that are not assigned to a corresponding general administrative expense are as a matter of princi-
ple booked against other net operating income.

Provisions for pensions and similar obligations

All defined benefit plans relating to so-called social capital (provisions for pensions, provisions for severance payments and provi-
sions for service anniversary bonuses) are measured using the Projected Unit Credit Method in accordance with IAS 19 – Em-
ployee Benefits. The biometrical basis for the calculation of provisions for pensions, severance payments and service anniversary
bonuses for Austrian companies is provided by AVÖ 2008-P-Rechnungsgrundlagen für die Pensionsversicherung (Computational
Framework for Pension Insurance) – Pagler & Pagler, using the relevant parameters for salaried employees. In other countries,
comparable actuarial parameters are used for calculation.
Please refer to Provisions for pensions and similar obligations in the notes under (28) Provisions for liabilities and charges.
Defined contribution plans

Under defined contribution plans, the company pays fixed contributions into a separate entity (a fund). These payments are rec-
ognized as staff expenses in the income statement.
Employee compensation plans

Variable remuneration – special remuneration policies
In the Group variable compensation is based on bonus pools on the bank or profit center level. Every variable remuneration
system has fixed minimum and maximum levels and thus defines maximum payout values.
As of the financial year 2011, the following general and specific principles for the allocation, the claim and the payment of varia-
ble remuneration (including the payment of the deferred portion of the bonus) for board members of RBI AG and certain Group
units and identified staff ("risk personnel") are applied:
 60 per cent and for especially high amounts 40 per cent of the annual bonus respectively will be paid out on a proportional
basis as 50 per cent cash immediately (up-front), and 50 per cent through a phantom share plan (see details below), which
will pay out after a holding period (retention period) of one year. An exception to this are the Group units in Bulgaria, with 40
per cent up-front portion and a retention period of two years, and in the Czech Republic with a holding period of 1.5 years.
 40 per cent and 60 per cent of the annual bonus respectively will be deferred according to local law over a period of three
(in Austria, five) years (deferral period). Payment will be made on a proportional basis, 50 per cent cash and 50 per cent
based on the phantom share plan.
Variable remuneration including a deferred portion is only allocated, paid or transferred if the following criteria are met:
 This is not prohibited at the level of RZB/RBI and/or RBI AG on the basis of a decision by the competent supervisory authority
(e.g. by the European Central Bank for RZB/RBI).
 This is tenable overall based on the financial position of RZB/RBI and the financial position of RBI AG and is justified based on
the performance of the Group, RBI AG, the business unit and the individual concerned.
 The minimum requirements applicable to RBI AG under local legislation for the allocation or payment of variable remuneration
are fulfilled.
 The legally required CET 1 ratio of RZB/RBI is achieved, the capital and buffer requirements of the CRR and CRD IV for
RZB/RBI are complied with in full and additionally neither the allocation, payment or transfer of the variable remuneration is
detrimental to the maintenance of a sound capital base for RZB/RBI.
 RBI has met the minimum requirements under applicable law for economic and regulatory capital and additionally neither the
allocation, payment nor transfer of the variable remuneration is detrimental to the maintenance of a sound capital base for
RZB/RBI.
 All additional criteria and prerequisites for the allocation and/or payment of variable remuneration, as defined from time to
time by the Management Board or the Supervisory Board (REMCO) of RZB/RBI, are met.
The Group fulfills the obligation arising from Clause 11 of the Annex to Section 39b of the Austrian Banking Act (BWG) which
stipulates that at least 50 per cent of the variable remuneration of risk personnel must be paid out in the form of shares or similar
non-cash instruments by means of a phantom share plan as follows: 50 per cent of the "up front" and 50 per cent of the "de-
ferred" portion of the bonus are divided by the average closing price of the RBI share on trading days of the Vienna Stock Ex-
change in the payment year serving as the basis for calculating the bonus. Thereby, a certain amount of phantom shares is
determined. This amount is fixed for the entire duration of the deferral period. After the expiration of the respective retention period,
the amount of specified phantom shares is multiplied by RBI's share price for the previous financial year, calculated as described
above. The resulting cash amount is paid on the next available monthly salary payment date.
These rules are valid unless any applicable local laws prescribe a different procedure (e.g. Poland).

Further details of the employee compensation plans are described in the management report.
Share-based compensation
The Management Board, with approval of the Supervisory Board, of RBI AG has approved a share incentive program (SIP) for
the years 2011, 2012 and 2013 which provides performance based allotments of shares to eligible employees domestically and
abroad for a given period. Eligible employees are current board members and selected executives of RBI AG, as well as execu-
tives of its affiliated bank subsidiaries and other affiliated companies. In 2014, it was already decided not to continue the pro-
gram due to the complexity of the regulatory rules regarding variable compensation.
The number of ordinary shares of RBI AG which will ultimately be transferred depends on the achievement of two performance
criteria: the targeted return on equity (ROE) and the performance of the shares of RBI AG compared to the total shareholder return
of the shares of companies in the DJ EURO STOXX Banks index after a five-year holding period.
All expenses related to the share incentive program are recognized in staff expenses in accordance with IFRS 2 (share-based
payment) and charged to equity. They are described in greater detail in the notes under (33) Equity.
Subordinated capital
This item comprises subordinated capital and supplementary capital. Liabilities documented or undocumented are subordinated if,
in the event of liquidation or bankruptcy, they can only be met after the claims of the other – not subordinated – creditors have
been satisfied. Supplementary capital contains all paid-in own funds which are provided by a third-party and are available for the
company for at least eight years, for which interest is paid only from the profit and which can be repaid in the case of solvency
only after all other debtors are satisfied.
Net interest income

Interest and interest-like income mainly includes interest income on loans and advances to banks and customers and from fixed-
interest securities. In addition, current income from shares and other variable-yield securities (especially dividends), income from
equity participations and from investments accounted for at equity, and interest-like income are also reported under net interest
income. Dividend income is recognized if the entitlement of the owner for payment exists. Interest expenses and interest-like ex-
penses mainly include interest paid on deposits from banks and customers and on debt securities issued and subordinated capital.
Interest income and interest expenses are accrued in the reporting period. Negative interest from asset items is shown in interest
income; negative interest from liability items is shown in interest expenses.
Net fee and commission income

Net fee and commission income mainly includes income and expenses arising from payment transfer business, foreign exchange
business and credit business. Fee and commission income and expenses are accrued in the reporting period.
Net trading income

Net trading income comprises the trading margins resulting from the foreign exchange business, results due to foreign exchange
revaluations and all realized and unrealized gains and losses from financial assets and liabilities at fair value. In addition, it in-
cludes all interest and dividend income attributable to trading activities and related refinancing costs.
General administrative expenses

General administrative expenses include staff and other administrative expenses as well as amortization/depreciation and im-
pairment losses on tangible and intangible fixed assets.
Income taxes
RZB AG is the hub of a tax group whose members are 37subsidiaries and 15 other affiliated companies. Current taxes are calcu-
lated on the basis of taxable income for the current year taking into account the tax group (in terms of a tax group allocation). In
the reporting year, a supplementary agreement with RBI AG was added to the current tax group allocation agreement. If RBI AG
generates a negative taxable net income and these taxable losses are not usable in the Group, then the Group parent does not
immediately pay a negative tax group allocation. Only and after withdrawal from the tax group at the latest, a final settlement is
carried out. The Group parent still pays a negative tax group allocation to RBI AG if the tax losses of RBI AG are usable. The
taxable income deviates from the profit of the statement of comprehensive income due to expenses and income which are taxable
or tax-deductible in the following years or which are never taxable or tax-deductible. The liability of the Group for current taxes is
recognized on the basis of the actual tax rate or the future tax rate which is enacted by the end of the reporting period.

Deferred taxes are calculated and recognized in accordance with IAS 12 applying the liability method. Deferred taxes are based
on all temporary differences that result from comparing the carrying amounts of assets and liabilities in the IFRS accounts with the
tax bases of assets and liabilities, and which will reverse in the future. Deferred taxes are calculated by using tax rates applicable
in the countries concerned. A deferred tax asset should also be recognized on tax loss carry-forwards if it is probable that suffi-
cient taxable profit will be generated against which the tax loss carry-forwards can be utilized within the same entity. On each
reporting date, the carrying amount of the deferred tax assets is reviewed and impaired if it is no longer probable that sufficient
taxable income will become available in order to partly or fully realize the tax assets. Deferred tax assets and deferred tax liabili-
ties within the same entity are netted. Income tax credits and income tax obligations are recorded separately under the item "other
assets" and "tax provisions" respectively.
Current taxes and movements of deferred taxes are recognized in the income statement. In case that they are linked to items which
are recognized in other comprehensive income, in which case current and deferred taxes are also directly recognized in other
comprehensive income.
Other comprehensive income

Other comprehensive income comprises all income and expenses directly recognized in equity according to IFRS standards.
Income and expenses recognized directly in equity that are reclassified in the income statement are reported separately from
income and expenses recognized directly in equity that are not reclassified in the income statement. This applies to currency
differences resulting from the translation of equity held in foreign currency, changes resulting from the hedging of net investments in
a foreign entity (capital hedge), the effective part of a cash flow hedge, changes resulting from valuation of available-for-sale
financial assets as well as deferred taxes on the mentioned items. Revaluations of defined benefit plans are reported in other
comprehensive income and are not reclassified to the income statement.
Fiduciary business
Transactions arising from the holding and placing of assets on behalf of third parties are not shown in the statement of financial
position. Fees arising from these transactions are shown under net fee and commission income.
Financial guarantees
According to IAS 39, a financial guarantee is a contract under which the guarantor is obliged to make certain payments. These
payments compensate the party to whom the guarantee is issued for losses arising in the event that a particular debtor does not
fulfill payment obligations on time as stipulated in the original terms of a debt instrument. At the date of recognition of a financial
guarantee, the initial fair value corresponds under market conditions to the premium at the date of signature of the contract. For
subsequent measurement the credit commitment has to be presented as a provision according to IAS 37.
Insurance contracts
Liabilities arising from insurance contracts change depending on changes in interest rates, income from investments and expenses
for pension agreements for which future mortality rates cannot be reliably predicted. IFRS 4 must be applied to the reporting of
liabilities resulting from the existence of mortality rate risks and discretionary participation features. All assets associated with pen-
sion products are reported in accordance with IAS 39. Liabilities are recorded under other liabilities. Please refer to the notes
under (31) Other liabilities for more information on insurance contracts.
Contingent liabilities and commitments

This item mainly includes contingent liabilities from guarantees, credit guarantees, letters of credit and loan commitments recog-
nized at face value. Guarantees are used in situations in which the Group guarantees payment to the creditor of a third party to
fulfill the obligation of the third party. Irrevocable credit lines must be reported when a credit risk may occur. These include com-
mitments to provide loans, to purchase securities or to provide guarantees and acceptances. Loan loss provisions for contingent
liabilities and irrevocable loan commitments are reported under provisions for liabilities and charges.
Statement of cash flows

The cash flow statement reports the change in the cash and cash equivalents of the Group through the net cash from operating
activities, investing and financing activities. Cash flows for investing activities mainly include proceeds from the sale, or payments
for the acquisition of, financial investments and tangible fixed assets. The net cash from financing activities shows all cash flows
from equity capital, subordinated capital, and participation capital. All other cash flows are – according to international practices
for financial institutions – assigned to operating activities.

Segment reporting
Notes on segment reporting are to be found in the section segment reporting.
Notes to the nature and extent of risks

Information about risks arising from financial instruments is disclosed in the explanatory notes. The risk report in particular contains
detailed information on credit risk, country risk, concentration risk, market risk and liquidity risk.
Capital management
Information on capital management, regulatory own funds and risk-weighted assets are disclosed in the notes under (48) Capital
management and regulatory total capital according to the Austrian Banking Act.
Application of new and revised standards

IAS 19 (Employee contributions; entry into force February 1, 2015)
The amendments clarify the provisions that relate to the allocation of employee or third-party contributions linked to periods of
service. In addition, a solution that simplifies accounting practice is permitted if the amount of the contributions is independent of
the number of years of service performed. These amendments have no material impact on the consolidated financial statements of
RZB.
Annual Improvements to IFRS – 2010–2012 cycle (entry into force February 1, 2015)
The Annual Improvements to IFRS – 2010–2012 cycle include numerous amendments to various IFRS. These amendments have
no material impact on the consolidated financial statements of RZB.
Amendments to IAS 1 (Presentation of financial statements; entry into force January 1, 2016)
The amendments aim to remove obstacles encountered by those responsible for preparing the financial statements relating to the
exercise of discretion in the presentation of financial statements. These amendments have no material impact on the consolidated
financial statements of RZB.
Amendments to IAS 16/IAS 38 (Clarification of acceptable methods of depreciation and amortization; entry into
force January 1, 2016)
These amendments provide guidelines for methods of depreciation on tangible and intangible fixed assets to be used; especially
related to revenue-based methods of depreciation. These amendments have no material impact on the consolidated financial
statements of RZB.
Amendments to IAS 16/IAS 41 (Agriculture: bearer plants; entry into force January 1, 2016)
According to these amendments, IAS 16 is applicable for bearer plants which are no longer subject to obvious biological chang-
es; therefore they can be recognized as tangible fixed assets. These amendments have no impact on the consolidated financial
statements of RZB.
Amendments to IAS 27 (Equity method in separate financial statements; entry into force January 1, 2016)
Under these amendments, the option to use the equity method to measure investments in subsidiaries, joint ventures and associated
companies in separate financial statements of investors is reinstated. These amendments have no impact on the consolidated
financial statements of RZB.

Amendment to IFRS 10, IFRS 12 and IAS 28 (Investment entities: Applying the consolidation exception; entry into
These amendments clarify that an entity may also apply the consolidation exception if its parent entity is an investment entity which
measures its subsidiaries at fair value pursuant to IFRS 10. The amendments also clarify that an investment entity only has to consol-
idate a subsidiary that provides services related to the parent’s investment activities if the subsidiary itself is not an investment enti-
ty. These amendments have no material impact on the consolidated financial statements of RZB because the Group is not an
investment entity pursuant to IFRS 10.
Amendments to IFRS 11 (Joint arrangements; entry into force January 1, 2016)
The amendments to IFRS 11 modify accounting for acquisitions of interests in joint operations in such a way that the acquirer of
shares in a joint operation in which the activity constitutes a business operation as defined in IFRS 3 is required to apply all of the
principles regarding the recognition of business combinations pursuant to IFRS 3 and other IFRS, provided they do not contradict
the principles contained in IFRS 11. These amendments have no material impact on the consolidated financial statements of RZB.
Annual Improvements to IFRS – 2012–2014 cycle (entry into force January 1, 2016)
Numerous amendments and clarifications to various IFRS. These amendments have no material impact on the consolidated finan-
cial statements of RZB.
Standards and interpretations that are not yet applicable (already endorsed by the EU)
The following new or amended standards and interpretations, which have been adopted, but are not yet mandatory, have not
been applied early.
IFRS 15 (Revenue from contracts with customers; entry into force January 1, 2018)
The standard regulates when revenue is recognized and how much revenue is recognized. IFRS 15 replaces IAS 18 (Revenue),
IAS 11 (Construction contracts) and a series of revenue-related interpretations. The application of IFRS 15 is obligatory for all IFRS
users and is applicable to almost all contracts with customers – the material exemptions are leasing contracts, financial instruments
and insurance contracts.
IFRS 9 (Financial instruments; entry into force January 1, 2018)
IFRS 9 (financial instruments) contains requirements for the classification, measurement, derecognition of and accounting for hedg-
ing relationships. The IASB published the final version of the standard within the context of completion of the various phases on July
24, 2014 and it was definitively incorporated into EU law through the EU Commission’s adoption of Regulation (EU) No.
2016/2067 of November 22, 2016. Key requirements of IFRS 9 are:
According to IFRS 9, all financial assets must be measured at amortized cost or fair value. Specifically, debt investments that are
held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are
solely payments of principal and interest on the principal outstanding are measured at amortized cost at the end of subsequent
accounting periods. All other instruments must be measured at fair value.
IFRS 9 also includes an irrevocable option to recognize subsequent changes in the fair value of an equity instrument (not held for
trading purposes) in other comprehensive income and to recognize only dividend income in the profit and loss statement.
With regard to the measurement of financial liabilities (designated as measured at fair value through profit or loss), IFRS 9 requires
that changes in fair value arising out of changes in the default risk of the reporting entity are to be recognized in other comprehen-
sive income. Changes in fair value attributable to a reporting entity’s own credit risk may not be subsequently reclassified to profit
or loss.
For subsequent measurement of financial assets measured at amortized cost, IFRS 9 provides for three stages which determine the
future amount of losses to be recognized and the recognition of interest. The first stage requires that at the time of initial recogni-
tion, expected losses must be shown in the amount of the present value of an expected twelve-month loss. If there is a significant
increase in the default risk, the risk provision must be increased up to the amount of the expected full lifetime loss (stage 2). When
there is an objective indication of impairment, the interest in step 3 must be recognized on the basis of the net carrying amount. In
addition to transitional provisions, IFRS 9 also includes extensive provisions on disclosure both during transition and during ongoing
application. New provisions relate in particular to impairment. The mandatory date of the initial application of IFRS 9 will be Janu-
ary 1, 2018.

RZB is implementing a centrally managed IFRS 9 program (“IFRS 9 Implementation”) which is sponsored by the RBI Group’s Chief
Financial Officer and Chief Risk Officer and for which experts provide support in matters relating to methodology, data acquisition
and modelling, IT processes and accounting. Overall steering is the responsibility of an IFRS 9 steering committee (“Steering
Committee IFRS9 Business Policy & Group Implementation”), whose members include Finance and Risk employees together with
the board members with relevant responsibility. Policies and training on IFRS 9 are being provided across all Group units and
Group functions as part of the IFRS 9 program in order to prepare for IFRS 9’s entry into force for the Group as of January 1,
2018. During the 2016 financial year, RBI also further developed the relevant technical concepts and associated implementation
guidelines. As part of the project, steps were commenced to conduct Group-wide iterative impact analyses with regard to classifi-
cation and measurement (“SPPI test” and “benchmark test”) and impairment of financial instruments. RBI will complete the analyses
in stages in 2017 and move the project into its implementation phase.
RZB also anticipates that the application of IFRS 9 in the future may have an impact on amounts reported in respect of the Group's
financial assets and financial liabilities. It is expected that overall, IFRS 9 will increase the level of risk provision. This estimate is
based on the requirement to recognize a risk provision in the amount of the expected loan defaults for the first twelve months even
for those instruments where the credit risk has not increased significantly since initial recognition. Moreover, it is based on the
estimate that the volume of assets for which the “lifetime expected loss” is applied is probably larger than the volume of assets
where loss events pursuant to IAS 39 have already occurred.
RZB also assumes that IFRS 9 will have consequences for the classification and measurement of financial instruments. Following a
detailed analysis, it was established with regard to classification and measurement that for certain contractual cash flows of financial
assets there is a risk that parts of the portfolio will have to be re-measured “at fair value through profit or loss”.
IFRS 9 grants accounting options for hedge accounting. RZB plans to continue to apply the provisions on hedge accounting pursu-
ant to IAS 39 while, however, taking into account the changes in the information in the notes pursuant to IFRS 7. In addition, RZB will
adapt the structure of the consolidated financial statements due to the first-time application of IFRS 9 and resulting changes to IFRS 7
and regulatory requirements (especially FINREP).
Standards and interpretations not yet applicable (not yet endorsed by the EU)
Amendments to IAS 7 (Disclosure initiative; entry into force January 1, 2017)
The amendments aim to ensure that entities provide disclosures that enable users of financial statements to evaluate changes in
liabilities arising from financing activities.
Amendments to IAS 12 (Deferred taxes; entry into force January 1, 2017)
The amendments clarify that unrealized losses related to debt instruments measured at fair value but at cost for tax purposes can
give rise to deductible temporary differences. This applies irrespective of whether the holder expects to recover the carrying
amount by holding the debt instrument until maturity and collecting all contractual payments or by selling the debt instrument. In
addition, the carrying amount of an asset does not represent the upper limit for the estimation of probable future taxable profits.
When estimating future taxable profits tax deductions resulting from the reversal of deductible temporary differences must be
excluded and a company must assess a deferred tax asset in combination with other deferred tax assets. If tax law restricts the
realization of tax losses, a company must assess a deferred tax asset in combination with other deferred tax assets of the same
(admissible) type.
Amendments to IFRS 2 (Share-based payment; entry into force January 1, 2018)
The amendments concern individual matters relating to the accounting of cash-settled share-based payments. The principal
amendment/addition relates to the fact that IFRS 2 now contains provisions which relate to the calculation of the fair value of
liabilities resulting from share-based payments. The consequences for the consolidated financial statements are still being ana-
lyzed.

Amendments to IFRS 4 (Insurance contracts; entry into force January 1, 2018)
The amendments aim to mitigate the consequences resulting from different first-time effective dates for the application of IFRS 9
and the successor standard to IFRS 4, especially for companies whose activities are predominantly connected with insurance. Two
optional approaches are being introduced which can be used by insurers if certain requirements are met: the overlay approach
and the deferral approach. The consequences for the consolidated financial statements are still being analyzed.
Amendments to IFRS 15 (Revenue from contracts with customers; entry into force January 1, 2018)
The IASB published clarifications to IFRS 15 in 2016. The amendments to clarify IFRS 15 'Revenue from contracts with customers'
address three of the five topics identified (identifying performance obligations, principal versus agent considerations and licensing)
and aim to provide transition relief for modified contracts and completed contracts. The consequences for the consolidated finan-
cial statements are still being analyzed.
IFRS 16 (Leases; entry into force January 1, 2019)
For lessees, the new standard provides an accounting model which does not distinguish between finance and operating leases. In
future, it will be necessary to report the majority of lease agreements in the balance sheet. For lessors, the rules of IAS 17 remain
largely applicable, with the result that in future, they will still have to distinguish between finance and operating lease agreements
– with corresponding implications for accounting. The consequences for the consolidated financial statements are still being ana-
lyzed.
Annual improvements to IFRS – 2014–2016 cycle (entry into force January 1, 2017/2018)
The amendments include in particular:
• IFRS 1 First-time adoption of International Financial Reporting Standards: Deletion of the remaining short-term exemptions in
IFRS 1 for first-time users.
• IFRS 12 Disclosure of interests in other entities: Clarification that with the exception of IFRS 12.B10-B16, the standard’s
disclosure requirements also apply to interests which fall under the scope of IFRS 5.
• IAS 28 Investments in associates and joint ventures: Clarification that the election to measure an investment in an associate or
a joint venture that is held by an entity that is a venture capital organization, or other qualifying entity, is available for each
investment on an investment-by-investment basis.
The amendments to IFRS 12 are applicable from January 1, 2017, the amendments to IFRS 1 and IAS 28 from January 1, 2018.
Earlier application is permitted.
IFRIC 22 (Foreign currency transactions and advance consideration; entry into force January 1, 2018)
This interpretation clarifies the accounting for transactions that include the receipt or payment of considerations in a foreign curren-
cy.
Amendments to IAS 40 for the classification of property under construction or development published (entry into
The amendments serve to clarify the provisions in relation to transfers to or from investment properties. In particular, the amend-
ments clarify whether property which is under construction or development which was previously classified under inventories can
be transferred to investment properties when there is an evident change of use.
Amendments to IFRS 10/IAS 28 (Sale or contribution of assets between an investor and its associate or joint venture;
entry into force January 1, 2016)
The amendments clarify that for transactions with an associate or joint venture, the extent of recognition of gains or losses depends
on whether the sold or contributed assets constitute a business. The effective date has been deferred indefinitely.

IFRS 14 (Regulatory deferral accounts; entry into force January 1, 2016)
Only entities applying IFRS for the first time and who recognize regulatory deferrals according to their previous accounting
standards are allowed to continue with regulatory deferrals after transition to IFRS. The standard is intended to be a short-term interim
solution till the IASB concludes the long-term project relating to price-regulated business transactions. The European Commission has
decided not to commence the adoption process for this temporary standard yet and to await the final IFRS 14.
Vienna, 1 March 2017
The Management Board
Walter Rothensteiner
Michael Höllerer Johannes Schuster

Auditor’s report
Report on the Consolidated Financial Statements
We have audited the consolidated financial statements of
Raiffeisen Zentralbank Österreich Aktiengesellschaft,

Vienna, Austria,
and its subsidiaries (the Group), which comprise the consolidated statement of financial position as at 31 December 2016, and
the consolidated statement of comprehensive income, the consolidated statement of changes in equity and the consolidated
statement of cash flows for the year then ended, and the notes to the consolidated financial statements, including a summary of
significant accounting policies.
In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the
Group as at 31 December 2016, and its consolidated financial performance and consolidated cash flows for the year then
ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU, and the additional require-
ments pursuant to Sections 245a UGB (Austrian Commercial Code) and 59a BWG (Austrian Banking Act).
Basis for our Opinion

We conducted our audit in accordance with the EU Regulation (EU) 537/2014 ("EU Regulation") and with Austrian Standards
on Auditing. These standards require the audit to be conducted in accordance with International Standards on Auditing (ISA). Our
responsibilities pursuant to these rules and standards are described in the “Auditors’ Responsibility” section of our report. We are
independent of the audited entity within the meaning of Austrian commercial law and professional regulations, and have fulfilled
our other responsibilities under those relevant ethical requirements. We believe that the audit evidence we have obtained is suffi-
cient and appropriate to provide a basis for our audit opinion.
Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated
financial statements. Key audit matters are selected from the matters communicated with the audit committee, but are not intended
to represent all matters that were discussed with them. Our audit procedures relating to these matters were designed in the context
of our audit of the consolidated financial statements as a whole. Our opinion on the consolidated financial statements is not
modified with respect to any of the key audit matters described below, and we do not express an opinion on these individual
matters.
In the following we present the key audit matters from our point of view:
 Recoverability of loans and advances to customers

 Valuation of derivative financial instruments
 Valuation of liabilites issued at fair value through profit and loss
 Valuation of Associates and the accounting of significant purchases and sales
Recoverability of loans and advances to customer

The Financial Statement Risk
Loans and advances to customers as at the Balance Sheet date amout to EUR 79.8 billion. This is made up of EUR 47.0 billion in
loans to corporates, EUR 32.0 billion in loans to retail customers and EUR 0.8 billion in loans to the public sector. For these assets
individual as well as portfolio loan loss provisions amounting to a total of EUR 5.2 billion have been recognized, comprising EUR
3.4 billion for loans to corporates and EUR 1.8 billion loans to retail customers.
The Board describes the process of monitoring the credit risk and the procedures for determining the loan loss provisions within the
“Risk Report” and “Recognition and Measurement Principles” chapters within the notes of the Financial Statements.
As part of the credit risk monitoring process the bank checks if there is any indication of impairment and therefore whether an
individual loan loss provision is needed. This includes assessing whether the customer can fully fulfill the contractually agreed
repayments without the need of realizing collaterals.

Where there is an indication of impairment on loans to corporates, provisions are formed in the amount of the expected loss
according to homogeneous Group-wide standards. This occurs when the discounted projected future repayment amounts,
including interest and any amounts realisable from collateral, is below the carrying value of the loan. This assessment is
significantly influenced by the estimate of the clients economic situation and development, the estimate of collateral values and the
amount and timing of future cash flows.
For retail clients individual loan loss provisions are calculated using the Internal Rating Based Approach using the default
definitions of the internal rating systems. One entity uses the Delinquency Bucket based Approach whereby all amounts overdue
by more than 180 days are fully provisioned.
Portfolio loan loss provisions are calculated for all corporate customers that are not impaired based on their individual risk profile
(individul rating classes). Portfolio loan loss provisions are determined using centrally calculated historical default rates for each
rating class, collateral values and other statistical and historical data.
For retail clients the portfolio loan loss provision is calculated automatically using general probability of default rates and loss
given default rates. These parameters are based on historical statistic data.
The calculation of loan loss provisions is significantly influenced by management’s assumptions and estimates. These assumption
and estimate uncertainties lead to a risk of mistatement in the Financial Statements.
Our Audit Approach
We have obtained the documentation that describes the process of loan issuance, loan monitoring and determination of loan loss
provisions and analysed these documents to determine whether the processes adequately identify impairment indicators and
ensure amounts are recorded at their appropriate carrying value in the Financial Statements. In addition we tested the entire
process as well as the essential key controls within these processes. As part of this work we checked the design, implementation
and effectiveness of these key controls.
For individual loan loss provision we used a sampling based approach to determine whether impairment indicators were
indentified and whether appropriate loan loss provisions were calculated. We critically assessed the banks estimates regarding
the amount and timing of future cash flows, including those resulting from realisation of collaterals, and whether the banks
assessment was in line with the internal and external information available. The sample selection was made using both a risk
based approach dependant on the clients rating class, and random selection approach for clients with a lower probability of
default. With regards to the internal collateral valuation we analysed whether the assumptions used in the model were adequate
and in line with available market data. We involved our internal valuation specialists in this process.
For portfolio loan loss provision we reviewed whether the models and relevant parameters used were adequate for calculating
loan loss provisions. For corporate clients we used sampling to test whether the applied probability of default rates per rating class
had been correctly determined. Our internal valuation specialists assessed the appropriateness of the models and parameters
used in the calculation. We further analysed whether the models and parameters used, taking into account backtesting results, are
appropriate for calculating loan loss provisions.
Finally we asssessed whether the disclosures in the notes to the Financial Statements regardings loan loss provisions were
appropriate.
Valuation of Derivatives
The Group has entered into derivatives for trading and hedging purposes as part of its business activities. The allocation of a
derivative to the trading/banking book or hedge accounting is significant for it’s presentation and subsequent valuation.
The Board describes its derivative financial instruments, the designation of derivatives to a hedging relationship as well as the
calculation of fair value of financial instruments within the “Recognition and Measurement Principles” chapter in the notes of the
Financial Statements.
For fair value instruments for which no quoted prices or only insufficient observable market data is available fair value is
determined using internal models based on the assumptions and parameters within these models. Due to the leverage inherent in
derivatives, market values of derivatives can be subject to significant fluctuation.
In order to apply hedge accounting, the bank is required to document the hedging relationship as well as the hedge effectiveness
testing. In the case of a suitably documented strategy, bank book derivatives can be designated as hedging instruments for both
micro hedges and portfolio hedges.

Our Audit Approach
We have analysed the allocation of derivatives and their presentation in the Statement of Financial Position using a sampling
approach. We have analysed the process documentation regarding derivate closing, settlement, valuation, risk and limit
monitoring, clearing and internal data management. The design and implementation of essential controls in the processes were
critically assessed and the effectiveness of these controls was tested.
We involved valuation specialists to evaluate the fair values determined by the Group. We have examined the appropriateness of
the valuation models used and the underlying valuation parameters by comparing the parameters used with available market
data. Additionally we have sample tested the calculation and the assumptions used.
We have examined the existence of hedging relationships by reviewing the hedge accounting documentation using a sampling
approach and in particular whether the hedging intention and documentation were in place at inception of the hedging
relationship. We also reviewed the effectiveness tests provided by the Group to ensure they have been calculated appropriately.
In addition, we have reconciled on a sample basis the hedge accounting adjustments to the Statement of Financial Position and
Statement of Comprehensive Income.
Finally, we assessed whether the disclosures in the notes regarding the valuation methods, fair value hierarchy and hedging
relationships were complete and appropriate.
Valuation of Liabilities that are measured at Fair Value

Liabilities that are measured at fair value amounted to EUR 2.8 billion, of which EUR 0.7 subordinated, as at the Balance Sheet
date. In addition to the general market risk factors, their fair value is significantly influenced by the credit risk of the issuing entity
(credit spread).
The Board describes the process of calculating the fair value of these liabilities that are measured at fair value within Note 41 and
the “Recognition and Measurement Principles” chapter in the notes of the Financial Statements.
The fair value calculation of own debt security issues for which there is no market price is available is done using a Internal
valuation model. The fair value is determined using a Discounted Cash Flow model using estimated credit spreads. The credit
spreads used in the model are derived from available market data.
The credit spread curve is a significant input to the fair value calculation and due to the indicative nature of the price quotations
leads to a risk of mistatement in the Financial Statements.
Our Audit Approach
We have obtained the documentation that describes the process of issuance, valuation and risk and limit monitoring of liabilites
measured at fair value. The design and implementation of essential controls in the processes were critically assessed and the
effectiveness of these controls was tested.
We involved valuation specialists to evaluate the fair value model used by the Bank. Further we compared the data inputs to this
model to the available market data to determine whether it they were reasonable. With involvement of relevant staff members and
utilising documents made available by the Treasury department we assessed whether the derived credit spread curve was suitable
in dertermining the fair value of the liabilities. Using a samplling approach we tested whether the fair values had been calculated
properly.
Finally, we assessed whether the disclosures in the notes regarding the fair valued liabilities was appropriate and complete.

Valuation of Associates and accounting for the initial recognition of additions as well as
disposals of investments in associated companies
Financial Statement Risk
The Board describes the classification and impairment testing process for associated companies in the “Recognition and
Measurement Principles” chapter within the notes of the Financial Statements.
The „Participation and Finance“ department reviews whether there is any objective evidence for impairment. If there is objective
evidence of impairment, an impairment test is carried out by using internal or external company valuations. If the recoverable
amount of the associated company is lower than it’s carrying value this difference is recognized as an impairment charge. Vice
versa, if in subsequent periods the reasons for impairment no longer exist, the impairment is reversed.
The valuations of the associated companies in the course of the impairment test are based to a large extent on assumptions and
estimates of future cash flows. These future cash flows are based on the budget approved by the associate company’s
management bodies. The discount rate used can be impacted by future market, economic and legal conditions. The company
valuations are therefore significantly influenced by assumptions and estimates which in consequence leads to a risk of mistatement
in the Financial Statements.
The Group was engaged in the following transactions with UNIQA Insurance Group AG, Vienna, shares in the business year
2016: Sale of a UNIQA share package of 17.6 % and the simultaneously sale of a 5.2% package of UNIQA shares belonging
to Non-controlling interests as well as the purchase of a 2.2% package of UNIQA shares. These transactions are described in
Note 7 and Note 20. Due to the complexity of those transactions there is a risk of mistatement in the Financial Statements.
Our Audit Approach
We have reviewed the processes of the “Participation and Finance” department for associated companies and tested the
respective internal controls to assess whether they are appropriate to identify impairment indicators and potential reversals of
impairments for the reporting period.
In order to examine the appropriateness of valuation models used, the valuation parameters included therin, as well as the
assumptions in the budget plans we involved our valuation specialists. They reviewed the valution model and parameters used to
ensure they were appropriate for determining the company value. We hereby assessed the appropriateness of the assumptions
used in determing the discount rate by comparison of the data with market and industry specific benchmarks. The bank tests the
accuracy of the assumptions in the budget plans by doing back-testing. The company values were compared with publicly
available information and market data including market multiples.
In relation to the sale of UNIQA shares we have assessed whether the requirements of IFRS 5 have been complied with. In par-
ticular we have analysed whether the impairment adjustment required to reduce the carrying amount of the associate to the “fair
value less costs of sales” value, was carried out in accordance with IFRS 5 and whether immediately before the initial classification
of the shares as held for sale, the carring amounts of the assets have been measured in accordance with applicable IFRSs.
Additionally we have assessed whether prior period valuation adjustments within other comprehensive income connected to the
UNIQA shares sold have been correctly recycled to the Statement of Comprehensive Income.
The presentation and valuation of the remaining and newly acquired UNIQA shares was reviewed to ensure that the relevant IFRS
rules have been complied with.
Finally, we assessed whether the disclosures in the notes regarding the valuation of associates and initial recognition of additions
as well as disposals of investments in associates described were complete and appropriate.
Management's Responsibility and Responsibility of the Audit Committee for the

Consolidated Financial Statements
The Company’s management is responsible for the preparation and fair presentation of these consolidated financial statements in
accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU, and the additional requirements
pursuant to Sections 245a UGB (Austrian Commercial Code) and 59a BWG and for such internal control as management
determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement,
whether due to fraud or error.
Management is also responsible for assessing the Group’s ability to continue as a going concern, and, where appropriate, to
disclose matters that are relevant to the Group’s ability to continue as a going concern and to apply the going concern assump-

tion in its financial reporting, except in circumstances in which liquidation of the Group or closure of operations is planned or cases
in which such measures appear unavoidable.
The audit committee is responsible for overseeing the Group’s financial reporting process.
Auditors’ Responsibility
Our aim is to obtain reasonable assurance about whether the consolidated financial statements as a whole are free of material
misstatements, whether due to fraud or error, and to issue an audit report that includes our opinion. Reasonable assurance repre-
sents a high degree of assurance, but provides no guarantee that an audit conducted in accordance with the EU Regulation and
with Austrian Standards on Auditing, which require the audit to be performed in accordance with ISA, will always detect a materi-
al misstatement when it exists. Misstatements may result from fraud or error and are considered material if they could, individually
or in the aggregate, reasonably be expected to influence the economic decisions of users taken on the basis of these consolidat-
ed financial statements.
As part of an audit in accordance with the EU Regulation and with Austrian Standards on Auditing, which require the audit to be
performed in accordance with ISA, we exercise professional judgment and retain professional skepticism throughout the audit.
Moreover:
 We identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error,
we plan and perform procedures to address such risks and obtain sufficient and appropriate audit evidence to serve as a basis
for our audit opinion. The risk that material misstatements due to fraud remain undetected is higher than that of material
misstatements due to error, since fraud may include collusion, forgery, intentional omissions, misleading representation or
override of internal control.
 We obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control.
 We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates as well as
related disclosures made by management.
 We conclude on the appropriateness of management’s use of the going concern assumption and, based on the audit evi-
dence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the enti-
ty’s ability to continue as a going concern. In case we conclude that there is a material uncertainty about the entity’s ability to
continue as a going concern, we are required to draw attention to the respective note in the financial statements in our audit
report or, in case such disclosures are not appropriate, to modify our audit opinion. We conclude based on the audit evidence
obtained until the date of our audit report. Future events or conditions however may result in the Company departing from the
going concern assumption.
 We evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures,
and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves
fair presentation.
 We obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within
the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision
and performance of the group audit. We remain solely responsible for our audit opinion.
 We communicate with the audit committee regarding, among other matters, the planned scope and timing of our audit as well
as significant findings including any significant deficiencies in internal control that we identify in the course of our audit.
 We report to the audit committee that we have complied with the relevant professional requirements in respect of our
independence and that we will report any relationships and other events that could reasonably affect our independence and,
where appropriate, related measures taken to ensure our independence.
 From the matters communicated with the audit committee we determine those matters that required significant auditor attention
in performing the audit and which are therefore key audit matters. We describe these key audit matters in our audit report ex-
cept in the circumstances where laws or other legal regulations forbid publication of such matter or in very rare cases, we de-
termine that a matter should not be included in our audit report because the negative effects of such communication are
reasonably expected to outweigh its benefits for the public interest.

Report on Other Legal Requirements

Group Management Report
In accordance with Austrian Generally Accepted Accounting Principles the group management report is to be audited as to
whether it is consistent with the consolidated financial statements and as to whether it has been prepared in accordance with legal
requirements.
The legal representatives of the Company are responsible for the preparation of the group management report in accordance
with Austrian Generally Accepted Accounting Principles.
We have conducted our audit in accordance with generally accepted standards on the audit of group management reports as
applied in Austria.
Opinion
In our opinion, the group management report has been prepared in accordance with legal requirements and is consistent with the
consolidated financial statements. The disclosures pursuant to Section 243a UGB (Austrian Commercial Code) are appropriate.
Statement
Based on our knowledge gained in the course of the audit of the consolidated financial statements and the understanding of the
Group and its environment, we did not note any material misstatements in the group management report.
Other Information
The legal representatives of the Company are responsible for the other information. Other information comprises all information
provided in the annual report, with the exception of the consolidated financial statements, the group management report, and the
auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover other information, and we will not provide any assurance on it.
In conjunction with our audit, it is our responsibility to read this other information and to assess whether it contains any material
inconsistencies with the consolidated financial statements and our knowledge gained during our audit, or any apparent material
misstatement of fact. If on the basis of our work performed, we conclude that there is a material misstatement of fact in the other
information, we must report that fact. We have nothing to report with this regard
Auditor in Charge
The auditor in charge is Mr. Wilhelm Kovsca.
KPMG Austria AG
Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
Wilhelm Kovsca
Wirtschaftsprüfer
(Austrian Chartered Accountants)

164 Management report
Management report
Market development
Markets swayed by monetary policy
Developments in the money and capital markets continued to be dominated last year by international central bank policies. In the
spring of 2016, for example, the European Central Bank (ECB) decided among other things to expand its bond-buying program
from € 60 billion per month to € 80 billion, to offer banks funding through long-term refinancing operations, as well as to cut key
interest rates. The central bank made adjustments to its policy mix at its last meeting in 2016. The minimum remaining period for its
bond purchases was extended to the end of 2017, with the monthly volume to return to € 60 billion as of April 2017. Money
market rates fluctuated between the central bank’s deposit rate and main refinancing rate over the course of last year, and were in
negative territory across all maturities since mid-January 2016. The yield on two-year German government bonds was already
negative in 2015, with yields at the short end continuing to fall in 2016. The yield on ten-year German government bonds came
down in the first half of 2016, due to falling inflation expectations and the increase in ECB bond purchases; however, started
increasing as of last autumn. In the US, the Fed raised its key rate range by 25 basis points to 0.50-0.75 per cent in December
after a one-year pause.
According to preliminary data, real GDP in the euro area grew 1.7 per cent in 2016. Consequently, the upswing in the monetary
union continued, despite the fact that economic growth concerns repeatedly surfaced last year. Economic growth was driven
primarily by private consumption and to a lesser extent by government consumption and gross fixed capital formation. At the
country level, economic development continued to be highly varied. Whereas Spain’s GDP expanded by 3.3 per cent, Italy
posted GDP growth of a mere 1.0 per cent. The average price level of consumer goods remained virtually unchanged in the euro
area during most of the year. The lack of general inflationary pressure on consumer goods was attributable to falling prices for
energy and imported goods. Only when energy prices increased towards the end of 2016 ‒ compared to prior year levels ‒ did
the inflation rate pull away appreciably from the zero per cent mark.
Austria’s economy experienced a moderate upturn in 2016, with real GDP growing 1.5 per cent. Domestic demand was the main
pillar of economic growth. Private consumption benefited from the tax reform that went into effect at the beginning of 2016, and
equipment investment was comparatively dynamic. Construction investment expanded for the first time in a number of years. In
contrast, net exports did not support real GDP growth.
The US economy had a weak start to 2016. This was primarily the result of unusually low inventory investment, as well as declin-
ing investment in mining and oil and gas exploration due to sharply lower commodity prices. These negative effects subsequently
subsided in the second half of the year, and the economy resumed its dynamic growth. In particular, private consumption grew at
an encouraging pace. Nevertheless, real gross domestic product increased only 1.6 per cent in 2016, due to the weak start to
the year.
China’s economic growth stabilized and is estimated to be 6.7 per cent for 2016. Although the government’s economic support
initiatives are likely to have kicked in, these primarily benefited large state enterprises through infrastructure investment. Growth
impetus continued to come from the real estate sector.
Solid growth in CE and SEE, recession flattening out in Russia

The low and in some cases negative inflation rates in Central and Southeastern Europe (CE and SEE) and the ECB’s low interest
rate policy enabled key rates in the region to be kept at a low level last year. In a number of countries further monetary policy
easing measures were even taken or continued to be implemented. In Poland and Romania, moreover, fiscal growth stimuli sup-
ported private consumption.
The CE region registered somewhat weaker economic trend in 2016, with GDP growth at 2.7 per cent. Although CE continued to
benefit from solid economic growth in Germany, as well as from the recovery in the euro area and from expansionary monetary
policies in some CE countries, economic growth in CE came in below the previous year’s level. One contributory factor was the
drop in investment activity owing to temporarily lower EU transfer payments into the region. Poland, the region’s growth engine, lost
considerable momentum and recorded 2.8 per cent year-on-year growth. Overall, however, the economic data indicates bal-
anced growth with solid export and dynamic domestic economic activity.

Management report 165
SEE reported strong economic growth of 3.9 per cent year-on-year in 2016. Once again, the Serbian and Croatian economies
significantly stepped up their pace of growth compared to the previous year. The Croatian economy benefited from political
stabilization. In Romania, household demand was stimulated by tax cuts. With GDP growth of 3.3 per cent, Bulgaria caught up
somewhat with Romania. Overall, economic growth in SEE was at its strongest pace in several years. Although a portion of this
growth was attributable to temporary factors, it nonetheless underscores that the weak phase of previous years has been over-
come.
Economic conditions in Eastern Europe (EE) improved in 2016. Russia benefited from a recovery in oil prices over the course of the
year. Prudent monetary and fiscal policy had a stabilizing effect but failed to deliver additional growth impetus. The recession in
Russia flattened out significantly, and economic output fell only 0.2 per cent year-on-year in 2016. Russia’s manufacturing sector
improved somewhat towards the end of last year, but private household demand remained weak. Ukraine’s economy bottomed
out in 2015 and returned to growth of 2.2 per cent in 2016. The Belarusian economy, which is heavily dependent on financial
support from and exports to Russia, remained in a persistent recession. Inflation rates in EE retreated from high levels amid more
stable exchange rate developments and weak domestic demand.
Annual real GDP growth in per cent compared to the previous year
Region/country 2015 2016e 2017f 2018f
Czech Republic 4.6 2.3 2.7 2.5
Hungary 2.9 2.0 3.2 3.4
Poland 3.9 2.8 3.3 3.0
Slovakia 3.8 3.3 3.3 4.0
Slovenia 2.3 2.5 2.7 2.5
Central Europe 3.8 2.7 3.1 3.0
Albania 2.6 3.5 4.0 4.0
Bosnia and Herzegovina 3.0 2.5 3.0 3.5
Bulgaria 3.6 3.3 3.3 3.3
Croatia 1.6 2.9 3.3 2.8
Kosovo 4.1 3.5 3.5 3.5
Romania 3.9 4.8 4.2 3.5
Serbia 0.7 2.7 3.0 3.0
Southeastern Europe 3.1 3.9 3.7 3.3
Belarus (3.8) (2.6) (0.5) 1.5
Russia (2.8) (0.2) 1.0 1.5
Ukraine (9.9) 2.2 2.0 3.0
Eastern Europe (3.3) (0.1) 1.0 1.6
Austria 1.0 1.5 1.7 1.5
Germany 1.5 1.8 1.7 1.5
Euro area 2.0 1.7 1.9 1.7
Economic recovery in Austria

In 2016, the Austrian economy was able to increase the rate of expansion, which is mainly due to the second half of the year. For
the full year of 2016, the real GDP expanded by 1.5 per cent, compared to 1.0 per cent in 2015. The main pillar of the econom-
ic development was domestic demand. On the one hand, private consumption benefited from the increase in real disposable
income as a result of the tax reform that came into force at the beginning of 2016. On the other hand, gross fixed capital for-
mation was encouraging, mainly due to equipment investments. Against the backdrop of the cyclical economic recovery, imports
continued to develop dynamically. Since at the same time exports could only be expanded moderately, foreign trade did not
contribute positively to GDP growth in 2016. The recovery is expected to continue in 2017. Economic growth should continue to
be driven by domestic demand (private consumption, investments), while net exports are expected to continue to not contribute to
GDP growth in 2017.

Development of the banking sector

Development of the banking sector in CEE
In 2016, many indicators exhibited a substantial recovery of the banking sector from the subdued levels of the previous year.
Positive trends in new lending or in asset growth continued in several CE and SEE countries in 2016 (e.g. in the Czech Republic,
Slovakia and Romania). The banking sector in Russia also recovered significantly. Nearly all banking markets in CEE now show a
comfortable loan/deposit ratio (well below 100 per cent for the most part), which represents a solid foundation for future growth.
In addition, many challenging banking markets of recent years started posting considerable profits again at sector level in 2016
(e.g. Hungary, Romania, Croatia and Russia). In particular, leading foreign banks also significantly outperformed general market
trends in the challenging Eastern European banking markets (Russia, Ukraine and Belarus). The positive profitability trend was
additionally supported by the sustained stabilization, or even a sharp drop, in non-performing loans (NPLs) in CE and SEE (with
significant differences at country level). Overall, the NPL ratio in CE and SEE fell from previously 8.3 per cent to 7.4 per cent in
2016 as a result. In view of the positive developments in CE and SEE, as well as the stabilization of NPLs and profitability in
Russia, return on equity in the CEE banking sector significantly increased above the comparable figure in the euro area again in
2016.
Banking sector in Austria

In 2016, the banking sector in Austria continued to perform below average when compared to the euro area in terms of credit
growth (notably in corporate banking). Lending focused on retail customer and real estate financing transactions in particular.
However, the profitability of Austria’s banking sector markedly increased at a consolidated level, mainly supported by CEE busi-
ness. As a result, the Austrian banking sector also significantly improved its capitalization relative to major Western European
countries. However, the reported regulatory capital ratios continue to be below average by international standards. If the leverage
ratio is included as benchmark, Austrian banks performed remarkably better. Capital requirements will gradually increase follow-
ing the introduction of the Systemic Risk Buffer as well as of the buffer for Other Systemically Important Institutions (O-SIIs), which
the Financial Market Stability Board (FMSB) has recommended. The reduction in the bank tax from 2016 should also have a
positive impact in the following years.
In the first half of 2016, the Austrian banks generated a positive consolidated net income of roughly € 2.9 billion, or € 0.3 billion
more than in the same period of the previous year. The positive result was mainly driven by the sharp reduction in loan loss provi-
sions, which not only more than offset significant declines in net interest income as the most important income component, but also
lower income from commissions and net trading income. The profitability of Austrian subsidiary banks in CEE significantly improved
in the first quarter of 2016. Profit contributions from Austrian subsidiary banks were positive in all CEE countries. The highest profits
were made in the Czech Republic, Romania and Russia, albeit with profits down in Russia in comparison with the previous year’s
quarter. The Sustainability Package, which was launched in 2012, has helped to strengthen the local funding base of Austrian
subsidiary banks in CEE. The loan/deposit ratio fell from 117 per cent in 2008 to 88 per cent in the first quarter of 2016, and
was primarily attributable to an increase in local savings deposits. Accordingly, credit growth is increasingly financed on a local
basis.
The Single Resolution Mechanism (SRM) became fully effective on 1 January 2016. The Single Resolution Board (SRB) is the
central body responsible for making all decisions relating to the resolution of major banks that are either failing or at risk of failing.
The measures are implemented in cooperation with the relevant national resolution authorities.
Regulatory environment
Changes in the regulatory environment
The Group focused intensively on current and forthcoming regulatory developments again in the year under review.

Proposed legislation relating to the European Deposit Insurance Scheme (EDIS)

In 2015, the European Commission proposed a European Deposit Insurance Scheme (EDIS) designed to support the banking
union, strengthen the protection of depositors, increase financial stability, and further weaken the link between banks and sover-
eigns. The EDIS is part of the European SRB and covers all national deposit guarantee systems (including IPS) and is to be devel-
oped incrementally in three stages by 2024. In the first stage it is to comprise a reinsurance scheme of the national deposit
guarantee systems and subsequently become a co-insurance scheme after three years, under which the contribution of the EDIS is
to progressively increase over time. A fully comprehensive EDIS is planned as the last stage, which is scheduled for 2024. The
final adoption and publication of the law is lined up for the fourth quarter of 2017 at the earliest.
Bank recovery and bank resolution

The Austrian Bank Recovery and Resolution Act (Bankenabwicklungs- und Sanierungsgesetz (BaSAG)) went into force in 2015
and ensures the national implementation of the EU’s Bank Recovery and Resolution Directive from 2014. With regard to recovery
planning under the Single Supervisory Mechanism (SSM), the Group is subject to direct supervision by the ECB while, with regard
to resolution planning under the SRM, it is subject to direct supervision by the SRB.
The Group has drawn up a recovery plan that meets the requirements of the BaSAG. The recovery plan describes potential
measures for ensuring the capacity to act in financial stress situations. With the help of material key performance indicator (KPI)
monitoring for early detection, the recovery plan establishes a comprehensive governance structure for stress situations. The recov-
ery plan is drawn up by the Group, updated on a regular basis and reviewed by the supervisory authority (ECB).
Resolution plans are drafted by the resolution authority, which also grants powers to remove any barriers to resolution. Resolution
strategies for banks are likewise laid down in the resolution plans. As part of the framework for the resolution of banks, specific
resolution tools are made available to the resolution authorities. For example, the Group – already prior to the introduction of the
Austrian Bank Intervention and Restructuring Act (Banken Interventions- und Restrukturierungsgesetz (BIRG)) and the BaSAG –set
limits on intra-Group relationships in order to reduce cluster risk and unrestricted residual risk both to itself and to its owners.
In addition to preparing resolution plans, the obligation to comply with an MREL (Minimum Requirement for Own Funds and Eligi-
ble Liabilities) is also determined and individually specified for each bank/resolution entity. The Group is currently working in close
cooperation with the SRB and national resolution authorities to draw up a resolution plan that meets the statutory requirements. The
participation of creditors (bail-in tool) represents one possible tool in a resolution concept. As a result, the resolution authorities will
set the MREL. On the basis of the resolution strategy, an MREL is set for each bank/resolution entity or the entire banking group.
The calibration of MREL targets is to be carried out by the supervisory authorities and is based on relevant statutory regulations,
resolution plans, as well as individual aspects of the respective bank (e.g. size, business model and risk profile). Not only a bank’s
regulatory capital but also its long-term unsecured debt that is not subject to a deposit protection scheme or similar restrictions are
basically considered to be eligible for MREL.
Amendment to European regulations

In November 2016, the European Commission published a legislative proposal to change the prudential requirements (CRD
IV/CRR), as well as to amend the recovery and resolution framework (BRRD, SRM). The documents provide the basis for follow-up
negotiations with the EU Parliament and European Council and at the same time offer a preview of the regulatory challenges for
the years following 2017.
On the one hand, the proposed changes to the CRR can be broken down thematically into criteria for classification under the
finalized Basel III. This comprises, for example, the introduction of a binding minimum leverage ratio and net stable funding ratio
(NSFR), as well as add-ons to the bank recovery and resolution regulations, in order to meet the Total Loss Absorbing Capacity
(TLAC) requirements for global systemically important banks. On the other hand, the drafts include adjustments whose content
already relates to Basel IV, e.g. the introduction of a standardized approach for measuring counterparty risks, an overhaul of
market price risk regulations within the framework of the Fundamental Review of the Trading Book (FRTB) and new rules for invest-
ment funds. Compared to the previous implementation of Basel standards, it is clearly evident that proportionality is given far
greater weight, in particular, to meet the needs of the numerous smaller banks in the EU. According to the latest information, the
new rules and regulations are expected to be applicable from 2019 onwards.
Action plan for building a capital markets union

The European Commission aims to improve access to capital market funding for all companies, especially small and medium-sized
enterprises (SMEs). It wants to break down barriers that are blocking cross-border investments on the capital market. The action
plan of 30 September 2015, provides for a bundle of measures through to 2017, including specific legislative proposals relating
to securitization and consultations on covered bonds. The work packages for the action plan were processed and/or expedited
in 2016. While the fundamental aim of driving cross-border investments is certainly to be welcomed, it cannot provide a realistic
alternative to credit financing for SMEs through banks. Instead, the proposed measures can arguably only be considered as
measures to supplement financing by banks.

Earnings and financial performance

Introduction and scope of consolidation
The consolidated financial statements of RZB are prepared in accordance with the International Financial Reporting Standards
(IFRS) as applied in the EU. RZB AG also prepares separate financial statements in accordance with the the Austrian Commercial
Code (UGB), in conjunction with Austrian Banking Act (BWG) which provide the formal basis of assessment for calculating divi-
dend distributions and taxes. For more information on the disclosures required by the UGB and BWG, please see the relevant
sections of this Group management report, including the notes section.
At the end of September 2016, the ultimate parent company of RZB AG, Raiffeisen-Landesbanken-Holding GmbH, Vienna, and its
100 per cent subsidiary R-Landesbanken-Beteiligung GmbH, Vienna, in which 82.4 per cent of stakes in RZB AG were bundled,
were merged into RZB AG. This is part of a strategy simplifying the group’s structure. This way, RZB AG functions as ultimate parent
company. The core shareholders of RZB AG are the regional Raiffeisen banks that hold together 90.4 per cent.
As at 31 December 2016, RZB AG’s scope of consolidation comprised 283 Group units including 27 banks and 168 financial
institutions and bank-related service providers. Changes in the financial year resulted primarily from the sales of Raiffeisen-Leasing
Polska S.A., Warsaw, and of Raiffeisen Banka d.d., Maribor.
Significant events
Merger of RZB AG and RBI AG
On 5 October 2016, the Management and Supervisory Boards of RZB AG and RBI AG passed in principle a resolution to
merge RZB AG and RBI AG. The respective Extraordinary General Meetings of the participating companies subsequently ap-
proved the merger by a clear majority in January 2017. Accordingly, the merger of RZB AG into RBI AG will become effective in
the first quarter of 2017 with its entry in the commercial register. Consequently, reporting will be prepared on the basis of the
combined bank as of the first quarter of 2017. The company will continue to operate under the name of Raiffeisen Bank Interna-
tional AG, and RBI shares will remain listed on the Vienna Stock Exchange. The shareholding of the RBI free float will be 41.2 per
cent following the merger. The regional Raiffeisen banks will hold approximately 58.8 per cent of RBI shares. There is a related
syndicate agreement that contains, among other things, lock-up provisions.
Following the merger, the Group’s risk-weighted assets (total RWA) would increase 13 per cent to € 68 billion (pro forma as at
the end of 2016). The CET1 ratio (transitional) of the merged entity, based on a pro forma calculation, would be 12.7 per cent as
at the end of 2016, with a CET1 ratio (fully loaded) of 12.4 per cent.
Transformation program of RBI

The sale of Raiffeisen-Leasing Polska S.A., Warsaw, to PKO Leasing S.A., Warsaw, was closed on 1 December 2016. The pur-
chase price was € 193 million. Including reclassified realized currency effects, this led to a positive impact of approximately € 18
million on RBI’s consolidated profit in the fourth quarter. The transaction also resulted in an improvement of 33 basis points in RBI’s
CET1 ratio (fully loaded). RWA decreased around € 1,272 million.
Negotiations with Alior Bank S.A., Warsaw, on the sale of the core banking business of Raiffeisen Bank Polska S.A. (Raiffeisen
Polbank), Warsaw, were terminated on 7 December 2016. As agreed with the regulator, RBI is now preparing to list a 15 per
cent stake in Raiffeisen Polbank in an initial public offering, while also working on rightsizing the business model.
Following the inconclusive sales process relating to ZUNO BANK AG, parts of the existing business are being integrated into the
subsidiary banks in the Czech Republic and Slovakia. It is planned to complete the integration by the middle of 2017.

As part of the planned reduction in RWA, significant progress has been made in Asia since the end of 2014, with RWA scaled
back by approximately 84 per cent to € 596 million. The winding down of the US operations is also making good headway, with
a decrease in RWA of circa 66 per cent to € 347 million since the end of 2014. The remaining business is now being run down;
branches in Asia and business outlet in the US are being reduced to a minimum, and no longer conduct active business.
As a result of the measures described, RBI reached its CET1 ratio (fully loaded) target of at least 12 per cent by the end of 2017,
ahead of schedule, and significantly exceeded it with a ratio of 13.6 per cent (fully loaded) at the end of 2016. The transfor-
mation program was thereby completed ahead of time, and the Non-Core segment is to be dissolved as of the beginning of
2017. The remaining business will be integrated into the existing segments.
Sale of a significant stake in UNIQA Insurance Group AG

In December 2016, the partial sale of RZB’s participation in UNIQA Insurance Group AG (UNIQA), Vienna, in the amount of
17.6 per cent, which had already been announced in June 2016, was successfully concluded by means of share transfer to
UNIQA Versicherungsverein Privatstiftung. At the same time, RZB purchased shares in UNIQA Insurance Group AG amounting to
a 2.2 per cent stake from Raiffeisen-Holding Niederösterreich-Wien, Raiffeisen-Landesbank Steiermark and Raiffeisenlandesbank
Kärnten. After the sale and the clearing of minority interests, RZB will consequently hold around 10.9 per cent of the shares in
UNIQA in total. The transactions are part of the current measures to simplify the group’s structure and the group’s adaption to
increased regulatory capital requirements. The transaction led to a negative result after tax and minorities of € 99 million.
Revision of bank levy regulation in Austria

In July 2016, the Austrian government reached an agreement to
Development of operating income amend the bank levy regulation from 2017 onwards. The amend-
In € million amendment includes a reduction in the annual bank levy; at the
6,022 same time, Austrian banks are to make a one-off payment. For the
6,000 2% 5,732
5,374 5% 1%
5,333
merged RBI group this will amount to around € 163 million. This
2%
4%
2% 5,132
2%
payment will be spread over a four-year period, starting in 2017.
5,000
27% 29% 4% The Austrian bank levy came to approximately € 102 million for
28% 30% RZB in 2016 (€ 3 million less than in 2015). Starting in 2017,
4,000 31% the amount will be around € 58 million per year for the merged
Group, including the proportional share of the one-off payment,
3,000 until 2020.
2,000 65% 70%

66% 68%
63%
Overview of the financial year
1,000
In addition to the persistently low interest rate level, which also
0 resulted in a decline in RZB’s operating result, the financial year
2012 2013 2014 2015 2016 was primarily influenced by significantly lower impairment losses
Net interest income Net fee and commission income on loans and advances. In CEE, nearly all markets registered
Net trading income
Recurring other net operating income
declines. Also in Asia, impairment losses were € 118 million
lower than in the previous year. Net provisioning for impairment
losses fell 40 per cent year-on-year, or € 501 million to € 758
million. The largest declines occurred in Ukraine, Asia and at RBI
AG. The partial sale of a stake in UNIQA Insurance Group AG resulted in a negative effect and led to a loss after tax and minori-
ties of € 99 million in total. The Group result was at € 253 million and increased year-on-year by 7 per cent or € 16 million.
Operating income was down 4 per cent year-on-year, or € 201 million, to € 5,132 million. A portion of the decline was attributa-
ble to currency devaluations in Eastern Europe. Net interest income fell 11 per cent, or € 406 million, to € 3,218 million. This was
primarily attributable to a volume decline by 4 per cent of interest-bearing assets and the continuing low market interest rates, a
reduction of € 230 million, particularly in Russia, in interest income from derivatives entered into for hedging purposes as well as
€ 58 million lower contributions from at-equity companies. Net fee and commission income increased € 5 million to 1,599 million
year-on-year. Net trading income rose € 204 million year-on-year to € 220 million. Net income from currency-based transactions
improved by € 175 million to € 116 million, primarily as a result of a more limited devaluation of the Ukrainian hryvnia than in the
previous year (€ 81 million increase).
General administrative expenses were down 1 per cent year-on-year, or € 29 million, to € 3,141 million. On the one hand, this
decline was attributable to currency devaluations in Eastern Europe; on the other hand office space expenses declined by € 29
million due to the closure of branches. In addition, deposit insurance fees were lower (€ 28 million) mainly in Poland, the Czech
Republic, Romania and Bulgaria. Expenses were increased by expenditures for IT (up € 13 million) and the bank resolution fund
(up € 10 million). Staff expenses rose 3 per cent, or € 38 million, to € 1,552 million. Cost savings from the workforce reduction of
7 per cent were set against increases from the purchase of Citibank’s retail business in the Czech Republic and from growth in

Slovakia. Furthermore, no bonuses for the year 2014 were paid in 2015, which resulted in a release of provisions. This effect was
absent in the 2016 financial year.
The average number of staff was further reduced, down 3,885 year-on-year to 51,810. The number of business outlets decreased
199 year-on-year to 2,523.
In the course of the year, total assets fell 3 per cent, or € 3,579 million, to € 134,847 million. Changes in the scope of consoli-
dation were responsible for around € 2,200 million decline in consolidated total assets, which resulted primarily from the sale of
the Polish leasing business and of the Slovenian subsidiary bank. In return, currency developments – predominantly the apprecia-
tion of the Russian rouble (up 25 per cent) and the US-Dollar against the Euro (up 3 per cent) – resulted in an increase of
around € 1,700 million.
Equity including capital attributable to non-controlling interests increased 5 per cent, or € 498 million, to € 9,794 million. Increases
resulted from profit after tax of € 533 million and other comprehensive income of € 152 million. Exchange rate differences repre-
sented the largest item in other comprehensive income and amounted to € 291 million in the reporting period (2015: minus
€ 189 million).
In terms of regulatory capital, the key metrics changed as follows: CET1 (after deductions) was € 8,112 million at the end of the
year, the € 633 million increase is attributable to retained profits, positive currency development of the Russian rouble as well as to
the partial sale of UNIQA Insurance Group AG. Total capital pursuant to the CRR came to € 10,088 million, which corresponds
to an increase of € 268 million compared to the 2015 year-end figure. Total risk-weighted assets were down € 3,982 million to
€ 68,055 million, as a result of the sale of the Slovenian subsidiary bank and the Polish leasing business, RWA reductions at
subgroup Raiffeisen-Leasing and the dismantling units in Asia and the US, as well as due to rating improvements in Ukraine and
Belarus. Based on total risk, the CET1 ratio (transitional) was 11.9 per cent while the total capital ratio (transitional) was
14.8 per cent. Excluding the transitional provisions as defined in the CRR, the CET1 ratio (fully loaded) stood at 11.9 per cent,
and the total capital ratio (fully loaded) was 14.0 per cent.

Income statement
in € million 2016 2015 Change absolute Change in %
Net interest income 3,218 3,623 (406) (11.2)%
Net fee and commission income 1,599 1,594 5 0.3%
Net trading income 220 16 204 >500.0%
Recurring other net operating income 96 100 (4) (4.1)%
Operating income 5,132 5,333 (201) (3.8)%
Staff expenses (1,552) (1,515) (38) 2.5%
Other administrative expenses (1,214) (1,277) 63 (4.9)%
Depreciation (375) (378) 4 (1.0)%
General administrative expenses (3,141) (3,170) 29 (0.9)%
Operating result 1,991 2,163 (172) (7.9)%
Net provisioning for impairment losses (758) (1,259) 501 (39.8)%
Other results (391) (167) (224) 134.2%
Profit/loss before tax 843 737 106 14.4%
Income taxes (310) (272) (38) 14.1%
Profit/loss after tax 533 465 68 14.5%
Profit attributable to non-controlling interests (280) (228) (52) 22.7%
Consolidated profit/loss 253 237 16 6.7%
Operating income
Net interest income
In 2016, net interest income declined 11 per cent, or € 406

Development of the net interest margin million, to € 3,218 million. This development was primarily
(average interest-bearing assets) attributable to a volume reduction of interest-bearing assets by
4 per cent and the continuing low level of interest rates. Net
3.1% 3.05%
2.98%
income contribution from associates fell 44 per cent to € 74
million, which was primarily attributable to lower contributions
2.9% from the participation in UNIQA Insurance AG, Vienna, as well
as from Raiffeisen Informatik GmbH, Vienna.
2.72%
2.7% 2.61% In the RBI segment, net interest income fell 12 per cent, or
2.51% € 391 million, to 2,920 million in 2016. In Central Europe, net
2.4%
interest income fell 4 per cent, or € 25 million, to € 629 million.
Here, lower interest rates reduced net interest income by € 23
million in Slovakia, and by € 14 million in Hungary. In contrast,
2.2% the Czech Republic reported a volume-related rise of € 12
million. In Southeastern Europe, net interest income fell 5 per
cent, or € 42 million, to € 738 million. All countries in this seg-
2.0%
2012 2013 2014 2015 2016
ment – with the exception of Bosnia and Herzegovina – report-
ed declines, which were also mainly attributable to the
continuing low level of interest rates. Eastern Europe reported a
9 per cent, or € 82 million, decline in net interest income to
€ 866 million. This primarily resulted from a 12 per cent, or € 80 million, drop in net interest income to € 567 million in Russia, due
to a € 175 million reduction in interest income from derivatives. In contrast, margins from the core business improved significantly,
especially on the liabilities side. In Ukraine, the 3 per cent, or € 5 million, decline in net interest income to € 171 million was
currency related, whereas in local currency terms, net interest income rose 14 per cent. In Belarus, net interest income increased
€ 3 million to € 128 million. Asia reported a decline of 56 per cent to € 37 million due to reduced volumes. In the US, net interest
income fell € 11 million to € 14 million, due to the reduction in business volumes. In contrast, in Poland, repricing measures in the
deposit business increased net interest income by 4 per cent, or € 9 million, to € 262 million.
In the segment Central institution and specialized subsidiaries net interest income declined 15 per cent, or € 27 million, to € 161
million, due to the low interest level and due to a € 34 million reduced contribution from Raiffeisen Informatik GmbH.

In the segment Other Equity Participations, net interest income rose 8 per cent, or € 11 million, to € 154 million primarily due to
higher dividend earnings, contrasting with a 44 per cent, or € 58 million, lower income contribution of associates in the amount of
€ 74 million. This was primarily due to the decline in income contribution from UNIQA Insurance Group AG of € 75 million to
€ 31 million. In contrast, there was an increase in income contribution by € 26 million from Raiffeisen evolution project develop-
ment GmbH, Vienna, because in the previous year losses were recorded due to impairment of real estate projects.
The Group’s net interest margin declined 20 basis points year-

Development of net fee and commission income on-year to 2.51 per cent. The decline in the net interest margin
In € million was attributable to the aforementioned low market interest rates,
especially in several countries of the Group and to a limited
1,800
1,630 1,647
1,594 1,599
extent to currency devaluations in Eastern Europe. In addition,
1,521
9% the business volume (average interest-bearing assets) was down
1,500 14%
9% 15% 17% 4 per cent.
22%
24%
1,200 23%
24% 24%
Net fee and commission income
9%
8% 8%
900
16%
8% 8% Net fee and commission income increased year-on-year, de-
11%
17%
12% 9% spite the currency devaluations in Eastern Europe and lower
600 sales in Central Europe, by € 5 million, to € 1,599 million.
Net income from the management of investment and pension
300 44% 45% 44% 41% 41% funds increased € 39 million to € 162 million due to the inclu-
sion of Valida Group (€ 52 million) in October 2015. Also, the
net income from the foreign currency, notes/coins and precious
0
2012 2013 2014 2015 2016
metals business grew 3 per cent, or € 11 million, to € 392
Payment transfer business Loan and guarantee business million, predominantly due to higher income in the Czech
Securities business Other banking services Republic and at RBI AG. In contrast, the loan and guarantee
Foreign currency, notes/coins, and precious-metals business business fell € 37 million to € 150 million. Aside from currency
effects, this was also due to volume reductions in Asia and
Slovenia, the legal restriction on fees for early loan repayments
in Slovakia, lower guarantee income at RBI AG and in Croatia,
Net trading income by products and lower fee and commission income in Hungary as well as
In € million higher fee and commission expenses at Raiffeisen Bauspar-
kasse.
400
323 Net trading income

29
300
Net trading income increased € 204 million year-on-year to
220
196
9 € 220 million. Currency-based transactions rose € 175 million
200
116
to € 116 million, primarily as a result of a more limited Ukrainian
260
hryvnia devaluation than in the previous year (€ 81 million
208 increase). Another positive effect was attributable to the discon-
100 16
(21) 7 tinuation of a hedging transaction for Russian rouble denominat-
8 123
52 66 ed dividend income, which had resulted in a € 70 million
39 -1
0
16
(28)
2
(19)
reduction in the previous year. Net trading income also in-
(37) (5) (59) creased as a result of valuation gains on derivatives and foreign
(53)
currency positions in Russia (€ 13 million increase) and Croatia
-100 (€ 6 million increase). In contrast, Belarus (down € 61 million)
2012 2013 2014 2015 2016
reported declines resulting from lower net income from open
foreign currency positions due to valuations and volumes and to
the termination of a strategic currency position. Net income from
interest-based business rose € 57 million to € 123 million, pri-
marily due to valuation gains and higher interest income from
derivatives and securities positions at RBI AG. In contrast, net income from equity and index-based transactions fell € 25 million to
minus € 19 million, as a result of an adjustment of the yield curve due to changed market conditions.
Recurring other net operating income
Recurring other net operating income decreased 4 per cent, or € 4 million, year-on-year to € 96 million. This included a € 15
million decline in net income from the allocation and release of other provisions, caused by higher allocations for litigation in
Slovakia. Net income from non-banking activities increased € 8 million, net income from sale of tangible and intangible fixed
assets increased € 4 million.

General administrative expenses

The Group’s general administrative expenses were down 1 per cent, or € 29 million, to € 3,141 million in the reporting period.
The cost/income ratio increased 1.8 percentage points to 61.2 per cent due to lower operating income.
Staff expenses
Staff expenses, which constituted the largest item within general

administrative expenses (49 per cent), increased 3 per cent, or General administrative expenses
In € million
€ 38 million, to € 1,552 million. Following the decision not to
pay a bonus for 2014, bonus provisions were released in the 4,000
previous year. The Czech Republic reported an increase of
3,460
€ 27 million, primarily driven by higher staffing levels following 3,340 3,294
3,170 3,141
the purchase of Citibank’s retail business. In Slovakia, staff 13%
13%
13%
3,000 12%
expenses rose € 9 million which was also due to increased 12%
staffing levels. At RBI AG, staff expenses grew € 7 million as a

result of an increase in staffing levels and salary adjustments. 38% 38%
39% 40% 39%
The first-time consolidation of Valida Group in October 2015 2,000
resulted in an increase of € 11 million compared to the previous
year. Staff expenses fell in Russia (down € 14 million) due to a
reduction in staffing levels and to currency effects. In Asia, staff 1,000
49% 49%
expenses were down € 5 million due to reduced staffing levels. 48% 48% 49%
The average number of staff (full-time equivalents) fell 3,885 0

year-on-year to 51,810. The largest declines occurred in Ukraine 2012 2013 2014 2015 2016
(down 1,728), in Poland (down 1,143) due to the sale of the Staff expenses Other administrative expenses
Polish leasing company, in Russia (down 358), in Slovenia Depreciation of tangible and intangible fixed assets
(down 189) due to the sale of the Slovenian subsidiary bank,
and in Hungary (down 150). The largest increases occurred in
the Czech Republic (up 341) and in Slovakia (up 154).
Other administrative expenses
Other administrative expenses decreased 5 per cent, or € 63 million, to € 1,214 million. The decline was largely driven by a
decrease in space expenses (down € 29 million) due to branch closures. The number of business outlets was down 199 to 2,523
compared to year-end 2015. The most significant declines occurred in Ukraine (down 80), Poland (down 58), Romania (down
32), and in Slovenia due to the sale of the subsidiary bank (down 13). In addition, contributions to deposit insurance fees de-
creased by € 28 million, especially in Poland, the Czech Republic, Romania and Bulgaria. Also, advertising, PR and promotional
expenses declined by € 8 million. In contrast, IT expenses grew € 13 million and contributions to the bank resolution fund in-
creased € 10 million.
Depreciation of tangible and intangible fixed assets
Depreciation of tangible and intangible fixed assets fell 1 per cent year-on-year, or € 4 million, to € 375 million. The most signif-
icant decline occurred in Hungary, which reported impairment charges in the previous year as a result of branch closures
(€ 5 million) and in relation to software (€ 7 million). Ukraine also reported a decline of € 10 million, following impairment charg-
es in relation to buildings and the brand in the previous year. The impairment charge in relation to the Polbank brand amounted to
€ 21 million in the previous year, with the remaining € 26 million written down in the year under review. An increase was reported
in Russia, where investments in software and licenses resulted in higher depreciation. At the Raiffeisen-Leasing Group the sale of
wind park companies led to a decrease in expenses of € 5 million. At Raiffeisen Immobilienfonds there was an increase due to an
impairment of investment property in the amount of € 18 million.
The Group invested € 391 million in fixed assets in the reporting period. Of that amount, 36 per cent (€ 140 million) were invest-
ed in own tangible assets. Investments in intangible fixed assets – mainly related to software projects – accounted for 41 per cent.
The remainder was invested in assets in the operating leasing business.

Net provisioning for impairment losses

Net provisioning for impairment losses declined 40 per cent overall year-on-year, or € 501 million, to € 758 million. This included
a € 555 million reduction in individual loan loss provisions to € 771 million, while net releases for portfolio-based loan loss provi-
sions declined € 53 million to € 4 million. Proceeds from the sale of impaired loans remained almost unchanged at € 10 million.
The majority of net provisioning for impairment losses in the reporting year was attributable to corporate customers, for which
provisions of € 500 million were required. The figure for retail customers was € 241 million, of which € 88 million were related to
the switch to a rating-based model (PD/LGD) to calculate portfolio-based loan loss provisions, which had commenced in the
previous year. For this, an amount of € 28 million was already reported in the previous year.
The largest decline in net provisioning for impairment losses was recorded in Ukraine, which reported a net release of € 2 million
compared to a net provisioning requirement of € 212 million in the previous year. This was because higher allocations for retail
and corporate customers were still necessary in 2015, due to the economic situation in the Donbass region, and because curren-
cy effects had a reduced influence in the reporting period. At RBI AG net provisioning for impairment losses for corporate custom-
ers stood at € 255 million, thus € 178 million below the levels of the previous year. Hungary even reported a net release of € 7
million, compared to net provisioning for impairment losses of € 56 million for corporate and retail customers in the previous year.
The decline was in particular due to sales of non-performing loans collateralized with real estate and to rating improvements of
corporate customers. The credit risk situation for corporate and retail customers also improved in Russia, where net provisioning for
impairment losses amounted to € 145 million, € 36 million less than in the previous year. In Bulgaria, the settlement of several
corporate customer non-performing loans resulted in a decline of € 32 million, with no net provisioning requirement in the reporting
year. Albania was the only country where the situation was different, with the default of several large corporate customers resulting
in a € 34 million increase to € 65 million.
The significant credit risk improvement is also reflected in the portfolio of non-performing loans, which fell € 1,906 million to
€ 6,911 million during the year. The reduction was primarily attributable to sales of non-performing loans (€ 1,187 million), while
the remainder of the decline was largely due to the derecognition of uncollectible loans. Currency effects resulted in a € 56
million rise. The largest declines occurred at RBI AG (down € 839 million), Ukraine (down € 299 million), Hungary (down € 252
million), Russia (down € 152 million), Slovenia (down € 121 million as a result of the sale of the Slovenian subsidiary bank),
Bulgaria (down € 77 million), Croatia (down € 72 million) as well as the Raiffeisen-Leasing Group (down € 55 million). The
Group’s NPL ratio declined 2.4 percentage points year-on-year to 8.7 per cent. Non-performing loans compared to loan loss
provisions amounted to € 5.195 million. Despite the sales and write-offs, the NPL coverage ratio improved from 71.2 per cent to
75.2 per cent.
The provisioning ratio – net provisioning for impairment losses in relation to the average volume of loans and advances to custom-
ers – fell 0.52 percentage points to 0.93 per cent year-on-year.
Other results
Net income from derivatives and liabilities
Net income from derivatives and liabilities declined € 244 million to minus € 259 million. This reduction was primarily due to net
income from changes in credit spreads for own liabilities, which fell € 116 million to minus € 119 million due to lower risk premi-
ums for RBI AG. Net income from the valuation of derivatives entered into for hedging purposes fell € 128 million.
Net income from financial investments
Net income from financial investments improved € 88 million year-on-year to € 56 million. This was primarily attributable to net
proceeds from the sale of equity participations, which rose € 130 million year-on-year to € 146 million. The sale of Visa Europe
shares to Visa Inc. in June 2016 resulted in proceeds of € 132 million, of which € 78 million was transferred from other compre-
hensive income. In contrast, net income from the sale of securities from the fair value portfolio fell € 24 million. This decline was
primarily due to the sale of bonds at RBI AG in the previous year. The valuation result for securities in the fair value portfolio in-
creased € 14 million. Valuation results from primarily eligible government bonds at RZB AG contrasted with significantly lower
valuation results on fixed income government bonds linked to the US-Dollar in Ukraine. In the reporting period, net income from
associates amounted to minus € 130 million compared to minus € 94 million in the previous year. The partial sale of UNIQA
Insurance Group AG, Vienna, resulted in an impairment of the carrying amount of € 79 million as well as an impairment of the
stake available for sale, in accordance with IFRS 5, of € 84 million in the reporting period. The carrying amount of the remaining
stake was impaired at € 25 million. In the previous year, an impairment of the carrying amount of UNIQA Insurance Group AG,
Vienna, of € 86 million was necessary.

Bank levy, one-off effects and goodwill
The expense for bank levies rose € 35 million year-on-year to € 174 million. The increase was primarily due to expenses of
€ 34 million for the newly-introduced bank levy in Poland.
In Romania, the “Walkaway Law” came into force in the second quarter of 2016. The expected utilization resulted in a provision-
ing requirement of € 27 million in the reporting period. The new mortgage loan law stipulates that borrowers can sign their proper-
ties over to banks and thereby settle their debts, even if the outstanding volume of the loan exceeds the value of the property. The
law relates to certain mortgage loans taken out by private individuals in any currency and applies retroactively. Since the Group is
of the opinion that this law contravenes the Romanian constitution, corresponding proceedings were initiated. In October 2016,
the Romanian Constitutional Court repealed sections of the law connected with its retroactive application.
A provision of € 67 million was released in the previous year in connection with the implementation of the adjustments required in
2014 under the Settlement Act in Hungary, and a further € 7 million was released in the reporting period.
In Croatia, a law to enforce the conversion of loans denominated in Swiss francs resulted in a negative one-off effect of
€ 77 million in the previous year (2016: minus € 10 million). Proceedings initiated by the banks against the Croatian government
challenging the constitutionality of the law are pending.
Net income from the disposal of Group assets
In the reporting year, the disposal of 25 subsidiaries resulted in net income of € 27 million, mainly from the sale of the Polish leas-
ing company and a real estate leasing project in the Czech Republic. In the previous year, net income of € 52 million was record-
ed as a result of the exclusion of 47 subsidiaries from the consolidation group. In the previous year, the greatest impact came from
proceeds of € 86 million from the sale of the 75 per cent stake in the Russian pension fund business ZAO NPF Raiffeisen, Mos-
cow, and an impairment of € 52 million on assets available for sale in connection with the sale of the Slovenian subsidiary bank
Raiffeisen Banka d.d., Maribor. Of the subsidiaries excluded in the reporting year, twelve companies were excluded due to imma-
teriality, eight as a result of their sale, four due to the termination of operations and a further one due to a change in control. The
companies were predominantly active in leasing, financing and banking business, and as suppliers of ancillary services.
Income taxes
Income taxes increased € 38 million, or 14 per cent, year-on-year to € 310 million. The increase was predominantly the result of
the write-off of tax receivables from prior periods in Poland and the return to positive results from a tax perspective in Ukraine
and in Croatia. At 37 per cent, the effective tax rate in the reporting year was significantly above the Austrian income tax rate of
25 per cent.


In the course of 2016, RZB’s total assets declined 3 per cent, or € 3,579 million, to € 134,847 million. The reduction was at-
tributable to changes in the scope of consolidation of around € 2,200 million, primarily as a result of the sale of the Polish leasing
company and the Slovenian subsidiary bank. Currency developments – predominantly the appreciation of the Russian rouble (up
25 per cent) and the US-Dollar (up 3 per cent) against the Euro – resulted in a rise of around € 1,700 million.
Breakdown of assets Breakdown of equity and liabilities

In € billion In € billion
146.0 147.3 144.8 146.0 147.3 144.8

150 150
138.4 138.4
134.8 11% 134.8
12% 13% 11% 9%
18% 10%
19% 10%
120 18% 120 15% 16%
15% 17% 14%
13% 18% 12%
20% 18%
90 90
46% 51% 52%

58% 56% 60%
60 55% 56% 60
53% 55%
30 30
26% 23% 23%
15% 20% 18%
15% 13%
9% 8%
0 0
2012 2013 2014 2015 2016 2012 2013 2014 2015 2016
Loans and advances to banks (net) Deposits from banks
Loans and advances to customers (net) Deposits from customers
Securities Other assets Other liabilities Equity and subordinated capital
Assets
Loans and advances to banks before deduction of impairment losses (€ 50 million) fell 9 per cent over the year, or € 1,090
million, to € 11,024 million. This was primarily attributable to a decline of € 893 million to € 1,778 million in receivables from the
lending business, mainly at RBI AG. In contrast, receivables from repurchase agreements and securities lending increased
€ 2,194 million to € 3,374 million.
Loans and advances to customers before deduction of impairment losses (€ 5,195 million) increased € 311 million, to € 79,769
million in the reporting period. In particular, this included a € 852 million net increase in loans and advances to retail customers to
€ 32,016 million, while loans and advances to corporate customers declined € 374 million to € 46,980 million, and loans and
advances to sovereigns fell € 166 million to € 773 million. Loans to private individuals recorded a rise of € 1,497 million. This
loan increase came mainly from Russia (primarily currency-related), the Czech Republic (as a result of organic growth in the lend-
ing and mortgage lending business and of the acquisition of Citibank’s retail customer and credit card business) and Slovakia. The
€ 645 million decline in loans and advances to small and medium-sized entities to € 2,209 million was attributable to the sale of
the Polish leasing business. Declines in loans and advances to corporate customers in Asia and the US, due to the planned reduc-
tion in business volumes, were largely offset by increases in the Czech Republic, in Russia (notably currency-related) and in Roma-
nia.
The item securities registered a decrease of € 2,486 million to € 24,524 million, notably at RBI AG and in Poland as well as due
to the sale of stakes in UNIQA Insurance Group AG, Vienna. The € 1,470 million decline in other assets was mainly the result of
the € 563 million reduction in the cash reserve (primarily at RBI AG) and of the € 745 million reduction in assets available for sale
pursuant to IFRS 5 (sale of the Slovenian subsidiary bank, reclassification of ZUNO Bank AG, Vienna).
Equity and liabilities

The volume of Group financing from banks (mainly commercial banks) decreased 14 per cent, or € 4,053 million, to € 24,060
million. Long-term and short-term deposits declined, notably at RBI AG and in Asia.

Deposits from customers increased 3 per cent, or € 2,246 million, to € 80,325 million in the course of the year. In particular,
deposits from retail customers increased € 4,738 million to € 47,428 million, while deposits from corporate customers declined
€ 2,244 million to € 31,423 million. The € 3,885 million increase in deposits from retail customers was attributable to private
individuals mainly in the Czech Republic (organic growth and purchase of a business unit), Russia, Slovakia and Romania. Depos-
its from small and medium-sized entities also rose, by € 853 million to € 5,949 million, notably in the Czech Republic and Slo-
vakia. The decline in deposits from corporate customers was mainly recorded at RBI AG (repayments) as well as in Poland and
Slovakia due to the reduction of excess liquidity. In particular, deposits from large corporate customers reduced by € 2,239 million
to € 28,436 million.
Other liabilities fell € 2,303 million to € 16,431 million. Debt securities issued decreased € 826 million, primarily due to the
reduced refinancing required, while liabilities available for sale pursuant to IFRS 5 declined € 1,294 million (sale of the Slovenian
subsidiary bank, reclassification of ZUNO BANK AG).
Funding
For information related to funding, please refer to the risk report, note (43) Risks of financial instruments, in the consolidated financial statements.
Equity
Equity on the statement of financial position
Equity on the statement of financial position – consisting of
Breakdown of equity consolidated equity, consolidated profit/loss and non-controlling
In € million interests – increased 5 per cent compared to year-end 2015, or
12,172
11,788 € 498 million, to € 9,794 million. No dividends were paid out
12,000
to RZB’s shareholders for the financial year 2015.
9,794
10,000
40%
41%
9,207 9,296 Total comprehensive income attributable to the Group of € 355
million comprises consolidated profit of € 253 million and other
8,000 41% comprehensive income of € 102 million. Exchange rate differ-
43% 42%
ences represented the largest item in other comprehensive
6,000 income and amounted to € 181 million in the reporting year
41%
(2015: minus € 112 million). Key drivers were the appreciation
39%
4,000 32% 33% 35% of the Russian rouble (25 per cent) and the devaluation of the
Polish zloty (3 per cent). Since one part of the equity in these
2,000
currencies was hedged (capital hedge), the movement in the
19% 20% 25% 25% 24% exchange rate also resulted in a loss of € 26 million. The sale of
Visa Europe Ltd. shares to Visa Inc. realized € 74 million, result-
0
2012 2013 2014 2015 2016
ing in a net loss of € 46 million under the item net gains (losses)
Paid-in capital Earned capital
on financial assets available-for-sale. Due to the partial sale of
Non-controlling interests UNIQA Insurance Group AG, € 50 million of cumulative profits
were reclassified to the income statement. A contribution of € 26
million came from other changes in equity of associates valued
at equity.
Capital of non-controlling interests rose € 137 million to € 4,045 million. This was primarily due to the proportion of total compre-
hensive income attributable to non-controlling interests of € 330 million. In contrast, the partial sale of a stake in UNIQA Insurance
Group AG caused a decline in the amount of € 142 million. Moreover, the payment of dividends of € 59 million to minority
shareholders of Group units, mainly from Tatra banka a.s., Bratislava, (€ 24 million), BL Syndikat Beteiligungs GmbH, Vienna,
(€ 13 million) and Raiffeisenbank a.s., Prague, (€ 13 million) had to be paid.

Total capital pursuant to CRR/Austrian Banking Act (BWG)

The following consolidated figures have been calculated in
Development of total capital accordance with the provisions of the Capital Requirements
In € million Regulation (CRR) and the Austrian Banking Act (BWG). In
addition to the minimum capital requirements defined by the
14,000 18%
CRR, RZB is also obliged to comply with the capital require-
12,667 12,645
11,781
ments imposed by the ECB under the SREP process. With re-
spect to this, please refer to note (48) Capital management and
11,000
10,088
14% total capital according to CRR/CRD IV and the BWG.
9,820
10.9%
9.8% 11.9% RZB’s CET1 before deductions stood at € 8,809 million at year-
10.2% 10.4%
8,000 9% end 2016, after deductions CET1 stood at € 8,112 million. The
6,965 7,127
6,296
increase from the 2015 comparable level totaled € 633 million,
5,763
5,444 mainly due to the partial sale of UNIQA Insurance Group AG
5,000 5% and the resulting elimination of deductions for significant participa-
tions, the inclusion of the net profit for 2016 and positive currency
effects, especially in relation to the Russian rouble. In contrast, the
application of transitional provisions for 2016 of the CRR, as well
2,000 0%
2012 2013 2014 2015 2016
as matured additional tier 1 capital and consideration of federal-
Total capital
Total capital requirement
IPS contributions had a negative impact. Tier 2 capital declined
Common equity tier 1 ratio (transitional)/ Core tier 1 ratio (until 2012) € 365 million compared to the previous year and totaled
€ 1,976 million. The decline was mainly attributable to matured
tier 2 capital instruments in RBI AG and a higher deduction of
minorities in tier 2 capital. Total capital under CRR amounted to
€ 10,088 million. This corresponds to an increase of € 268 million compared to the 2015 year-end figure.
Total capital compared to a total capital requirement of € 5,444 million (2015: € 5.763 million). The decline was based on the
sale of Raiffeisen-Leasing Polska, Raiffeisen Banka d.d., Maribor, the rating improvement in Belarus and Ukraine, the sale of
UNIQA shares and also on the reduction in exposures in Asia and the US. The total capital requirement for credit risk amounted to
€ 4,501 million. The total capital requirement for position risk in bonds, equities, commodities and currencies came to € 216
million. The decline of € 35 million in the total capital requirement for operational risk to € 727 million was attributable to the
conversion of larger units to the advanced approach.
Based on total risk, the CET1 ratio (transitional) was 11.9 per cent, with a total capital ratio (transitional) of 14.8 per cent.
Excluding the transitional provisions as defined in the CRR, the CET1 ratio (fully loaded) stood at 11.9 per cent, and the total
capital ratio (fully loaded) was 14.0 per cent.

Research and development

As a universal bank, RZB is not involved in research and development in the strictest sense of the term.
In the context of financial engineering, it does however develop investment, financing and risk hedging solutions for its customers.
Financial engineering encompasses not only structured investment products, but also and in particular structured financing: financ-
ing concepts that go beyond the application of standard instruments and are used in acquisition or project finance, for example.
RZB also develops tailor-made solutions for its customers to hedge a broad spectrum of risks – from interest rate risk and currency
risk through to commodity price risk. Besides financial engineering, RZB works actively in cash management to develop integrated
product solutions for international payments.
The Program Digital Regional Bank under the lead of RZB AG focuses on quality leadership in omni-channel sales to create the
requirements for the Raiffeisen Banking Group to remain competitive. It aims to bridge the gap between a digital and regional
presence and views all channels as equal – from bank branch to website. The Digital Regional Bank also increases efficiency and
response times by establishing uniform process and product standards and promoting a culture of innovation within the Raiffeisen
Banking Group. As part of innovation management, networking with ambitious start-up companies, well-known research institutes
and cross-thinkers injects momentum and creates solutions for meeting customer requirements, placing these at the disposal of the
Raiffeisen Banking Group. Here, too, the focus is on developing a culture of innovation and supporting the digital transformation of
the entire Raiffeisen Banking Group. In CEE, the RBI subsidiary banks in Slovakia and the Czech Republic are leaders in the field
of mobile and online banking. To learn from the experiences and know-how in these markets, an extensive project to establish a
group-wide digital roadmap was launched at the end of 2016.

The internal control and risk

management system in relation to the
Group accounting process
Balanced and comprehensive financial reporting is a priority for RZB and its governing bodies. Compliance with all relevant
statutory requirements is of course a basic prerequisite. The Management Board is responsible for establishing and defining a
suitable internal control and risk management system that encompasses the entire accounting process while adhering to company
requirements. This is embedded in the company-wide framework for the internal control system (ICS).
The ICS is intended to provide the Management Board with the information needed to ensure effective and continuously improv-
ing internal controls for accounting. The control system is designed to comply with all relevant guidelines and regulations and to
optimize the conditions for specific control measures.
The consolidated financial statements are prepared in accordance with the relevant Austrian laws, predominantly the Austrian
Banking Act (BWG) and the Austrian Commercial Code (UGB), which govern the preparation of consolidated financial state-
ments. The accounting standards, applied to the consolidated financial statements, are the International Financial Reporting
Standards (IFRS) in the form in which they have been taken over in the EU.

Control environment
An internal control system has been in place for many years at the Group, including directives and instructions on key strategic
issues. It incorporates:
 The hierarchical decision-making process for approving Group and company directives and departmental and divisional in-
structions.
 Process descriptions for the preparation, quality control, approval, publishing, implementation and monitoring of directives and
instructions.
 Rules on revising and repealing directives and instructions.
The senior management of each Group unit is responsible for implementing the Group-wide instructions. Compliance with Group
rules is monitored as part of the audits performed by Group Audit and by local auditors.
The consolidated financial statements are prepared by the RBI main department Accounting & Reporting (on the basis of a service
level agreement) which reports to the Chief Financial Officer of RBI. The associated responsibilities are defined for the Group
within the framework of a dedicated Group function.
Risk Assessment
Significant risks relating to the Group accounting process are evaluated and monitored by the Management Board. Complex
accounting standards can increase the risk of errors, as can the use of differing valuation standards, particularly in relation to the
Group's principal financial instruments. A difficult business environment can also increase the risk of significant financial reporting
errors.
For the purpose of preparing the consolidated financial statements, estimates have to be made for asset and liability items for
which no market value can be reliably determined. This is particularly relevant for credit business, equity participations, trademark
rights and goodwill. Social capital and the valuation of securities are also based on estimates.
Control measures
The preparation of individual financial statements is decentralized and carried out by each Group unit in accordance with the RZB
guidelines. The Group unit employees and managers responsible for accounting are required to provide a full presentation and
accurate valuation of all transactions.
Differences in reporting dates and local accounting standards can result in inconsistencies between the individual financial state-
ments and the figures submitted to the RBI Group Financial Reporting department in accordance with central guidelines. The local
management is responsible for ensuring implementation of mandatory internal control measures, such as the separation of func-
tions and the principle of dual control. Reconciliation and validation controls are imbedded in the aggregation, calculation and
accounting valuation activities for all financial reporting processes.
Group consolidation
The transfer of financial statement data, which are examined by an independent auditor or undergo an audit review, are mostly
entered directly in, or automatically transferred to, the IBM Cognos Controller consolidation system by the end of January of the
subsequent year. The IT system is kept secure by limiting access rights.
The plausibility of the financial statement data submitted by the Group units is initially checked by the responsible key account
manager within the RBI Group Accounting & Reporting. Group-level control activities comprise the analysis and, where necessary,
modification of the financial statements submitted by Group units. These controls take into account the reports submitted by the
independent auditor and the results of the closing discussions with representatives of the individual companies, during which both
the plausibility of the individual financial statements and individual critical issues of the Group units are discussed.

The subsequent consolidation steps are then performed using the consolidation system, including capital consolidation, expense
and income consolidation, and debt consolidation. Finally, any intra-Group gains are eliminated through bookings at the Group
level. At the end of the consolidation process, the notes to the financial statements are prepared in accordance with IFRS, the
BWG and UGB.
The general control system encompasses both the Management Board and middle management. All control measures constitute
part of the day-to-day business processes and are used to prevent, detect and correct any potential financial reporting errors or
inconsistencies. Control measures range from managerial reviews of the results for the period as well as the specific reconciliation
of accounts through to analyzing ongoing accounting processes.
The consolidated financial statements and the management report are reviewed by the Supervisory Board's Audit Committee and
are also presented to the Supervisory Board for information. The consolidated financial statements are published on the Compa-
ny's website and in the Wiener Zeitung's official register and are filed with the commercial register as part of the annual report.
Information and communication

The consolidated financial statements are prepared using Group-wide standard forms. The accounting and valuation standards
are defined and explained in the RZB Group Accounts Manual and must be applied when preparing the financial statements.
Detailed instructions for the Group units on measuring credit risk and similar issues are provided in the Group directives. The rele-
vant units are kept abreast of any changes to the instructions and standards through regular training courses.
The consolidated results are reported in the form of complete consolidated financial statements in the annual report. These consol-
idated financial statements are examined by an independent auditor. In addition, the management summary (Group management
report) provides verbal comments on the consolidated results in accordance with the statutory requirements.
The Group produces consolidated quarterly reports. The external publication process takes place on a half-yearly basis: i. e. in
addition to the consolidated financial statements as of year-end, a semi-annual financial report is drawn up and published in
compliance with the provisions of IAS 34. Before publication, the consolidated financial statements are presented to senior man-
agers and the Chief Financial Officer for final approval and then submitted to the Supervisory Board's Audit Committee. Analyses
pertaining to the consolidated financial statements are also provided for the management as well as preliminary Group figures at
regular intervals. The financial budgeting process includes the compilation of a three-year Group budget.
Monitoring
Financial reporting is a main focus of the ICS framework, whereby financial reporting processes with inherent misstatement risk are
identified and subject to additional monitoring and control reviews – the results of which are presented to the Management Board
and the Supervisory Board’s Audit Committee for evaluation. The Management Board is responsible for ongoing company-wide
monitoring. In accordance with the target operating model, three successive lines of defense are established to meet the increased
requirements for internal control systems.
The first line of defense is formed by individual departments, where department heads are responsible for monitoring their business
areas. The departments conduct control activities and plausibility checks on a regular basis, in accordance with the documented
processes.
The second line of defense is provided by specialist areas focused on specific issues. These include, for example, Compliance,
Data Quality Governance, Operational Risk Controlling, and Security and Business Continuity Management. Their primary aim is
to support the individual departments when carrying out control steps, to validate the actual controls and to introduce state-of-the-
art practices within the organization.
Internal audits are the third line of defense in the monitoring process. Responsibility for auditing lies with Group Internal Audit at
RZB and also the respective internal audit departments of the Group units. All internal auditing activities are subject to the Group
Audit standards, which are based on the Austrian Financial Market Authority’s minimum internal auditing requirements and interna-
tional best practices. Group Audit’s internal rules also apply (notably the Audit Charter). Group Audit regularly and independently
verifies compliance with the internal rules within the RZB Group units. The head of Group Internal Audit reports directly to the
Management Boards.

Risk management
For information on risk management, please refer to note (43) Risks arising from financial instruments, in the risk report section of
the consolidated financial statements.
Human Resources
Human Resources (HR) deals with the key corporate processes for managing personnel resources within the Group, taking into
account both the needs of employees and corporate interests. As of 31 December 2016, RZB had 50,203 employees (full-time
equivalents), 2,893 people or 5 per cent fewer than at the end of 2016. The majority of this reduction is attributable to develop-
ments in Ukraine, Russia, Poland and Slovenia. The average age of employees remained relatively low at 37 years and women
accounted for 67 per cent of the workforce. Graduates make
up 73 per cent of employees, indicating a highly skilled work-
Development of personnel force.
Number of staff on balance sheet date
Professional and management

70,000
60,694 59,372
445
development
60,000 456 56,212
800 53,096
1,016 50,203
24,206
50,000
23,822
5,337
21,915
In 2016, the training budget was primarily used for strategic

19,369
40,000 objectives and initiatives. As well as ensuring regulatory training

17,827
requirements were met, increasing emphasis was placed on key

16,077
15,472
30,000
areas such as digital banking, sales, affluent retail customer
15,216
15,041
business, procurement and IT. The “Branch Management Acad-

14,831
20,000
emy”, a training initiative for managers in sales, was implement-
15,722
16,724
14,526
13,969
10,000
ed throughout the Group.
9,051
0
3,242 3,900 3,755 3,701 3,157 The main focus for management development was on strength-
2012 2013 2014 2015 2016 ening management expertise in the areas of change manage-
Austria Central Europe Southeastern Europe ment, staff leadership, motivation, and communication. The use
Eastern Europe Rest of the world
of reflective learning methods, such as 360° feedback, coach-
ing and mentoring, as well as experience-based measures such
as job rotation, was also further expanded.
In Albania, for example, a development program covering a wide variety of areas, “Growth is a Marathon, not a Sprint”, was
initiated within the subsidiary bank to equip managers for the challenges faced in an increasingly complex operating environment
and to facilitate growth.
A similar program named “FIRE” (Freedom - Inspiration - Raiffeisen - Energy), was also implemented in Hungary, focusing on key
leadership skills such as credibility and integrity, or resilience and inspiration.
The subsidiary bank in Russia increased efforts to foster a positive culture of communication and cooperation among managers
and employees, for example, by implementing ad-hoc feedback and round-table discussions on topical business issues.
Further exemplary measures are the support of the integration of RSC’s postal services into ZHS by management training, the
implementation of a body of experts for authorized employees as a forum for structured exchange at Raiffeisen-Leasing and the
implementation of structured personnel development reviews with the B-1 managers at Raiffeisen Bausparkasse.

Performance und Talent Management

The new performance management model for Group executives developed during 2015 was successfully implemented in 2016.
This included introducing clearly defined target categories (similar to a balanced scorecard approach) and improving consultation
between head office and Group units.
With one exception, the uniform Performance Management according to RZB/RBI standards was already introduced in the spe-
cialized subsidiaries and presented to managers in the course of workshops and information events.
Other measures included a new competence model and the intensification of dialogue and feedback. Based on these concepts,
an international team developed the guidelines and fundamental principles for the new performance management process for all
other employee levels. Some subsidiary banks have already launched corresponding pilot projects. In Hungary, for example, the
focus was on increasing the level of individual responsibility with respect to target definition and performance, as well as on regu-
lar and mutual feedback, coaching and staff development.
The annual standard processes to identify and develop talent – each with varying local focal points – were carried out again in
2016. The intensive efforts produced results, with talent pipelines at all levels in almost all units. Data for Austria, for example,
shows that 39 per cent of talented individuals identified have advanced in their careers in the last two years (compared to 14 per
cent of other employees).
Employee survey
In 2016, around 40,000 employees participated in a Group-wide employee survey. The overall response rate was 87 per cent.
Improvements were achieved for the two key factors employee engagement (commitment to the company and associated willing-
ness to voluntarily make additional effort) and employee enablement (existence of an environment which nurtures success). Of the
employees surveyed, 65 per cent felt committed to the company and 67 per cent felt their environment nurtured success. Com-
pared to the last Group-wide survey, this represents an increase of four and three percentage points respectively.
The results are now being used as a basis to develop further improvement measures. For example, the Management Board in
Hungary has defined four issues which will be given further attention. Each of the issues is being addressed by an interdisciplinary
team led by a member of first-level management, with expert support from the change facilitator and with a Management Board
member acting as sponsor.
Developments in compensation management

In order to more strongly reflect the critical importance of RZB’s medium-term objectives and its capitalization in the compensation
system, the bonus system was further adapted in 2016 by expanding the “step-in” criteria for Group executives and adjusting the
criteria for target achievement. A reduction in the variable compensation components of remuneration packages also led to new,
non-financial concepts for recognizing special achievements by employees being established. For example, a non-financial motiva-
tion program (starting with a system of medical services) was launched in Belarus to improve employee commitment and reward
long-serving employees, while the “Success Celebration System”, which aims to strengthen team cooperation and collaboration
between business areas, was established in Hungary.
In 2016, steps were taken and processes implemented from a regulatory perspective, in order to adjust the remuneration systems
of the specialized subsidiaries to an even higher extent to the Group’s remuneration policies.
HR Awards
The diverse measures taken by HR managers from the subsidiary banks designed to continuously improve HR functions and pro-
cesses were again recognized by a number of awards. The Hungarian subsidiary bank received the “Employer Partner Certifi-
cate” in recognition of high quality standards and “best HR practice”, as well as the “Colibri Internship Award” as the best
employer for interns. Headhunters ranked the Russian subsidiary among the “Top 10 best places to work” and the Head of HR
was awarded the accolade “Best HR Director in the Banking Sector”. The Romanian subsidiary’s project “Inspire to Aspire-
Wakanda Challenge” prevailed against 17 competitors and won an HR award in the category “Training and Development of
People”. This program places special emphasis on adapting leadership behavior. The Bulgarian subsidiary received the “Best HR
project in a Big Company Award” for the restructuring and modernization of its HR division. The Czech subsidiary received the
“HR Excellence Award” which is awarded by HR managers and experts from 300 Czech companies.


Outlook
Economic prospects
Central Europe
Following somewhat weaker growth last year, growth in Central Europe (CE) is expected to pick up again in 2017. Ongoing
expansionary monetary policy in the region, a solid growth climate in the euro area and an expected recovery in investment
demand – amid continued strong private household consumer spending – should support this positive momentum. Leading the
way are Poland and Slovakia, each with projected growth of 3.3 per cent, closely followed by Hungary, whose economy should
grow by 3.2 per cent. In the Czech Republic, growth is forecast to reach 2.7 per cent.
Southeastern Europe
The Southeastern European (SEE) region is likewise expected to continue its growth trend. Following very strong GDP growth of
3.9 per cent in 2016, SEE should increase its economic output in 2017 by slightly more than 3 per cent, which is its current potential
growth rate. In particular, Romania could continue its solid growth trajectory with GDP growth of 4.2 per cent, but momentum is
already slowing somewhat following last year’s peak of over 4.8 per cent. Conversely, negative overheating effects such as a
ballooning current account deficit should be avoided as a result. Serbia and Croatia, the two countries showing the strongest eco-
nomic recovery in 2016, should both achieve economic growth of around or just over 3.0 per cent.

Eastern Europe
In Russia, moderate economic growth of 1.0 per cent is expected following the easing of the recession; a positive trend in oil prices
would further support the Russian economy. In Ukraine, a continuation of last year’s weak recovery process is anticipated whereas
the economy in Belarus is still expected to shrink slightly. In general, Eastern Europe (EE) currently lacks strong external and internal
growth drivers, as a result of which the region is not able to replicate the higher growth rates of the past. In addition, event risk re-
mains considerable.
Austria
In Austria, the moderate economic upturn in 2017 should continue and gain momentum. Domestic demand (private consumption,
gross capital investment) should continue to be the main pillar of support. The growth rate for exports should be higher than in
2016. Notwithstanding continuing solid growth in imports resulting from domestic economic momentum, net exports are expected
to continue to support GDP growth in 2017. This scenario implies a 1.7 per cent increase in real GDP, following 1.5 per cent in
2016.
CEE banking sector

Solid economic growth in CE and SEE – as well as the end of the recession in Russia and Ukraine – should have a markedly
positive impact on the CEE banking sector in 2017. Favorable developments in the operating business in CE and SEE could also
be supported by at least stable or even slightly improved interest margins and/or somewhat steeper yield curves in 2017. In
addition, recent years have already seen necessary adjustments for foreign currency loans and NPL portfolios resulting from the
earlier expansion in CE and SEE, as well as their negative income effects. Accordingly, return on equity in the CEE banking sector
should continue to recover in 2017.
Outlook for RZB following merger with RBI

Due to the resolution passed by the General Extraordinary Meetings of RZB AG and RBI AG on 23 January, and respectively on
24 January 2017, regarding the merger of the two institutes, RBI AG is the universal successor of RZB AG and, among other
things, will take over the role of central institution of the RBG.
As a result of the merger with RZB, to be entered in the commercial register on 18 March 2017, the following outlook applies to
the combined bank.
RBI reached the 12 per cent CET1 ratio target one year ahead of schedule with a fully loaded CET1 ratio of 13.6 per cent at 31
December 2016 (12.4 per cent for the pro forma combined bank). In the medium term RBI strives to achieve a CET1 ratio (fully
loaded) of around 13 per cent.
After stabilizing loan volumes, RBI looks to resume growth with an average yearly percentage increase in the low single digit area.
RBI expects net provisioning for impairment losses for 2017 to be below the level of 2016 (€ 754 million).
RBI looks to reach an NPL ratio of around 8 per cent by the end of 2017, and over the medium term RBI expects this to reduce
further.
RBI further aims to achieve a cost/income ratio of between 50 and 55 per cent in the medium term, unchanged from our previous
target.
RBI’s medium term return on equity before tax target is unchanged at approximately 14 per cent, with a consolidated return on
equity target of approximately 11 per cent.

Annual financial statements 187
Annual financial
statements
Assets
31/12/2016 31/12/2015
in € in € thousand
1. Cash in hand and balances with central banks 4,503,461,768.98 4,051,914
2. Treasury bills and other bills eligible for refinancing with central banks 4,263,950,286.13 4,293,045
3. Loans and advances to credit institutions 1,117,469,520.84 2,523,150
a) due at call 261,596,351.95 28,630
b) Other loans and advances 855,873,168.89 2,494,521
4. Loans and advances to customers 1,010,951,754.21 1,083,154
5. Debt securities and other fixed-income securities 815,639,850.13 645,387
a) issued by public bodies 0.00 0
b) issued by other borrowers 815,639,850.13 645,387
hereof: own debt securities 0.00 0
6. Shares and other variable-yield securities 91,415,229.68 45,064
7. Financial investments 41,911,132.89 41,498
hereof: in credit institutions 27,815,879.86 27,816
8. Interest in affiliated companies 5,126,534,625.27 5,411,788
hereof: in credit institutions 0.00 0
9. Intangible fixed assets 1,380,901.17 1,963
10. Tangible fixed assets 4,588,356.99 4,552
11. Other assets 819,306,467.55 261,318
12. Accruals and deferred income 426,641.54 846
Total assets 17,797,036,535.38 18,363,679

188 Annual financial statements
Liabilities
31/12/2016 31/12/2015
1. Deposits from banks 12,427,164,761.85 13,739,487
a) Due at call 445,371,395.16 218
b) With agreed maturity dates or periods of notice 11,981,793,366.69 13,739,269
2. Liabilities to customers (non-banks) 680,529,605.22 271,999
a) Savings deposits 0.00 0
b) Other liabilities 680,529,605.22 271,999
aa) Due at call 35,352,151.27 17,000
bb) With agreed maturity dates or periods of notice 645,177,453.95 255,000
3. Debt securities issued 170,075,816.87 35,004
a) Debt securities issued 35,016,721.25 0
b) Other securitised liabilities 135,059,095.62 35,004
4. Other liabilities 132,960,895.67 70,358
5. Accruals and deferred income 3,527,013.70 4,950
6. Provisions 69,480,066.17 76,299
a) Provisions for severance payments 7,111,528.11 4,938
b) Provisions for pensions 46,497,754.21 53,022
c) Provisions for taxation 1,626,274.00 4,392
d) other 14,244,509.85 13,947
Supplementary capital pursuant to Chapter 4 of Title I of Part 2 of Regulation (EU) No
7. 575/2013 66,100,144.33 66,099
8. Subscribed capital 492,466,422.50 492,466
9. Capital reserves 1,862,164,089.07 1,862,143
a) Committed 1,861,974,553.59 1,861,975
b) Uncommitted 189,535.48 168
10. Retained earnings1 1,368,201,545.28 1,219,433
a) Legal reserve 38,612,000.00 38,612
b) Other reserves 1,329,589,545.28 1,180,821
11. Liability reserve pursuant to section 57 (5) BWG 524,366,174.72 524,366
12. Net profit for the year 0.00 1,075
a) Profit/loss (1,074,702.41) 77,657
b) profit/loss brought forward from previous years 1,074,702.41 (76,582)
Total liabilites 17,797,036,535.38 18,363,679
1 Transfer of untaxed reserves € 3.773 million to the retained earnings retrospectively as of 31/12/2015 according to § 906 Abs. 31 UGB

Annual financial statements 189
Items off the statement of financial position

ASSETS 31/12/2016 31/12/2015
1. Foreign assets 3,472,966,969.27 3,411,204
EQUITY AND LIABILITES 31/12/2016 31/12/2015

1. Contingent liabilities 7,708,060,916.30 8,744,921
Guarantees and assets pledged as collateral security 7,708,060,916.30 8,744,921
2. Commitments 3,047,383,000.00 2,168,017
hereof: liabilities from sale and repurchase agreements 0.00 0
3. Commitments arising from agengy services 0.00 24,010
4. Eligible capital pursuant to Part 2 of Regulation (EU) No 575/2013 3,997,438,796.92 3,393,822
hereof: supplementary capital pursuant to Chapter 4 of Title I of Part 2 of Regulation (EU) No
575/2013 29,125,172.40 0
5. Capital requirements pursuant to Article 92 of Regulation (EU) No 575/2013 7,458,932,097.06 8,103,178
hereof: capital requirement pursuant to Article 92 (1) (a) to (c) of Regulation (EU) No 575/2013
a) hereof: capital requirements pursuant to Article 92 (1) (a) 53.20% 41.88%
b) hereof: capital requirements pursuant to Article 92 (1) (b) 53.20% 41.88%
c) hereof: capital requirement pursuant to Article 92 (1) (c) 53.60% 41.88%
6. Foreign liabilities 67,831,475.92 140,009

190 Annual financial statements
Income statement
2016 2015
1. Interest receivable and similar income 24,562,995.31 47,366
hereof: from fixed-income securities 30,151,037.20 24,853
2. Interest payable and similar expenses (66,929,578.92) (68,690)
I. NET INTEREST INCOME (42,366,583.61) (21,325)
3. Income from securities and participating interests 537,167,598.58 82,255
a) Income from shares and other variable-yield securities 136,491.05 52
b) Income from participating interests 6,135,107.53 6,307
c) Income from shares in affiliated undertakings 530,896,000.00 75,896
4. Commissions receivable 9,993,068.96 11,149
5. Commissions payable (798,669.76) (575)
6. Net profit or net loss on financial operations (35,082.66) (9,039)
7. Other operating income 29,067,869.70 28,023
II. OPERATING INCOME 533,028,201.21 90,488
8. General administrative expenses
a) Staff costs (31,265,454.51) (30,219)
hereof aa) Wages and salaries (25,222,725.53) (22,687)
bb) Expenses for statutory social contributions and compulsory contributions related to
wages and salaries (5,151,608.59) (4,574)
cc) Other social expenses (1,089,798.95) (947)
dd) Expenses für pensions and assistance (3,854,872.17) (4,617)
ee) Release/Allocation to provision for pensions 6,492,697.98 3,678
ff) Expenses for severance payments and contributions to severance funds (2,439,147.25) (1,071)
b) Other administrative expenses (51,275,576.09) (48,383)
9. Value adjustments in respect of asset items 9 and 10 (601,987.50) (163)
10. Other operating expenses (748,069.86) (8,291)
III. OPERATING EXPENSES (83,891,087.96) (87,056)
IV. OPERATING RESULT 449,137,113.25 3,432
11./ Net income/expenses from the disposal and valuation of loans and advances and
12. securities classified as current assets (14,376,196.05) 12,933
Net income/expenses from the disposal and valuation of securities evaluated as
13./ financial investments and of shares in affiliated companies and participating interests
14. (284,441,339.27) (192,678)
V. PROFIT ON ORDINARY ACTIVITIES 150,319,577.93 (176,313)
15. Tax on profit or loss 13,859,390.15 12,746
16. Other taxes not reported under Item 15 (16,485,006.44) (20,252)
VI. PROFIT/LOSS BEFORE TAX 147,693,961.64 (183,819)
17. Changes in reserves (148,768,664.05) 261,475
hereof: allocation to liability reserve 0.00 0
VII. LOSS/PROFIT AFTER TAX (1,074,702.41) 77,657
18. Profit/Loss brought forward 1,074,702.41 (76,582)
VIII. NET PROFIT FOR THE YEAR 0.00 1,075

Notes 191
Notes
Company
Raiffeisen Zentralbank Österreich AG is the lead and central institution of the Raiffeisen Banking Group (RBG) in Austria. It was
founded in 1927 - at the time as "Girozentrale der österreichischen Genossenschaften" - as a central liquidity balancing provider
for the Austrian agricultural cooperatives. RZB is the third-largest banking group in Austria and RBG as a whole is the largest and
strongest domestic banking group. RZB AG is primarily owned by the Regional Raiffeisen Banks and is their central institution
pursuant to the Austrian Banking Law applicable until 31 December 2016.
The core business area of RZB AG is its function as the lead institution of RBG and its role as the head of RZB. RZB AG also
performs central services for RBG. RZB AG has a dense network of subsidiary banks, leasing companies and many other special-
ized financial service providers in Central and Eastern Europe (CEE) through its stock-exchange listed subsidiary, Raiffeisen Bank
International AG (RBI AG).. All told, RZB employs around 50,000 people worldwide and has around € 135 billion in total assets.
Alongside the management of its principal equity participation, RBI AG, RZB AG's business predominantly relates to its role as
lead institution of RBG and management of the broader portfolio of equity participations.
The main business areas of RZB AG encompass equity participation management, Raiffeisen sector business and liquidity man-
agement.
 Participation Management: RZB AG holds alongside RBI AG a number of equity participations which do not have a primary
connection to the operational commercial customer business or companies which have an operational connection to the fi-
nance business, but are not categorized as sector business.
 Sector business: Business that RZB AG, as the central institution of the Austrian Raiffeisen bank sector, undertakes with affiliat-
ed banks from the Raiffeisen bank sector within the framework of minimum reserve and liquidity management. This includes in
particular short-term money market transactions between banks from the Austrian Raiffeisen bank sector and RZB AG and be-
tween RZB AG and RBI AG, as well as investment of the required liquidity at the National Bank of Austria (Österreichische Na-
tionalbank). Furthermore, RZB AG carries out advisory and service activities for the entire Austrian Raiffeisen bank sector, such
as the organization and centralized management of Raiffeisen marketing.
 Liquidity Management: RZB AG is the central institution of RBG. Together with more than 400 banks in RBG, it forms the
largest liquidity network in Austria. In this liquidity network, pursuant to the Austrian Banking Act (Section 27a) members are re-
quired to hold a liquidity reserve at the central parent company institution. RZB AG invests the liquidity reserve in highly liquid
assets according to the CRR/CRD IV.
A further activity of RZB AG is risk management. RZB AG utilizes a system of risk principles and risk measurement and monitoring
processes, which serve the purpose of control and management of the risks arising from all bank business and special business of
the Group.
Service relationships between RZB AG and RBI AG

There are mutual service relationships between RZB AG and RBI AG that are covered by Service Level Agreements (SLAs). On the
basis of a framework agreement and a SLA template, which regulate the rights and obligations of the contracting parties and the
settlement modalities between them, there are a variety of SLAs on departmental level covering dealings between RZB AG and
RBI AG. These are subject to an annual review process based on the services actually provided.

192 Notes
As of the reporting date, there were 27 SLAs regulating services provided by RBI AG. The material ones are:
 Accounting & Reporting
 Risk Controlling
 Information Technology (IT)
 Human Resources
 Tax Management
 Group Communications
In turn, RZB AG provides services - Group management instruments - that represent Group guidelines. These are also regulated by
seven SLAs: Compliance, Corporate Responsibility, Executive Secretariat, Group Organizations & Internal Control System (inte-
grated in Compliance as of 1 October 2016), Risk Controlling and Raiffeisen sector customers.
Service relationships between RZB AG and other companies

There are numerous service relationships between RZB AG as service recipient and other companies. The primary relationships in
the banking business are with Raiffeisen Informatik GmbH, Raiffeisen Service Center GmbH and card complete Service Bank AG.
RZB AG in turn provides services to various affiliated companies and companies in the Raiffeisen Banking Groupin the areas of
marketing, risk controlling, compliance, accounting & reporting and internal control system (IKS).
Shareholders
RZB AG is, as part of the Raiffeisen Banking Group, majority owned by the Regional Raiffeisen Banks (Raiffeisen-Landeszentralen)
and is the ultimate parent company of the Group.
The consolidated financial statements of RZB AG are filed with the commercial register and published in the Wiener Zeitung, in
accordance with Austrian disclosure regulations. The Austrian Regional Raiffeisen Banks hold in total approximately 90 per cent of
the subscribed capital in RZB AG.
In September 2016, Raiffeisen-Landesbanken-Holding GmbH (which, until then, was the ultimate parent of the Group) first merged
with its wholly owned subsidiary R-Landesbanken-Beteiligung GmbH and then with RZB AG as the acquiring company. This gave
rise to a merger gain of € 21 thousand. RZB AG has been the ultimate parent since then.

Notes 193
Recognition and
measurement principles
General principles
The annual financial statements for the year ending 31 December 2016 were prepared by the Management Board in accord-
ance with the Austrian Commercial Code (UGB) as amended by the 2014 Austrian Financial Reporting Amendment Act (RÄG),
taking into account the special provisions of the Austrian Banking Act. In accordance with the principles of proper accounting, and
taking into account standard practice as described in Section 222 (2) of the Austrian Commercial Code (UGB), to the best of our
knowledge the annual financial statements give a true and fair view of the company’s net assets, financial position and earnings.
Since the 2014 Austrian Financial Reporting Amendment Act (RÄG) is being applied for the first time, amounts previously recog-
nized as untaxed reserves (valuation reserves) had to be reclassified as other reserves. In addition, temporary differences in the
form of deferred taxes attributable to different accounting and tax treatments have to be recognized on the asset and liability
sides. There were no other effects from the application of the 2014 Austrian Financial Reporting Amendment Act (RÄG). The
previous year figures were adjusted to conform to RÄG 2014.
The consolidated financial statements were prepared in compliance with the consistency principle.
Assets and liabilities are valued on the principle of individual valuation and on the assumption that the company will continue to
exist. The principle of prudence is applied, taking into account the special characteristics of the banking business.
RZB AG chose the internet as the medium for the disclosure under Section 431 ff Regulation (EU) No. 575/2013. The disclosure
is reported on the homepage of RZB AG (www.rzb.at).
Foreign currencies
Assets and liabilities in foreign currencies are converted at the ECB’s reference exchange rates as at 31 December 2016 pursuant
to Section 58 (1) of the Austrian Banking Act (BWG).
Financial instruments
Stock market prices were used to determine the fair value of listed products. Where stock market prices were not available, prices
for original financial instruments and forward transactions were determined based on the calculated present value. The prices for
options were determined based on suitable options pricing models. The present value calculation is based on the zero coupon
yield curve. Option pricing formulas as described by Black & Scholes 1972, Black 1976 and Garman-Kohlhagen were used
together with other conventional market models for the valuation of structured options.
Financial instruments in the banking book

Securities intended to serve business purposes on a permanent basis (investment portfolio) are valued as fixed assets. The differ-
ence between the purchase cost and repayment amount is written off or recognized pro rata over the residual term.
Securities held as current assets are valued strictly according to the lower of cost or market value principle, with any reversals of
impairment losses up to amortized cost.

194 Notes
RZB AG uses interest rate swaps to hedge the interest rate risk from assets (bonds) on the statement of financial position. Fixed
cash flows are exchanged for variable cash flows to minimize interest rate risk. These derivatives form parts of valuation units. Their
market value is therefore not reported in the annual financial statements, as they are offset by cash flows from the underlying trans-
actions recognized through profit and loss.
The hedging relationships are determined on the basis of micro fair value hedges in accordance with IAS 39 and documented
according to applicable regulations. On designation, the effectiveness of the hedging relationship is reviewed in a prospective
effectiveness test using a 100 basis point shift in the yield curve.
The effectiveness is measured retrospectively on a monthly basis using a regression analysis. For this purpose, a set of 20 data
points is used to determine the required calculation parameters employed for the retrospective effectiveness test. A hedge is classi-
fied as effective if changes in the fair value of the underlying and hedging transaction are in a range of 80-125 per cent.
Derivatives held in the bank book which do not form part of a hedging relationship are valued according to the imparity principle.
In the case of negative market values a provision for impending loss is allocated.
Loans and advances

Loans and advances are generally recognized at cost according to the strict lower of cost or market value principle.
Risks in the lending business

When the loan portfolio is assessed, appropriate value adjustments or provisions respectively for guarantee loans are made for all
identifiable risks, and the principle of prudence is observed. In addition, a general loan loss provision (portfolio-based provision) is
recorded on the basis of the respective averages of the historical default rates in the last five years in each rating category. The
single years are weighted on a linear basis.
In the financial year 2016, RZB AG allocated portfolio loan loss provisions and provisions for contingent liabilities.
Investments and shares in affiliated companies

Investments and shares in affiliated companies are measured at cost, provided sustained losses or reduced equity do not necessi-
tate write-down to fair value. Write-ups to a maximum of acquisition cost are recognized if the reasons for the permanent impair-
ment no longer apply.
Investments and affiliated companies are measured at the end of each financial year by means of an impairment test. Their fair
value is determined during the test.
Fair value is calculated using a dividend discount model. The dividend discount model properly accounts for the specific charac-
teristics of the banking business, including the need to comply with capital adequacy regulations. The recoverable amount is
considered to be the present value of the expected future dividends that may be distributed to the shareholders after meeting all
appropriate capital adequacy regulations.
The recoverable amount is calculated based on a five-year detailed planning period. The sustainable future (permanent dividend
phase) is based on a going concern assumption (perpetuity). In most cases, the income used for the valuation is assumed to grow
at a country-specific nominal rate based on the projected long-term inflation rate. If companies are significantly overcapitalized, an
interim phase of five years is defined without extending the detailed planning phase. During this period, these companies can
distribute full dividends without violating capital adequacy regulations. In the permanent dividend phase, earnings must be re-
tained as the company grows in order to continue complying with capital adequacy regulations. Earnings retention is not required
if no growth is expected in the permanent dividend phase.
In the permanent dividend phase, the model assumes a normalized, economically sustainable earnings situation in which the return
on equity and the costs of equity capital converge.

Notes 195
Tangible and intangible fixed assets

Intangible fixed assets and tangible fixed assets are valued at acquisition or production cost less amortization or depreciation.
Amortization or depreciation is on a straight-line basis. An impairment loss is recognized if an asset becomes permanently im-
paired.
Amortization or depreciation is based on the following periods of use as defined by commercial law (in years):
Useful life Years Useful life Years

Buildings 50 Software 4 to 10
Office equipment 3 to 5 Hardware 3
Office fixtures and fittings 5 to 10 Tenancy rights 10
Vehicles 5 Business equipment 5 to10
Low-value fixed assets are written off in full in the year of acquisition.
Deferred taxes
No deferred tax assets were recognized based on asset-side temporary differences or tax loss carryforwards because it currently
appears unlikely that they will be used within a reasonable time period. There were no liability-side temporary differences during
the financial year.
Capital expenses
Issuance and management fees and premiums or discounts for bonds issued are distributed over the given term. Other issuance
costs are directly expensed.
Pension and severance payment obligations

The provisions for pension and severance payment obligations are determined in accordance with IAS 19 – Employee Benefits –
based on the projected unit credit method.
The actuarial calculation of pension obligations for active employees is based on an interest rate of 1.6 per cent (31/12/2015:
2.0 per cent) per annum and an effective salary increase of 2.7 per cent (31/12/2015: 3.0 per cent) per annum. The parame-
ters for retired employees are a capitalization rate of 1.6 per cent (31/12/2015: 2.0 per cent) per annum and an expected
increase in retirement benefits of 1.2 per cent (31/12/2015: 2.0 per cent); in the case of retirement benefit commitments with
existing reinsurance policies 1.0 per cent (31/12/2015: 1.0 per cent), per annum. The calculations are based on an assumed
retirement age of 60 for women and 65 for men, subject to transitional statutory requirements and special arrangements contained
in individual contracts.
The actuarial calculation of severance payment and long-service bonus obligations is also based on an interest rate of 1.6 per
cent (31/12/2015: 2.0 per cent) per annum and an average salary increase of 2.7 per cent (31/12/2015: 3.0 per cent) per
annum.
The basis for the calculation of provisions for pensions, severance payments and long-service bonuses is provided by AVÖ 2008-
P Rechnungsgrundlagen für die Pensionsversicherung (Computational Framework for Pension Insurance) by Pagler & Pagler, using
the variant for salaried employees.
Other provisions
Other provisions are recorded at the level at which they are likely to be required. They take into account all identifiable risks and
liabilities, the level of which is not yet known.

196 Notes
Other provisions include provisions for bonuses for identified staff (pursuant to European Banking Authority CP 42, 46). RZB AG
fulfills the obligations set forth in the Annex to Section 39b of the Austrian Banking Act (BWG) as follows:
 60 per cent, or 40 per cent for particularly high amounts, of the annual bonus is paid out as an upfront cash payment;
 40 per cent, or 60 per cent for particularly high amounts, of the annual bonus is deferred for a period of five years (deferral
period) and is paid out in cash.
In conformity with the 2014 Austrian Financial Reporting Amendment Act (RÄG), long-term provisions have to be discounted
at prevailing market interest rates in the reporting period. The only provisions recognized by RZB AG in the financial year
were short-term provisions and provisions for bonus payments.
Liabilities
These are recognized at the higher of the nominal value or the repayment amount.

Notes 197
Notes on individual items of the

statement of financial position
Breakdown of maturities
Loans and advances to credit institutions and Loans and advances to customers that are not due on a daily basis break down by
their residual terms as follows:
in € million 31/12/2016 31/12/2015

Loans and advances to credit institutions 1,117.5 2,523.1
Repayable on demand 261.6 28.6
Up to 3 months 395.6 1,860.6
More than 3 months, up to 1 year 179.3 163.6
More than 1 year, up to 5 years 115.6 270.2
More than 5 years 165.4 200.2
Loans and advances to customers 1,011.0 1,083.2
Up to 3 months 49.3 43.3
Other assets 819.3 261.4
Up to 3 months 165.2 118.4
The item Loans and advances to customers contains an amount of € 19.3 million (31/12/2015: € 32.2 million) which constitutes
a cover pool for covered bonds of RBI AG.
In the next financial year, € 4.6 million in debt securities and other fixed-income securities will become due (31/12/2015: € 0.0
million).

198 Notes
Deposits from banks and Liabilities to customers (non-banks) that are not due on a daily basis break down by their residual terms
as follows:
in € million 31/12/2016 31/12/2015

Deposits from banks 12,427.2 13,739.3
Up to 3 months 8,452.0 8,819.4
More than 3 months, up to 1 year 872.3 1,655.2
More than 1 year, up to 5 years 2,249.8 2,398.9
Liabilities to customers (non-banks) 680.5 272.0
Debt securities issued 170.1 35.0
Other liabilities 133.0 70.4
In the next financial year, no issues of RZB AG will become due (31/12/2015: € 0.0 million).
Securities
RZB AG has no trading book pursuant to Chapter 3 of Title I of Part 3 of Regulation (EU) No. 575/2013.
The table below lists securities admitted to stock exchange trading (asset side), broken down into listed and unlisted securities
pursuant to Section 64 (1) Z10 of the Austrian Banking Act (BWG) (amounts incl. interest accrued):
in € million 31/12/2016 31/12/2016 31/12/2015 31/12/2015

Listed not listed Listed not listed
Debt securities and other fixed-income securities 815.6 0.0 645.4 0.0
Shares and other variable-yield securities 0.0 0.0 0.0 0.0
The table below lists securities admitted to stock exchange trading (asset side) measured as fixed assets or current assets pursuant
to Section 64 (1) Z10 of the Austrian Banking Act (BWG) (amounts incl. interest accrued):
in € million 31/12/2016 31/12/2016 31/12/2015 31/12/2015

Fixed assets Current assets Fixed assets Current assets
Debt securities and other fixed-income securities 815.6 0.0 645.4 0.0
Shares and other variable-yield securities 0.0 0.0 0.0 0.0
In relation to the difference between the acquisition cost and the repayment amount for securities (excluding zero coupon bonds)
held in the investment portfolio (banking book). The difference between the amortized costs and the repayment amounts of
€ 150.3 million as of 31 December 2016 is made up of € 153.2 million (31/12/2015: € 180.7 million) to be recognized as
expenditure in the future, and € 2.9 million (31/12/2015: € 2.7 million) to be recognized as income.
In the case of securities admitted to stock exchange trading that do not have the characteristics of financial investments, the differ-
ence between the acquisition cost and the higher fair value pursuant to Section 56 (4) of the Austrian Banking Act (BWG) is € 0.3
million (31/12/2015: € 0.6 million).

Notes 199
The item Loans and advances to credit institutions contains no bonds that are not admitted to trading on an exchange as of the
reporting date.
Investments and shares in affiliated companies

The list of investments is shown separately in the notes, annex 2. There are cross-shareholdings in respect to Raiffeisenlandesbank
Kärnten - Rechenzentrum und Revisionsverband, registrierte Genossenschaft mbH, UNIQA Insurance Group AG, Vienna, and
Posojilnica Bank eGen (formerly ZVEZA Bank).
During the financial year - as in the previous year - the carrying amount of the holding in R.B.T Beteiligungs GmbH was written
down. Furthermore, the holding in RZB-BLS Holding GmbH was subject to an impairment charge and a distribution-related write-
down. In contrast, the carrying amounts of the holdings in Raiffeisen International Beteiligungs GmbH, RALT Raiffeisen-Leasing
GmbH, RALT Raiffeisen-Leasing GmbH & Co KG and EMCOM Beteiligungs GmbH were written up.
In December 2016, RZB sold around 17.6 percent of its stake in UNIQA Insurance Group AG, Vienna, through a subsidiary and
at the same time acquired 2.2 per cent of the shares from the regional Raiffeisen banks. As a result, it now holds around 10.9 per
cent of UNIQA. The net proceeds from the sale were then distributed to RZB AG as a dividend in the same period and the stake in
RZB-BLS Holding GmbH was written down to the remaining equity.
As a member of the federal IPS, RZB subscribed for additional shares in Posojilnica Bank eGen, Klagenfurt, by way of direct
assistance and utilized part of the provision recognized for this purpose as of 31 December 2015. The value of the newly sub-
scribed shares was written down in full at year-end.
As of the 2016 and 2015 reporting dates, there were no profit and loss transfer agreements.
Loans and advances and liabilities to affiliated companies and companies linked by virtue of a participating interest break down
as follows:
in € million 31/12/2016 31/12/2015

Loans and advances to credit institutions
to affiliated companies 771.5 771.4
to companies linked by virtue of a participating interest 28.7 35.3
Loans and advances to customers
Debt securities and other fixed-income securities
Deposits from banks
from affiliated companies 1,341.0 2,375.8
from companies linked by virtue of a participating interest 908.0 945.7
Liabilities to customers (non-banks)
from affiliated companies 550.1 65.4
from companies linked by virtue of a participating interest 0.3 2.9
Fixed assets
The statement of fixed assets is shown separately in the notes, annex 1.
The land value of developed land was € 0.1 million (31/12/2015: € 0.1 million).
RZB AG was not engaged in the leasing business as a lessor in the financial years 2016 and 2015.
Obligations from the use of tangible fixed assets not reported in the statement of financial position amount to € 4.3 million for the
following financial year (31/12/2015: € 3.6 million), of which € 3.3 million (31/12/2015: € 3.3 million) are to affiliated com-
panies. The total amount of obligations for the following five years is € 22.3 million (31/12/2015: € 18.3 million), of which
€ 17.0 million (31/12/2015: € 17.1 million) is to affiliated companies.

200 Notes
The Intangible fixed assets item contains intangible fixed assets acquired from affiliated companies, which amount to € 1.4 million
(31/12/2015: € 2.0 million).
Other assets
As of 31 December 2016, Other assets totaled € 819.3 million (31/12/2015: € 261.3 million). At the reporting date, receiva-
bles due from the tax authorities amounted to € 108.6 million (31/12/2015: 72.6 million), receivables from Group members
resulting from tax transfers in an amount of € 37.9 million (31/12/2015: € 34.3 million) as well as receivables (special reserve) in
relation to the federal IPS contribution due from Österreichische Raiffeisen-Einlagensicherung eGen (ÖRE) in the amount of
€ 122.9 million (31/12/2015: € 66.8 million). Receivables from the capitalization of income from equity participations in the
same period amount to € 530.5 million (31/12/2015: € 75.5 million).
Income effectively due after the reporting date:
in € million 31/12/2016 31/12/2015

Participation income 531.2 76.2
Deferred tax assets

No deferred tax assets were recognized based on temporary differences of € 90.6 million or tax loss carryforwards of € 1,274.1
million because it currently appears unlikely that they will be used within a reasonable time period.
Other liabilities
The item Other liabilities totaling € 133.0 million as of 31 December 2016 (31/12/2015: € 70.4 million) contains liabilities from
tax transfers (corporate income tax) and chargeable capital gains as well as withholding tax due to Group members of
€ 99.8 million in total (31/12/2015: € 37.6 million) payable after the reporting date. Furthermore, this item contains accrued
interest on interest rate swaps used for hedging in the amount of € 24.9 million (31/12/2015: € 21.0 million).
Provisions
Provisions recognized by RZB AG are valued at € 69.5 million (31/12/2015: € 76.3 million), of which € 53.6 million
(31/12/2015: € 58.0 million) are for pensions and severance payment obligations, € 1.6 million (31/12/2015: € 4.4 million)
are taxation provisions, € 1.4 million (31/12/2015: € 1.6 million) are provisions for performance related bonuses, € 2.0 million
(31/12/2015: € 1.0 million) are provisions for unbilled services, € 1.8 million (31/12/2015: € 1.7 million) are provisions for
overdue vacation and € 1.8 million (31/12/2015: € 1.6 million) are provisions for anniversary payments. In addition, a provision
in the amount of € 6.3 million (31/12/2015: € 0.0 million) was recognized in the 2016 financial year for contingent liabilities.
Provisions for participations amounting to € 6.9 million were recognized in the previous year and used in the reporting year.
Debt Issuance Programme

RZB AG has utilized medium- to long-term funding instruments since the 2015 financial year, including the EUR 5,000,000,000
Debt Issuance Programme, which facilitates bond issuance in different currencies and with various structures. The aggregate vol-
ume of bonds outstanding under the program may not exceed € 5,000 million.
As of the reporting date, Czech koruna denominated 10 year bonds amounting to € 14.1 million (31/12/2015: € 14.1 million)
had been placed under the Debt Issuance Programme.

Notes 201
Equity
Subscribed capital
As of 31 December 2016, the subscribed capital of RZB AG as defined by the articles of incorporation remained unchanged at
€ 492.5 million. The subscribed capital consists of 6,776,750 ordinary registered shares.
Supplementary capital pursuant to Chapter 4 of Title I of Part 2 of Regulation (EU) No 575/2013
As of 31 December 2016, Supplementary capital amounted to € 66.1 million (31/12/2015: € 66.1 million).
One euro denominated 10 year subordinated bond in the amount of € 52.0 million and two Czech koruna denominated 10 year
subordinated bonds in the amount of € 14.1 million were issued by way of long-term refinancing. They are shown in the statement
of financial position pursuant to Regulation (EU) No. 575/2013 under
Supplementary capital in accordance with Chapter 4 of Title I of Part 2 of Regulation (EU) No. 575/2013.
Expenses for supplementary capital
Expenses for supplementary capital for the financial year 2016 amounted to € 3.3 million (31/12/2015: € 3.0 million).
Total capital according to CCR

in € million 31/12/2016 31/12/2015
Paid-in capital 492 492
Capital reserves and premium to CET1 instruments 1,862 1,862
Retained earnings and other reserves1 1,763 1,680
Common equity tier 1 (before deductions) 4,117 4,034
Net loss for the year 0 0
Intangible fixed assets -1 -2
Provision shortage for IRB positions -9 -11
Deductions exceeding common equity tier 1 -37 -288
Deduction insurance and other investments -176 -694
Transitional adaptions for common equity tier 1 74 355
Common equity tier 1 (after deductions) 3,968 3,394
Additional tier 1 0 0
Tier 1 3,968 3,394
Supplementary capital 66 66
Transitional adaptions for supplementary capital -37 -66
Tier 2 (after deductions) 29 0
Total capital 3,997 3,394
Total risk exposure amount (assessment basis) 7,459 8,103
Common equity tier 1 capital ratio 53.20% 41.88%
Tier 1 capital ratio 53.20% 41.88%
Total capital ratio (transitional) 53.60% 41.88%
Common equity tier 1 capital ratio (fully loaded) 53.20% 41.88%
Total capital ratio (fully loaded) 53.60% 41.88%
1 Less reserves relating to the federal IPS of € 129.8 million (31.12.2015: € 63.6 million)
in € million 31/12/2016 31/12/2015

Total risk exposure amount (assessment basis) 7,459 8,103
Total capital requirement for credit risk 575 616
Internal rating approach 103 123
Standardized approach 424 400
CVA risk 1 0
Basel I – Floor 47 93
Total capital requirement for operational risk 21 32
Total capital requirement 596 648

202 Notes
in € million 31/12/2016 31/12/2015

Risk-weighted assets according to standardized approach 424 400
Equity exposures 413 394
Other positions 11 6
Risk-weighted assets according to internal rating approach 103 123
Banks 4 4
Corporate customers 60 81
Equity exposures 39 38
CVA risk 1
Basel I - Floor 47 93
Total capital requirement for credit risk 575 616
Per cent 31/12/2016 31/12/2015

Leverage ratio (fully loaded) 15.31% 12.16%
Risk-weighted assets in per cent of total assets 41.91% 44.13%
Retained earnings
Other reserves
Other reserves consist solely of unappropriated retained earnings of which € 129.8 million (31/12/2015: € 63.6 million) are
allocated to the federal IPS. Due to the agreement on the establishment of an Institutional Protection Scheme (IPS) and a corre-
sponding resolution passed by the federal IPS Risk Council, a reserve in the amount of € 71.9 million (2015: € 60.5 million) for
the federal IPS was added to other reserves in the financial year 2016. This amount is not eligible for the calculation of capital pursuant
to CCR.
An amount of € 6.3 million (2015: release of € 21.9 million) was released from other reserves in relation to the recognition of
provisions for contingent liabilities for the benefit of Posojilnica Bank (formerly ZVEZA Bank).
In addition, € 82,642,702.06 of the annual profit was allocated to other reserves.
Additional notes
Institutional Protection Scheme
The regulatory changes arising from Basel III resulted in some material adjustments with respect to the regulations for a decentral-
ized banking group, organized according to cooperative principles, which to date have been covered by the Austrian Banking
Act (BWG). Pursuant to the EU Regulation, when calculating total capital, credit institutions outside of their credit institution group
must principally deduct positions held in capital instruments issued by other credit institutions, provided that no exemption exists due
to an Institutional Protection Scheme (IPS). An IPS was therefore established in RBG and contractual or statutory liability arrange-
ments were concluded which protect the participating institutions and in particular ensure their liquidity and solvency when re-
quired, in the event that it is necessary to avoid a failure of a bank. Based on the organizational structure of RBG, the IPS was
designed with two levels and the corresponding applications were filed with the competent supervisory authorities. The financial
market supervisory authority approved the applications in October and November 2014.
As the central institution of RBG, RZB AG is a member of the federal IPS, in which - as well as the Raiffeisen regional banks - Raif-
feisen-Holding Niederosterreich-Wien, Vienna, Posojilnica Bank eGen, Klagenfurt, Raiffeisen Wohnbaubank AG, Vienna, and Raif-
feisen Bausparkasse GmbH, Vienna, also participate. In addition, a provincial IPS was formed in most of the provinces.
The respective Raiffeisen regional banks and the locally active Raiffeisen banks are members of the provincial IPS.
The federal IPS is based on uniform, joint risk monitoring in the framework of the early identification system of the ORE. The IPS
therefore adds a further element to the reciprocal support within RBG, in case a member institution finds itself in financial difficulties.
In 2015, one case arose (Posojilnica Bank) and capital from the special reserve previously formed was immediately made avail-
able to the institution concerned by way of subscribed shares and a subordinated loan. In 2016, additional shares in Posojilnica
Bank were subscribed for and two additional subordinated loans were granted. In addition, a guarantee agreement for around €
6.3 million was signed with Posojilnica Bank regarding a loan portfolio. The guarantee can be called in until 30 June 2017. A
provision was recognized for the full guarantee amount.

Notes 203
Notes to the contingent liabilities

RZB AG is a member of the Deposit Guarantee Association of Austria (Raiffeisen-Kundengarantiegemeinschaft Österreich). Mem-
bers of the Association assume contractual liability under which they jointly guarantee the timely honoring of all customer deposits
and securities issues of an insolvent member of the Association up to an amount equaling the sum of the individual financial
strength of the other member institutions. The individual financial strength of a member institution is determined based on its availa-
ble reserves, taking into account the relevant provisions of the Austrian Banking Act (BWG). The liability was met by inserting a
noted item of one euro off the statement of financial position, as it is not possible to determine the exact amount of RZB AG poten-
tial liability in connection with the cross-guarantee system.
As of the 2016 reporting date, contingent liabilities amounted to € 7.7 billion (31/12/2015: € 8.7 billion). Of that amount,
€ 0.3 billion of the liabilities arising from guarantees (31/12/2015: € 0.4 billion) relate to the "RZB Euro Medium Term Note
Programme" (EMTN Programme). In the course of the demerger, all economic rights and obligations from or in connection with
the EMTN bonds were transferred to RBI. Accordingly, the bonds issued out of the EMTN program are booked by RBI under
securitized liabilities. However, under civil law the position of RZB AG remains unchanged, i.e. it continues to act as the issuer in
relation to the bondholders and bondholder claims can only be addressed to RZB AG. There is an agreement in place whereby
RBI has instructed RZB AG, and RZB AG has undertaken, to meet all economic and other obligations from or in connection with
the EMTN bonds in its own name, but for the account of RBI. This risk is reflected in the financial statements of Raiffeisen Zentral-
bank through the recognition of a contingent liability.
The remaining guarantees predominantly relate to guarantees for other liabilities of companies within the Group; these are mostly
commitments in respect to other liabilities of RBI to third parties arising from the securities, derivatives and cash management busi-
nesses, as well as commitments for liabilities of RBI resulting from the Public Finance Program in favor of the EIB. RZB issued these
guarantees in its function as head of the Group, whereby the beneficiaries are the banks in the Raiffeisen sector.
Furthermore, Raiffeisen Zentralbank has issued an "over-guarantee" in favor of Raiffeisen-Leasing Bank AG in the amount of
€ 152.1 million (31/12/2015: € 211.8 million).
Like the other members of the federal IPS, RZB signed a guarantee agreement with Posojilnica Bank regarding a loan portfolio
(RZB's portion: around € 6.3 million). The guarantee can be called in until 30 June 2017. A provision was recognized for the full
guarantee amount.
Soft letters of comfort in the amount of € 33.2 million (31/12/2015: € 33.2 million) are shown under the item Contingent liabili-
ties, off the statement of financial position; this amount includes € 30.0 million in favor of Raiffeisen-Leasing GmbH, € 1.4 million in
favor of RBI Leasing GmbH and € 1.8 million in favor of Raiffeisen Leasing Österreich GmbH.
In addition, RZB AG has provided a € 6.0 million (31/12/ 2015: € 16.8 million) guarantee in favor of RBI AG on the basis of a
support agreement. This relates to interest payments for the Jersey IV additional capital of RBI AG.
Undrawn credit lines of € 3,047.4 million (31/12/2015: € 2,168.0 million) are shown under the liabilities item Commitments, off
the statement of financial position; this amount includes € 2,678.4 million (31/12/ 2015: €1,625.0 million) in credit lines to RBI
AG.
There are no further transactions with material risks or benefits that are not reported in or off the statement of financial position.
Total assets and liabilities in foreign currency

in € million 31/12/2016 31/12/2015
Assets in foreign currency 190.9 158.4
Liabilities in foreign currency 191.2 158.2

204 Notes
Subordinated assets included under assets

in € million 31/12/2016 31/12/2015
Loans and advances to credit institutions 81.8 69.9
hereof to affiliated companies 68.4 66.1
hereof to companies linked by virtue of a participating interest 13.4 3.8
Loans and advances to customers 6.5 0.2
hereof to affiliated companies 6.5 0.2
hereof to companies linked by virtue of a participating interest 0.0 0.0
Open forward transactions as the reporting date are shown separately in the notes, annex 3.
For the following financial instruments within financial assets, the fair value in 2016 was lower than the book value:
Financial investments Carrying amount Fair value Carrying amount Fair value
in € million 31/12/2016 31/12/2016 31/12/2015 31/12/2015
Treasury bills and other bills eligible for refinancing with
1. central banks 82.1 81.8 262.8 261.7
2. Loans and advances to credit institutions 0.0 0.0 0.0 0.0
3. Loans and advances to customers 0.0 0.0 0.0 0.0
4. Debt securities and other fixed-income securities 53.1 52.8 119.5 119.0
a) issued by public bodies 0.0 0.0 0.0 0.0
b) issued by other borrowers 53.1 52.8 119.5 119.0
5. Shares and other variable-yield securities 0.0 0.0 0.0 0.0
Total 135.2 134.6 382.3 380.7
Commitments arising from agency services

In addition to its own holding, RZB AG held € 24.0 million in shares in UNIQA Insurance Group AG in trust until the end of De-
cember 2016 (31/12/2015: € 24.0 million). The trust agreement was canceled on 12 December 2016.

Notes 205
Notes to the income statement

As RZB AG only had one place of business in Austria in 2016, there is no regional allocation by segment according to the re-
spective registered office; a breakdown of income by geographic market is not applicable.
Net interest income in the 2016 financial year was negative and amounted to minus € 42.4 million (2015: minus € 21.3 million).
This was primarily due to the funding of the participating interests. Interest income includes negative interest of € 13.2 million
(2015: € 3.0 million) as an expense, including € 10.7 million (2015: € 1.4 million) of negative interest on balances held with
OeNB. Interest expenses include negative interest of € 2.0 million (2015: € 0.9 million) as income.
The net profit or loss on financial operations includes a result from forward foreign exchange business in the amount of minus
€ 0.04 million (2015: minus € 9.1 million).
Other operating income includes staff and administrative expenses passed on for other non-banking services and service fees of
€ 17.5 million (2015: € 16.7 million); of that amount, € 6.6 million (2015: € 6.6 million) represents payments from RBI for market-
ing, advertising and license fees (the latter in connection with the Raiffeisen brand) and marketing expenses of € 6.8 million
(2015: € 6.1 million) that were passed on to affiliated companies. In addition, RZB AG, in its function as lead institution, received
income under service level agreements from RBI in the amount of € 5.7 million (2015: € 5.3 million) and from companies in the
Raiffeisen sector in the amount of € 3.5 million (2015: € 3.0 million).
Expenses for severance payments and benefits for occupational employee pension funds include € 0.7 million (2015: € 0.8
million) in allocations to the provision for severance payments and € 1.4 million (2015: € 0.0 million) in allocations to the provi-
sion for voluntary severance payments.
The release of € 6.5 million (2015: € 3.7 million) from the item release/allocation to provision for pensions is particularly due to
the elimination of pension obligations, while the change in the discount rate from 2.0 per cent to 1.6 per cent resulted in an in-
crease.
Other administrative expenses include legal, advisory and audit costs of € 17.4 million (2015: € 15.5 million), advertising and
rental expenses of € 15.6 million (2015: € 13.7 million) and expenses for service level agreements of € 10.6 million (2015:
€ 9.7 million).
Net income/expenses from the disposal and valuation of loans and advances and securities held as current assets contains
individual loan loss provisions of € 1.0 million (2015: € 1.0 million), releases from portfolio loan loss provisions for on-balance
and off-balance sheet transactions of € 0.3 million (2015: allocation of € 0.4 million) and allocations to provisions for contingent
liabilities of € 1.4 million (2015: € 0.00 million). Furthermore, the item contains the valuation result of securities treated as current
assets, which amounted to minus € 7.4 million (2015: minus € 1.4 million).
Net income/expenses from the disposal and valuation of shares in affiliated companies and participating interests mainly includes
write-ups to acquisition cost of € 272.4 million (2015: write-down of € 125.5 million) for Raiffeisen International Beteiligungs
GmbH and € 8.5 million for RALT Raiffeisen-Leasing GmbH & Co KG as well as an impairment of € 138.9 million (2015: € 46.8
million) and a distribution-related write-down of € 418.2 million for RZB-BLS Holding GmbH. Furthermore, the value of the holdings
in R.B.T. Beteiligungs GmbH was written down € 10.1 million (2015: € 22.2 million).
Changes in reserves include a net allocation to retained earnings for the federal IPS special reserve in the amount of € 66.1
million (2015: € 38.7 million). An additional amount of € 82.6 million was allocated to other reserves.
Since the financial year 2005, RZB AG, has been the parent company of a group of companies according to Section 9 of the
Corporation Tax Act (KStG). The group of companies pursuant to Section 9 KStG has 54 (31/12/2015: 49) companies as
group members. In the reporting year, the existing tax compensation agreement was extended by way of a supplementary
agreement with RBI AG. If RBI AG records a negative result for tax purposes and if these tax losses cannot be utilized within the
group, the group parent does not have to pay any negative tax compensation to RBI AG immediately. A final settlement takes
place only/at the latest when the company leaves the tax group. The group parent must still pay a negative tax contribution to RBI
AG for usable shares in losses of RBI AG.
Tax on profit or loss includes income from the existing tax group allocation correspondent to Group taxation in the amount of
€ 12.8 million (2015: € 10.7 million) and income from the previous period’s tax group allocation correspondent to Group taxa-
tion of € 1.1 million (2015: tax income of € 2.2 million).

206 Notes
The overall return on assets (net profit or loss after tax divided by average total assets as for the last financial year) is 0.8 per cent
for the 2016 financial year. It was negative in the 2015 financial year.
Recommendation for the appropriation of profit

No dividend will be paid on shares for the 2016 financial year.

Other
The company did not conclude any significant transactions with related companies or persons at unfair market conditions.
In the financial year. the company had an average of 297 (2015: 232) employees.
Expenses for severance payments and pensions for members of the Management Board and senior staff amounted to € 0.3
million in the financial year (2015: € 1.1 million) and € 0.3 million for other employees (2015: € 0.9 million).
Members of the Supervisory Board received remuneration of € 0.4 million (2015: € 0.4 million).

Notes 207
Remuneration of the Management Board
The following remuneration was paid to the Management Board of RZB AG:

Fixed remunerations 1,478 1,772
Bonus (performance-based) 0 344
Payments to pension funds and reinsurances 271 977
Other remunerations 1,335 1,514
Total 3,084 4,607
The table lists the fixed, performance-related and other remuneration and also includes remuneration for functions on boards of
affiliated companies and benefits in kind. The total remuneration of Management Board members includes € 0.3 million (2015:
€ 1.3 million) in remuneration from affiliated companies for functions performed for such companies. Total remuneration paid to
former members of the Management Board and their surviving dependents was € 0.7 million (2015: € 0.6 million).
Management Board
 Walter Rothensteiner, since 1 January 1995, Chairman and CEO; Chairman of the Austrian Raiffeisen Association
 Michael Höllerer, since 1 July 2015
 Johannes Schuster, since 10 October 2010
Supervisory Board
Executive Committee
 Erwin Hameseder, since 23 May 2012, President, PersA, PrüfA, AA, VergA, NA, RA, Chairman of Raiffeisen-Holding Niederösterreich-Wien reg. Gen.m.b.H.
 Martin Schaller, since 10 October 2013, first Vice President, PersA, PrüfA, AA, VergA, NA, RA, General Director of Raiffeisen-Landesbank Steiermark AG
 Heinrich Schaller, since 23 May 2012, second Vice President, PersA, PrüfA, AA, VergA, NA, RA, General Director of Raiffeisenlandesbank Oberösterreich Aktiengesellschaft
 Wilfried Hopfner, since 18 June 2009 member, since 22 January 2016 third Vice President, PersA, PrüfA, AA, VergA, NA, RA, Spokesman of the Management Board of Raiffeisen-
landesbank Vorarlberg Waren- und Revisionsverband reg. Gen.m.b.H.
Members
 Klaus Buchleitner, since 25 June 2003, General Director of Raiffeisenlandesbank Niederösterreich-Wien AG and Raiffeisen-Holding NÖ Wien
 Peter Gauper, since 24 June 2008, Spokesman of the Management Board of Raiffeisenlandesbank Kärnten – Rechenzentrum und Revisionsverband, reg. Gen.m.b.H.
 Johannes Ortner, since 15 June 2016, Chairman of the Management Board of Raiffeisen-Landesbank Tirol AG
 Günther Reibersdorfer, since 23 June 2005, General Director of Raiffeisenverband Salzburg reg. Gen.m.b.H.
 Rudolf Könighofer, since 1 August 2013, General Director of Raiffeisenlandesbank Burgenland und Revisionsverband reg. Gen.m.b.H.
 Reinhard Wolf, since 23 May 2012, Director of the Management Board of RWA Raiffeisen Ware Austria AG
All of the above members of the Supervisory Board have been appointed until the Annual General Meeting relating to the 2018
financial year.
Delegated by the Works Council:
 Gebhard Muster, since 20 November 2008, since 14 June 2011 Chairman of the Works Council, PrüfA, AA, VergA, NA, RA
 Désirée Preining, since 14 June 2011 Deputy Chairwoman of the Works Council, PrüfA, AA, VergA, NA, RA
 Walter Demel, since 28 November 2013
 Doris Reinsperger, since 14 June 2011
 Tanja Daumann, since 27 March 2015
State Commissioner
 Ministerialrat Alfred Lejsek, since 1 September 1996, State Commissioner

 Sektionschef Gerhard Popp, since 1 December 2009, Deputy State Commissioner
Federal Advisory Board

208 Notes
 Walter Hörburger, since 22 June 2010, until 8 June 20161 Chairman, Chairman of the Supervisory Board of Raiffeisenlandesbank Vorarlberg Waren- und Revisionsverband reg.
Gen.m.b.H.
1
 Sebastian Schönbuchner, since 20 June 2002, since 8 June 2016 Chairman until 8 June 2016 Deputy Chairman, Chairman of Raiffeisenverband Salzburg reg. Gen.m.b.H.
 Jakob Auer, since 13 June 2000, President of the Supervisory Board of Raiffeisenlandesbank Oberösterreich Aktiengesellschaft
 Robert Lutschounig, since 12 June 2009, Chairman until 23 May 2012, Chairman of the Supervisory Board of Raiffeisenlandesbank Kärnten-Rechenzentrum und Revisionsverband,
reg. Gen.m.b.H.
 Michael Misslinger, since 3 June 2014, Chairman of the Supervisory Board of Raiffeisen-Landesbank Tirol AG
 Helmut Tacho, since 3 June 2014, since 8 June 20161 Deputy Chairman, Chairman of the Supervisory Board of Raiffeisen-Holding Niederösterreich-Wien reg. Gen.m.b.H.
 Wilfried Thoma, since 25 June 2003, President of the Supervisory Board of Raiffeisen Landesbank Steiermark AG
 Erwin Tinhof, since 20 June 2007, President of the Supervisory Board of Raiffeisenlandesbank Burgenland und Revisionsverband reg. Gen.m.b.H.
PersA Member of the Personnel Committee

PrüfA Member of the Audit Committee
AA Member of the Working Committee
VergA Member of the Remuneration Committee
NA Member of the Nomination Committee
RA Member of the Risk Committee
1 A new Chairman and his/her Deputy are appointed each year.

Notes 209
Annex 1: Statement of fixed assets

Item Description of fixed assets As at Exchange Additions Disposals Reclassific As at
ation
1/1/2016 difference 31/12/2016
s
in € thousand 1 2 3 4 5 6
Treasury bills and other bills eligible for 2,914,45

1. refinancing with central banks 9 0 1,092,209 (115,349) 0 3,891,319
2. Loans and advances to credit institutions 0 0 0 0 0 0
3. Loans and advances to customers 0 0 0 0 0 0
Debt securities and other fixed-income

4. securities 645,311 0 171,049 0 0 816,360
a) issued by public bodies 0 0 0 0 0 0
b) own debt securities 0 0 0 0 0 0
c) issued by other borrowers 645,311 0 171,049 0 0 816,360
5. Shares and other variable-yield securities 25,000 0 0 (25,000) 0 0
6. Financial investments 59,928 0 6,572 (4) 372 66,868
7. Interest in affiliated companies 5,833,810 0 413 0 (372) 5,833,851
8. Intangible fixed assets 2,062 0 (127) (90) 0 1,845

9. Tangible fixed assets 7,280 0 188 (22) 0 7,446
10. Other assets 117 0 0 0 0 117
Total 9,487,967 0 1,270,304 (140,465) 0 10,617,806
Writing-ups/depreciation Carrying amount

Cumulative Exchange Cumulative Write-ups Depreciati Reclassificati Cumulative
depreciation differenc depreciation on on depreciation As at As at
es
1/1/2016 disposal 31/12/201 31/12/201 31/12/201
6 6 5
Item 7 8 9 10 11 12 13 14 15
1. (27,355) 0 2,849 347 (33,444) 0 (57,603) 3,833,716 2,887,104
2. 0 0 0 0 0 0 0 0 0
3. 0 0 0 0 0 0 0 0 0
4. (1,247) 0 33 223 (1,225) 0 (2,216) 814,144 644,064
a) 0 0 0 0 0 0 0 0 0
b) 0 0 0 0 0 0 0 0 0
c) (1,247) 0 33 223 (1,225) 0 (2,216) 814,144 644,064
5. 0 0 0 0 0 0 0 0 25,000
6. (18,430) 0 0 45 (6,572) 0 (24,957) 41,911 41,498
7. (422,021) 0 0 281,868 (567,163) 0 (707,316) 5,126,535 5,411,788
8. (99) 0 90 0 (455) 0 (464) 1,381 1,963
9. (2,728) 0 18 0 (148) 0 (2,858) 4,588 4,552
10. 0 0 0 0 0 0 0 117 117
(471,880) 0 2,990 282,483 (609,007) 0 (795,414) 9,822,392 9,016,086

210 Notes
Annex 2: List of investments

Affiliated companies
RZB- Equity
1
Total nominal value in direct in € Result in € From annual
Company, registered office (country) currency share thousand thousand financial statements
Angaga Handels- und Beteiligungs GmbH, EU
Vienna 35,000.00 R 100% 24.00 (4.00) 31/12/2015
KAURI Handels und Beteiligungs GmbH, EU
Vienna 50,000.00 R 88% 7,399.00 455.00 30/9/2016
Raiffeisen International Beteiligungs GmbH, EU 3,310,284.0 280,427.0
2
Vienna 1,000,000.00 R 100% 0 0 31/12/2016
RALT Raiffeisen-Leasing Gesellschaft m.b.H. & 20,348,393.5 EU
Co. KG, Vienna 7 R 97% 45,346.00 2,144.00 31/12/2015
RALT Raiffeisen-Leasing Gesellschaft m.b.H., EU
Vienna 218,500.00 R 100% 33,103.00 3,435.00 31/12/2015
EU (10,012.00
2
R.B.T. Beteiligungsgesellschaft m.b.H, Vienna 36,336.42 R 100% 39,289.00 ) 31/10/2016
R.P.I. Handels- und Beteiligungsgesellschaft EU
2
m.b.H., Vienna 36,336.42 R 100% 271.00 (3.00) 31/10/2016
EU (45,954.00
2
RZB - BLS Holding GmbH, Vienna 500,000.00 R 100% 899,817.00 ) 31/12/2016
500,000. EU
2
RZB Invest Holding GmbH, Vienna 00 R 100% 854,082.00 32,595.00 31/12/2016
SALVELINUS Handels- und 40,000.0 EU
2
Beteiligungsgesellschaft m.b.H, Vienna 0 R 100% 381,547.00 24,091.00 31/12/2016
100,000. EU
Raiffeisen Verbundunternehmen-IT GmbH, Vienna 00 R 100% 104.00 3.00 31/12/2015
1 The result (in part from the consolidated financial statements) in € thousand corresponds to the annual profit/loss; equity is reported in accordance with Section 224 (3)
(a) HGB including untaxed reserves (lit b).
2 The equity and annual result figures shown are taken from the preliminary annual financial statements for the financial year ending 31 October and 31 December 2016,
respectively.
Other equity participations

RZB- Equity From annual
1
Company, registered office Total nominal value in direct in € Result in € financial
(country) currency share thousand thousand statements
EU
2
EMCOM Beteiligungs GmbH, Vienna 37,000.00 R 34% 21,034.00 987.00 31/10/2016
8,030,000.0 EU
NOTARTREUHANDBANK AG, Vienna 0 R 26% 27,768.00 7,754.00 31/12/2015
Österreichische Wertpapierdaten Service EU
GmbH, Vienna 36,336.41 R 25% 72.00 7.00 31/12/2015
EU
Raiffeisen e-force Gesellschaft m.b.H, Vienna 145,346.00 R 19% 1,382.00 8.00 31/12/2015
2,000,000.0 EU
RSC Raiffeisen Service Center GmbH, Vienna 0 R 17% 2,459.00 113.00 31/12/2015
EU
Austrian Reporting Services GmbH, Vienna 41,176.48 R 15% 42.00 1.00 31/12/2015
EU
Raiffeisen Software GmbH, Vienna 150,000.00 R 1% 5,264.00 1,264.00 31/12/2015
1 The result (in part from the consolidated financial statements) in € thousand corresponds to the annual profit/loss; equity is reported in accordance with Section 224
(3) (a) HGB including untaxed reserves (lit b).
2 The equity and annual result figures shown are taken from the preliminary annual financial statements for the financial year ending 31 October and 31 December 2016,
respectively.

Notes 211
Annex 3: Open forward transactions

Market value in €
31/12/2016 Nominal amount by maturity in € thousand thousand
More than hereof
1 year, up More than 5 trading
Name Up to 1 year to 5 years years Total book positive negative
Total 80,000 1,322,418 2,821,505 4,223,923 0 7,267 (146,662)
a) Interest rate contracts 80,000 1,322,418 2,821,505 4,223,923 0 7,267 (146,662)
OTC products
Interest rate swaps 80,000 1,322,418 2,821,505 4,223,923 0 7,267 (146,662)
Floating Interest rate swaps 0 0 0 0 0 0 0
Interest rate futures 0 0 0 0 0 0 0
Interest rate options - buy 0 0 0 0 0 0 0
Interest rate options - sell 0 0 0 0 0 0 0
Other similar interest rate contracts 0 0 0 0 0 0 0
Exchange-traded products
Interest rate options 0 0 0 0 0 0 0
b) Foreign exchange rate
contracts 0 0 0 0 0 0 0
OTC products
Cross-currency interest rate swaps 0 0 0 0 0 0 0
Forward foreign exchange
contracts 0 0 0 0 0 0 0
Currency options – purchased 0 0 0 0 0 0 0
Currency options – sold 0 0 0 0 0 0 0
Currency contracts (futures) 0 0 0 0 0 0 0
Currency options 0 0 0 0 0 0 0
c) Securities-related transactions 0 0 0 0 0 0 0
OTC products
Securities-related forward transactions 0 0 0 0 0 0 0
Equity/Index options -buy 0 0 0 0 0 0 0
Equity/Index options -sell 0 0 0 0 0 0 0
Equity/Index futures 0 0 0 0 0 0 0
Equity/Index options 0 0 0 0 0 0 0
d) Commodity contracts 0 0 0 0 0 0 0
OTC products
Commodity forward transactions 0 0 0 0 0 0 0
Commodity futures 0 0 0 0 0 0 0
e) Credit derivative contracts 0 0 0 0 0 0 0
OTC products
Credit default swaps 0 0 0 0 0 0 0

212 Notes
31/12/2015 Nominal amount by maturity in € thousand Market value in € thousand

More
than 1
year, up More than 5 hereof
Name Up to 1 year to 5 years years Total trading book positive negative
Total 0 680,000 1,622,635 2,302,635 0 362 (80,441)
a) Interest rate contracts 0 680,000 1,622,635 2,302,635 0 362 (80,441)
OTC products
Interest rate swaps 0 680,000 1,622,635 2,302,635 0 362 (80,441)
Floating Interest rate swaps 0 0 0 0 0 0 0
Interest rate options - buy 0 0 0 0 0 0 0
Interest rate options - sell 0 0 0 0 0 0 0
Interest rate options 0 0 0 0 0 0 0
b) Foreign exchange rate contracts 0 0 0 0 0 0 0
OTC products
Cross-currency interest rate swaps 0 0 0 0 0 0 0
Forward foreign exchange contracts 0 0 0 0 0 0 0
Currency options – purchased 0 0 0 0 0 0 0
Currency options – sold 0 0 0 0 0 0 0
Currency contracts (futures) 0 0 0 0 0 0 0
Currency options 0 0 0 0 0 0 0
c) Securities-related transactions 0 0 0 0 0 0 0
OTC products
Securities-related forward transactions 0 0 0 0 0 0 0
Equity/Index options -buy 0 0 0 0 0 0 0
Equity/Index options -sell 0 0 0 0 0 0 0
Equity/Index futures 0 0 0 0 0 0 0
Equity/Index options 0 0 0 0 0 0 0
d) Commodity contracts 0 0 0 0 0 0 0
OTC products
Commodity forward transactions 0 0 0 0 0 0 0
Commodity futures 0 0 0 0 0 0 0
e) Credit derivative contracts 0 0 0 0 0 0 0
OTC products
Credit default swaps 0 0 0 0 0 0 0

Management report
Market development
Markets swayed by monetary policy
Developments in the money and capital markets continued to be dominated last year by international central bank policies. In the
spring of 2016, for example, the European Central Bank (ECB) decided among other things to expand its bond-buying program
from € 60 billion per month to € 80 billion, to offer banks funding through long-term refinancing operations, as well as to cut key
interest rates. The central bank made adjustments to its policy mix at its last meeting in 2016. The minimum remaining period for its
bond purchases was extended to the end of 2017, with the monthly volume to return to € 60 billion as of April 2017. Money
market rates fluctuated between the central bank’s deposit rate and main refinancing rate over the course of last year, and were in
negative territory across all maturities since mid-January 2016. The yield on two-year German government bonds was already
negative in 2015, with yields at the short end continuing to fall in 2016. The yield on ten-year German government bonds came
down in the first half of 2016, due to falling inflation expectations and the increase in ECB bond purchases; however, started
increasing as of last autumn. In the US, the Fed raised its key rate range by 25 basis points to 0.50-0.75 per cent in December
after a one-year pause.
According to preliminary data, real GDP in the euro area grew 1.7 per cent in 2016. Consequently, the upswing in the monetary
union continued, despite the fact that economic growth concerns repeatedly surfaced last year. Economic growth was driven
primarily by private consumption and to a lesser extent by government consumption and gross fixed capital formation. At the
country level, economic development continued to be highly varied. Whereas Spain’s GDP expanded by 3.3 per cent, Italy
posted GDP growth of a mere 1.0 per cent. The average price level of consumer goods remained virtually unchanged in the euro
area during most of the year. The lack of general inflationary pressure on consumer goods was attributable to falling prices for
energy and imported goods. Only when energy prices increased towards the end of 2016 ‒ compared to prior year levels ‒ did
the inflation rate pull away appreciably from the zero per cent mark.
Austria’s economy experienced a moderate upturn in 2016, with real GDP growing 1.5 per cent. Domestic demand was the main
pillar of economic growth. Private consumption benefited from the tax reform that went into effect at the beginning of 2016, and
equipment investment was comparatively dynamic. Construction investment expanded for the first time in a number of years. In
contrast, net exports did not support real GDP growth.
The US economy had a weak start to 2016. This was primarily the result of unusually low inventory investment, as well as declin-
ing investment in mining and oil and gas exploration due to sharply lower commodity prices. These negative effects subsequently
subsided in the second half of the year, and the economy resumed its dynamic growth. In particular, private consumption grew at
an encouraging pace. Nevertheless, real gross domestic product increased only 1.6 per cent in 2016, due to the weak start to
the year.
China’s economic growth stabilized and is estimated to be 6.7 per cent for 2016. Although the government’s economic support
initiatives are likely to have kicked in, these primarily benefited large state enterprises through infrastructure investment. Growth
impetus continued to come from the real estate sector.
Solid growth in CE and SEE, recession flattening out in Russia

The low and in some cases negative inflation rates in Central and Southeastern Europe (CE and SEE) and the ECB’s low interest
rate policy enabled key rates in the region to be kept at a low level last year. In a number of countries further monetary policy
easing measures were even taken or continued to be implemented. In Poland and Romania, moreover, fiscal growth stimuli sup-
ported private consumption.
The CE region registered somewhat weaker economic trend in 2016, with GDP growth at 2.7 per cent. Although CE continued to
benefit from solid economic growth in Germany, as well as from the recovery in the euro area and from expansionary monetary
policies in some CE countries, economic growth in CE came in below the previous year’s level. One contributory factor was the
drop in investment activity owing to temporarily lower EU transfer payments into the region. Poland, the region’s growth engine, lost
considerable momentum and recorded 2.8 per cent year-on-year growth. Overall, however, the economic data indicates bal-
anced growth with solid export and dynamic domestic economic activity.
SEE reported strong economic growth of 3.9 per cent year-on-year in 2016. Once again, the Serbian and Croatian economies
significantly stepped up their pace of growth compared to the previous year. The Croatian economy benefited from political
stabilization. In Romania, household demand was stimulated by tax cuts. With GDP growth of 3.3 per cent, Bulgaria caught up
somewhat with Romania. Overall, economic growth in SEE was at its strongest pace in several years. Although a portion of this

growth was attributable to temporary factors, it nonetheless underscores that the weak phase of previous years has been over-
come.
Economic conditions in Eastern Europe (EE) improved in 2016. Russia benefited from a recovery in oil prices over the course of the
year. Prudent monetary and fiscal policy had a stabilizing effect but failed to deliver additional growth impetus. The recession in
Russia flattened out significantly, and economic output fell only 0.2 per cent year-on-year in 2016. Russia’s manufacturing sector
improved somewhat towards the end of last year, but private household demand remained weak. Ukraine’s economy bottomed
out in 2015 and returned to growth of 2.2 per cent in 2016. The Belarusian economy, which is heavily dependent on financial
support from and exports to Russia, remained in a persistent recession. Inflation rates in EE retreated from high levels amid more
stable exchange rate developments and weak domestic demand.
Annual real GDP growth in per cent compared to the previous year
Region/country 2015 2016e 2017f 2018f

Czech Republic 4.6 2.3 2.7 2.5
Hungary 2.9 2.0 3.2 3.4
Poland 3.9 2.8 3.3 3.0
Slovakia 3.8 3.3 3.3 4.0
Slovenia 2.3 2.5 2.7 2.5
Central Europe 3.8 2.7 3.1 3.0
Albania 2.6 3.5 4.0 4.0
Bosnia and Herzegovina 3.0 2.5 3.0 3.5
Bulgaria 3.6 3.3 3.3 3.3
Croatia 1.6 2.9 3.3 2.8
Kosovo 4.1 3.5 3.5 3.5
Romania 3.9 4.8 4.2 3.5
Serbia 0.7 2.7 3.0 3.0
Southeastern Europe 3.1 3.9 3.7 3.3
Belarus (3.8) (2.6) (0.5) 1.5
Russia (2.8) (0.2) 1.0 1.5
Ukraine (9.9) 2.2 2.0 3.0
Eastern Europe (3.3) (0.1) 1.0 1.6
Austria 1.0 1.5 1.7 1.5
Germany 1.5 1.8 1.7 1.5
Euro area 2.0 1.7 1.9 1.7
Economic recovery in Austria

In 2016, the Austrian economy was able to increase the rate of expansion, which is mainly due to the second half of the year. For
the full year of 2016, the real GDP expanded by 1.5 percent, compared to 1.0 percent in 2015. The main pillar of the economic
development was domestic demand. On the one hand, private consumption benefited from the increase in real disposable in-
come as a result of the tax reform that came into force at the beginning of 2016. On the other hand, gross fixed capital formation
was encouraging, mainly due to equipment investments. Against the backdrop of the cyclical economic recovery, imports contin-
ued to develop dynamically. Since at the same time exports could only be expanded moderately, foreign trade did not contribute
positively to GDP growth in 2016. The recovery is expected to continue in 2017. Economic growth should continue to be driven
by domestic demand (private consumption, investments), while net exports are expected to continue to not contribute to GDP
growth in 2017.

Development of the banking sector

Moderate growth in CEE
In 2016, many indicators exhibited a substantial recovery of the banking sector from the subdued levels of the previous year.
Positive trends in new lending or in asset growth continued in several CE and SEE countries in 2016 (e.g. in the Czech Republic,
Slovakia and Romania). The banking sector in Russia also recovered significantly. Nearly all banking markets in CEE now show a
comfortable loan/deposit ratio (well below 100 per cent for the most part), which represents a solid foundation for future growth.
In addition, many challenging banking markets of recent years started posting considerable profits again at sector level in 2016
(e.g. Hungary, Romania, Croatia and Russia). In particular, leading foreign banks also significantly outperformed general market
trends in the challenging Eastern European banking markets (Russia, Ukraine, and Belarus). The positive profitability trend was
additionally supported by the sustained stabilization, or even a sharp drop, in non-performing loans (NPLs) in CE and SEE (with
significant differences at country level). Overall, the NPL ratio in CE and SEE fell from previously 8.3 per cent to 7.4 per cent in
2016 as a result. In view of the positive developments in CE and SEE, as well as the stabilization of NPLs and profitability in
Russia, return on equity in the CEE banking sector significantly increased above the comparable figure in the euro area again in
2016.
Banking sector in Austria

In 2016, the banking sector in Austria continued to perform below average when compared to the euro area in terms of credit
growth (notably in corporate banking). Lending focused on retail customer and real estate financing transactions in particular.
However, the profitability of Austria’s banking sector markedly increased at a consolidated level, mainly supported by CEE busi-
ness. As a result, the Austrian banking sector also significantly improved its capitalization relative to major Western European
countries. The reduction in the bank tax from 2016 should also have a positive impact in the following years.
In the first half of 2016, the Austrian banks generated a positive consolidated net income of roughly € 2.9 billion, or
€ 255.8 billion more than in the same period of the previous year. The positive result was mainly driven by the sharp reduction in
loan loss provisions, which not only more than offset significant declines in net interest income as the most important income com-
ponent, but also lower income from commissions and net trading income. The profitability of Austrian subsidiary banks in CEE
significantly improved in the first quarter of 2016. Profit contributions from Austrian subsidiary banks were positive in all CEE coun-
tries. The highest profits were made in the Czech Republic, Romania and Russia, albeit with profits down in Russia in comparison
with the previous year’s quarter.
However, the reported regulatory capital ratios continue to be below average by international standards. If the leverage ratio is
included as benchmark, Austrian banks performed remarkably better. Capital requirements will gradually increase following the
introduction of the Systemic Risk Buffer as well as of the buffer for Other Systemically Important Institutions (O-SIIs), which the
Financial Market Stability Board (FMSB) has recommended.
The Sustainability Package, which was launched in 2012, has helped to strengthen the local funding base of Austrian subsidiary
banks in CEE. The loan/deposit ratio fell from 117 per cent in 2008 to 88 per cent in the first quarter of 2016, and was primarily
attributable to an increase in local savings deposits. Accordingly, credit growth is increasingly financed on a local basis.
The Single Resolution Mechanism (SRM) became fully effective on 1 January 2016. The Single Resolution Board (SRB) is the
central body responsible for making all decisions relating to the resolution of major banks that are either failing or at risk of failing.

The measures are implemented in cooperation with the relevant national resolution authorities.
Regulatory environment
Changes in the regulatory environment
The Group focused intensively on current and forthcoming regulatory developments again in the year under review.
Proposed legislation relating to the European Deposit Insurance Scheme (EDIS)

In 2015, the European Commission proposed a European Deposit Insurance Scheme (EDIS) designed to support the banking
union, strengthen the protection of depositors, increase financial stability, and further weaken the link between banks and sover-
eigns. The EDIS is part of the European SRB and covers all national deposit guarantee systems (including IPS) and is to be devel-
oped incrementally in three stages by 2024. In the first stage it is to comprise a reinsurance scheme of the national deposit
guarantee systems and subsequently become a co-insurance scheme after three years, under which the contribution of the EDIS is
to progressively increase over time. A fully comprehensive EDIS is planned as the last stage, which is scheduled for 2024. The
final adoption and publication of the law is lined up for the fourth quarter of 2017 at the earliest.
Amendment to European regulations

In November 2016, the European Commission published a legislative proposal to change the prudential requirements (CRD
IV/CRR), as well as to amend the recovery and resolution framework (BRRD, SRM). The documents provide the basis for follow-up
negotiations with the EU Parliament and European Council and at the same time offer a preview of the regulatory challenges for
the years following 2017.
On the one hand, the proposed changes to the CRR can be broken down thematically into criteria for classification under the
finalized Basel III. This comprises, for example, the introduction of a binding minimum leverage ratio and net stable funding ratio
(NSFR), as well as add-ons to the bank recovery and resolution regulations, in order to meet the Total Loss Absorbing Capacity
(TLAC) requirements for global systemically important banks. On the other hand, the drafts include adjustments whose content
already relates to Basel IV, e.g. the introduction of a standardized approach for measuring counterparty risks, an overhaul of
market price risk regulations within the framework of the Fundamental Review of the Trading Book (FRTB) and new rules for invest-
ment funds. Compared to the previous implementation of Basel standards, it is clearly evident that proportionality is given far
greater weight, in particular, to meet the needs of the numerous smaller banks in the EU. According to the latest information, the
new rules and regulations are expected to be applicable from 2019 onwards.
Action plan for building a capital markets union

The European Commission aims to improve access to capital market funding for all companies, especially small and medium-sized
enterprises (SMEs). It wants to break down barriers that are blocking cross-border investments on the capital market. The action
plan of 30 September 2015, provides for a bundle of measures through to 2017, including specific legislative proposals relating
to securitization and consultations on covered bonds. The work packages for the action plan were processed and/or expedited
in 2016. While the fundamental aim of driving cross-border investments is certainly to be welcomed, it cannot provide a realistic
alternative to credit financing for SMEs through banks. Instead, the proposed measures can arguably only be considered as
measures to supplement financing by banks.

Business performance
RZB AG is the lead institution of the Austrian Raiffeisen Banking Group (RBG). It also acts as the central holding company of the
RZB Group of domestic and foreign subsidiaries. Its largest equity participation is Raiffeisen Bank International AG (RBI AG),
which is stock-exchange listed and has an international banking network focused on Central and Eastern Europe (CEE). As of 31
December 2016, RZB AG held approximately 60.7 per cent in RBI. RBI AG significantly influences the result of RZB AG. In addi-
tion, alongside UNIQA Insurance Group AG (UNIQA), dividend income from affiliated companies (in particular Raiffeisen Baus-
parkasse, Raiffeisen KAG) also contributes to the profit of RZB AG.
Combining the operations of affiliated companies within RZB AG facilitates consistent business management practices, along with
improved financial and earnings performance and the application of uniform risk management standards. The objective is to
increase the value of the RBG on federal level.
In December 2016, a subsidiary of RZB AG sold a stake of around 17.64 per cent in UNIQA by means of a share transfer to
UNIQA Versicherungsverein Privatstiftung. At the same time, shares totaling around 2.24 per cent were acquired from Raiffeisen-
Holding Niederösterreich-Wien, Raiffeisen-Landesbank Steiermark and Raiffeisenlandesbank Kärnten. As of 31 December 2016,
RZB AG thus held a total indirect stake of around 10.87 per cent in UNIQA.
In September 2016, Raiffeisen-Landesbanken-Holding GmbH (which was until then the ultimate parent company). following its
prior merger with its wholly-owned subsidiary R-Landesbanken-Beteiligung GmbH, was merged into RZB AG as the acquiring
company,.
Regulatory changes
RZB AG was again confronted with regulatory changes in the past financial year. Since November 2014, the European Central
Bank (ECB) has been responsible for the supervision of banks in the euro area under the Single Supervisory Mechanism (SSM).
RZB AG has therefore been under the direct supervision of the ECB since the fourth quarter of 2014. The Single Resolution
Mechanism (SRM) was also implemented in the euro area in 2015, which is designed to enable an orderly winding down of
failing banks. In addition to drawing up resolution plans, banks must also pay contributions to finance a Single Resolution Fund
(SRF), which resulted in expenses of € 1 million for RZB AG in 2016. The amount banks are required to contribute to the resolution
fund is determined on the basis of business volumes and a bank-specific risk assessment. The target size of the SRF (at least one
per cent of covered customer deposits of eligible banks in participating member states) is due to be reached by 2024.
In the area of deposit guarantees, the goal is also to establish a harmonized guarantee system in Europe. The target size of the
deposit guarantee fund is based on 0.8 per cent of the deposits covered, and is also expected to be reached by 2024.
Business areas
Alongside the management of its principal equity participation, RBI AG, RZB AG's business predominantly relates to its role as
lead institution of the RBG and management of the broader portfolio of equity participations.
The main areas of RZB AG's activity therefore encompass equity participation management, Raiffeisen sector business and liquidi-
ty management.
Participation management
The portfolio of participating interests held by RZB AG derives from its role as the lead institution of the Raiffeisen Banking Group
in Austria (RBG), as parent credit institution according to the Austrian Banking Act (BWG) and as head of the Group. The focus of
the participating interests is on the participating interest in RBI AG and on strategic core holdings, which provide products and ser-
vices to RBG or which provide support in core business areas.
RZB AG’s participation strategy aims to safeguard and expand the strategic interests of RZB and RBG and also to steadily in-
crease the value of the portfolio.

The portfolio of participating interests is characterized by long-term strategic holdings in core business areas (credit institutions,
financial institutions, insurance companies, banking support services) and other strategic interests (e.g. IT). In addition, RZB AG
enters into financial investments, with the primary objective of income optimization.
Active control of participating interests aims to take account of the interests of RZB AG’s owners as regards value appreciation and
rising dividend distributions.
The book values of the direct holdings changed as follows:
in € million 31/12/2016 31/12/2015

Additions 11.4 272.4
Posojilnica Bank (ehemals ZVEZA Bank) 11.0 15.2
RZB Invest Holding GmbH 0.0 256.2
Other 0.4 1.0
Disposals 0.0 (9.7)
Valida Holding AG 0.0 (8.9)
Other 0.0 (0.8)
Write-ups 281.9 21.2
Raiffeisen International Beteiligungs GmbH 272.4 0.0
RALT Raiffeisen-Leasing Gesellschaft m.b.H. & Co KG 8.5 0.0
SALVELINUS Handels- und Beteiligungsgesellschaft m.b.H. 0.0 21.2
Other 1.0 0.0
Write-downs (578.2) (209.7)
RZB-BLS Holding GmbH -(557.1) (46.8)
Posojilnica Bank (ehemals ZVEZA Bank) (11.0 (15.2)
R.B.T. Beteiligungsgesellschaft m.b.H. (10.1) (22.2)
Raiffeisen International Beteiligungs GmbH 0.0 (125.5)
Total change (284.9) 74.2
The write-up of Raiffeisen International Beteiligungs GmbH results from the appreciation in value of RBI AG, as a result of which the
write-downs carried out in previous years had to be reversed. The write-down of RZB-BLS Holding GmbH is due, first, to a distribu-
tion of € 460 million and, second, to a capital loss (UNIQA partial sale).
The principal holdings listed in order of book value are as follows
Direct investments in € million 31/12/2016 31/12/2015

Raiffeisen International Beteiligungs GmbH, Vienna (Raiffeisen Bank International AG) 3,302.3 3,029.9
RZB Invest Holding GmbH 838.1 838.1
RZB – BLS Holding GmbH, Vienna (UNIQA Insurance Group AG) 439.9 997.0
SALVELINUS Handels- und Beteiligungsgesellschaft mbH, Vienna 358.3 358.3
R.B.T. Beteiligungsgesellschaft m.b.H. 39.2 49.3
Other 190.6 180.7
Total 5,168.4 5,453.3

Branches
RZB AG has no branches. It does, however, have a representative office in Brussels.
Sector business
RZB AG undertakes significant services to facilitate efficient cooperation in the RBG. The Marketing area at RZB AG provides
essential marketing services and is responsible for strategic brand management based on coordination and advisory services for
the RBG as well as support for the committee work of the Group. Client Relationship Management at RZB AG is responsible for
inquiries, projects, etc. in relation to commercial banking issues in the Group. In addition, all aspects concerning sustainability
management topics and associated activities of RZB come together in RZB AG.
The responsibility for strategic brand management for the RBG and RZB lies with RZB AG. Raiffeisen has developed into an inter-
nationally successful banking group with RZB AG as its lead institution. A uniform brand identity signals strength, conveys expertise
and generates confidence.
Raiffeisen is the clear number one in Austria in terms of customer share, both in the area of private individuals as well as corporate
customers. Regionalism, security and sustainability have constituted the guiding principles of the RBG since the days of its founda-
tion. These take on particular significance in economically challenging times, when security and confidence are the most important
criteria in choosing a bank.
The consistently integrated communication strategy executed by Central Raiffeisenwerbung (ZRW) - present in the media on TV, on
billboards, in print and online - is evidently highly successful in all of its key areas and generates advertising value far exceeding
that of competitors. According to the Financial Market Data Service (FMDS - half-year evaluation 2016), in terms of advertising
recall Raiffeisen remains uncontested in first place with 52 per cent, 22 percentage points ahead of the next competitor. This lead
was greater than in the previous year. In terms of image perception among its own major customers, Raiffeisen scores above
average for 14 out of 16 "Image Dimensions" and ranks top among the banks for "high security".
Federal IPS
Institutional protection schemes (IPS) approved by the Financial Market Authority (FMA) have been established within the Austrian
RBG since the end of 2014 and contractual or statutory liability arrangements have been concluded in this connection; these
schemes provide additional protection for the participating institutions and, in particular, ensure their liquidity and solvency where
required. These IPS are based on joint and uniform risk monitoring pursuant to Article 49 CRR (Capital Requirements Regulation).
Based on the RBG's structure, the IPS were also designed with two levels (federal and provincial IPS).
As the lead institution of the RBG, RZB AG is a member of the Federal IPS whose members include, in addition to the Raiffeisen
regional banks, Raiffeisen-Holding Niederösterreich-Wien, Posojilnica Bank (formerly ZVEZA Bank), Raiffeisen Wohnbaubank and
Raiffeisen Bausparkasse. The Federal IPS is its own supervisory legal subject. Consequently, the capital adequacy requirements of
the CRR must also be complied with at the level of the Federal IPS. Therefore, no deductions are made for the members of the
Federal IPS for their participation in RZB AG. Moreover, internal receivables within the IPS can be weighted at zero per cent. It is
planned that, following the registration of the merger of RZB AG and RBI AG, RBI AG will become a member of the Federal IPS.
The basis of the Federal IPS is uniform and joint risk monitoring within the framework of the early warning system of the Austrian
Raiffeisen Deposit Guarantee scheme (ÖRE). The IPS is therefore an additional element which supplements mutual cooperation in
the framework of the Raiffeisen Banking Group, which comes into effect when members run into financial difficulties.
Communication campaigns
In 2016, ZRW implemented national campaigns focused on specific topics and target groups, based on House/Home including
"Aspiration fulfillment" (January to March), Youth (March/April), Euro 2016 “My Team. My Bank” (May/June), Ac-
count/Convenience (June/July) and Savings (August to November), and developed sales support resources for the corporate
customers target group.
Sport sponsorship
Sport sponsorship has been an important factor driving the success of Raiffeisen marketing for many years. As "the Austrian Bank",
Raiffeisen considers itself to be the optimal sponsorship partner for home-grown ski stars and the national soccer team. The part

nership with top Austrian sportsmen and women brings Raiffeisen the highest level of sport advertisement recall among all banks,
along with an extremely high degree of attention and personal identification. The Raiffeisen brand is consequently perceived as
particularly familiar and approachable, and as representing partnership.
Sport sponsorship has a number of advantages: it generates attention, increases or more firmly establishes market recognition,
positively affects brand image, brings about personal identification and differentiates the brand from competitors, which is particu-
larly important in the financial services sector where products are largely commoditized.
The gable cross was displayed on the helmets of Austrian ski stars in the 2016/2017 world cup season, such as those of six times
world champion and five times overall and slalom world cup winner, Marcel Hirscher and the speed specialist, Max Franz. Since
2003, Raiffeisen has also been the main sponsor of the Austrian national soccer team.
Raiffeisen brand
The Raiffeisen brand, according to the Austrian brand value study 2016 undertaken by the European Brand Institute, has a value
of approximately € 1.8 billion, ranking sixth among the brands evaluated. In the financial services sector, Raiffeisen is the uncon-
tested market leader in Austria. Of all banks, Raiffeisen also enjoys the highest scores for brand recognition, popularity, and
advertising recall.
Liquidity management
RZB AG is the central institution of the RBG. Along with the circa 450 banks in the Group, it forms the largest liquidity network in
Austria. Within this liquidity network, pursuant to the Austrian Banking Act (BWG, Section 27a) members are required to hold a
liquidity reserve at the parent central institution. RZB AG invests the liquidity reserve in highly liquid assets according to
CRR/CRD IV.
As the RBG has a three-tier structure, liquidity balancing takes place on two levels: between the Raiffeisen Banks and the Regional
Raiffeisen Banks as central institutions of the Raiffeisen Banks, as well as between the Regional Raiffeisen Banks and RZB AG as
central institution of the Regional Raiffeisen Banks. Within the RBG, the highest level of liquidity balancing is undertaken by RZB
AG.
In addition to its role as central institution, RZB AG provides numerous other services to the RBG. Amongst other functions, RZB AG
coordinates the holding of the RBG minimum reserve at the National Bank of Austria (OeNB), determining and pooling cash flows
and passing them on to OeNB.

Financial performance indicators

RZB AG’s Total assets as at the 31/12/2016 reporting date amounted to € 17,797.0 million (31/12/2015: 18,363.7 million).
Cash in hand and balances with central banks totaled € 4.503.5 million at year-end (31/12/2015: € 4,051.9 million) and
consisted entirely of balances at the National Bank of Austria (OeNB).
€ 4,264.0 million were shown at the reporting date under the item Treasury bills and other bills eligible for refinancing with central
banks (31/12/2015: € 4,293.0 million), of which € 2,868.5 million (31/12/2015: € 2,982.5 million) related to domestic debt securi-
ties and € 1,395.5 million (31/12/2015: € 1,310.5 million) to foreign debt securities.
Loans and advances to credit institutions amounted to € 1.117,5 million (31/12/2015: € 2,523.2 million). Loans and advances to
RBI accounted for 35.8 per cent (31/12/2015: 16.2 per cent), while and 64.2 per cent (31/12/2015: 83.8 per cent) to other
banks, predominantly banks in the Austrian Raiffeisen sector, accounted for 64.2 per cent (31/12/2015: 83.8).
Loans and advances to customers stood at € 1,011.0 million at the reporting date (31/12/2015: € 1,083.2 million), of which
€ 989.3 million (31/12/2015: € 1,070.8 million) were to domestic customers and € 21.7 million (31/12/2015: € 12.4
million) were to foreign customers. As of 31 December 2016, foreign currency denominated loans and advances to customers
amounted to € 82.4 million (31/12/2015: € 9.0 million).
At the reporting date, an amount of € 815.6 million (31/12/2015: € 645.6 million) was reported under the item Debt securities
and other fixed-income securities. The strong increase of € 170.0 million in comparison with the previous financial year is caused
by the purchase of bonds and notes issued by credit institutions.
The items Interest in affiliated companies and Financial investments of € 5,168.4 million in aggregate (31/12/2015: € 5,453.3
million) included material holdings in Raiffeisen International Beteiligungs GmbH, in RZB-Invest Holding GmbH, in RZB-BLS Hold-
ing GmbH, in SALVELINUS Handels- und Beteiligungsgesellschaft mbH and in R. B. T. Beteiligungsgesellschaft m.b.H.
At the reporting date, Other assets totaled € 819.3 million (31/12/2015: € 261.3 million), of which € 531.2 million (31/12/2015:
€ 76.2 million) represented receivables due from income from equity participations to be paid out after 31/12/2016. Further-
more, as of 31 December 2016, the item contains receivables due from tax group members in relation to tax transfers of € 37.9
million (31/12/2015: € 34.3 million), receivables due from the tax authority of € 108.6 million (31/12/2015: € 72.6 million)
as well as receivables of € 122.9 million (31/12/2015: € 66.8 million) due from ÖRE in connection with the trust account for the
federal IPS.
On the liabilities side, Deposits from banks were reported in an amount of € 12,427.2 million (31/12/2015: € 13,739.5 million).
At 69.8 per cent of total assets (31/12/2015: 74.6 per cent), these represented the largest source of refinancing for RZB AG.
Deposits from banks were split between liabilities to RBI AG, which accounted for 5.4 per cent (31/12/2015: 14.6 per cent), and
liabilities to other banks, predominantly banks in the Austrian Raiffeisen sector, which accounted for 94.6 per cent (31/12/2015:
85.4 per cent).
As at the reporting date, Liabilities to customers (non-banks) amounted to € 680.5 million (31/12/2015: € 272.0 million). This
included liabilities to foreign customers of € 67.6 million (31/12/2015: € 140.0 million).
The item Debt securities issued increased in comparison with the previous financial year to € 170.1 million (31/12/2015:
€ 35.0 million).
The item Other liabilities totaling € 133.0 million (31/12/2015: € 70.4 million) included liabilities from tax transfers (corporate
income tax) and chargeable capital gains as well as withholding tax due to Group members of € 23.4 million in aggregate
(31/12/2015: € 37.6 million). Furthermore, this item contains accrued interest for interest rate swaps used for hedging purposes of
€ 24.9 million (31/12/2015: € 21.0 million).

Provisions recognized by RZB AG are valued at € 69.5 million (31/12/2015: € 76.3 million), of which € 53.6 million
(31/12/2015: € 58.0 million) are for pensions and severance payment obligations, € 1.6 million (31/12/2015: € 4.4 million)
are taxation provisions, € 1.4 million (31/12/2015: € 1.6 million) are provisions for performance related bonuses, € 2.0 million
(31/12/2015: € 1.0 million) are provisions for outstanding invoices, € 1.8 million (31/12/.2015: € 1.7 million) provisions for
unused vacation, and € 1.8 million (31/12/2015: € 1.6 million) provisions for anniversary payments. Furthermore, in the 2016
financial year a provision for contingent liabilities was set up in an amount of € 6.3 million (31/12/2015: € 0.0 million). In the
previous year, provisions were set up for participations in an amount of € 6.9 million, which were used in the year under review.
The total amount at risk (i.e. the risk-weighted assets) as at 31 December 2016 was € 7.5 billion (31/12/2015: € 8.1 billion). Of
this amount, credit risk accounted for € 6.6 billion (31/12/2015: € 6.5 billion), the Basel I floor for € 0.6 billion (31/12/2015:
€ 1.2 billion) and operational risk for € 0.3 billion (31/12/2015: € 0.4 billion). The total amount at risk fell by approximately
€ 0.6 billion compared to the previous year.
Common equity tier 1 (CET1 capital) stood at € 4.0 billion as of 31 December 2016 (31/12/2015: € 3.4 billion). The increase
was primarily caused by the sale of shares in UNIQA insurance, which significantly reduced deductions for material holdings in the financial
sector, and by the allocation of reserves. Tier 2 capital was € 0.0 billion, as the tier 2 capital issued in the amount of € 0.1 billion was
largely absorbed by deductions. All in all, total capital amounted to € 4.0 billion (31/12/2015: € 3.4 billion), a year-on-year
increase of € 0.6 billion.
This resulted in a CET1 ratio and core capital ratio of 53.2 per cent (31/12/2015: 41.9 per cent) and a total capital ratio of
53.6 per cent (31/12/2015: 41.9 per cent). The total capital surplus was approximately € 3.4 billion, € 0.7 million above that
of the previous year.
Earnings performance
In the 2016 financial year, RZB AG posted negative Net interest income of € 42.4 million (2015: minus € 21.3 million). This
development is due on the one hand to negative interest on deposits at the OeNB in an amount of € 10.7 million (2015: € 1.4
million), and to the market and volumes on the other.
Income from securities and participating interests of € 537.2 million (2015: € 82.3 million) mainly consisted of income from shares
in affiliated companies of € 530.9 million (2015: € 75.9 million). This change was primarily caused by the dividend payments in
the same period from RZB-BLS Holding GmbH of € 460.0 million (2015: € 26.0 million).
Commissions receivable amounted to € 10.0 million (2015: € 11.1 million), in particular due to guarantee fees from affiliated
companies.
The income statement item Other operating income amounted to € 29.1 million (2015: € 28.0 million), with the major part made
up of costs passed on and service fees in the amount of € 17.5 million (2015: € 16.7 million) and SLA income of € 9.2 million
(2015: € 8.3 million).
RZB AG generated total Operating income of € 533.0 million (2015: € 90.5 million).
Total Operating expenses were € 83.9 million (2015: € 87.1 million).
At the reporting date, , Staff costs totaled € 31.3 million (2015: € 30.2 million). This change was due to higher salary expenses
caused by the absorption of staff from affiliated companies and by income from the release of provisions for pensions as a result
of the cessation of pension obligations.
Other administrative expenses rose to € 51.3 million (2015: € 48.4 million) and mainly comprised expenses for legal, advisory
and audit costs of € 17.4 million (2015: € 15.5 million), expenses for Service Level Agreements of € 10.6 million (2015: € 9.7
million), advertising expenses of € 11.9 million (2015: € 10.7 million), and rental expenses of € 3.8 million (2015: € 3.0 mil-
lion).
The income state item Other operating expenses totaled € 0.7 million as of the reporting date (31.12.2015: € 8.3 million). The
expense in the previous year was caused by the write-off of a receivable in an amount of € 7.6 million.
RZB AG’s Operating result for the 2016 financial year was € 449.1 million (2015: € 3.4 million).
Net income/expenses from the disposal and valuation of loans and advances and securities held as current assets contains
valuation and realized foreign exchange losses of € 7.4 million (2015: minus € 1.4 million) on securities treated as current

assets, on the one hand, and valuations of loans and advances, and allocations to provisions for contingent liabilities, of minus
€ 7.0 million (2015: plus € 14.4 million) on the other.
Net income/expenses from the disposal and valuation of securities evaluated as financial investments and of shares in affiliated
companies and participating interests showed a negative result of € 284.4 million (2015: minus € 192.7 million) in the 2016
financial year resulting from a write-up to up to the purchase cost for Raiffeisen International Beteiligungs GmbH of € 272.4 million
(2015: write-down of € 125.5 million) and for RALT Raiffeisen-Leasing G.m.b.H. & Co. KG of € 8.5 million, and from an impairment of
€ 138.9 million (2015: € 46.8 million) and a dividend-related write-down of € 418.2 million for RZB-BLS Holding GmbH. R.B.T. Beteili-
gungsgesellschaft m.b.H was also written down € 10.1 million (2015: € 22.2 million).
Consequently, Profit on ordinary activities was positive, at € 150.3 million for the financial year (2015: minus € 176.3 million).
Expenses for corporate income tax and tax transfers in the amount of € 13.9 million (2015: € 12.7 million) are shown under the
item Tax on profit or loss. Other taxes contain the “stability contribution” special tax for banks in the amount of € 16.5 million
(2015: € 20.3 million).
Annual net profit for 2016 amounted to € 147.7 million (2015: annual net loss of € 183.8 million). The item Changes in re-
serves contains a net allocation to the reserves in connection with the federal IPS contribution of € 66.1 million (2015:
€ 38.7 million). An amount of € 82.6 million was also allocated to other reserves in the last financial year.
After movements of reserves, the annual loss for the year amounted to € 1.1 million (2015: annual profit for the year of € 77.7
million). After adding € 1.1 million in profit brought forward (2015: loss brought forward € 76.6 million), a net profit for the year
of € 0.0 million (2015: net profit € 1.1 million) was reported.

Non-financial Performance Indicators

Human Resources
As of 31 December 2016, RZB AG had 245 employees (full-time equivalents, excluding employees assigned to other group
companies), an increase of 12 per cent on 2015 (219 employees). This increase was driven by new hiring and the filling of
vacancies, undertaken in consideration of the assumption of new functions in the Group (including as a consequence of the "Fu-
turePLUS" (ZukunftPLUS) project) and, as lead institution of the Raiffeisen sector, in consideration of regulatory requirements and
also to replace losses in critical functions due to staff turnover. The traditionally very high proportion of women in the total work-
force was unchanged at 49 per cent. To help achieve the best possible balance between work and family life, RZB AG offers
home office and a number of part-time models alongside flexible working time without core working hours. "Daddy's month" is
also offered in RZB AG, giving fathers the opportunity to spend time with their family following the birth of a child. An increasing
number of fathers are also taking several months' paternity leave.
The staff turnover rate during the reporting period was 10.2 per cent (2015: 8.3 per cent).
Developments in remuneration management

To anchor the key importance of the medium-term objectives and the capitalization of the RZB Group more firmly in the remunera-
tion system, in 2016 the bonus system was adapted further by extending the “step-in” criteria for Group Executives and adjusting
the objective attainment criteria. These steps connected RZB AG’s remuneration structure even more closely to the business strate-
gy. Preparatory activities had already been carried out in 2016 to facilitate the smooth implementation of the EBA Guidelines on
sound remuneration policies which enter into force in January 2017. As both the RZB AG remuneration system and remuneration
processes already largely meet the regulatory requirements, only minor adjustments to the compensation framework are expected.
Organizational structure development

In 2016 adjustments were also made to the organizational structure. On 1 July 2016, in the interests of pooling tasks and creating a stronger
focus, the Group Transformation Office and Group Regulatory Affairs areas were combined to create the new Group Regulatory Affairs &
Transformation Office area, while the Sector Customers and Sector Sales Services areas were merged to create the new Sector Services
area.
Professional and management development

The focus of human resources development in RZB AG during the year under review was placed on continuing professional devel-
opment, management development and team development.
The targeted support of new executives in the organization was provided through management training, feedback tools and
personal coaching. The new selection and promotion process implemented in 2015 in filling new management positions was
consistently and successfully deployed. With the implementation of structured 360-degree feedback for management teams in
some areas, moreover, a contribution was made to further developing and strengthening leadership skills in existing structures.
The reorganization measures were massively supported by human resources development, and successfully implemented through
team development events and tools, making change processes more tangible for staff, and allowing business requirements in the
newly created areas to be implemented more quickly and successfully.
The number of “Leaders’ Breakfasts”, short workshops for executives on relevant management topics, was further increased. These
placed greater value on networking between executives from RZB, RBI and affiliated companies.

Corporate responsibility
Sustainability Management at RZB AG
Responsible business practices at RZB AG serve the purpose of comprehensive value creation, incorporating economic, ecologi-
cal and social responsibility. For 130 years, Raiffeisen has combined economic success with socially responsible conduct. The
Raiffeisen values of solidarity, regionalism and subsidiarity form the foundation of all Raiffeisen organizations. Detailed information
on the developments in sustainability management is available at www.rbinternational.com/nachhaltigkeitsmanagement and in
the current Sustainability Report (available at www.rbinternational.com/nachhaltigkeitsmanagement).
For RZB AG, as the lead institution of the Raiffeisen Banking Group, they are important pillars of corporate responsibility. Ever
since Friedrich Wilhelm Raiffeisen founded the original bank, sustainable practices have been an integral part of the culture within
all Raiffeisen companies. Accordingly, corporate responsibility and sustainability form integral elements of business activity.
Sustainability issues in 2016

One of the cornerstones of the sustainability strategy is the role of responsible banking. This is of particular significance for the
core business, which, through the provision of credit and the investment of funds, constitutes the most effective means of sustainable
development. In November 2016, RZB’s rating by sustainability rating agency oekom research was upgraded from “C minus” to
“C” (corresponding to “prime” status) in recognition of its progress. Around 550 companies currently hold oekom research’s prime
status and form the oekom Prime Universe, a comprehensive basis for structuring sustainable capital investments and investment
products.
Also in November 2016, the seventh Stakeholder Council was held and provided a forum for internal and external participants to
meet in workshops and discuss expectations and needs in relation to the following themes: sustainable investments and engage-
ment activities, developing awareness among employees, impact of the Climate Conference, investments in the community, diversi-
ty in the core business, consequences of social transformation and sustainability in the supply chain. The numerous findings will be
incorporated into the various areas of action for the 2017 sustainability strategy and contribute to ongoing development in sus-
tainability.
As a fair partner, RZB AG maintains an active, transparent and open dialog with all stakeholders. The annual Sustainability Report
is an important communication tool in this connection. The 2015 Sustainability Report received the gold award of the Austrian
ASRA (Austrian Sustainability Reporting Award) as the best sustainability report in the “large companies” category.
In spring 2016, RZB AG launched the diversity initiative “Diversity 2020”. The project’s primary focus is on the empowerment of
women (for details, please refer to the Corporate Governance Report). In organizational terms, this involved establishing a diversi-
ty committee, creating diversity ambassadors and appointing a diversity officer.
As an engaged citizen, RZB AG assumes responsibility for society and the environment. Accordingly, it was for example engaged
in the establishment of the Raiffeisen Climate Protection Initiative (Raiffeisen Klimaschutz-Initiative - RKI) in 2007. The RKI is a plat-
form and a driving force for measures in the areas of sustainability, climate protection, energy efficiency, renewable resources and
corporate responsibility.
Under the established corporate volunteering program, all employees of RZB AG and RBI AG are given the opportunity to
demonstrate active participation in society and spend two days’ special leave per year working on selected community projects.
In that connection, migration/integration in Austria was selected as a special focus. Projects to promote financial education are
currently being prepared.

Risk management
Taking and transforming risks form integral components of the banking business. This makes active risk management as much a
core competence of overall bank governance as capital planning and management of the bank's profitability. In order to effec-
tively identify, classify and contain risks, the Group utilizes comprehensive risk management and controlling.
This function spans the entire organizational structure, including all levels of management, and is also implemented in each of the
subsidiaries by local risk management units. Risk management is structured to ensure the careful handling and professional man-
agement of credit risk, country risk, market risk, liquidity risk, investment risk and operational risk in order to ensure an appropriate
risk/reward ratio.

Risk report
Active risk management constitutes a fundamental responsibility of RZB AG, as parent credit institution of the RZB Group, in respect
to the governance of the Group. In order to effectively identify, classify and contain risks, the bank works closely with RBI AG to
develop and implement relevant concepts.
Organization
RZB AG, as parent credit institution, maintains a number of Service Level Agreements with risk management units within RBI AG,
which carries out the operational implementation of risk management processes in the Group in conjunction with the individual
Group subsidiaries. In addition, RZB AG determines risk management policies and defines business-specific guidelines, tools and
procedures for all companies in the Group.
RZB Group
Central risk management

functions and committees
Risk Management Group Risk Committee
 for all risk categories
Risk Controlling Credit Committee (Management Board)
 for all group units
Central and local risk RZB AG RBI Group

management units and
committees Credit Management
Risk Management
(Corporate customers, financial
Risk Controlling
institutions and sovereigns, retail)
Group Risk Committee Credit Portfolio Management
Credit Committee Risk Controlling (Credit, market,
(Management Board) liquidity, and operational risks)
Restructuring/Workout
Risk Management Committee (RMC)

other participations of RZB AG Group Asset/Liability Committee (ALCO)
Market Risk Committee (MACO)
Credit Committees (CC)
Problem Loan Committee (PLC)
Credit Portfolio Committees (CPC)
Local risk management

units and committees Banks and leasing companies Specialist units
 for all risk categories
 in all group units
Consolidation Level / Legal Units Group Functions Committees Division / Department
The two risk management units of RZB AG have defined authority for credit decisions relating to business undertaken by RZB AG
and for large Group credit exposures (risk management) as well as for risk monitoring in the Group (risk controlling). These risk
management units also ensure compliance with all regulatory requirements in the RZB credit institution group pursuant to Section
30 of the BWG (Banking Act).
The Group Risk Committee is under the chairmanship of the RZB AG Board member responsible for risk management and is the
ultimate decision-making body for all risk-related issues in the Group. It decides upon the risk management and control policies to
be employed for the overall Group and in principal areas of the Group. This also includes determination of risk appetite, different
risk budgets and limits on overall bank level, monitoring of the current risk position and corresponding management measures.
Additionally, personnel from risk management areas in RZB AG are represented in all risk-related committees within the Group.

Quality assurance and internal audit

Quality assurance with respect to risk management refers to ensuring the integrity, soundness, and accuracy of processes, models,
calculations, and data sources. This is to ensure that the Group adheres to all legal requirements and that it can achieve the high-
est standards in risk management related operations.
All these aspects are coordinated by the division Group Compliance, which analyzes the internal control system on an ongoing
basis and – if actions are necessary for addressing any deficiencies – is also responsible for tracking their implementation.
Two very important functions in assuring independent oversight are performed by the divisions Audit and Compliance. Independ-
ent internal auditing is a legal requirement and a central pillar of the internal control system. Audit periodically assesses all busi-
ness processes and contributes considerably to securing and improving them. It sends its reports directly to the Management
Board of RZB AG which discusses them on a regular basis in its board meetings.
The Compliance Office is responsible for all issues concerning compliance with legal requirements in addition to and as integral
part of the internal control system. Thus, compliance with existing regulations in daily operations is monitored.
Moreover, an independent and objective audit, free of potential conflicts of interest, is carried out during the audit of the annual
financial statements by the auditing companies. Finally, the Group is continuously supervised by the Austrian Financial Markets
Authority.
Overall bank risk management

Maintaining an adequate level of capital is a core objective of the company. Capital requirements are monitored regularly based
on the actual risk level as measured by internal models, and in choosing appropriate models the materiality of risks annually
assessed is taken into account. This concept of risk management provides for capital requirements from a regulatory point of view
(sustainability and going concern perspective) and from an economic point of view (target rating perspective). Thus it covers the
quantitative aspects of the internal capital adequacy assessment process (ICAAP) as legally required. The full ICAAP process of
RZB AG is audited during the supervisory review process for RZB credit institution group (RZB-Kreditinstitutsgruppe) on an annual
basis.
Objective Description of risk Measurement technique Confidence level

Target rating perspective Risk of not being able to satisfy Unexpected losses on an annual 99.92 per cent as derived from the
claims of the Group´s senior lenders basis (economic capital) must not default probability implied by the
exceed the present value of equity target rating
and subordinated liabilities
Going concern perspective Risk of not meeting the capital Risk-taking capacity (projected 95 per cent presuming the owners´
requirement as defined in the Basel III earnings plus capital exceeding willingness to inject additional capital
regulations regulatory requirements) must not fall
below the annualized value-at-risk of
the company
Sustainability perspective Risk of falling short of a sustainable Capital and net income projection for 70-90 per cent based on the
tier 1 ratio over a full business cycle a three-year planning period based management decision that a
on a severe macroeconomic temporary reduction in risks or the
downturn scenario raising of additional capital might be
required.
Target rating perspective

Risks in the target rating perspective are measured based on economic capital which represents a comparable measure across all
types of risks. It is calculated as the sum of unexpected losses stemming from business areas in the different risk categories (credit,
participation, market, liquidity, macroeconomic and operational risk as well as risk resulting from other tangible fixed assets). In
addition, a general buffer for other risk types not explicitly quantified is held.


Participation risk 958,961 75.9% 1,077,421 81.9%
Credit risk sovereigns 91,842 7.3% 43,160 3.3%
Macroeconomic risk 55,000 4.4% 39,750 3.0%
Market risk 50,915 4.0% 48,340 3.7%
Credit risk financial institutions 23,550 1.9% 8,840 0.7%
Credit risk corporate customers 11,416 0.9% 8,109 0.6%
Operational risk 6,421 0.5% 5,060 0.4%
Other tangible assets 4,222 0.3% 7,478 0.6%
CVA risk 637 0.1% 0 0.0%
Liquidity risk 0 0.0% 15,030 1.1%
Risk buffer 60,148 4.8% 62,659 4.8%
Total 1,263,111 100.0% 1,315,848 100.0%
The objective of calculating economic capital is to determine the amount of capital that would be required for servicing all of the
claims of customers and creditors even in the case of such an extremely rare loss event. RZB AG uses a confidence level of 99.92
per cent for calculating economic capital. This confidence level is derived from the probability of default implied by the target
rating. Based on the empirical analysis of rating agencies, the selected confidence level corresponds to a rating of Single A.
Economic capital is an important instrument in overall bank risk management and is used in the allocation of risk budgets. Econom-
ic capital limits are assigned to individual business areas during the annual budgeting process and are supplemented for day-to-
day management by volume, sensitivity, or value-at-risk limits. In RZB AG, this planning is undertaken on a revolving basis for the
upcoming three years and incorporates the future development of economic capital as well as available internal capital. Econom-
ic capital thus substantially influences the plans for future lending activities and the overall limit for market risks.
Risk-adjusted performance measurement is also based on this risk measure. The profitability of business units is examined in relation
to the amount of economic capital attributed to these units (risk-adjusted return on risk-adjusted capital, RORAC), which yields a
comparable performance measure for all business units of the Bank. This measure is used in turn as a key figure for overall bank
management, for future capital allocations to business units, and influences the remuneration of executive management.
Recovery and resolution of banks

At the beginning of January 2015, the Federal Act on the Recovery and Resolution of Banks (BaSAG), the national transposition of
the European Union’s 2014 Banking Recovery and Resolution Directive (BRRD), came into force. With regard to the recovery
agendas, RZB AG is subject within the framework of the Single Supervisory Mechanism (SSM) to direct supervision by the super-
visory authority of the European Central Bank (ECB) and with regard to the resolution agendas is subject within the framework of
the Single Resolution Mechanism (SRM) to direct supervision by the Single Resolution Board (SRB).
In accordance with the requirements of the Federal Act on the Recovery and Resolution of Banks (BaSaG) RZB AG has a Group
Recovery Plan. The Recovery Plan describes potential measures to ensure the capacity to act in financial stress scenarios. Accom-
panied by the monitoring of important KPIs (Key Performance Indicators) for the early identification of risk, the Recovery Plan
establishes a comprehensive governance structure for stress scenarios.
The Recovery Plan is prepared by RZB AG and is audited by the supervisory authority (ECB).
The resolution authority drafts the resolution plans including powers for the elimination of obstacles to resolution. The resolution
plans also stipulate the resolution strategies for the banks. Certain resolution instruments are made available to the resolution
authorities within the framework of bank resolutions. For example, even before the introduction of the BIRG and the BaSaG, RZB
AG limited internal group exposures in order to reduce cluster risks as well as unlimited residual risks for itself and for its owner
banks. Besides drafting resolution plans, the resolution authority also stipulates the obligation to comply with an MREL (Minimum
Own Funds and Eligible Liabilities) ratio, which is prescribed for each individual bank/resolution unit.
Risk position
Risks relating to equity participations form the most important risk category for RZB. The holding in RBI - which in addition to its
own banking business also holds interests in banks and leasing companies in Central and Eastern Europe - constitutes the largest
equity participation. The majority of the direct and indirect equity participations held by RZB (e.g. network banks, leasing compa-
nies) are fully consolidated in the consolidated financial statements and their risks are therefore closely monitored from an integrat-
ed perspective not only by RBI, but also by the risk controlling area of RZB AG. The other equity participations include affiliated
companies and are additionally focused on the insurance industry, the food sector and the area of banking support services.

Market and liquidity risks in RZB AG are relatively minor in comparison and primarily relate to the sovereign bond portfolio.
Equity participation risk

The risks from listed and unlisted equity participations are also considered to be part of the banking book. They are reported
separately under this risk category. Most of RZB AG’s direct or indirect equity participations are fully consolidated in the consoli-
dated financial statements (e.g. network banks, affiliated companies, leasing companies) and their risks are therefore captured in
detail. Consequently, the management, measurement and monitoring methods described in relation to other types of risk are
employed for the risks arising from these equity participations.
Equity participation risk and default risk are fundamentally similar: a deterioration in the financial situation of an equity participation
is normally followed by a rating downgrade (or default) of that unit. The calculation of the value-at-risk and/or the economic
capital for equity participations is based on an extension of the credit risk approach pursuant to Basel III.
RZB AG’s equity participations are managed by the Participations Management and Controlling division. This area monitors the
risks that arise from long-term participations in equity and is also responsible for the ensuing results. New investments are made
only by RZB AG’s Management Board on the basis of a separate due diligence.
Credit risk
Credit risk in RZB AG principally relates to default risk resulting from business with public sector borrowers or from business with
members of the Austrian Raiffeisen Banking Group. As the latter group predominantly have a relationship based on ownership with
RZB AG - either as a subsidiary or a parent company – default risk protection generally takes the form of posting of collateral and
netting agreements. Moreover, in the context of managing the Group, large credit exposures of subsidiary companies are also
approved by RZB AG whenever a credit limit application for a customer group exceeds the defined approval authority of that
subsidiary.
Credit decisions are made within a hierarchical competence authority scheme depending on the type and size of a loan. The
approval of the business and the credit risk management divisions is always required for individual limit decisions and the regular
rating renewals. If the individual decision-making parties disagree, the potential transaction is decided upon by the next higher-
ranking credit authority.

RZB AG risk policies and credit assessments also take the industry sector of the borrower into account. Financial Intermediation
represents the largest industry sector, which is to a large extent attributable to the Austrian Raiffeisen sector. The public sector
predominantly derives from the portfolio of securities issued by the Republic of Austria. Credit exposure by customer industry classi-
fication is shown in the following table:

Financial Intermediation 16,008,481 71.3% 17,283,026 72.0%
Public administration and defence,
compulsory social security 3,890,277 17.3% 3,964,356 16.5%
Real estate activities 895,436 4.0% 1,160,294 4.8%
Business management, -consultancy 848,462 3.8% 966,764 4.0%
Extraterritorial organizations 427,620 1.9% 261,827 1.1%
Other personal services 213,279 1.0% 213,785 0.9%
Others 162,842 0.7% 143,507 0.6%
Total 22,446,397 100.0% 23,993,559 100.0%
A detailed credit portfolio analysis is undertaken based on individual ratings. Customer ratings are tailor-made and are therefore
carried out separately for different asset classes. Internal risk classification models (rating and scoring models), which are validated
by a central organization unit, are used. The rating models in the main non-retail segments – corporates, financial institutions and
sovereigns – provide for ten main grades. Rating and validation software tools are available (e.g. business valuation, rating and
default database).
Collateralization is one of the main strategies and an actively pursued measure for reducing potential credit risks. The value of
collateral and the effects of other risk mitigation techniques are determined during the limit application process. The risk mitigation
effect taken into account is the value that RZB AG expects to realize within a reasonable period. Types of eligible collateral are
defined in the Group’s collateral list and corresponding valuation guidelines for collateral. The collateral value is calculated ac-
cording to uniform methods, including standardized calculation formulas based on market values, predefined discounts, and expert
assessments.
Credit default and workout process

The credit portfolio and individual borrowers are subject to constant monitoring. The main objectives of monitoring are to ensure
that the borrower meets the terms and conditions of the contract and to keep track of the borrower’s financial position. Such a
review is conducted at least once annually in the non-retail asset classes (corporates, financial institutions, and sovereigns). This
includes a rating review and the revaluation of financial and tangible collateral.
Problem loans (where debtors might run into material financial difficulties or a delayed payment is expected) need special treat-
ment. In non-retail divisions, problem loan committees make decisions on problematic exposures. If restructuring is necessary,
problem loans are assigned either to a designated specialist or to a restructuring unit (workout department). Involving employees
of the workout departments at an early stage can help reduce losses from problem loans.
A default and thus non-performing loan (NPL) is internally defined as a case in which a specific debtor is unlikely to pay its credit
obligations to the bank in full, or a case in which the debtor is overdue 90 days or more on any material credit obligation. RZB
AG has defined twelve indicators to identify a default event in the non-retail segment. These include the following cases, among
others: a customer is involved in insolvency or similar proceedings; an impairment provision has been allocated or a direct write-off
has been taken; credit risk management has judged that a customer account receivable is not wholly recoverable; the work-out
unit is considering stepping in to help a customer regain its financial soundness.
As part of the Basel II project, a Group-wide default database was created to record and document customer defaults. Defaults
and default reasons are also recorded in the database, which enables probabilities of default to be calculated and validated.
Provisions for impairment losses are formed in accordance with defined guidelines based on IFRS accounting principles and cover
all identifiable credit risks. In the non-retail segment, problem loan committees decide on individual loan loss provisions.
Country risk
Country risk includes transfer and convertibility risks as well as political risk. It arises from cross-border transactions and direct
investments in foreign countries. RZB AG’s business activities in the converging Central, Eastern European and Asia markets expose
it to this risk. In those markets, political and economic risks to some extent are still considered to be significant.
RZB AG’s active country risk management is based on the country risk policy, which is set by the Management Board. This policy
is part of the credit portfolio limit system and sets a strict limitation on cross-border risk exposure to individual countries. In day-to-

day work, business units therefore have to submit limit applications for the respective countries for all cross-border transactions in
addition to the limit applications for specific customers. A model which takes into account the internal rating for the sovereign, the
size of the country, and RZB AG’s own capitalization is applied to determine the absolute limit for individual countries.
Country risk is also reflected via the internal funds transfer pricing system in product pricing and in risk-adjusted performance
measurement. In this way, the bank offers the business units an incentive to hedge country risks by seeking insurance (e.g. from
export credit insurance organizations) or guarantors in third countries. The insights gained from the country risk analysis are not
only used to limit total cross-border exposure, but also to cap total exposure in each individual country (i.e. including the exposure
that is funded by local deposits). RZB AG thus realigns its business activities to the expected economic development in different
markets and enhances the broad diversification of its credit portfolio.
Counterparty credit risk

The default of a counterparty in a derivative, repurchase, securities lending or borrowing transaction can lead to losses from
reestablishing an equivalent contract. At RZB AG, this risk is measured by the mark-to-market approach where a predefined add-on
is added to the current fair value of the contract in order to account for potential future changes. The total amount of the potential
expected credit exposures from derivatives transactions determined in this way is set out in the tables for the individual customer
segments. For internal management purposes, potential price changes, which affect the fair value of an instrument, are calculated
specifically for different contract types based on historical market price changes.
For derivative contracts, the standard limit approval process applies; the same risk classification, limitation, and monitoring proce-
dures as in traditional lending are used. Credit risk mitigation techniques such as netting agreements and collateralization represent
an important strategy for reducing counterparty credit risk. In general, RZB AG strives to conclude standardized ISDA master
agreements with all major counterparties for derivative transactions to perform close-out netting and to agree on credit support
annexes (CSA) for full risk coverage of positive fair values on a daily basis.
Market risk
RZB AG defines market risk as the risk of possible losses arising from changes in market prices of trading and investment positions.
Market risk is determined by fluctuations in exchange rates, interest rates, credit spreads, equity and commodity prices, and other
relevant market parameters (e.g. implied volatilities).
Market risks in the customer divisions are transferred to the Treasury division using the transfer price method. Treasury is responsible
for managing these structural risks and complying with the bank’s overall limit. The Capital Markets division comprises proprietary
trading, market making, and customer business with money market and capital market products.
Organization of market risk management

The measurement, monitoring and management of all market risks is undertaken at the RZB AG overall bank level.
The Market Risk Committee is responsible for strategic market risk management. It is responsible for managing and controlling all
market risks. The bank’s overall limit is set by the Management Board on the basis of the risk-bearing capacity and the income
budget. This limit is apportioned to sub-limits in coordination with business divisions according to strategy, business model and risk
appetite.
The Market Risk Management department (RBI) ensures that the business volume and product range comply with the defined and
agreed strategy and risk appetite. It is responsible for developing and enhancing risk management processes, manuals, measure-
ment techniques, risk management infrastructure and systems for all market risk categories and credit risks arising from market price
changes in relation to derivative transactions. In addition, the department independently measures and reports all market risks on a
daily basis.

All products in which open positions can be held are listed in the product catalog. New products are added to this list only after
successfully completing the product approval process. Product applications are investigated thoroughly for any risks. They are
approved only if the new products can be implemented in the front- and back-office (and risk management) systems respectively.
Limit system
RZB AG uses a comprehensive risk management approach for trading and banking books (total return approach). Market risks
are managed consistently in all trading and banking books. The following values are measured and limited on a daily basis in the
market risk management system:
 Value-at-risk (VAR) confidence level 99 per cent, horizon one day

The VaR limit caps the maximum loss which is not exceeded with a confidence level of 99 per cent within one day. It is the
main steering instrument in liquid markets and normal market situations.
 Sensitivities (to changes in exchange rates, interest rates, gamma, vega, equity and commodity prices)
Sensitivity limits are designed to avoid concentrations in normal market situations and represent the main steering instrument in
stress situations or in illiquid markets or those that are structurally difficult to measure.
 Stop loss
This limit strengthens traders’ management of their proprietary positions to ensure that they do not allow losses to accumulate,
but strictly limit them instead.
A comprehensive stress testing concept complements this multi-level limit system. It simulates potential valuation changes in the total
portfolio under various scenarios. Risk concentrations evidenced by these stress tests are reported to the Market Risk Committee
and taken into account when setting limits. Stress test reports for each portfolio are included in daily market risk reports.
Value-at-risk (VAR)
VaR is measured based on a hybrid approach in which 5,000 scenarios are simulated. The approach combines the advantages
of a historical simulation and a Monte Carlo simulation. The market parameters used are based on a 500-day historical time
series. Distribution assumptions include modern features such as volatility declustering and random time change in order to accu-
rately reproduce fat-tailed and asymmetrical distributions. The Austrian Financial Market Authority has approved this model as an
internal model for calculating total capital requirements for market risks.
Structural interest rate risks and spread risks from bond books maintained as a liquidity buffer dominate the VaR. RZB AG does not
have a qualifying trading book. The complete overview therefore represents the results from the banking book.
Total VaR 99% 1d VaR as at Average VaR Maximum VaR Minimum VaR
Currency risk 13 6 13 0
Interest rate risk 955 540 1,207 292
Credit spread risk 6,437 5,650 9,165 3,561
Vega risk 3 2 7 0
Total 5,962 5,589 8,914 3,665
Total VaR 99% 1d VaR as at Average VaR Maximum VaR Minimum VaR
Currency risk 5 782 6,809 2
Interest rate risk 607 1,480 11,970 256
Credit spread risk 5,544 7,711 33,246 2,006
Total 5,162 8,871 32,284 4,279
Interest rate risk in the banking book

As a result of different maturities and repricing schedules of assets and liabilities (customer deposits and financing from money and
capital markets), RZB AG is subject to interest rate risk. This risk arises in particular from different interest rate sensitivities, rate
adjustments, and other optionality of expected cash flows. Interest rate risk in the banking book exists in the euro and US dollar as
major currencies.

This risk is mainly hedged by a combination of transactions on and off the statement of financial position, in particular interest rate
swaps and – to a lesser extent – interest rate forwards and interest rate options are also used. Management of the structure of the
statement of financial position is a core task of the Treasury division, which is supported by the Group Asset/Liability Committee.
The latter uses scenarios and interest income simulations that ensure proper interest rate sensitivity in line with expected changes in
market rates and the overall risk appetite.
Interest rate risk in the banking book is measured not only in a value-at-risk framework, but is also managed by the traditional tools
of nominal and interest rate gap analyses. The following table shows the change in the present value of RZB AG’s banking book
given a one-basis-point parallel interest rate increase. The main currencies are shown separately.
CHF 0 0 0 0 0 0 0 0 0 0 0 0
CZK (3) 0 0 0 0 0 0 1 (4) 0 0 0
EUR 50 (13) (6) 4 96 9 64 25 (130) 0 0 0
PLN 0 0 0 0 0 0 0 0 0 0 0 0
SEK 0 0 0 0 0 0 0 0 0 0 0 0
USD 0 0 0 0 0 0 0 0 0 0 0 0
CHF 0 0 0 0 0 0 0 0 0 0 0 0
CZK 8 0 0 0 0 0 1 1 6 0 0 0
EUR 146 (23) (17) (45) 51 141 126 42 (130) 0 0 0
PLN 0 0 0 0 0 0 0 0 0 0 0 0
SEK 0 0 0 0 0 0 0 0 0 0 0 0
USD 0 0 0 0 0 0 0 0 0 0 0 0
Credit spread risks

The market risk management framework uses time-dependent bond and CDS-spread curves as risk factors to measure credit
spread risks. It covers all capital market instruments.
Liquidity Management
Principles
Internal liquidity management is an important business process within general bank management because it ensures the continuous
availability of funds required to cover day-to-day debt obligations.
Liquidity adequacy is guaranteed from both an economic and also a regulatory perspective. In economic terms, RZB AG has
established a governance framework comprising internal limits and control measures which complies with the Principles for Sound
Liquidity Risk Management and Supervision established by the Basel Committee on Banking Supervision and the regulation on
credit institution risk management (KI-RMV) issued by the Austrian regulatory authority.
The regulatory component is addressed by compliance with reporting requirements under Basel III (minimum liquidity ratio, liquidity
coverage ratio, structural liquidity ratio and net stable funding ratio as well as key ratios for liquidity monitoring and additional
liquidity monitoring metrics) as well as by compliance with the regulatory limits.
Organization and responsibility
Responsibility for guaranteeing adequate levels of liquidity lies with the overall Management Board. In terms of functions, the
responsible Management Board members are the Chief Financial Officer (Treasury) and the Chief Risk Officer (Risk). Consequent-
ly, the processes relating to liquidity risk are mainly carried out by two divisions within the bank. Firstly, Treasury controls the liquidi-
ty risk positions within the strategy, guidelines and parameters set by decision-making bodies. Secondly, these are monitored and
supported by independent Risk Controlling units. The risk units measure and model liquidity risk positions, set limits and monitor
their compliance.
In addition to the aforementioned line functions, the Group Risk Committee (GRC) functions as a decision-making body for all
matters affecting management of a unit’s liquidity positions and the structure of RZB AG’s statement of financial position, including

determining strategies and guidelines for handling liquidity risks. The GRC makes decisions and reports to the respective manage-
ment boards on at least a monthly basis using standardized liquidity risk reports.
Liquidity strategy
Treasury is obliged to comply with certain performance ratios and risk-based principles. The current performance ratios include
general targets (e.g. for return on risk adjusted capital (RoRAC) or coverage ratios), as well as specific Treasury targets for liquidity
(such as a minimum survival horizon in defined stress scenarios or diversification of the financing structure). Besides achieving a
structural contribution by means of maturity transformation which reflects the liquidity and market risk assumed by the bank, Treas-
ury must pursue a prudent and sustainable risk policy in its management of the statement of financial position. Strategic objectives
include reducing the parent company’s funding to the Group subsidiaries, further stabilization of the investor base and ongoing
compliance with regulatory requirements and with internal rules and limits.
Liquidity risk framework
Regulatory and internal liquidity reports and ratios are generated and determined based on certain modelling approaches.
Whereas the regulatory reports are generated in accordance with the requirements of the authorities, the internal reports are
based on assumptions from empirical observations.
RZB AG has a sound database and expertise for forecasting capital flows arising from all material items on and off the statement
of financial position. Cash inflows and outflows are modelled in a sufficiently detailed manner which, as a minimum, distinguishes
between products, customer segments and, where applicable, currencies. Modelling of retail and corporate customer deposits
includes assumptions concerning the retention times for deposits after maturity. The modelling approaches are cautious, in that they
do not, for example, assume “rollover” of deposits from financial institutions and all financing channels and liquidity buffers are
subject to simultaneous stress testing, without considering the mitigating effects of diversification.
The mainstays of the economic liquidity risk framework are the going concern (GC) and the time to wall scenario (TTW). The
going concern report shows the structural liquidity position and covers all main risk drivers which could detrimentally affect the
group in a normal business environment (“business as usual”). The going concern models are also the main input factors for the
cost contribution for the funds transfer pricing model. The time to wall report, on the other hand, shows the survival horizon for
certain disadvantageous scenarios and stress models (market, name and combined crisis) and determines the minimum level of the
liquidity buffer (and/or the balancing capacity) of the Group and its individual units.
The liquidity scenarios are modelled using a Group-wide approach which considers local specifics where these are justified by
influencing factors such as the market or the legal environment or certain business characteristics; calculation is performed at
Group head office. When modelling cash inflows and outflows a minimum distinction is made between products, customer seg-
ments and individual currencies (where applicable). For products without a contractual maturity, cash inflows and outflows are
allocated using a geometric Brownian motion which derives statistical forecasts for future daily balances from the observed, expo-
nentially weighted historical volatility of the corresponding products.
The liquidity risk framework is continuously developed. The technical infrastructure is enhanced and data availability is improved in
order to meet the new reporting and management requirements for this area of risk.
Risk appetite and liquidity limits
The liquidity position is monitored at the level of RZB AG and is restricted by means of a comprehensive limit system. The limits are
determined both for a normal business environment and also for stress scenarios. In accordance with the defined risk appetite,
RZB AG must demonstrate a survival horizon of up to 90 days (TTW) in a severe, combined stress scenario (name and market
stress). This can be guaranteed either by a structurally positive liquidity profile or by a sufficiently high liquidity buffer. In a normal
going concern environment, maturity transformation must be fully covered by the available liquidity buffer in the medium term. This
means that the cumulative liquidity position over a period of up to one year must be positive. In the long term (one year or more),
maturity transformation is permitted up to a certain level. For internal models, these limits are supplemented by limits on compliance
with regulatory liquidity ratios, such as the liquidity coverage ratio (LCR). All limits must be complied with on a daily basis.

Liquidity monitoring
The bank uses a series of customized measuring instruments and early warning indicators which provide the Management Board
and corporate management with near-term and forward-looking information. Compliance with the liquidity risk framework ensures
that the bank can continue its business activities even under high levels of stress.
Monitoring and reporting on compliance with the limits is conducted regularly and effectively, and the corresponding escalation
channels function and are used as intended. The defined limits are complied with in a very disciplined manner and any breach is
reported to the GRC and escalated. This takes appropriate steps or escalates contentious matters to the Management Board.
Liquidity stress test
Stress tests are conducted on a daily basis for RZB AG and once a week at Group level. The tests cover three scenarios (market,
name and combined crisis), consider the effects of the scenarios for a period of up to three months and demonstrate that stress
events can simultaneously result in a time-critical liquidity requirement in several currencies. The stress scenarios include the princi-
pal funding and market liquidity risks, without considering beneficial diversification effects (i.e. all units are simultaneously subject to
a severe combined crisis for all their major products). The results of the stress tests are reported to the Management Board and
members of the corporate management on a weekly basis; they also form a key component of the monthly Group Risk Committee
meetings and are included in the bank’s strategic planning and emergency planning.
A conservative approach is adopted when establishing outflow ratios based on historical data and expert opinions. The simula-
tions assume a lack of access to the money or capital markets and also assume simultaneous significant outflows of customer
deposits. In this respect, the deposit concentration risk is considered by assigning even higher outflow ratios to major customers.
Furthermore, stress models are formulated for the utilization of guarantees and loan liabilities. In addition, the liquidity buffer posi-
tions are adapted by haircuts in order to cover the risk of disadvantageous market movements, and the potential outflows resulting
from collateralized derivative transactions are estimated. The bank continuously monitors whether the formulated stress models are
still appropriate or whether new risks need to be considered.
The time to wall concept has established itself as the main controlling instrument for day-to-day liquidity management and is there-
fore a central component of funding planning and budgeting. It is also essential for determining performance ratios relating to
liquidity.
Liquidity buffer
As shown by the daily liquidity risk reports, each Group unit actively maintains and manages liquidity buffers, including high quality
liquid assets (HQLA) which are always sufficient to cover the net outflows expected in crisis scenarios. RZB AG has sizeable,
unencumbered and liquid securities portfolios and favors securities eligible for Central bank tender transactions in order to ensure
sufficient liquidity in various currencies. Each Group unit ensures the availability of liquidity buffers, tests its ability to utilize central
bank funds, constantly evaluates its collateral positions as regards their market value and encumbrance and examines their coun-
ter-balancing capacity, including the secured and unsecured funding potential and the realizability of the assets.
Generally, a haircut is applied to all liquidity buffer positions. These haircuts include a market-risk-specific haircut and a central
bank haircut. While the market risk haircut represents the potential price volatility of the assets-side securities in the liquidity buffer,
the central bank haircut represents an additional haircut by the central bank for each individual relevant security offered as collat-
eral.
Emergency funding plan
Under aggravated liquidity conditions, the RZB AG moves to an emergency process in which it follows predefined emergency
funding plans. These emergency plans also constitute an element of the liquidity management framework and are mandatory for
all significant Group units. The emergency management process is designed so that RZB AG can retain a strong liquidity position
even in serious crisis situations.

Liability structure and liquidity position
Funding of RZB AG consists mainly of wholesale deposits. The funding instruments are appropriately diversified and are made use
of on a regular basis. The ability to procure funds is precisely monitored and evaluated by Treasury.
In the past year and to date, RZB AG’s excess liquidity was significantly above all regulatory and internal limits. The result of the
internal time to wall stress test demonstrates that RZB AG would continuously survive the modeled stress phase of 90 days even
without applying emergency measures.
The results of the going concern scenario are shown in the following table. The table shows excess liquidity and the ratio of ex-
pected capital inflows and the counterbalancing capacity to capital outflows (liquidity ratio) for selected maturities on a cumula
tive basis. The capital flows are based on assumptions taken from expert opinions, statistical analyses and country specifics. This
calculation also includes estimates on the sediment of customer deposits, outflows of off-balance sheet items and market downturns
for positions which are included in the counterbalancing capacity.

Maturity 1 month 1 year 1 month 1 year
Liquidity gap 1,224,648 79,958 441,437 458,511
Liquidity ratio 115% 101% 106% 105%
Liquidity coverage ratio (LCR)

The Liquidity Coverage Ratio (LCR) supports the short-term resilience of banks. The latter must ensure that they have an adequate
stock of unencumbered high-quality liquid assets (HQLA) in order to be able to cover potential outflows due to liabilities that may
be incurred during crises. HQLAs can be converted into cash in order to cover the liquidity requirement within the framework of a
liquidity stress scenario for at least 30 calendar days.
The calculation of the expected cash inflows and outflows as well as HQLAs is based on regulatory guidelines.
In 2016, the regulatory LCR limit was 70 per cent which will be raised gradually to 100 per cent by 2018.
in € thousand 31/12/2016 31/12/2015

Average liquid assets 8,737,667 7,661,682
Net outlows 7,626,223 7,007,152
Inflows 646,705 1,936,875
Outflows 8,272,928 8,944,027
Liquidity Coverage Ratio 115% 109%
The LCR increased slightly in 2016 year-on-year. While cash inflows declined due to longer loan periods, the HQLAs were in-
creased by moving liquidity from the Raiffeisen Sector to the ECB, so that the LCR improved slightly.
Net Stable Funding Ratio (NSFR)

The NSFR is defined as the ratio of available stable funding and required stable funding. This ratio should continuously be at least
100 per cent, although no regulatory limit has been set. “Available stable funding” is defined as that part of equity and debt
which is expected to be a reliable source of funds over the time horizon of one year covered by the NSFR. A bank’s required
stable funding depends on the liquidity characteristics and residual maturities of the various assets held and of off-balance sheet
exposures.
RZB AG targets a balanced funding position. The regulatory provisions are currently being revised by the regulatory authorities.

in € thousand 2016
Required stable funding 7,793,426
Available stable funding 7,411,744
Net Stable Funding Ratio 95%
The NSFR is not shown for year-end 2015 due to limited comparability.
Operational risk
Operational risk is defined as the risk of losses resulting from inadequate or failed internal processes, people and systems or from
external events, including legal risk. In this risk category, internal risk drivers such as unauthorized activities, fraud or theft, losses
caused by conduct, model, execution and process errors, or business disruption and system failures are managed. External factors
such as damage to physical assets or fraudulent intentions are also managed and controlled.
These risks are analyzed and managed on the basis of in-house historical loss data and the results of the risk assessment.
As with other risk types, the principle of firewalling between risk management and risk controlling also applies to operational risk
at RZB AG. To this end, individuals are designated and trained as so-called OpRisk Managers for each division and report regu-
larly their risk assessments, loss events, indicators and measures to central OpRiskControlling. They are supported in their work by
the DORS. .
The risk controlling units for operational risk are responsible for the reporting, implementation of the framework, the development of
control measures and the monitoring of compliance with the requirements. Within the framework of the annual risk management
cycle they also coordinate the participation of the relevant second-line-of-defense units (Financial Crime Management, Compli-
ance, Vendor Management, Outsourcing Management, Insurance Management, Information Security, Physical Security, BCM,
Internal Control System) and the entire first-line-of-defense contacts (OpRisk Managers).
Risk identification
Identifying and evaluating risks that could endanger the bank as a going concern (but risks that occur with a very low degree of
probability) and other areas in which losses occur more frequently (but on a small scale) represent key tasks in the management of
operational risk.
Operational risk is evaluated in a structured form according to categories such as business processes and event types by risk
assessments. Moreover, all new products are subject to a risk assessment. The impact of high probability/low impact events and
low probability/high impact events is measured over a one- and ten-year horizon. Low probability/high impact events are quanti-
fied on the basis of scenarios. The internal risk profile, loss events or external changes determine which scenarios are analyzed.
Monitoring
In order to monitor operational risks, early warning indicators are used for prompt identification and mitigation of losses. Opera-
tional losses are recorded in a central database named ORCA (Operational Risk Controlling Application) broken down by busi-
ness line and type of event.In addition to the requirements for the internal and external reporting for standard approach units, loss-
events are used for the exchange of information with international databases to further develop advanced measurement methods
as well as to track measures and effectiveness of controls. Since 2010, the RZB Group has participated in the ORX data consorti-
um (Operational Riskdata eXchange Association), whose data is currently used for internal benchmark purposes and analyses and
as part of the operational risk model. The ORX data consortium is an association of banks and insurance groups for statistical
purposes.
The Risk Management Committee receives regular and comprehensive reports on the results of the analyses as well as on events
arising from operational risks.
Quantification and mitigation

Since October 2016, RZB AG has calculated the equity requirement using the Advanced Approach.
The Advanced Measurement Approach is based on an internal model with the input factors of the external and internal loss events
and the group-wide scenarios. Risk-based management is carried out with the allocation on the basis of the input factors of the

corresponding units and operating income for stabilization. The implementation of these high qualitative standards has already
been rolled out in broad sections of the group.
To mitigate operational risk, the business division heads take preventive action to reduce and transfer risk. The progress and suc-
cess of these actions is monitored by risk controlling. The business division heads also draw up contingency plans and nominate
persons or departments to take the required measures if losses do in fact occur. In addition, several dedicated organizational units
provide support to business divisions to reduce operational risks. An important role in connection with operational risk activities is
taken on by Financial Crime Management. Financial Crime Management provides support for the prevention and identification of
fraud. RZB AG also organizes regular extensive staff training programs and has a range of contingency plans and back-up sys-
tems in place.
Internal control and risk management

system with regard to the accounting
process
Introduction
The establishment and definition of a suitable internal control and risk management system with regard to the accounting process is
extremely significant for RZB AG and the Group. The annual financial statements of RZB AG are prepared in the Financial Ac-
counting department of Raiffeisen Bank International, which falls within the area of responsibility of the Chief Financial Officer
(CFO). The scope of its activities is defined in a service level agreement between the companies.
The annual financial statements are prepared on the basis of the relevant Austrian laws, above all the Austrian Banking Act (BWG)
and the Austrian Commercial Code (UGB), which deal with the preparation of annual financial statements.
RZB AG’s general ledger is maintained in SAP. The GEBOS core banking application fulfills key sub-ledger functions such as
credit and deposit processing (GIRO) and a partial coexistence function for the SAP general ledger. Other sub-ledgers exist in
addition to GEBOS, including in particular:
 Wall Street Systems and Murex (Treasury transactions)

 GEOS und GEOS Nostro (securities settlement and nostro securities management)
 Payments
 Banktrade (guarantees and letters of credit)
 SAP sub-ledgers (accounts receivable, accounts payable, fixed asset accounting)
The accounting process can be described as follows:
 Day-to-day accounting
Day-to-day accounting records are mainly posted to the respective sub-ledgers (sub-systems). This posting data is transferred to
the general ledger (SAP) in aggregated form on a daily basis, using automated interfaces. In addition, individual postings are
recorded directly in the SAP general ledger. The general ledger in SAP has multi-GAAP functionality, which means two equiva-
lent parallel general ledgers are maintained in SAP: one in accordance with UGB/BWG reporting standards and also a par-
allel ledger in accordance with IFRS. An operational chart of accounts exists for the two general ledgers; depending on the
respective content, all postings are made either simultaneously in both general ledgers or in only one of the two ledgers. The
parallelism of the entries and the parallel existence of the two general ledgers remove the need for reconciliations from
UGB/BWG to IFRS.
 Individual financial statements for RZB AG in accordance with UGB/BWG and IFRS
The SAP trial balance in accordance with UGB/BWG and/or IFRS results from the posting data of the respective sub-systems
which is delivered via automated interfaces. In addition, a number of supplementary ledger-specific closing entries are made
directly in SAP. These are independent of the respective sub-systems. The sum of all these entries gives the statement of financial
position and the income statement pursuant to UGB/BWG or IFRS.

Control environment
In general, all internal Group directives can be retrieved from the RZB Group Internal Law Database. With regard to accounting,
mention should be made above all of the Group Accounts Manual, which contains a description of the following points in particu-
lar:
 General accounting rules

 Measurement methods
 Required (quantitative) information in the notes
 Accounting rules for specific transactions
Additional guidelines exist solely for RZB AG. These include, for example, accounting guidelines, which defines the instruction
process for the settlement of purchase invoices or the management of clearing accounts.
Risk assessment
The assessment of the risk of incorrect financial reporting is based on various criteria. Valuations of complex financial instruments
may lead to an increased risk of error. In addition, asset and liability items have to be valued for the preparation of the annual
financial statements; in particular the assessment of the impairment of receivables, securities and equity participations, which are
based on estimates of future developments, gives rise to a risk. The main focus of risk assessment is on RZB AG’s listed and unlisted
participating interests; any impairments have a significant influence on the annual financial statements.
Control measures
The main control measures encompass a wide range of reconciliation processes. Besides the four eyes principle, automation-
aided controls and monitoring instruments dependent on risk levels are used, for example the comparison of the main ledger with
the sub-ledgers or the continuous reconciliation of clearing accounts. The duties assigned to individual positions are documented
and updated on an ongoing basis. Particular emphasis is placed on effective deputizing arrangements to ensure that deadlines
are not missed due to the absence of one person.
The Audit Committee of the Supervisory Board examines the annual financial statements and the management report and they are
adopted by the Supervisory Board. They are published in the Wiener Zeitung and finally filed with the commercial register.
Information and communication

Information on the accounting treatment of their respective products is regularly exchanged with the specialist departments. Regu-
lar departmental meetings ensure that employees receive ongoing training on changes to accounting rules under the Austrian
Commercial Code (UGB).
As part of the reporting process, the Management Board receives monthly and quarterly reports analyzing the results of RZB AG
and the Group. The Supervisory Board is also regularly informed about the results at its meetings. This ensures that the internal
control system is monitored.
External reports are for the most part prepared only for the consolidated results of RZB. This information is published on a semi-
annual basis, comprising consolidated financial statements and an interim financial report. In addition, there are regular regulatory
reporting requirements with respect to the banking supervisory authority.

Monitoring
Financial reporting is an important part of the ICS during which the accounting processes are subject to additional monitoring and
control, the results of which are presented to the Management Board and Supervisory Board. The Audit Committee is also respon-
sible for monitoring the accounting process. The Management Board is responsible for ongoing company-wide monitoring. In
accordance with the target operating model, three successive lines of defense are established to meet the increased requirements
for internal control systems.
The first line of defense is formed by the individual departments, where department heads are responsible for monitoring their
business areas. Controls and plausibility checks are conducted on a regular basis within the departments, in accordance with the
documented processes.
The second line of defense is provided by issue-specific specialist areas. These include, for example, Compliance, Data Quality
Governance, Operational Risk Controlling or Security & Business Continuity Management. Their primary aim is to support the
individual departments when carrying out control steps, to validate the actual controls and to introduce state-of-the-art practices
within the organization.
Internal audits are the third line of defense in the monitoring process. Responsibility for auditing lies with Group Internal Audit at
RZB and also the respective internal audit departments of the Group units. All internal auditing activities are subject to the Group
Audit standards, which are based on the Austrian Financial Market Authority’s minimum internal auditing requirements and interna-
tional best practices. Group Audit’s internal rules are additionally applicable (notably the Audit Charter). Group Audit regularly
and independently verifies compliance with the internal rules within the RZB Group units. The head of Group Internal Audit reports
directly to the Management Boards
Outlook
Economic prospects
Central Europe
Following somewhat weaker growth last year, growth in Central Europe (CE) is expected to pick up again in 2017. Ongoing
expansionary monetary policy in the region, a solid growth climate in the euro area and an expected recovery in investment
demand – amid continued strong private household consumer spending – should support this positive momentum. Leading the
way are Poland and Slovakia, each with projected growth of 3.3 per cent, closely followed by Hungary, whose economy should
grow by 3.2 per cent. In the Czech Republic, growth is forecast to reach 2.7 per cent.
Southeastern Europe
The Southeastern European (SEE) region is likewise expected to continue its growth trend. Following very strong GDP growth of
3.9 per cent in 2016, SEE should increase its economic output in 2017 by slightly more than 3 per cent, which is its current potential
growth rate. In particular, Romania could continue its solid growth trajectory with GDP growth of 4.2 per cent, but momentum is
already slowing somewhat following last year’s peak of over 4.8 per cent. Conversely, negative overheating effects such as a
ballooning current account deficit should be avoided as a result. Serbia and Croatia, the two countries showing the strongest eco-
nomic recovery in 2016, should both achieve economic growth of around or just over 3.0 per cent.
Eastern Europe
In Russia, moderate economic growth of 1.0 per cent is expected following the easing of the recession; a positive trend in oil prices
would further support the Russian economy. In Ukraine, a continuation of last year’s weak recovery process is anticipated whereas
the economy in Belarus is still expected to shrink slightly. In general, Eastern Europe currently lacks strong external and internal
growth drivers, as a result of which the region is not able to replicate the higher growth rates of the past. In addition, event risk re-
mains considerable.

Austria
In Austria, the moderate economic upturn in 2017 should continue and gain momentum. Domestic demand (private consumption,
gross capital investment) should continue to be the main pillar of support. The growth rate for exports should be higher than in
2016. Notwithstanding continuing solid growth in imports resulting from domestic economic momentum, net exports are expected
to continue to support GDP growth in 2017. This scenario implies a 1.7 per cent increase in real GDP, following 1.5 per cent in
2016.
CEE banking sector

Solid economic growth in CE and SEE – as well as the end of the recession in Russia and Ukraine – should have a markedly
positive impact on the CEE banking sector in 2017. Favorable developments in the operating business in CE and SEE could also
be supported by at least stable or even slightly improved interest margins and/or somewhat steeper yield curves in 2017. In
addition, recent years have already seen necessary adjustments for foreign currency loans and NPL portfolios resulting from the
earlier expansion in CE and SEE, as well as their negative income effects. Accordingly, return on equity in the CEE banking sector
should continue to recover in 2017.
Outlook for RZB following merger with RBI

Due to the resolution passed by the General Extraordinary Meetings of RZB AG and RBI AG on 23 January, and respectively on
24 January 2017, regarding the merger of the two institutes, RBI AG is the universal successor of RZB AG and, among other
things, will take over the role of central institution of the RBG.
As a result of the merger with RZB, to be entered in the commercial register on 18 of March 2017, the following outlook applies
to the combined bank.
RBI reached the 12 per cent CET1 ratio target one year ahead of schedule with a fully loaded CET1 ratio of 13.6 per cent at 31
December 2016 (12.4 per cent for the pro forma combined bank). In the medium term RBI strives to achieve a CET1 ratio (fully
loaded) of around 13 per cent.
After stabilizing loan volumes, RBI looks to resume growth with an average yearly percentage increase in the low single digit area.
RBI expects net provisioning for impairment losses for 2017 to be below the level of 2016 (€ 754 million).
RBI looks to reach an NPL ratio of around 8 per cent by the end of 2017, and over the medium term RBI expects this to reduce
further.
RBI further aims to achieve a cost/income ratio of between 50 and 55 per cent in the medium term, unchanged from our previous
target.
RBI’s medium term return on equity before tax target is unchanged at approximately 14 per cent, with a consolidated return on
equity target of approximately 11 per cent.

Auditor's Report 243
Auditor's Report
Report on the Financial Statements
Audit Opinion
We have audited the financial statements of
Raiffeisen Zentralbank Österreich Aktiengesellschaft,

Vienna
that comprise the statement of financial position as of 31 December 2016, the income statement for the year then ended, and the
notes.
In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of
31 December 2016, and its financial performance for the year then ended in accordance with Austrian Generally Accepted
Accounting Principles, and other legal requirements (Austrian Banking Act).
Basis for our Opinion

We conducted our audit in accordance with Austrian Standards on Auditing. These standards require the audit to be conducted in
accordance with International Standards on Auditing (ISA). Our responsibilities pursuant to these rules and standards are de-
scribed in the “Auditors’ Responsibility” section of our report. We are independent of the Company within the meaning of Austrian
commercial law and professional regulations, and have fulfilled our other responsibilities under those relevant ethical requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Key Audit Matters

Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial state-
ments. Key audit matters are selected from the matters communicated with the audit committee, but are not intended to represent
all matters that were discussed with them. Our audit procedures relating to these matters were designed in the context of our audit
of the consolidated financial statements as a whole. Our opinion on the financial statements is not modified with respect to any of
the key audit matters described below, and we do not express an opinion on these individual matters.
In the following we present the key audit matters from our point of view:
Recoverability of shares in affiliated companies and participating interests

Shares in affiliated companies and participating interests represent a significant proportion of the total assets of Raiffeisen Zentralbank Öster-
reich Aktiengesellschaft. Alongside its holding in Raiffeisen Bank International AG, Vienna, the bank has shareholdings in particular in special-
ized subsidiaries of the Austrian Raiffeisen Group, in which it holds an indirect majority through holding companies. Additionally, it has direct
and indirect shareholdings in credit institutions and in project companies and service companies.
The Management Board describes the process for managing the participation portfolio and the procedures for assessing impairment of
shares in affiliated companies and equity participations under "Recognition and measurement principles" in the notes to the Financial State-
ments and in the section "Business Areas" in the Management Report.
At the reporting date, the bank division "Participations Management and Finance" assesses whether, on the basis of the fair value of the
individual participations, there are triggers for permanent impairment in any given case or whether a reversal of a previous impairment up to the
amount of the acquisition cost is necessary.
Internal and external company valuations are used to calculate the fair value. The company valuation calculation is based to a large extent on
assumptions and estimates regarding expected future cash flows. These are based on the budgeted figures approved by the governing

244 Auditor's Report
bodies of the respective company. The discount rates applied can furthermore be affected by market-based, economic and legal factors which
may change in the future.
In consequence the valuations are based on judgmental factors by nature and carry uncertainties with respect to the estimates. They therefore
lead to a risk of misstatement in the Financial Statements.
Our Audit Approach
We have examined the processes in the "Participations Management and Finance" division and tested the key controls using a sampling
approach, to assess whether the process structure and implementation are adequate to identify necessary impairments or potential impairment
reversals on a timely basis.
Our valuation specialists have examined the appropriateness of the valuation models used, the planning assumptions and the
valuation parameters. The valuation models applied were analyzed on a sampling basis and it was assessed as to whether they
adequately calculate company valuations. The valuation parameters used in the models, primarily the interest rate components,
were evaluated and critically assessed. The assumptions used to determine the interest rates were assessed as to their appropri-
ateness by comparison with market and industry-specific benchmarks. Backtesting of the planning assumptions conducted by the
bank was reviewed to evaluate the forecasting accuracy with respect to the assumptions in the detailed planning phase. The
calculation of the company valuations was analyzed on a sampling basis. The results of the company valuations were compared
with market data and publicly available information (primarily market multiples).
Finally we assessed whether the disclosures in the notes to the Financial Statements and in the Management Report regarding the
recoverability of shares in affiliated companies and participating interests are appropriate.
Managemet's Responsibility and Responsibility of the Audit Committee for the Financial
Statements
The Company’s management is responsible for the preparation and fair presentation of these financial statements in accordance
with Austrian Generally Accepted Accounting Principles and other legal requirements (Austrian Banking Act) and for such internal
control as management determines is necessary to enable the preparation of financial statements that are free from material mis-
statement, whether due to fraud or error.
Management is also responsible for assessing the Company’s ability to continue as a going concern, and, where appropriate, to
disclose matters that are relevant to the Company’s ability to continue as a going concern and to apply the going concern as-
sumption in its financial reporting, except in circumstances in which liquidation of the Company or closure of operations is planned
or cases in which such measures appear unavoidable.
The audit committee is responsible for the oversight of the financial reporting process of the Company.
Auditors’ Responsibility
Our aim is to obtain reasonable assurance about whether the financial statements taken as a whole, are free of material – inten-
tional or unintentional– misstatements and to issue an audit report containing our audit opinion. Reasonable assurance represents
a high degree of assurance, but provides no guarantee that an audit conducted in accordance with Austrian Standards on Audit-
ing, which require the audit to be performed in accordance with ISA, will detect a material misstatement, if any. Misstatements may
result from fraud or error and are considered material if they could, individually or as a whole, be expected to influence the eco-
nomic decisions of users based on the financial statements.
As part of an audit in accordance with Austrian Standards on Auditing, which require the audit to be performed in accordance
with ISA, we exercise professional judgment and retain professional skepticism throughout the audit.

Auditor's Report 245
Moreover:
— We identify and assess the risks of material misstatements – intentional or unintentional – in the financial statements, we
plan and perform procedures to address such risks and obtain sufficient and appropriate audit evidence to serve as a basis for
our audit opinion. The risk that material misstatements due to fraud remain undetected is higher than that of material misstatements
due to error, since fraud may include collusion, forgery, intentional omissions, misleading representation or override of internal
control.
— We consider internal control relevant to the audit in order to design audit procedures that are appropriate in the circum-
stances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control.
— We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates as well
as related disclosures made by management.
— We conclude on the appropriateness of management’s use of the going concern assumption and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the
entity’s ability to continue as a going concern. In case we conclude that there is a material uncertainty about the entity’s ability to
continue as a going concern, we are required to draw attention to the respective note in the financial statements in our audit report
or, in case such disclosures are not appropriate, to modify our audit opinion. We conclude based on the audit evidence obtained
until the date of our audit report. Future events or conditions however may result in the Company departing from the going concern
assumption.
— We assess the overall presentation, structure and content of the financial statements including the notes as well as
whether the financial statements give a true and fair view of the underlying business transactions and events.
— We communicate to the audit committee the scope and timing of our audit as well as significant findings including
significant deficiencies in internal control that we identify in the course of our audit.
— We report to the audit committee that we have complied with the relevant professional requirements in respect of our
independence and that we will report any relationships and other events that could reasonably affect our independence and,
where appropriate, related measures taken to ensure our independence.
— From the matters communicated with the audit committee we determine those matters that required significant auditor
attention in performing the audit and which are therefore key audit matters. We describe these key audit matters in our audit report
except in the circumstances where laws or other legal regulations forbid publication of such matter or in very rare cases, we de-
termine that a matter should not be included in our audit report because the negative effects of such communication are reasona-
bly expected to outweigh its benefits for the public interest.
Report on Other Legal Requirements

Management Report
In accordance with Austrian Generally Accepted Accounting Principles the management report is to be audited as to whether it is
consistent with the financial statements and as to whether it has been prepared in accordance with legal requirements.
The legal representatives of the Company are responsible for the preparation of the management report in accordance with
Austrian Generally Accepted Accounting Principles and other legal requirements (Austrian Banking Act).
We have conducted our audit in accordance with generally accepted standards on the audit of management reports as applied
in Austria.

246 Auditor's Report
Opinion
In our opinion, the management report has been prepared in accordance with legal requirements and is consistent with the finan-
cial statements. The disclosures pursuant to Section 243a UGB (Austrian Commercial Code) are appropriate.
Statement
Based on our knowledge gained in the course of the audit of the financial statements and the understanding of the Company and
its environment, we did not note any material misstatements in the management report.
Auditor in Charge
The auditor in charge is Mr. Mag. Wilhelm Kovsca.
KPMG Austria GmbH
Wirtschaftsprüfungs- und Steuerberatungsgesellschaft
Wilhelm Kovsca
Wirtschaftsprüfer
(Austrian Chartered Accountants)

Statement of all legal representatives 247
Statement of all legal

representatives
We confirm to the best of our knowledge that the consolidated financial statements give a true and fair view of the assets, liabili-
ties, financial position and profit or loss of the Group as required by the applicable accounting standards and that the Group
management report gives a true and fair view of the development and performance of the business and the position of the Group,
together with a description of the principal risks and uncertainties the Group faces.
We confirm to the best of our knowledge that the financial statement give a true and fair view of the assets, liabilities, financial
positions and profit or loss of the company as required by the applicable accounting standards and that the management report
gives a true and fair view of the development and performance of the business and the position of the company, together with a
description of the principal risks and uncertainties the company faces.
Chairman of the Management Board responsible for
Participation Management & Finance, Sustainability Management, Compliance, Audit of RZB Group
and Management Secretariat

Member of the Management Board responsible for Member of the Management Board
Sector Marketing, Sector Customers, Sector Treasury, responsible for Risk Management, Risk Controlling
Sector Services, Group Regulatory Affairs, Group Transfor- and Organization & Processes
mation Office and Digital Banking & Innovation Management

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RAIFFEISEN

© 2017 RBI Accounting & Reporting

Raiffeisen Zentralbank | Annual Financial Report 2016

Statement of comprehensive income ...................................................................................................................................................................................................... 4

Management report ............................................................................................................................................................... 164

Market development............................................................................................................................................................................................................................... 164

Annual financial statements.................................................................................................................................................... 187

Statement of financial position ............................................................................................................................................................................................................. 187

Notes ....................................................................................................................................................................................... 191

Company .................................................................................................................................................................................................................................................... 191

Management report ............................................................................................................................................................... 213

Market development............................................................................................................................................................................................................................... 213

Auditor's Report ...................................................................................................................................................................... 243

Statement of all legal representatives .................................................................................................................................. 247

Raiffeisen Zentralbank | Annual Financial Report 2016

Earnings per share

Raiffeisen Zentralbank | Annual Financial Report 2016

Other comprehensive income and total comprehensive income

Other comprehensive income

Raiffeisen Zentralbank | Annual Financial Report 2016

The components of retained earnings developed as follows:

Fair value Companies

Raiffeisen Zentralbank | Annual Financial Report 2016

in € thousand H1/2013 H2/2013 H1/2014 H2/2014

Raiffeisen Zentralbank | Annual Financial Report 2016

Statement of financial position

Equity and liabilities

Raiffeisen Zentralbank | Annual Financial Report 2016

Statement of changes in equity

Raiffeisen Zentralbank | Annual Financial Report 2016

Statement of cash flows

in € thousand 2016 2015

Payments for taxes, interest and dividends 2016 2015

Raiffeisen Zentralbank | Annual Financial Report 2016

 net cash from operating activities

Raiffeisen Zentralbank | Annual Financial Report 2016

Raiffeisen Bank International Group (RBI)

Central institution and specialized subsidiaries

Other equity participations

Assessment of segment profit and loss

Raiffeisen Zentralbank | Annual Financial Report 2016

Raiffeisen Zentralbank | Annual Financial Report 2016

Financial year 2016 Central institution and Other Equity

Risk-weighted assets (credit risk) 48,841,245 6,108,991 1,535,572 (219,647) 56,266,161

Financial year 20151 RBI Central institution and Other Equity

Risk-weighted assets (credit risk) 51,458,646 5,858,077 2,576,124 (304,983) 59,587,865

Raiffeisen Zentralbank | Annual Financial Report 2016

Principles underlying the consolidated financial statements

Foreign currency translation

Raiffeisen Zentralbank | Annual Financial Report 2016

The following exchange rates were used for currency translation:

Key sources of estimation uncertainty and critical accounting judgments

Risk provisions for loans and advances

Raiffeisen Zentralbank | Annual Financial Report 2016

Fair value of financial instruments

Provisions for pensions and similar obligations

Impairment of non-financial assets

Deferred tax assets

Raiffeisen Zentralbank | Annual Financial Report 2016

Interests in structured entities