Raiffeisen funds motorway project inRomania

Raiffeisen has arranged a EUR 73 million syndicated term loan as part of theinitial funding for construction works of a motorway that will linkRomania with Hungary. Overall project totals EUR 2.8 billion.

Raiffeisen Zentralbank Oesterreich AG (RZB)andRaiffeisen Bank S.A., Romania, have successfully arrangeda EUR 73 million syndicated term loan facility for the RomanianMinistry of Transport, Construction and Tourism. The transaction,which forms a part of the initial funding, was very well receivedby investors, resulting in an oversubscription for the facility.The syndicated loan is part of the first tranche of funding of thecontract between the Romanian authorities and the U.S. constructioncompanyBechtelto build the Bra''ov-Bor'' motorway,designed to link the central part of Romania to its western borderwith Hungary.

The mandate for this initial funding was signed by the Ministryof Transport, Construction and Tourism in Bucharest earlier thisyear, when RZB and the U.S. investment bankBear Stearnsjointly bid against other syndicates of international banks. Theinitial funding mandated is a 10-year syndicated loan to financepart of the non-US content and together with a U.S.Eximbankfacility. A guarantee will be issued by theMinistry of Finance on behalf of the State of Romania.

"The transaction is not only another example of RZB''sability to provide large-scale financing to its customers, but italso emphasizes its ongoing and consistent commitment to Centraland Eastern Europe. It''s a long-term investment objective, withimportant added value for Romania''s development and the regionswhere the motorway will pass through. Any kind of infrastructurebrings investments, new jobs and clearly adds value for the peopleliving in the region", said Herbert Stepic, Chairman of theManaging Board ofRaiffeisen International Bank-Holding AG(Raiffeisen International)and RZB''s DeputyChairman,on the occasion of the signing.

The motorway extends for 415 km from Bra''ov to the Hungarianborder near the village of Bor''. It is part of theConstan''a-Bucharest-Budapest motorway corridor, which is one ofthe three planned links of the trans-European motorway network. Themotorway will be a critical element in securing Romania''scontinued pivotal role between Europe, Asia and the Black SeaRegion. Construction work has started with a schedule for themotorway to be completed by 2012. The project, estimated at EUR 2.8billion, is expected to create direct employment for close to 8,000persons, whilst indirect employment far exceed this estimatedfigure of direct employment. There also will be significant benefitto road users.

RZB is the central institution of the AustrianRaiffeisenBanking Group, the country''s most powerful banking group.RZB also considers Central and Eastern Europe (CEE) as its homemarket and throughRaiffeisen InternationalBankHolding (Raiffeisen International)operates a network of 15subsidiary banks with more than 800 banking outlets, as well as tworepresentative offices, in 16 markets of the region. RaiffeisenInternational, 100 per cent owned by RZB, is the holding companyfor RZB''s most important subsidiaries in Central and EasternEurope (CEE).Raiffeisen Bank S.A.,Romania, is asubsidiary of Raiffeisen International and hasresulted from the merger ofthe two Romanian RZB-entities on the local market back in June 2002Raiffeisenbank (Romania), established in 1998 as asubsidiary of RZB Group and the former state-ownedBancaAgricola, acquired in July 2001. In 2003, only two years afterprivatisation, Raiffeisen Bank managed an impressive turnaround.Its balance sheet total reached EUR 1,037 million, an increase of55 per cent compared with the figure for year-end 2002. The bankachieved a record profit after tax: It came in at EUR 4.6 million,compared with a loss of EUR 10 million at year-end 2002. Byyear-end 2003, the total number of staff amounted to 3,565. Thebank services more than one million customers in 190branches.