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K&H Bank

Budapest, 21 April 2004

K&H Group’s market position and key strategy

John HollowsCEO

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contents

K&H Bank

market position

strategy of the Bank

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snapshot I.157 retail branches

19 corporate branches

3 800 staff

522 000 retail clients

70 000 corporate clients, 6 300 medium-sized companies

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snapshot II.leading corporate bank

2nd placed retail bank

2nd placed bank (in terms of assets)

profits of EUR 70 million p.a.

ROE 17%

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K&H Bank network

157 branches

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K&H Group K&H Asset Managementwith HUF 120 billion in assets under management, third largest player, 8.3% market share, wide range of funds

K&H Medicina Health Fund the first nationwide health fund operated by a bank

K&H Leasing Groupwith a portfolio of HUF 140 billion, 400 partners nationwide, second largest market player, 80,000 clients

K&H Life Insurancewith a premium income of HUF 4 billion, 35,000 clients, comprehensive insurance services

K&H Equitiesa wide range of capital market services for domestic and foreign private, as well as corporate clients

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market share I.figures by assets30 September 2003

1 186 991775 632

885

2 636

1 371

0500

1 0001 5002 0002 5003 000

HUF bln

K&H Bank: IAS, consolidated datas; other banks: HAS, non-consolidated datas

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market share II.operating profit30 September 2003

15 14 125

13

72

17

01020304050607080

HUF bln

K&H Bank: IAS, consolidated datas; other banks: HAS, non-consolidated datas

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ROEROE (2003)

-10%

0%

10%

20%

30%

40%

OTP

RAIF

FEIS

EN K&H

HVB

MKB

+KO

NZUM CI

B

ERST

E+PO

STA

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ROAROA (2003)

-1%

0%

1%

2%

3%

4%

5%

OTP

RAIF

FEIS

EN HVB

K&H

MKB

+KO

NZUM CI

B

POST

A+ER

STE

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SWOT analysisstrengths

full service bankcorporate market leadergrowing retail businessextensive networkstrong performance since mergerstrong profitability

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SWOT analysisweaknesses

reputation damagedcost income weaktoo reliant on Corporatetoo many back offices systemsweak Corporate deposit growthproduct driveninternal barriers

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SWOT analysis

opportunities

expanding economystrong shareholderscommitted staffloyal clients

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SWOT analysis

threats

competitionbanking consolidationclient expectationsregulator expectations

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mission statementBy combining best international practice with sound

local knowledge we aim to provide:

our clients with a distinctively modern banking service which begins with their needs and concludes with the delivery of effective solutions at competitive prices; our staff with clear goals, strong leadership, transparent reward programs and attractive career path choices; andour shareholders with growing and sustainable profitability at above average returns.

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strategyTo fulfill our mission we are

developing a client needs approach to marketing and sales

drawing upon the resources of our shareholders to offer effective and modern client solutions

simplifying and rationalizing back office systems and procedures to improve efficiency and enhance control

seeking to achieve a better balance between Corporate and Retail contributions

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on top of my agenda

corporate governancestrategy implementationcredit riskLeasingsystems (including K2)

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recent developments

balanced scorecard

investment advisers

Equities re-opens

executive retail committee

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concluding remarks

strong organic growth building on past success drawing on shareholder resources client focus, values embedded sound systems and controls quality – earnings, growth, return