PRESS RELEASE Prague, 30.6 2008 BAWAG Reverse Repo Transactions: tip how to finance conveniently not only purchase of securities! BAWAG Bank introduces Reverse Repo Transactions. This product was especially designed for clients who own a large quantity of shares, would like to invest more but do not have own finances. In this case, BAWAG Bank will provide a loan that will be secured by customer’s securities. Interest rates start at 6.5% p.a.! Petr Pokorný, Head of Securities Trading, explains: „The great advantage of this product is that customer gets money for either further investment in securities, or just simply for anything. Money from this loan can be also used for unspecified purposes. “ The maximum amount of a loan is 70 % of the market value of securities (depending on the issue and the repayment period). „Another advantage is that the bank does not assess financial standing of the customer or his/hers income. Without passing the standard evaluation process, the customer can get fast loan for unspecified purpose“, adds P. Pokorný. Example of using Reverse Repo Transactions A client owns 5,000 shares of company XYZ and needs a short-term loan. The market value of the shares of company XYZ shares is CZK 1,300 per share. BAWAG Bank can offer the client a loan in the maximum amount of (5,000*1,300)*0.7 = CZK 4,550,000. Acceptable securities used as collateral securing loans: - traded in the SPAD segment on the Prague Stock Exchange - funds offered by BAWAG Bank What is Repo Transaction? Repo transaction is an operation when a customer uses a loan from a bank for the purchase of desired securities. The purchased securities transferred on the bank’s account serve as the collateral for this loan. BAWAG Bank CZ a.s. can provide customers with a loan up to 70 % of finances required for the securities purchase. For the remaining 30 % customers uses his/hers own money. Repo transactions are only closed in lots (standardized number of investment instruments traded in SPAD) or multiples of lots (customer at BAWAG Bank can buy non-standardized number then lot). Considering that this way of trading involves considerable risks, we recommend this type of transactions only to customers who have extensive experience with trading investment instruments. Consultation with investment expert from the bank is always recommended. PRESS RELEASE Repo Transaction Principle - example: Purchase of securities for CZK 100 in total. CZK 30 is paid by customer CZK 70 is a loan from BAWAG Bank This example does not include interest rate cost. For more information, please contact: Mrs. Martina Lambert Head of Communications & Marketing Tel.: (+420) 224 406 233 Fax: (+420) 224 406 483 e-mail: [email protected] -------------------------------------------------------------------------------------------Note for editors: BAWAG Bank has been present on the Czech banking market since 1991 and during the past years established its position as a modern universal bank providing a broad range of quality services, quickly and promptly reacting to all current and future client needs. The new BAWAG Bank CZ a.s. is the result of a merger of BAWAG Bank CZ a.s. (former Interbanka, akciová společnost) and BAWAG International Bank CZ a.s. (former Dresdner Bank CZ a.s.) that became effective on March 31, 2005. The new bank builds on the resources and experience of its predecessors, which operated in the Czech Republic from 1991 and 1992, respectively. BAWAG Bank CZ a.s. is 100% owned by Austrian BAWAG P.S.K., the fifth largest financial group in Austria. BAWAG Bank CZ a.s. offers a broad range of top quality services in banking sectors such as Corporate, Investment, Individual and International Banking as well as Financial Markets activities. Bank für Arbeit und Wirtschaft und Österreichische Postsparkasse Aktiengesellschaft (BAWAG P.S.K.) is Austria’s fifth-largest banking group and the leading retail bank for the middle-income market. It is a modern, service-oriented, multifaceted financial group with a well-honed knowledge of the marketplace that focuses on comprehensive personalized services. A leader on the Austrian market, BAWAG P.S.K. Group is a strong and growing Austrian financial services organization with 6 300 highly qualified staff and total assets worth over EUR 44,8 bn. With some 160 BAWAG branch offices and more than 1,300 post offices, the BAWAG P.S.K. Group operates the largest centrally managed financial distribution network in Austria. It is also the leading provider of payments services in Austria. The Group can be found, apart from Austria and the Czech Republic, in Slovakia with its Istrobanka, Bratislava, in Slovenia 100% subsidiary BAWAG Banca, in Malta with BAWAG Malta Bank Ltd., its 100% subsidiary as well as in Hungary with its share in MKB, Budapest. The Group has representative office in Libya. The BAWAG P.S.K. is wholly owned by a consortium led by Cerberus Capital Management L.P, which includes the Austrian Post AG, Generali Holding Vienna AG, Wüstenrot Verwaltung- und Dienstleistungen GmbH and leading Austrian industrialists.
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