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Komercni Banka (KMCA)

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Friday 28 February, 2003

Komercni Banka

Final Results

Komercni Banka
28 February 2003


                            OF KOMERCNI BANKA, A. S.

                      FOR THE YEAR ENDED 31 DECEMBER 2002


In accordance with the requirements of the Prague Stock Exchange, Komercni
banka, a. s. (the 'Bank') announces its preliminary, unconsolidated and
unaudited results for the year ended 31 December 2002 prepared in accordance
with both Czech (CAS) and International (IAS) Accounting Standards. The
management will announce its full year audited results on March 31, 2003.

According to Czech Accounting Standards (CAS)

(CZK thousand)                                               December 31, 2002                        December 31, 2001
Profit before tax                                                   11,875,251                                3,386,892
Income tax                                                         (2,646,165)                                (763,250)
Net profit                                                           9,229,086                                2,623,642
Total assets                                                       445,981,759                              429,658,614
Share capital                                                       19,004,926                               19,004,926

According to International Accounting Standards (IAS)

(CZK thousand)                                                           December 31, 2002           December 31, 2001
Net banking income                                                              22,596,371                  23,809,756
Operating costs                                                               (12,760,079)                (15,065,330)
Net operating income                                                             9,836,292                   8,744,426
Provisions for loan and investment losses                                        1,434,733                 (5,333,070)
Income tax                                                                     (2,508,040)                   (879,263)
Net profit                                                                       8,762,984                   2,532,093
Total assets                                                                   439,753,263                 421,720,567
Share capital                                                                   19,004,926                  19,004,926
ROAE                                                                                 30.6%                       11.6%

The Annual General Meeting (AGM) for the year ended 31 December 2002 is expected
to take place in the second half of June 2003. The record date for participation
at the AGM is seven days prior to the AGM date.

The higher 2002 net profit under Czech Accounting Standards is primarily due to
CAS unification of the evaluation of securities with International Accounting
Standards. Since January 2002 the securities held for trading and available for
sale have been booked in fair values also under CAS, the one-off revaluation of
securities resulted in the extraordinary income in CAS. Currently there is no
difference in evaluation of securities under CAS and IAS.

Unconsolidated net profit of Komercni banka for 2002 in accordance with IAS was
CZK 8,763 million representing an increase of 246% compared to 2001. This result
was influenced principally by successful reengineering of Bank's organisation
and processes and release of provisions. Significant events affecting the
year-end results are described below:

                              NET INTEREST INCOME

Net interest income of CZK 12,447 million representing a decrease of 4.2%
compared to 2001 was influenced by continuously declining interest rates (the
CNB repo rate fell from 4.75% to 2.75% during 2002).

                            NET FEES AND COMMISSIONS

The Bank generated Net fees and commissions in the amount of CZK 8,320 million
which represents a year-on-year decrease by 0.9%. This result was affected by
3.3% increase of non-foreign exchange fees and commissions and decline in FX
fees and commissions linked to impact of the introduction of the Euro. Fees and
commissions were also partially negatively impacted by August floods.


Net profit from financial operations achieved a satisfactory result of CZK 1,426
million due to unrealised profits on Government bonds and gains on FX

                               Net banking income

Net banking income of the Bank reached the amount of CZK 22,596 million
representing a decrease of 5.1% compared to the year-ended 31 December 2001.

                                OPERATING COSTS

The operating costs including both administrative expenses and restructuring
costs totalled to CZK 12,760 million, that is a decrease of 15.3% compared to
the year-end 2001.

The administrative expenses stood at CZK 10,100 million representing a
year-on-year decrease of 7.8%. This is an outcome of efficient cost control
within the Bank, staff reduction in conjunction with centralisation of processes
and savings in the contributions to the Deposit Insurance Fund.

The restructuring costs amounted to CZK 1,007 million and represent costs
incurred in the Bank's rebranding as well as advisory and consultancy expenses
related to the Transformation program and redundancy costs.

                              net operating income

Net operating income of CZK 9,836 million increased by 12.5% compared to 2001.
The main driver of this development was the successful cost control in the Bank.


The net release of provisions for loan and investment losses amounted to CZK
1,435 million.

The net release of provisions and reserves for loan losses of CZK 1,513 million
reflects release of specific provisions to loans as a result of improving
quality of the Bank's loan portfolio. It also includes partial release of
general reserve following new Czech legal requirements. The current sale of part
of KB non-performing loans has no material impact on the result in 2002.

Net creation of provisions for CDO/CLN amounted to CZK 759 million, which
reflects the deterioration in assets underlying these securities.

The net creation of provisions for investments in subsidiaries and associates of
CZK 339 million was mostly dedicated to restructuring process of Komercni

                                   TAX CHARGE

The total income tax amounted to CZK 2,508 million. In 2002 the Bank for the
first time posted deferred tax receivable in the amount of CZK 902 million.

In Prague, February 28, 2003.

                        Alexis Juan                                              Philippe Rucheton
                   Komercni banka, a. s.                                       Komercni banka, a. s.
        Chairman of the Board of Directors and CEO                   Member of the Board of Directors and CFO

                      This information is provided by RNS
            The company news service from the London Stock Exchange