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The Government of the Republic of Serbia

In the service of citizens

Contract on sale of Vojvodjanska Bank to NBG signed

Belgrade, 12 September 2006

Serbian Minister of Finance Mladjan Dinkic and Chairman and CEO of the National Bank of Greece (NBG) Takis Arapoglou signed today a contract on the sale of Vojvodjanska Bank to NBG for €385 million.

At a press conference following the signing, Dinkic recalled that Serbia was the owner of 99.4% of Vojvodjanska Bank's shares and stressed that this transaction concludes the reform of the Serbian banking system that began in 2001, as this is the last bank in which the state was majority share holder which it decided to offer for sale.

He said that the contractual price of €385 million is around four times higher than the bank's capital and stressed that €360 million from the sale will immediately be at Serbia's disposal, whereas €25 million will be retained in a temporary account by mid-2008 at the latest.

According to Dinkic, NBG will in turn grant a favourable loan up to this amount to the Development Fund. The loan will have a seven-year repayment period and an interest rate of 1%. He added that the transfer of title will be carried out by December 12 this year.

Dinkic said that NBG is obliged by contract to invest a further €40 million in capital projects during the upcoming three years, which will contribute to the modernisation of the bank itself. Similarly, NBG will retain the average number of employees in the upcoming three years, and is to grant severance payment to redundant personnel who leave according to the collective contract, he added.

Vojvodjanska Bank is the largest bank in Vojvodina and ranks seventh in Serbia with a current market share of 4.4% and a 10% share of financial transactions in the country. According to the number of clients (700,000) it ranks second in Serbia, and according to deposit amount comes first in Vojvodina and fifth in Serbia. It is the leading bank according to the number of cash cards issued (500,000). The total assets of the bank on June 30, 2006, stood at €511 million.

Arapoglou expressed satisfaction at the success of NBG at the international sale tender for Vojvodjanska Bank, considering the fact that Serbia is a strategic market with great potential for further growth in the banking sector.

The signing of the contract was also attended by Greek Ambassador to Belgrade Christos Panagopoulos, who said that Greek investors will do everything to contribute to further improvement of the business climate in Serbia.