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Raiffeisen International
Bank-Holding AG
Am Stadtpark 3
A-1030 Vienna
Glossary
Affiliated enterprise Company upon whose business or financial policies a controlling influence is exerted.
Associated undertaking Company upon whose business or financial policies a significant influence is exerted.
Banking book All items that are not assigned to the trading book.
Basis of assessment (incl. market risk) Comprises the basis of assessment within the meaning of section 22 of the Austrian Banking Act (BWG) plus 12.5 times the own funds required as cover for the trading book and open currency positions.
BWG Austrian Banking Act
Cash flow Inflows and outflows of cash and cash equivalents.
Cash flow statement Statement of cash flows during the financial year arising from operating activities, investing activities and financing activities and a reconciliation of cash and cash-equivalents held at the beginning and the end of the financial year.
CEE Central and Eastern Europe.
CIS Commonwealth of Independent States, consisting predominantly of territories of the former Soviet Union.
Clean price Price of a financial instrument without broken period interest (interest deferrals).
Consolidated ROE (return on equity) Consolidated profit in relation to average balance sheet equity (including minority interests).
Core capital Paid-in capital and reserves less intangible fixed assets and balance sheet losses and material losses during the current financial year.
Core capital ratio This ratio’s numerator is core capital (tier 1) and its denominator is the basis of assessment (incl. market risk).
Cost/income ratio Indicator of an enterprise’s cost efficiency based on the ratio of expenses to earnings. It is calculated by comparing general administrative expenses (comprising expenditure on staff and other administrative outlay and depreciation/amortisation/write-downs of tangible and intangible fixed assets) with operating income (net interest income, net commission income, trading profit/loss and other operating profit/loss adjusted by the net result from hedge accounting and net income from other derivative instruments).
DBO Defined benefit obligation = The present value, without deducting any plan assets, of expected future payments required to settle the obligation resulting from employee service in the current and prior periods.
Default risk Risk that counterparties in a financial transaction will not be able to fulfil an obligation, causing the other party a financial loss.
Deferred tax assets The amounts of income taxes recoverable in future periods in respect of deductible temporary differences, the carryforwards of unused tax losses, and the carryforwards of unused tax credits.
Deferred tax liabilities The amounts of income taxes payable in future periods in respect of taxable temporary differences.
Derivatives Financial instruments whose value changes in response to the change in a specified interest rate, security price, commodity price, foreign exchange rate, index of prices or rates, a credit rating or credit index, or similar variable, that requires no initial net investment or little initial net investment and that is settled at a future date.
Dirty Price Price of a financial instrument inclusive of broken period interest (interest deferrals).
Earnings per share (EPS) The amount of net profit for the period less the amount apportionable to preferred shareholders divided by the average number of ordinary shares in circulation during the period.
Fair value The amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm’s length transaction.
Finance lease A lease that transfers substantially all the risks and rewards incident to ownership of an asset to the lessee.
Futures Standardised forward contracts traded on an exchange under which a commodity traded in a money, capital, precious metal or currency market is to be delivered or accepted at a price fixed in an exchange environment.
Goodwill Any excess of the cost of the acquisition over the acquirer’s interest in the fair value of the identifiable assets and liabilities acquired as at the date of the exchange transaction.
Gross investment value Total of minimum payments under a finance lease from the point of view of the lessor and any unguaranteed residual value to which the lessor is entitled.
Hedging Designating one or more hedging instruments so that their change in fair value is an offset, in whole or in part, to the change in fair value or cash flows of a hedged item.
Held-for-trading Securities held for trading purposes to take advantage of short-term market fluctuations.
Held-to-maturity Financial assets that an enterprise has the positive intent and ability to hold to maturity.
HGB [Austrian] Commercial Code
IFRIC, SIC – International Financial Reporting Interpretation Committee Interpreter of the International Financial Reporting Standards, formerly also SIC (Standing Interpretations Committee).
IFRS, IAS The International Financial Reporting Standards or International Accounting Standards are reporting standards published by the IASB (International Accounting Standards Board) with the goal of achieving transparent and comparable accounting on an international basis.
Interest margin Net interest income in relation to average balance sheet total.
IPO Initial public offering
Loans outstanding Comprises all onbalance sheet exposures (receivables, debt securities) and off-balance-sheet exposures (guarantees, credit line) that expose Raiffeisen International to credit risk.
Market risk The risk that the value of a financial instrument will fluctuate as a result of changes in market prices whether those changes are caused by factors specific to the individual security or its issuer or factors affecting all securities traded in the market.
Negative goodwill Any (remaining) excess, as at the date of the exchange transaction, of the acquirer’s interest in the fair values of the identifiable assets and liabilities acquired over the cost of the acquisition.
Net provisioning ratio Denotes both net loan impairment provisioning/average risk-weighted asset (i.e. the ratio of net new loan impairment provisions relative to the average risk-weighted assets in the banking book) and net loan impairment provisioning / total loan portfolio (i.e. the ratio of net new loan impairment provisioning relative to the total loan portfolio).
Operating lease Lease under which commercial ownership remains with the lessor alongside legal ownership, with the effect that the lessor must show the asset on its balance sheet.
Operating profit/loss In IFRS-compliant financial statements, consists of operating income net of general administrative expenses. Operating income comprises net interest income, net commission income, trading profit/loss and other operating profit/loss adjusted by the net result from hedge accounting and net income from other derivative instruments. General administrative expenses comprise staff expenses and other administrative outlay and depreciation/amortisation/write-downs of tangible and intangible fixed assets.
Options Instruments that give the holder the right to purchase the underlying from a contracting party at a prearranged price and at an agreed time or within an agreed period (call option) or to sell the underlying to a contracting party at a prearranged price and at an agreed time or within an agreed period (put option).
OTC instruments Financial instruments that are neither standardised nor traded on a stock exchange. They are traded directly between market participants “over-the-counter”.
Own shares Repurchased equity instruments (shares originated by the enterprise) held by the originating enterprise itself or by its subsidiaries.
Own funds within the meaning of BWG Made up of core capital (tier 1), additional and subordinated capital (tier 2) and short-term subordinated capital and rededicated tier 2 capital (tier 3).
Own funds ratio This ratio’s numerator is own funds within the meaning of the Austrian Banking Act (BWG) and its denominator is the basis of assessment pursuant to section 22 BWG plus 12.5 times the own funds required as cover for the trading book and open currency positions.
Projected unit credit method An actuarial valuation method defined by IAS 19 that sees each period of service as giving rise to an additional unit of benefit entitlement and measures each unit separately to build up the final obligation (sometimes known as the accrued benefit method prorated on service or as the benefit/years of service method).
Raiffeisen International Raiffeisen International Bank-Holding AG Group
Repurchase agreement During a genuine repurchase transaction (repo), the enterprise sells assets to a counterparty and concurrently agrees to reacquire the assets at an agreed time and at a prearranged price.
Risk-weighted assets of the banking book According to the Austrian Banking Act (BWG) these are off-balance sheet and special off-balance-sheet banking book asset positions weighted by business or counterparty risk.
ROE (return on equity) – Consolidated profit before tax or after tax in relation to average balance sheet equity (including minority interests).
RZB Raiffeisen Zentralbank Österreich AG Group
RZB-Kreditinstitutsgruppe Pursuant to section 30 of the Austrian Banking Act (BWG), RZB-Kreditinstitutsgruppe is made up of all banks, financial institutions, securities companies, and companies rendering banking-related ancillary services in which Raiffeisen Zentralbank holds direct or indirect interests as a superordinate institution.
Segment reporting Disclosure of earnings and asset data for individual fields of business (primary) and geographical areas (secondary).
Splitting A procedure that is particularly common in U.S. investment banking where equities that have become very highly priced are split into two or more shares or share certificates.
Stress tests Stress tests endeavour to simulate extreme fluctuations in market parameters. They are used because such fluctuations are usually inadequately captured by VaR models (VaR forecasts maximum losses under normal market conditions).
Swap Exchange of interest obligations (interest swap) and/or currency position (currency swap).
Trading book Bank regulators’ term for assets held by a bank for short-term resale to exploit fluctuations in prices and interest rates.
VaR Value at risk expresses the potential loss that will, with a 99 per cent probability, not be exceeded within the period for which an asset is held in the portfolio in question.
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Contact
Susanne Langer
Head of Group Investor Relations
International