Vienna Insurance Group in the first quarter of 2010: Best first quarter in the corporate history

Profit (before taxes) increased by 10.4 percent to EUR 133.4 million * Group premiums for the first time above EUR 2.5 billion * Premiums grow by 7.9 percent * CEE core markets1 - market leadership also in life insurance * Number one in the Czech Republic * Foundation of a life insurance company in Macedonia

"The business figures for the first quarter of 2010 confirm our forecast for the result of the current financial year", stated Günter Geyer, CEO of Vienna Insurance Group, with regard to the Group's development. "We are particularly pleased about growth achieved by our Group companies in the life insurance segment through insurance contracts sold by banks, proving that our decision to acquire the Sparkassen Versicherung Group one and a half years ago was right. This has made us the market leader in the Czech Republic for the first time. Moreover, we have also managed to move into leadership ranks in this segment in our CEE core markets. This success has encouraged us to expand our engagement in the life insurance business in new markets. After Montenegro, we will open up another market in the life insurance segment in Macedonia."

1 CEE core markets defined as follows: Bulgaria, the Czech Republic, Croatia, Hungary, Poland, Romania, Serbia, Slovakia

I. OVERVIEW OF KEY GROUP DATA FOR THE 1ST QUARTER OF 2010 (based on IFRS)

In the first quarter of 2010, Vienna Insurance Group reported a total of premiums written (consolidated) of EUR 2.53 billion; this is a plus of 7.9 percent compared to the same period of the previous year. The Group achieved an increase of 13.8 percent in net earned premiums.

The Group's profit (before taxes, consolidated) for the first three months of 2010 amounted to EUR 133.44 million, corresponding to a total growth of 10.4 percent. This is the best first-quarter result ever achieved in the corporate history.

The combined ratio of the Group after reinsurance (without taking into account investment income) stood at 97.5 percent in the first quarter of the current year.

The financial result of the Group totaled EUR 310.36 million in the first quarter of 2010, climbing by 30.3 percent from the prior-year level.

The investments of the Group amounted to EUR 26.85 billion as at 31 March 2010; this is an increase by 3.7 percent compared to 31 December 2009.

II. GROUP DATA BY SEGMENTS 1ST QUARTER OF 2010 (consolidated)

Property/casualty insurance

In this segment, the Group companies of Vienna Insurance Group earned premiums written of a total of EUR 749.52 million in the CEE markets, corresponding to a plus of 1.6 percent. The Group succeeded in increasing the net earned premiums in this segment by 8.3 percent.

In the non-CEE countries, the premiums in this segment remained on a stable level of EUR 634.56 million. In Austria, premiums in this segment showed a similar development as in the previous year, totaling EUR 614.01 million. In Germany, premiums went up by 1.7 percent to EUR 20.54 million.

Life insurance

In this segment, the Group companies of Vienna Insurance Group reported premiums written totaling EUR 1.06 billion. Compared to the prior-year period, this corresponds to a growth of 19.4 percent.

The CEE markets reported a strong growth of 12.8 percent in the life-insurance segment; premiums written increased to EUR 362.11 million.

In the non-CEE countries, the premiums written earned in this segment amounted to EUR 700 million, going up by 23.2 percent compared to the same period of the previous year.

Health insurance

With premiums written totaling EUR 84.78 million, Vienna Insurance Group reported a growth of 1.0 percent in health insurance.

III. GROUP DATA BY REGIONS 1ST QUARTER OF 2010 (consolidated)

Austria

In the first quarter of 2010, the Group companies of Vienna Insurance Group in Austria reported premiums written of a total of EUR 1.30 billion, achieving an increase by 4.5 percent. In the segment property/casualty insurance, premiums written of EUR 614.01 million were earned. Growing by 10.2 percent, premiums in the life-insurance segment rose to EUR 602.32 million.

The profit (before taxes) totaled EUR 70.29 million in the first quarter of 2010.

The combined ratio amounted to 94.3 percent.

Czech Republic

By increasing premiums written to a total of EUR 454.46 million in the Czech Republic, the Group companies of Vienna Insurance Group achieved a plus of 12.4 percent.

In the non-life insurance segment, premiums written amounted to EUR 285.05 million; this corresponds to an increase by 4.2 percent.

Thanks to a strong growth by 29.3 percent, premiums written in the life insurance segment climbed to a level of EUR 169.41 million.

With a market share of 32.5 percent after the first quarter of 2010, the Group companies of Vienna Insurance Group became the new number one in the Czech insurance market. This makes Vienna Insurance Group the Czech Republic's market leader in both non-life insurance and life insurance.

Compared to the same period of the previous year, the profit (before taxes) surged by 30.0 percent to EUR 31.47 million.

The combined ratio amounted to 94.8 percent in the first quarter of 2010.

Slovakia

The Group companies reported premiums written of EUR 181.77 million in total (minus 2.4 percent) in Slovakia. The Group achieved a clear plus of 5.8 percent in net earned premiums.

Premiums written of EUR 101.63 million were registered in the non-life insurance segment. Growing by 11.4 percent, premiums written in the life insurance segment totaled EUR 80.13 million.

Thanks to a market share of 33.2 percent, the Group companies of Vienna Insurance Group are the number one in the Slovakian insurance market.

The profit (before taxes) doubled to EUR 10.09 million.

The combined ratio improved to 96.1 percent.

Poland

In Poland, the Group companies of Vienna Insurance Group increased premiums written by 23.5 percent to EUR 176.72 million in the first three months of the current year.

In the non-life insurance segment, Vienna Insurance Group achieved a 60.1 percent plus, with premiums written amounting to EUR 134.89 million.

With premiums of EUR 41.82 million, the life insurance segment recorded a decline by 28.9 percent, which is exclusively due to the downward trend in the single premium business.

The profit (before taxes) amounted to EUR 7.17 million in the first quarter of 2010, climbing by 14.0 percent compared to the same period of the previous year.

Due to weather-induced damages, the combined ratio rose to above 100 percent.

Romania

The Romanian Group companies reported premiums written totaling EUR 147.40 million (minus 12.2 percent) in the first quarter of 2010. Net earned premiums went up by 4.7 percent.

In the non-life insurance segment, premiums of EUR 121.37 million were written. In this segment, the income-oriented restructuring of the portfolio has resulted in a decline of premiums.

In the life insurance segment, premiums grew by an outstanding 59.1 percent to a total of EUR 26.03 million. This significant increase is mainly due to the strong selling power of BCR life insurance.

The profit (before taxes) rose by 18.1 percent to EUR 7.41 million.

As a result of this strategy, the combined ratio was decreased significantly by more than ten percentage points compared to the first quarter of the previous year, amounting to 98.1 percent.

Other CEE markets

The segment "Other CEE markets" comprises the Group companies of Vienna Insurance Group in the following countries: Albania, Bulgaria, Croatia, Macedonia, Serbia, Turkey, Ukraine, Hungary as well as the three Baltic states.

Premiums written totaled EUR 151.28 million in total; out of this amount, EUR 106.56 million were attributable to the non-life insurance segment. In the life insurance segment, a growth of 4.1 percent was registered, with premiums of EUR 44.72 million.

The profit (before taxes) amounted to EUR 2.80 million.

Other markets

In Germany and Liechtenstein, the Group companies reported a total of premiums written of EUR 118.22 million in the first quarter; this means that premiums more than doubled.

The profit (before taxes) amounted to EUR 4.21 million.

 IV. OUTLOOK

Due to the business development in the first quarter of 2010, the management of Vienna Insurance Group reinforces the expected growth in the profit (before taxes) by more than ten percent and a single-digit increase in premiums.

V. FOUNDATION OF A LIFE INSURANCE COMPANY IN MACEDONIA

After the announced market entry in Montenegro, Vienna Insurance Group continues strengthening its presence in Central and Eastern Europe and plans to establish a life insurance company in Macedonia. The Group has already been represented in the non-life insurance sector of Macedonia through Winner Vienna Insurance Group since 2007.

The insurance products are to be sold through Investbanka a.d. Skopje, forming part of the Erste Group. As a result, sales cooperation with Erste Group will cover a total of ten countries.

Macedonia has 2.1 million inhabitants and is an insurance market with a strong development potential. The insurance density (premiums per capita) was almost EUR 50 in 2009 and the insurance penetration (share of premiums in the GDP in percent) amounted to slightly more than 1.5 percent. By comparison, the EU-15 Member States reported an insurance density of more than EUR 2,500 and an insurance penetration of 8.7 percent in this sector in 2009.