seb_wealth_management_2007_eng by xiangpeng

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									JOINT STOCK COMPANY
“SEB UNIFONDI” INVESTMENT MANAGEMENT JSC
ANNUAL REPORT
FOR THE YEAR ENDED 31st DECEMBER 2007
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Contents

Information on the Investment Company                                     4

Report of the Management                                                 5–6

The Statement of the Investment Management JSC „SEB Unifondi”
Management’s Responsibility                                               7

Auditors’ report                                                         8–9

Financial statements:

      Income statement                                                    10

      Balance Sheet                                                       11

      Statement of changes in equity                                      12

      Cash flow statement                                                 13

      Notes                                                             14 – 33




                                           2
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)




Information on the Investment Company

Title of the Investment Company           “SEB Unifondi” Ieguldījumu pārvaldes akciju sabiedrība
                                          (Investment Management Joint-stock Company)

Legal Status of the Investment Company    Joint-stock company for investment management

Registration number, place and date       40003525797
                                          Riga, 29 December 2000

                                          Reregistered with the Commercial Register on 11
                                          September 2003
                                          Certificate repeatedly issued on 18 April 2005

The investment company licence            The licence for investment management services
                                          reregistered with the Financial and Capital Market
                                          Commission on 14 May 2004 with registration
                                          No.06.03.07.101/92

Address                                   Riga, Krasta street 105a, LV-1019

Shareholder’s name, address and paid-in   AS SEB Latvijas Unibanka - 100%
share capital                             „Unicentrs”, Valdlauci, Kekavas district, Riga region,
                                          LV 1076, Latvia

Names, surnames and positions of the      Ainars Ozols – Chairman of the Council since 2
Council members                           November 2007. (Until 2 November 2007 Chairman of
                                          the Council - Viesturs Neimanis)

                                          Asmo Onni Peteri Kartunenu – Deputy chairman of the
                                          Council since 2 November 2007. (Until 2 November 2007
                                          Deputy chairman of the Council - Ainars Ozols)

                                          Charlotte Margit Inga Hagberg – Member of the Council
                                          since 2 November 2007

                                          Rein Retsep – Member of the Council

                                          Hans Erik Roland Ek – Member of the Council

Names, surnames and positions of the      Normunds Igolnieks – Chairman of the Board
Board members                             Janis Rozenfelds – Deputy chairman of the Board
                                          Elina Jansone – Member of the Board since 4 April 2007.
                                          (Until 4 April 2007 member of the Board - Līga Treiliha)

Accounting year                           1 January 2007 – 31 December 2007




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               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Auditors and responsible certified auditor   PricewaterhouseCoopers SIA
name and address                             Commercial company licence No.5
                                             Kr. Valdemara street 19
                                             Riga LV-1010
                                             Latvia

                                             Responsible certified auditor::
                                             Juris Lapshe
                                             Certified auditor
                                             Certificate No. 116




                                                4
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Report of the Management

Operations in the reporting period

In 2007 the investment management joint-stock company „SEB UNIFONDI” (hereinafter referred to as
„the Investment Company”) operated in the following major areas – fund management of the state-
funded pension scheme, asset management of private pension funds and management of individual
investment portfolios.

The year 2007 was very successful for the Investment Company as the portfolio managers achieved the
highest profitability among the market participants both in the fund management of the 2nd pillar
pension plans and in the management of the Lat Reserve Fund that showed the best result among
Latvian money market funds. The Investment Company has also received recognition from international
institutions, for example in 2007 for the second year running it received the prestigious Euromoney
Award for Excellence 2007 - 1st Investment Management - Real Estate - Latvia.

Assets under management of the Investment Company in the reporting year grew by more than 36% and
by 31 December 2007 had reached LVL 197.90 million.

The Investment Company manages two investment funds – the open-ended investment fund „Lat
Reserve Fund” (hereinafter – „LRF”) and the closed-ended investment fund - Real Estate Fund
(hereinafter- „REF”).

The purpose of the LRF is to offer the investors an alternative to the bank current accounts which along
with equal investment safety and liquidity may provide a substantially higher profit margin. The
margin of the LRF in the reporting period was 5.01 %. Total assets of the LRF at the end of 2007
amounted to LVL 33 million. The LRF in 2007 held a stable position as the biggest money market
investment fund in Latvia with a market share of 72 %.

The objective of the REF is to secure a 10-15% profit margin for its clients by drawing upon the
potential of the Baltic real estate market. Profitability of the REF in the reporting year was 8.17 %,
while its profitability since the reorganisation of the fund on 15.07.2004 had reached 13.90 % per year.
Thanks to the growing interest of the community about accumulation of long-term investments the
volume of money in the SEB investment funds over the year 2007 rose considerably four times
exceeding the result for 2006.

At the end of the reporting year the total assets of the state funded pension plans (hereinafter – „SFP”)
were LVL 55.80 million or 22.70% of the total SFP scheme assets and there were 212 000 investors
participating in the investment plans managed by the Investment Company (SEB Active Plan, SEB
Balanced Plan, SEB Europe Plan and SEB Latvian Plan).

The total volume of assets managed by the Investment Company through the largest open-ended
pension fund SEB Unipensija (hereinafter – „SEB Unipensija”) with its pension plans UNI-
Sabalansētais, UNI-Aktīvais and UNI-Eiropensija by the end of 2007 had reached LVL 24.4 million.




                                                 5
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Report of the Management (continued)

Operating Results

Compared with the previous year, the operating income of the Investment Company from the asset
management almost doubled accounting for 98% of the total income in the reporting year. Compared
with 2006, the operating expenses of the Investment Company had grown by 91%. The largest growth
items were in the liabilities to the parent company for the services received as well as staff, office and
other costs.

In 2007 the Investment Company signed an agreement with the parent company AS SEB Latvijas
Unibanka on receiving of services (such as accounting, personnel documentation and recruitment,
administrative, legal and other services); payment for those services accounted for 14% of total
expenses. According to the above-mentioned agreement, the Investment Company, in addition to the
costs of the services provided by the parent company, paid for the sale of its products (investment funds,
investment plans of the state funded pension scheme, individual investment portfolio management).
These costs reached 35 % of total operating income.

The share capital of SEB Unifondi IPAS in 2007 remained unchanged during the year and amounted to
LVL 318 thousand.

The Investment Company successfully concluded the year 2007 with the profit of LVL 403 526. the
profit for the reporting year had grown by 4.38 % compared with the previous reporting year. The
operating result for 2007 is a good basis for further achievements. The Board of the Investment
Company proposes the shareholders to retain the profits of the reporting year and bring them forward to
the next year.

Future Outlook

In 2008 the Investment Company is planning to continue management of the assets, investment funds
and individual investment portfolios of the SFP, SEB Unipensija and SEB Dzīvības apdrošināšana.

In 2008 the Company is planning to focus on constant upgrading of the investment products and
offering to the Latvian community the state-of-the–art solutions that are already being used in other
countries where SEB operates.


Post Balance Sheet Events

During the period between the last day of the financial year and the date of signing of this report there
have been no significant events that would have a material effect on the year end results.




8 February 2008


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               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)




Statement of Responsibility of the Management

The Board (the Management) of JSC “SEB Unifondi” is responsible for the preparation of the financial
statements of JSC “SEB Unifondi” in accordance with legislation of the Republic of Latvia that requires
preparation of the financial statements of asset management Companies in accordance with
International Financial Reporting Standards as adopted for use in the European Union (EU).

The financial statements on pages 10 to 33 present fairly the financial position of JSC “SEB Unifondi”
as at 31 December 2007 and the results of its operations and cash flows for the year then ended.

The Management of the JSC “SEB Unifondi” is responsible for the maintenance of proper accounting
records, the safeguarding the JSC “SEB Unifondi” assets and the prevention and detection of fraud and
other irregularities in the JSC “SEB Unifondi”.

The financial statements are prepared in accordance with International Financial Reporting Standards as
adopted for use in the European Union.

Prudent and reasonable judgments and estimates have been made by the Management in the preparation
of the financial statements.




8 February 2008




                                                7
INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
          (TRANSLATION FROM LATVIAN ORIGINAL)




                        8
INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
          (TRANSLATION FROM LATVIAN ORIGINAL)




                        9
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)




Income Statement

                                                        Note                       2007        2006
                                                                                     Ls          Ls

Revenues                                                  5                  1 453 978        766 691

Interest income from non-current deposits                                          32 574       5 551

Other income                                                                        1 054         113

Fees and commission                                       6                  (506 745)           (599)

Foreign exchange revaluation                                                       (2 028)     (1 250)

Personnel expenses                                       16                  (265 788)       (180 467)

Office expenses                                                                   (50 931)    (20 911)

Professional services expenses                                                    (95 401)    (37 829)

Transport and communication expenses                                              (35 320)    (29 664)

Product marketing and development expenses                                        (32 009)    (39 784)

Amortization and depreciation charges                     7                       (18 953)     (5 129)

Other expenses                                                                    (24 564)    (10 988)

Finance income                                                                     19 619       9 364

Profit before income tax                                                          475 486     455 098

Income tax and deferred tax expense                       8                       (71 960)    (68 512)

Profit for the year                                                               403 526     386 586


The notes on pages 14 to 33 are an integral part of these financial statements.




8 February 2008
                                                 10
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Balance Sheet as at 31st December 2007
                                                        Notes             31.12.2007.   31.12.2006.
                                                                                  Ls            Ls
Assets
Cash at Bank                                              9                   195 140      454 256
Available for sale financial assets:
     - shares and other non-fixed income
     securities                                           13                    2 640        2 640
Term deposits                                             10                  726 835      120 647
Accrued income and deferred expenses                      12                  203 297      165 760
Deferred income tax asset                                  8                       36          677
Income tax overpayment                                    17                    2 659            -
Property, plant and equipment                             11                   75 804       73 821
Intangible Assets                                         11                   36 057        3 687
Total Assets                                                                1 242 468      821 488

Liabilities
Accrued expenses and deferred income                      14                  116 836       35 954
Income tax liabilities                                    17                        -       63 428
Total Liabilities                                                             116 836       99 382

Equity
Ordinary share capital                                    15                 318 000      318 000
Retained earnings                                                            807 632      404 106
Total Equity                                                               1 125 632      722 106

Total Liabilities and Equity                                                1 242 468      821 488


The notes on pages 14 to 33 are an integral part of these financial statements.




8 February 2008




                                                 11
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



Statement of changes in equity

                                                Share capital     Retained earnings    Total Equity
                                                          Ls                     Ls             Ls

Balance as at 1st January 2006                        318 000                 17 520       335 520

Profit for the year                                           -              386 586       386 586

Balance as at 1st January 2007                        318 000                404 106       722 106

Profit for the year                                           -              403 526       403 526

Balance as at 31st December 2007                      318 000                807 632      1 125 632



The notes on pages 14 to 33 are an integral part of these financial statements.




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                 INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                     ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                           (TRANSLATION FROM LATVIAN ORIGINAL)



 Cash flow Statement
                                                         Notes                       2007       2006
                                                                                       Ls         Ls
Cash flows from operating activities
      Profit before income tax                                                    475 486    455 098
      Depreciation of property, plant and
      equipment and amortization of intangible
      assets                                               11                       18 953      5 129
      Net loss on foreign exchange revaluation                                       2 028      1 250
      Interest income                                                             (52 193)   (14 915)
      Write-down of property, plant and
      equipment and intangible assets                      11                       1 031         97
Net cash generated from operating activities
before changes in working capital                                                 445 305    445 409
      Change in creditors                                                          82 190      10 273
      Change in available-for-sale securities                                           -     (2 640)
      Change in debtors                                                            71 443    (68 112)
Change in cash and cash equivalents from
operating activity                                                              598 938      384 930
      Interest received                                                           1 385         9 310
      Income tax paid                                      17                 (138 047)       (9 073)
Net cash generated from operating activities                                    462 276      385 167

Cash flows from investing activities
      Purchase of property, plant and equipment
      and intangible assets                                11                  (54 337)      (71 739)
      Increase in term deposits                                               (667 055)       (9 786)
Net cash used in investing activities                                         (721 392)      (81 525)

Net (decrease) / increase in cash and cash
equivalents                                                                   (259 116)      303 642

Cash and cash equivalents at the beginning of the
year                                                       9                      454 256    150 614

Cash and cash equivalents at the end of the year           9                      195 140    454 256

The notes on pages 14 to 33 are an integral part of these financial statements.




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               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements

1. General information

JSC SEB Unifondi (hereinafter - JSC or “Investment manager”) is an asset management company
incorporated and domiciled as a joint stock company under Latvian legislation on December 29, 2000.
JSC main direction is asset management. SEB Unifondi manages two investment Funds – open ended
investment Fund „Lat Reserve Fund” and closed-end real estate investment Fund “Real Estate Fund”.
Also, 4 different state-funded pension plans are managed, namely, ”SEB Aktīvais plāns”, ”SEB Eiropas
plāns”, ”SEB Sabalansētais plāns” and ”SEB Latvijas plāns”. SEB Unifondi also manages SEB
Unipensija private pension plans, SEB Life Insurance portfolio, and private portfolio management for
individuals and legal entities.

The registered office of SEB Unifondi: Krasta Street 105a, Rīga, LV – 1019, Latvia.

Shares of JSC SEB Unifondi are not listed.

These Financial Statements are approved by the Board of the JSC SEB Unifondi on February 8, 2008.

2. Summary of significant accounting policies

The principal accounting policies applied in the preparation of these financial statements are set out
below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRS) as adopted for use in the European Union.

All amounts in the financial statements including note disclosures are stated in Latvian Lats (Ls), unless
stated otherwise.

The financial statements have been prepared under the historical cost convention, as modified by the
revaluation of available-for-sale financial assets.

(a) New IFRS became effective from 1 January 2007 and are applicable to JSC::

IFRS 7, Financial Instruments: Disclosures and a complementary Amendment to IAS 1 Presentation of
Financial Statements - Capital Disclosures (effective from 1 January 2007).

The IFRS introduced new disclosures to improve the information about financial instruments, including
about quantitative aspects of risk exposures and the methods of risk management. The new quantitative
disclosures provide information about the extent of exposure to risk, based on information provided
internally to the entity’s key management personnel.

Qualitative and quantitative disclosures cover exposure to credit risk, liquidity risk and market risk
including sensitivity analysis to market risk. IFRS 7 replaced IAS 30, Disclosures in the Financial
Statements of Banks and Similar Financial Institutions, and some of the requirements in IAS 32,
Financial Instruments: Disclosure and Presentation. The Amendment to IAS 1 introduced disclosures
about the level of an entity’s capital and how it manages capital. The new disclosures are made in these
financial statements.




                                                14
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)




Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.1. Basis of preparation (continued)

(b) IFRS amendments and interpretations which are valid since 1 January, 2007 and are not
    relevant to operations of JSC

IFRIC 7, Applying the Restatement Approach under IAS 29, Financial Reporting in Hyperinflationary
Economies (effective from 1 March 2006).

IFRIC 7 provides guidance on how to apply requirements of IAS 29 in a reporting period in which an
entity identifies the existence of hyperinflation in the economy of its functional Currency, when the
economy was not hyperinflationary in the prior period. As none of the group entities have a Currency of
a hyperinflationary economy as its functional Currency, IFRIC 7 is not relevant to the JSC operations.

IFRIC 8, Scope of IFRS 2 (effective for annual periods beginning on or after 1 May 2006).

IFRIC 8 requires consideration of transactions involving the issuance of equity instruments – where the
identifiable consideration received is less than the fair value of the equity instruments issued – to
establish whether or not they fall within the scope of IFRS 2. IFRIC 8 it is not relevant to the JSC
operations.

IFRIC 9, Reassessment of embedded derivatives (effective for annual periods beginning on or after 1
June 2006).

IFRIC 9 requires an entity to assess whether an embedded derivative is required to be separated from
the host contract and accounted for as a derivative when the entity first becomes a party to the contract.
Subsequent reassessment is prohibited unless there is a change in the terms of the contract that
significantly modifies the cash flows that otherwise would be required under the contract, in which case
reassessment is required. As none of the group entities have changed the terms of their contracts, IFRIC
9 is not relevant to the JSC operations.

IFRIC 10, Interim Financial Reporting and Impairment (effective for annual periods beginning on or
after 1 November 2006).

IFRIC 10 prohibits the impairment losses recognized in an interim period on goodwill, investments in
equity instruments and investments in financial assets carried at cost to be reversed at a subsequent
balance sheet date. IFRIC 10 is not relevant to the JSC operations as it does not issue interim financial
statements.

(c) Standards, amendments and interpretations, which will become valid starting from 1 January
    2008 or later periods which the JSC has not early adopted

IFRS 8, Operating Segments (effective from 1 January 2009).

IFRS 8 replaces IAS 14 and aligns segment reporting with the requirements of the US standard SFAS
131 Disclosures about Segments of an Enterprise and Related Information. IFRS 8 is not relevant to the
JSC operations.




                                                15
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.1.Basis of preparation (continued)

(c) Standards, amendments and interpretations, which will become valid starting from 1 January
     2008 or later periods which the JSC has not early adopted (continued)

IFRS 3 Business combinations (reassessment in January 2008, is valid for the periods beginning on or
after 1 July 2009).

Reassessed version of IFRS 3 was published in January 2008. IFRS 3 is not applicable for JSC activity,
because of not purchasing entrepreneurships.

IFRS 2 Group and Treasury Share Transactions (reassessed in January 2008, valid for the annual
periods beginning on or after 1 January 2009).

Reassessed version of IFRS 2 was published in January 2008. IFRS 2 is not applicable to JSC activity,
because of not dealing with it’s own shares.

IAS 23, Borrowing Costs (reassessed in March 2007, valid for the annual periods beginning on or after
1 January 2009).

The revised IAS 23 was issued in March 2007. The main change to IAS 23 is the removal of the option
of immediately recognising as an expense borrowing costs that relate to assets that take a substantial
period of time to get ready for use or sale. An entity is, therefore, required to capitalise such borrowing
costs as part of the cost of the asset. The revised Standard applies prospectively to borrowing costs
relating to qualifying assets for which the commencement date for capitalisation is on or after 1 January
2009. IAS 23 is not applicable for JSC activity.

IAS 27 Consolidated and separate financial statements (reassessed in January 2008, valid for the
annual periods beginning on or after 1 January 2009).

Reassessed IAS 27 is not applicable to JSC, because it hasn’t got any subsidiary.

IFRIC 11, IFRS 2 – Group and Treasury Share Transactions (effective for annual periods beginning on
or after 1 March 2007)

IFRIC 11 addresses how to apply IFRS 2 Share-based Payments to share-based payment arrangements
involving an entity's own equity instruments or equity instruments of another entity in the same group.
IFRIC 11 is not relevant to the JSC operations.

IFRIC 12, Service Concession Arrangements (effective for annual periods beginning on or after 1
January 2008)

IFRIC 12 addresses how service concession operators should apply existing IFRS to account for the
obligations they undertake and rights they receive in service concession arrangements. It does not
address accounting for the government side of service concession arrangements. IFRIC 12 is not
relevant to the JSC operations.




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              INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                  ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                        (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.1.Basis of preparation (continued)

(c) Standards, amendments and interpretations, which will become valid starting from 1 January
     2008 or later periods which the JSC has not early adopted (continued)

IFRIC 13, Customer Loyalty Programmes (valid for the annual periods beginning on or after 1July
2008).

IFRIC 13 describes, how to repute clients’ assigned premiums and those influence on a company’s
intrinsic value. IFRIC 13 is not relevant for the JSC activities.

IFRIC 14, IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their
Interaction (valid for the annual periods beginning on or after 1 January, 2008).

IFRIC 14 and IAS 19 amendments are not applicable for the JSC activities, because it hasn’t taken
control of long-term liabilities in relation to employee’s payments.

2.2. Foreign currency translation into Lats

   (a) Functional and presentation currency
Items included in the financial statements of the JSC are measured using
the currency of the primary economic environment in which the entity operates (“the functional
currency”). The financial statements are presented in Latvian Lats (“Ls”), which is the JSC functional
and presentation currency.

    (b) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year-end exchange rates of monetary assets
and liabilities denominated in foreign currencies are recognized in the income statement of the
Company.

Currency exchange rates applied:

                                                                    31.12.2007.     31.12.2006.
                                                                            Ls              Ls

 1 USD                                                                   0.484            0.536
 1 EUR                                                                0.702804         0.702804
 1 LTL                                                                    0.204           0.204




                                                17
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.3 Property, plant and equipment and intangible assets

Intangible assets and property, plant and equipment are recorded at historical cost net of accumulated
depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the
intangible assets and property, plant and equipment.

Depreciation is calculated using the straight-line method to allocate cost of the assets to their residual
amount over their estimated useful lives using the following rates set by the management:

 Fixed Assets                                                                Depreciation rates

 Computers                                                                           25%
 Furniture                                                                         10%-25%
 Other office equipment                                                             14.29%
 Mobile phones                                                                      33.33%

Intangible assets are depreciated during the entire economic life of the assets.

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance
sheet date.

When the carrying amount of an intangible or a property, plant and equipment exceeds its estimated
recoverable amount, it is written down immediately to its recoverable amount.
Recoverable amount is the highest of the fair value less costs to sell and the value in use of the related
intangible or property, plant and equipment.

Subsequent costs are included in the asset’s carrying amount or recognized as separate asset, as
appropriate, only when it is probable that future economic benefits associated with the item will flow to
the JSC and the cost of the item can be measured reliably. Such costs are depreciated over the remaining
useful life of the related asset.

Repairs and maintenance are charged to the income statement during the period in which they are
incurred.

Gains or losses on disposals are determined by comparing carrying amount with proceeds and are
charged to the income statement during the period in which they are incurred.

2.4 Financial assets

The Investment Manager classifies its financial assets in the following categories: available-for-sale
financial assets and loans and receivables. The classification depends on the purpose for which the
financial assets were acquired. The Management determines the classification of its financial assets at
initial recognition.

    (a) Recognition / derecognition
Regular-way purchases and sales of financial assets are recognized on the settlement date - the date that
an asset is delivered to or by an entity. Financial assets are derecognized when the rights to receive cash
flows from the financial assets have expired or who has transferred substantially all risks and rewards of
ownership. Financial assets are initially recognized at fair value plus transaction costs. The Investment
Manager assesses at each balance sheet date whether there is objective evidence that a financial asset or a
group of financial assets is impaired.

                                                 18
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.4. Financial assets (continued)

    (b) Loans and receivables
Classification
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are
not quoted in an active market. Loans and receivables are classified as Term deposits in the balance
sheet.

Measurement
Loans and receivables are carried at amortized cost using the effective interest rate method, net of
accumulated impairment losses. Provisions for impairment are established when there is an objective
evidence that Investment Manager will not be able to collect all amounts due according to the original
terms of receivables. The amount of provisions for impairment is the difference between the amortized
cost and the recoverable amount.

    (c) Available-for-sale financial assets
Classification
Available-for-sale financial assets are non-derivatives that are either designated in this category or not
classified in any of the other categories. They are included in non-current assets unless management
intends to dispose of the investment within 12 months of the balance sheet date.

Measurement
Available-for-sale financial assets are initially recognized at fair value plus transaction costs. Available-
for-sale financial assets are subsequently carried at fair value.

Changes arising from changes in the fair value of available-for-sale assets are recognized in equity. For
unlisted securities the Investment Manager establishes fair value by using valuation techniques. These
include discounted cash flow analysis, using recent arm’s length transactions, making maximum use of
market inputs.

When assets classified as available-for-sale are sold or impaired, the accumulated fair value adjustments
recognized in equity are included in the income statement as other income or expenses.

2.5 Taxation

(a) Value Added Tax (VAT)
Under the current legislation of the Republic of Latvia JSC SEB UNIFONDI is not a VAT payee.

(b) Income Tax
Income tax is calculated according to legislation of the Republic of Latvia and currently amounts to
15%.




                                                  19
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

2. Summary of significant accounting policies (continued)

2.5. Taxation (continued)

(c) Deferred Tax
Deferred income tax is provided in full, using the liability method, on temporary differences arising
between the tax bases of assets and liabilities and their carrying amounts in the financial statements.
However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or
liability in a transaction other than a business combination that at the time of the transaction affects
neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and
laws) that have been enacted or substantially enacted by the balance sheet date and are expected to
apply when the related deferred income tax asset is realised or the deferred income tax liability is
settled.

Temporary differences arise mainly because of application of different depreciation rates as well as
from accrued expenses for employee vacations and bonuses.

Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will
be available against which the temporary differences can be utilised.

2.6. Cash and cash equivalents

For the purposes of the cash flow statement cash and cash equivalents include cash at bank and debit
cards and are included in balance sheet position “Cash at bank”.

2.7. Accrued unused annual leave expenses

Amount of accrual for unused annual leave is determined by multiplying the average daily wage of
employees for the last six months of the reporting year by the amount of accrued but unused annual
leave at the end of the reporting year.

2.8. Employee benefits

The Investment Manager pays social security contributions to the state Social Security Fund on behalf
of its employees in accordance with the local legal requirements. A Social Security Fund is contribution
plan under which the Investment Manager pays fixed contributions as defined in the legislation. The
Investment Manager also makes fixed contributions to a private defined contribution pension plan.
Investment Manager will have no legal or constructive obligations to pay further contributions if the
Social Security Fund or the private pension plan do not hold sufficient assets to pay all employees
benefits relating to employee service. The social security and pension contributions are recognized as an
expense on an accrual basis and are included within staff costs.

2.9. Revenue

(a)      Sale of services
Sales of services are recognized in the accounting period in which the services are rendered. Main
revenue consist of commission, which is received for the finance management and what is stated as
certain part from the managed finance amount.

(b)      Interest income
Interest income is recognized on a time-proportion basis using the effective interest method. Interest
income includes interest received from term deposits and from cash at bank. Interest income is
recognized in income statement in interest income from non-current deposits and finance income
respectively.
                                                  20
                  INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                      ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                            (TRANSLATION FROM LATVIAN ORIGINAL)



   Notes to the financial statements (continued)

   3. Risk Management

   Investment manager’s main risks are associated with market risk, credit risk, and liquidity risk. Risk
   policy of JSC SEB UNIFONDI implies that organization’s success is highly dependent on assessment,
   management and continuous monitoring of those risks. JSC in its activity and policy take into account
   SEB group’s risk policy. In order to limit risks in managing assets of plans and funds JSC comply with
   laws and regulations and plan prospectus requests. JSC has developed and implemented policies and
   procedures in order to provide clients with high level and effective customer’s service.
   JSC allocate its funds according to a conservative investment strategy, investing money in deposits and
   fixed income securities with a different maturity, but mostly investing in a short-term financial tools in
   order to ensure a necessary cash flow in accounts. The main aim of the JSC is to retain principal amount
   towards to obtaining maximum profit JSC has no rights to invest in its own investment funds. During
   the annual year investments were made just in term deposits according to market rates fascination.

      (a)                  Market risk

   (i)                      Foreign exchange risk
   The JSC is not exposed to significant foreign exchange risk because all its investments are denominated
   in Latvian lats. Investments of JSC can be made as well in other currencies, but during the financial year
   no such investments were made. It was not favorable for JSC to keep currency position open. Effect of a
   currency fluctuation influences revenues, because managed portfolios, that are in currencies other than
   Latvian lat, accrued commissions were calculated Latvian Bank’s currency exchange rates, but actually
   received commission according to a market exchange rates for a proper currency. Major part of assets in
   managed portfolios are denominated in LVL, EUR and USD. Almost all revenues are collected in LVL,
   this way the influence of the currency is inessential. Analysis of the currency exchange rates fluctuation
   sensitivity is given below.

   Analysis of the currency fluctuation sensitivity

   Currency exchange rates fluctuations are presumed according to the prior year’s EUR, USD and LTL
   currency exchange rates fluctuations, which were average in limit of 10%.

   December 31, 2007

                 Currency       Book value   Influence on          Influence on   Influence on     Influence on
                                             profit for the              equity   profit for the         equity
                                                      year                                 year
                                                     +10%                +10%             -10%            -10%
                                         LVL          LVL                 LVL              LVL             LVL
Accured
comissions for
asset
management
                 EUR                12 494                 1 249         1 249          (1 249)         (1 249)
                 USD                26 443                 2 644         2 644          (2 644)         (2 644)
                 LTL                   155                    16            16             (16)            (16)
                                    39 092                 3 909         3 909          (3 909)         (3 909)




                                                      21
                   INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                       ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                             (TRANSLATION FROM LATVIAN ORIGINAL)



   Notes to the financial statements (continued)

   3.Risk Management (continued)

   (i)           Foreign exchange risk (continued)

   December 31, 2006

                  Currency      Book value Influence on           Influence on   Influence on     Influence on
                                           profit for the               equity   profit for the         equity
                                                    year                                  year
                                                   +10%                 +10%             -10%             -10%
                                       LVL          LVL                  LVL              LVL              LVL
Accured
comissions for
asset
management
                  EUR               25 373                2 537         2 537          (2 537)          (2 537)
                  USD               25 144                2 514         2 514          (2 514)          (2 514)
                  LTL                  235                   24            24             (24)             (24)
                                    50 752                5 075         5 075          (5 075)          (5 075)


   (ii)         Price risk
   The JSC is not exposed to equity price risk and changes of the interest rates on fixed income securities,
   because during the financial year there haven’t been made any investments in securities.

   (ii)         Cash flow and fair value interest rate risk
   The Investment Manager is not exposed to cash flow or fair value interest rate risk as term deposits
   carry fixed interest rates and are accounted at amortized cost.

   (b) Credit risk
   The JSC has some exposure to credit risk associated with receivables, accrued income, cash and
   investments in bank term deposits. Term deposits are made in local banks by determining banks or
   parent company credit rating, as well as offered interest rates. Short-term investments are made in banks
   with a low credit rating. At the end of the financial year term deposits were allocated in banks with
   Standard & Poor’s credit ratings BBB+ (LHZB) and A+ (SEB Unibanka). Credit risk connected with
   investments in corporate bonds is not relevant for JSC, because these type investmets haven’t been
   made during the financial year. The most essential credit risk concetration is reflected in Note 11.

   (c) Liquidity risk
   Prudent liquidity risk management implies maintaining sufficient cash balances. Future cash flow is
   analyzed carefully, before cash is allocated in financial instruments. Investments are made on different
   terms in order to provide required cash flow in accounts. For JSC assets and liabilities allocation by
   maturities groupings see in Note 20.

   4. Critical accounting estimates and judgments

   There are no assets or liabilities exposed to significant risk of material adjustments subject to the
   outcome of critical accounting estimate or judgment.
   During the financial year there were no significant changes in the structure of balance sheet. Cash was
   gradually placed allocated in term deposits during the reporting period.




                                                     22
              INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                  ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                        (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

5. Revenue

Revenue include income from the asset management of following sources:

                                                                             2007              2006
                                                                               Ls                Ls

“SEB Unipensija” – pension plan asset management                          171 208          126 034
State-funded pension plans asset management                               586 370          317 031
Lat Reserve Fund – asset management                                       260 978          149 668
Real Estate Fund asset management                                          24 617           23 986
Private Client Portfolio Management                                       135 382           84 125
JSC “SEB Latvijas Unibanka” – portfolio management                         26 185           27 639
Insurance company “SEB Dzīvības apdrošināšana” – portfolio
management                                                                  47 986          28 449
Distribution of SEB mutual funds                                           201 252           9 759
                                                                         1 453 978         766 691

100% from revenue are obtained within the Republic of Latvia.


6. Fees and commissions

Membership fees                                                               404              289
Commissions for investment fund and pension plan distribution             506 005                -
Bank fees and commissions                                                     336              310
                                                                          506 745              599

98% of Commissions for investment fund and pension plan distribution was paid to JSC SEB Latvijas
Unibanka for sale of JSC products in accordance with agreement signed in 2007 for rendering of
services.

7. Amortization and depreciation charges

Intangible asset depreciation (see Note 11)                                3 252             2 069
Depreciation of property, plant and equipment (see Note 11)               15 701             3 060
                                                                          18 953             5 129




                                                23
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

8. Income tax and deferred tax

    (a) Income tax
                                                                                 2007                 2006
                                                                                   Ls                   Ls

Deferred tax asset decrease/(increase) (See Note 8 [c])                           641                (258)
Income tax for the reporting period                                            71 319               68 770
                                                                               71 960               68 512

    (b) Financial Year Profit’s Comparison with Income Tax Expenses

Income tax differs from the theoretically calculated tax amount that would arise applying the 15% rate
stipulated by the law to profit before taxation:


Profit before tax                                                             475 486              455 098

Theoretically calculated Income Tax at 15% tax rate                             71 323              68 265
Expenses not deductible for tax purposes                                           914                 247
Tax discount for donations                                                       (918)                   -
Prior period correction                                                            641                   -
Tax charge                                                                      71 960              68 512

    (c) Deferred income tax asset

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to offset
current tax assets against current tax liabilities and when the deferred income taxes relate to the same
taxation authority. The offset amounts are as follows:

                                                                          31.12.2007.           31.12.2006.
                                                                                  Ls                    Ls

Deferred income tax assets:
– deferred tax asset to be recovered within 1 year                               7 492               3 762
                                                                                 7 492               3 762
Deferred income tax liabilities:
– deferred tax liability to be recovered within more than 1 year               (6 344)             (2 649)
– deferred tax liability to be recovered within 1 year                         (1 112)               (436)
                                                                               (7 456)             (3 085)

 Net deferred income tax asset                                                      36                 677




                                                 24
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

8. Income tax and deferred tax (continued)

                                                                              2007               2006
                                                                                Ls                 Ls

Deferred income tax asset at the beginning of
the reporting year                                                              677               419
Deferred income tax (credited to)/ charged to profit and loss
account                                                                       (641)               258
Deferred income tax asset at the end of the reporting year                       36               677

The movement in deferred tax assets and liabilities during the year, without taking into consideration
the offsetting of balances within the same tax jurisdiction, is as follows:

                      Accelerated tax     Accruals for unused              Accruals for
                        depreciation            annual leave                   bonuses               Total
                                   Ls                     Ls                         Ls                Ls

Balance as at 31
December 2005                   1 376                     (892)                    (903)            (419)
Charged/(credited)
to the income
statement                       1 709                      (60)                  (1 907)            (258)
Balance as at 31
December 2006                   3 085                     (952)                  (2 810)            (677)

Charged/(credited)
to the income
statement                       4 369                     (100)                  (3 628)                 641
Balance as at 31
December 2007                   7 454                   (1 052)                  (6 438)             (36)


9. Cash at bank
                                                                          31.12.2007.         31.12.2006.
                                                                                  Ls                  Ls

Bank account at JSC “SEB Latvijas Unibanka”                                   192 963             452 033
Debit cards at JSC “SEB Latvijas Unibanka”                                      2 177               2 223
                                                                              195 140             454 256

Cash at bank is classified in category “Loans and receivables”.




                                                25
              INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                  ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                        (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

10. Term deposits
                                                                       31.12.2007.      31.12.2006.
                                                                               Ls               Ls

Term deposit 4.19% (19.06.2006. –19.06.2008.) A/S LHZB                     62 421            59 864
Term deposit 6.00% (17.06.2003. –17.06.2008.) A/S LHZB                     63 825            60 783
Term deposit 5.44% (08.05.2007.-08.01.2008.) SEB Unibanka                  81 055                 -
Term deposit 8.00% (08.05.2007.-08.05.2012.) SEB Unibanka                 335 138                 -
Term deposit 8.00% (08.05.2007.-08.05.2009.) SEB Unibanka                  84 312                 -
Term deposit 10.1% (28.12.2007.-15.12.2008.) SEB Unibanka                 100 084                 -
                                                                          726 835           120 647

As at 31 December, 2007 fair value of term deposits is 753 017 LVL (31.12.2006 – 118 229 LVL). In
order to determine fair value of term deposits Bank of Latvia weighted-average term deposit interest
rates on 31 December, 2007 and 31 December, 2006 were used. For each term deposit was applied
Market rate, according to remaining term and accrued interest have been recalculated.
All term deposits are classified in category “Loans and receivables”.




                                                26
                 INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                     ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                           (TRANSLATION FROM LATVIAN ORIGINAL)



   Notes to the financial statements (continued)

   11. Intangible and property, plant and equipment

                        Intangible       Leasehold      Computers          Office    Advances for             Total
                            assets    improvements                     equipment        property,
                                                                                        plant and
                                                                                       equipment

                                Ls                 Ls            Ls            Ls               Ls               Ls
01.01.2006.
Cost                         9 815                  -       12 339          2 068                 -          24 222
Accumulated
depreciation               (4 767)                  -       (7 732)          (727)                -         (13 226)
Net book value               5 048                  -         4 607          1 341                -           10 996

Year ended as at
31.12.2006.
Opening book value           5 048                 -          4 607         1 341                -           10 996
Additions                      733            41 671        11 004         17 300            1 031           71 739
Disposals                     (25)                 -              -          (72)                -              (97)
Depreciation charge        (2 069)                 -        (2 557)         (503)                -           (5 129)
Net book value               3 687            41 671        13 053         18 066            1 031           77 509

31.12.2006.
Cost                        10 368            41 671        21 266         19 021            1 031           93 357
Accumulated
depreciation               (6 681)                 -        (8 213)         (955)                -          (15 849)
Net book value               3 687            41 671         13 053        18 066            1 031            77 508

Year up to
31.12.2007.
Opening book value           3 687           41 671         13 053         18 066            1 031            77 508
Additions                  35 622                  -          9 193          9 522               -            54 337
Disposals                        -                 -              -              -         (1 031)           (1 031)
Depreciation charge        (3 252)           (5 953)        (5 709)        (4 039)               -          (18 953)
Net book value              36 057           35 718         16 537         23 549                -          111 861

31.12.2007.
Cost                        45 990            41 671        30 459         28 543                 -         146 663
Accumulated
depreciation               (9 933)           (5 953)       (13 922)        (4 994)                -         (34 802)
Net book value              36 057            35 718         16 537         23 549                -         111 861

   In September 2006 the Investment Manager signed a rent agreement of new office premises and
   initiated repair works. In December 2006 works were completed and the Investment Manager moved
   into new premises, situated in Krasta Street 105a. Leasehold improvements include renovation expenses
   that will be depreciated during the period of rent agreement (7 years). According to rent agreement
   lessor will compensate repair works in amount of 20 Ls per each square meter and that will be deducted
   from current lease payments. Compensation was received during 2007 thus compensation in amount of
   3,952Ls was included in Accounts Receivable as at 31 December 2006.




                                                   27
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

12. Accrued income and deferred expenses
                                                                        31.12.2007.         31.12.2006.
                                                                                Ls                  Ls

Accrued interest income on bank accounts                                         33                  53
Accrued commissions for asset management (see Note 18)                      191 548             152 069
Compensation for improvements of rented Fixed Assets (see Note 12)                -               3 952
Other deferred expenses                                                      11 716               9 686
                                                                            203 297             165 760

These financial assets are classified in category “Loans and receivables”.
The fair value of accrued income and deferred expenses is not materially different from carrying
amount.

13. Shares and other non-fixed income securities

On 5 July 2006 the Investment Manager has aquired 12% of shares in “Zaļās gaismas investīcijas” Ltd.
for 2 640 Ls. All shares and other non-fixed income securities are classified in category “Available for
selling financial assets”.

14. Accrued expenses and deferred income

Accrued personnel expenses                                                 49 946               25 078
FKTK commissions for investment funds                                       5 074                4 063
Other accrued expenses                                                     61 816                6 813
                                                                          116 836               35 954

The fair value of accrued expenses and deferred income is not materially different from carrying value.

15. Share capital

As at 31 December 2007 JSC subscribed and fully paid share capital consists of 318 000 shares with a
nominal value of 1 Ls each.

16. Personnel expenses
                                                                               2007                2006
                                                                                 Ls                  Ls

Salary expenses                                                            190 325              129 168
State compulsory social insurance contributions                             44 981               32 210
Payments In Pension Fund Schemes                                             4 932                6 191
Health Insurance                                                             3 104                1 544
Annual leave expenses                                                       22 446               11 354
                                                                           265 788              180 467




                                                  28
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



 Notes to the financial statements (continued)

 17. Taxes and the state compulsory social insurance contributions

                             Income Tax          State compulsory             Personal                    Total
                                                  social insurance         Income Tax
                                                     contributions
                                       Ls                       Ls                     Ls                    Ls

Liabilities 31.12.2006.            63 428                              -                    -            63 428

Charge for 2007                     71 319                 55 373                41 622                 168 314
Corrections                            641                      -                     -                     641
Paid in 2007                     (138 047)               (55 373)              (41 622)               (235 042)

(Overpaid) 31.12.2007.             (2 659)                         -                    -               (2 659)

 18. Accrued commissions for asset management
                                                                             31.12.2007.              31.12.2006.
                                                                                     Ls                       Ls

 JSC “SEB Unipensija” – pension plan asset management                                44 131              44 934
 State-funded pension plans asset management                                         69 172              33 603
 Lats Reserve Fund asset management                                                  18 250              16 261
 Real Estate Investment Fund asset management                                        25 588              23 411
 Private Portfolio management                                                         7 608              28 457
 JSC “SEB Latvijas Unibanka” portfolio management                                     2 194               2 290
 Insurance comapny “SEB Dzīvības apdrošināšana” portfolio
 management                                                                           5 039               3 113
 SEB investment funds distribution                                                   19 566                   -
                                                                                    191 548             152 069
Distribution of accrued commissions by currencies:

 As at 31st December 2007
                                                 LVL       EUR              USD         LTL               Total

 JSC “SEB Unipensija” pension plan
 asset management                             40 731       3 400                -                 -      44 131
 State-funded pension plans asset
 management                                   69 172           -                -                 -      69 172
 Lat Reserve Fund Asset management            18 250           -                -                 -      18 250
 Real Estate Investment Fund asset
 management                                        -           -           25 588                 -      25 588
 Private Portfolio management                  1 436       5 400              772                 -       7 608
 JSC “SEB Latvijas Unibanka”
 portfolio management                              -       1 956              83                155       2 194
 Insurance company “SEB Dzīvības
 apdrošināšana” portfolio management           5 039           -                -                 -       5 039
 SEB investment funds distribution            17 828       1 738                -                 -      19 566
 Total                                       152 456      12 494           26 443               155     191 548



                                                  29
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

18. Accrued Commissions for asset management (continued)

As at 31st December 2006

                                                LVL          EUR            USD               LTL         Total

JSC “SEB Unipensija” pension plan
asset management                             43 285         1 649                  -            -       44 934
State-funded pension plans asset
management                                   33 603                -               -            -       33 603
Lat Reserve Fund Asset management            16 261                -               -            -       16 261
Real Estate Investment Fund asset
management                                        -             -         23 411                -       23 411
Private Portfolio management                  5 055        21 764          1 638                -       28 457
JSC “SEB Latvijas Unibanka”
portfolio management                                 -      1 960             95              235        2 290
Insurance company “SEB Dzīvības
apdrošināšana” portfolio
management                                   3 113              -              -                -        3 113
Total                                      101 317         25 373         25 144              235      152 069


  19. Average number of employees
                                                                                       2007               2006

Average number of employees during the reporting year                                   13                  11


20. Distribution of assets and liabilities by time to maturity

The table below sets out distribution of the assets and liabilities by expected time to maturity
determined as time period from the balance sheet date to the contractual maturity dates.

31st December 2007

                                   Up to 3      From 3 months          From 1 to           Open        Total
                                   months            to 1 year           5 years          ended
                                       Ls                   Ls                Ls             Ls           Ls

Cash and cash equivalents          195 140                     -               -              -      195 140
Available-for-sale securities            -                     -               -          2 640        2 640
Accounts receivable                    755                     -           1 996              -        2 751
Term deposits                       81 055               226 330         419 450              -      726 835
Deferred expenses and
accrued income                     196 226                   261           6 810              -       203 297
Total financial assets             473 176               226 591         428 256          2 640     1 130 663




                                                30
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

21. Distribution of assets and liabilities by time to maturity (continued)

31st December 2007 (continued)

                                    Up to 3     From 3 months         From 1 to         Open
                                    months           to 1 year          5 years        ended          Total
                                        Ls                  Ls                            Ls            Ls

Deferred income and accrued
liabilities                        116 836                       -             -           -        116 836

Financial liabilities              116 836                       -             -           -        116 836

Net Liquidity                      356 340              226 591         428 256        2 640       1 013 827

Accounts receivable are recoverable and mainly consist of deposits for rent of premises and
telecommunication services.

31st December 2006
                                     Up to 3         From 3          From 1 to 5        Open          Total
                                     months       months to 1             years        ended
                                                        year
                                           Ls             Ls                 Ls           Ls             Ls

Cash and cash equivalents            454 256                 -                -            -        454 256
Available-for-sale securities              -                 -                -        2 640          2 640
Accounts receivable                   11 036                 -            1 996            -         13 032
Term deposits                              -                 -          120 647            -        120 647
Deferred expenses and
accrued income                       152 214              514                  -              -     152 728

Total financial assets               617 506              514           122 643        2 640        743 303


                                     Up to 3         From 3          From 1 to 5        Open          Total
                                     months       months to 1             years        ended
                                                        year
                                           Ls             Ls                  Ls          Ls             Ls

Deferred income and accrued
liabilities                           35 954                 -                     -           -     35 954

Financial liabilities                 35 954                 -                     -           -     35 954

Net Liquidity                        581 552              514            122 643        2 640       707 349




                                                31
                INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                    ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                          (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

21. Transactions with related parties

The Parent company of JSC SEB Unifondi is JSC SEB Latvijas Unibanka, which holds 100% of JSC
share capital.
SEB Latvijas Unibanka is a joint-stock company incorporated in the Republic of Latvia, which together
with subsidiaries are engaged in banking and financial services business. The Parent and ultimate parent
of the AS SEB Latvijas Unibanka is Skandinaviska Enskilda Banken AB, registered in Sweden.
Other companies mentioned in this note are subsidiary undertakings of JSC SEB Latvijas Unibanka. In
the financial period Investment Manager made a following transactions with related parties:

(a)     Services rendered and received

                                                                                     2007              2006
                                                                                       Ls                Ls
Parent company:
Rent of premises                                                                        -           (6 628)
Bank fee and commissions                                                         (58 580)           (4 200)
Commissions for investment fund and pension plan distribution                   (499 030)                 -
Expenses for bank accounts                                                          (404)             (310)
Interest income from term deposits                                                 26 975                 -
Income from asset management                                                      156 674            37 398
Income from bank accounts                                                          19 619             9 364
                                                                                (354 746)            35 624

Funds’ and plans’ expenses also include payments to parent company for distribution of JSC managed
funds’ investment shares (Lat Reserve Fund and Real Estate Fund) and distribution of pension plan
investment shares. Expenses for services, which were offered to JSC by a parent company, i.e.,
accounting, administrative, juridical and other services are included in expenses for Banking services.
Payments were made according to mutually signed contract in 2007 about received services.


Other Related Parties:
Insurance company SEB Dzīvības apdrošināšana – Income from asset
management                                                                         47 986            28 449
Insurance company SEB Dzīvības apdrošināšana – Comissions for asset
management                                                                         (6 351)                 -
SEB Unipensija – Income from asset management                                     216 142           129 984
Unilīzings Ltd. – Car rent                                                         (3 980)           (3 355)
Other related parties – income from asset management                                 1 346             1 347
                                                                                  255 143           156 425

Total                                                                            (99 603)           192 049




                                                32
               INVESTMENT MANAGEMENT JOINT-STOCK COMPANY SEB UNIFONDI
                   ANNUAL REPORT FOR THE YEAR ENDED 31 DECEMBER 2007
                         (TRANSLATION FROM LATVIAN ORIGINAL)



Notes to the financial statements (continued)

21. Transactions with related parties (continued)

Accounts receivable arising from transactions with related parties

                                                                              31.12.2007.       31.2.2006.
                                                                                      Ls               Ls
Parent Company:
Interest receivable for bank account                                                   33               53
Interest receivable for term deposits                                               6 087                -
Commissions receivable for asset management                                        21 760            2 290
                                                                                   27 880            2 343


Other Related Parties:
Insurance company SEB Dzīvības apdrošināšana – Commission for asset
management                                                                          5 039            3 113
SEB Unipensija – Commission for asset management                                   44 131           44 934
Other related parties – income for asset management                                    91              343
                                                                                   49 261           48 390

Total                                                                              77 141           50 733

Accounts payable arising from transactions with related parties

                                                                              31.12.2007.       31.2.2006.
                                                                                      Ls               Ls
Parent Company:
Commissions for fund distribution                                                  47 205                  -
                                                                                   47 205                  -


Other Related Parties:
Unilizings Ltd – deferred expenses                                                  5 728              285
Insurance Company SEB Dzīvības apdrošināšana – commission for fund
distribution                                                                        6 351                -
                                                                                   12 079              285

Total                                                                              59 284              285

Total management compensation in 2007 includes salaries of Ls 88 939 (In 2006: Ls 79 164) and state
compulsory social insurance contribution of Ls 15 710 (In 2006: Ls 15 892).

22. Events after the reporting period

There are no subsequent events since the last date of the reporting year, which would have a significant
effect on the financial position of the JSC as at 31 December 2007.




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