Results in line with expectations

The definitive results for BCV (parent company) at 31 December 2001 fall within the range predicted at the 18 December 2001 press conference. Following a change in provisioning method and the resulting significantly improved credit risk coverage, two measures judged favorably by Standard & Poor's, which maintained BCV's credit ratings, BCV made a net loss of CHF 390.2 million in fiscal 2001. Gross profit fell by 30.4 %, to CHF 309 million, essentially due to losses on the securities portfolio.

BCV's business activities in fiscal 2001 show several positive points. Interest income rose by 5.5 % to CHF 421.7 million, for example, and commission operation income dropped by only 6.3%, to CHF 224.9 million. A 15.4 % drop in asset management commissions was partially compensated for by a large increase in commissions on loan operations, which were up 29.7%, thanks to improved documentary credit business. Trading operation results recorded a loss of CHF 24.8 million. This is due entirely to drops in the value of securities, as foreign currency exchange, derivative, and equity arbitrage transaction income reached almost CHF 70 million. As for the results posted by the other ordinary banking activities, they show a drop of 18.1% to CHF 120.7 million, which was caused by decreases in the value of equities listed as financial investments. Total income comes in at CHF 741.3 million, or 15.3 % below that of fiscal 2000. Operating expenses remained practically unchanged at CHF 432.3 million. In spite of a 7% increase in staff, personnel expenses dropped 6.1%, to CHF 267.7 million, due to decreases in those components of BCV employee remuneration packages which vary as a function of gross profits. Other operating expenses rose 12.2% to CHF 164.6 million.

Total depreciation, write-offs and new provisions, including a CHF 100 million rebate on the value of real estate intended for sale, come to CHF 1.325 billion. This amount is partially covered by extraordinary net income of CHF 630 million resulting from the dissolution of the Bank's free reserves. After taxes, which total CHF 4 million as against CHF 30.1 million last year, the balance sheet for fiscal 2001 shows a net loss of CHF 390.2 million, which entails a corresponding drop in capital reserves. The Board of Directors will therefore propose at the General Shareholders' Meeting that there be no dividend for fiscal 2001.

The balance sheet total fell by CHF 1.76 billion, or 4.7%, to CHF 35.51 billion. This drop is for the most part due to movements in inter-bank operations, which were voluntarily reduced after a sharp rise during the previous year. Among assets, lending volume dropped slightly (down 1% to CHF 25.63), as the rise in mortgage loans (up 3% to CHF 15.6 billion) could not quite offset a drop in other advances to clients (down 5% to CHF 10.04 billion). On the liability side, third-party funds (deposits and long-term borrowings) slipped by 0.5%, or CHF 127 million, to CHF 26.99 billion, at 31 December. The drops in savings (- 1.3%, to CHF 8.35 billion) and cash bonds (down 5.5%, to CHF 606 million) were much less pronounced than in recent years. In addition, the Bank reduced the level of its other liabilities toward clients (down 5.9% to CHF 7.76 billion), particularly by declining to renew certain time deposits, given that its refinancing needs were covered by long-term borrowing (+5.2 % to CHF 10.27 billion). The Bank's shareholder's equity amounted to CHF 1.42 billion at 31 December 2001, as against CHF 2.33 billion one year earlier, after transfer of free reserves to provisions and coverage of the loss on fiscal 2001. Legal equity requirements will be fulfilled after the planned recapitalization, which will be put before the Shareholders' Meeting on 23 May 2002. The Canton of Vaud has committed itself to participating in this recapitalization in proportion to its present stake in BCV.

BCV Group's results will not show any striking departures from those presented by the parent company, and will be presented at the press conference scheduled for 19 March 2002.

Lausanne, 8 February 2002