Significant events after the balance sheet date

Resolution of the government bank resolution company HETA

The Austrian Financial Market Authority (FMA) made a decision on 1 March 2015 to resolve the government bank resolution company HETA under BaSAG (Austrian Federal Act on the Recovery and Resolution of Banks). This will have effects on Austria as a financial centre, depending on the outcome of various civil and constitutional actions before the courts. VIG has to take account of this decision in its consolidated financial statements by making large write-downs of Austrian Group company claims against HETA (see financial result).

Successful bond issue: VIG's capital structure strengthened

On 2 March 2015 the Company issued a subordinated bond with a nominal value of EUR 400,000,000.00 and a term of 31 years. The Company can call the bond in full for the first time on 2 March 2026 and on each following coupon date. The subordinated bond bears interest at a fixed rate of 3.75% p.a. during the first eleven years of its term and variable interest after that. The subordinate bond satisfies the Tier 2 requirements of Solvency II. The bond is listed on the Luxembourg Stock Exchange. In March 2015, the Company repurchased EUR 51,983,000 of the nominal value of Tranche 1 of the EUR 500 million in income bonds issued in 2008 and EUR 35,822,500 of the nominal value of supplementary capital bond 2005-2022 issued in January 2005.

Tense situation in the Ukraine

The mutual economic sanctions imposed by the EU and Russia have been extended a number of times since the beginning of the year. Key representatives of the EU generally state that the sanctions should remain specifically linked to the situation in the Ukraine. The EU has been sceptical to date about the possibility of US weapons deliveries to the Ukraine. At the beginning of March, the International Monetary Fund (IMF) approved another aid package of more than EUR 16 billion for the Ukraine. A large amount of these funds is aimed at stabilising the currency.