BNG Maintains its Stable Course: Net Profit EUR 257 Million

By Bng bank Nederlandse Gemeenten, PRNE
Monday, March 7, 2011

THE HAGUE, The Netherlands, March 8, 2011 - BNG looks back on an very positive year, despite market conditions
continuing to be uncertain. A more than reasonable return for shareholders
was combined with record scores with regard to new lending and market shares.
The net profit for 2010 was EUR 257 million. The proposed dividend pay-out to
shareholders is EUR 128 million (EUR 2.30 per share). BNG is confidently
looking forward to the development of the result in 2011.

Due to the historically low interest rates, cautiously decreasing spreads
for credit and liquidity risks and uncertainty regarding the future scope of
guarantees in the housing association sector, the volume of new long-term
lending in 2010 was at a record high. BNG's market share was also higher than
ever before. In 2010 long-term lending to clients rose by 89% to EUR 16.3

At EUR 257 million net profit was EUR 21 million lower than for 2009. The
net profit was positively influenced by a significantly higher interest
result, primarily due to the increase in the long-term lending portfolio. The
unrealised result financial transactions was negative, mainly due to the debt
crisis in various Euro-countries. BNG expects the results in the coming years
to gain from the reverse movements of these value adjustments. Without these
adjustments the net profit 2010 would have exceeded the 2009 result.

BNG's liquidity profile improved still further in 2010. The bank was able
to raise more long-term funding with more favourable conditions. By
integrating the so-called Rule 144A into the existing Debt Issuance
Programme, BNG offers US institutional investors the possibility of investing
directly in issues by the bank. In 2010 BNG raised EUR 18.2 billion (2009:
EUR 14.5 billion) in long-term funding. The bank's triple A ratings were
reconfirmed and investors' confidence in BNG was maintained.

BNG's strong solvency position is expressed in the high BIS tier 1 ratio.
Due to retained earnings this ratio rose to 19.6%. Despite the considerably
higher balance sheet total the bank's leverage ratio remained stable at 2.0%.

At the end of 2010 the Basel Committee for Banking Supervision issued new
guidelines in respect of bank capital adequacy and liquidity. For BNG the
most important of these guidelines is the intention to fix the minimum
leverage ratio at 3% as of 2018. It was, however, indicated that whether this
demand will be applicable for all banks in the same way is still under
consideration. BNG is investigating ways to be able to comply with this
regulation in due course.

BNG is confidently looking forward to 2011. The interest result is
expected to be around the high level of 2010. However, given the volatility
of the financial markets against the background of the debt crisis and all
the other uncertainties, the bank does not consider it wise to make a
statement concerning the net profit for 2011.

BNG is the bank of and for public authorities and public sector
institutions. BNG strives to be a financial institution that can be assured
of the appreciation of its stakeholders. This means that the bank
continuously scans its environment and anticipates and responds to issues
timely en responsively. BNG's clients are at the heart of its mission. The
banks core clients are local authorities, housing associations and healthcare
institutions. Long-term, solvency-free lending to these clients is BNG's core
activity. With its services BNG flanks the government's policy.

BNG will publish its Annual Report 2010 on its investors site
( on 29 April 2011.

This is an unofficial translation of the press release 'BNG blijft
stabiel op koers: nettowinst EUR 257 miljoen' which is provided for
convenience only. In the event of any ambiguity, the Dutch text will prevail.

                Consolidated balance sheet as of 31 December 2010

                               In millions of euro

                                                               31        31
                                                         December  December
                                                             2010      2009
    Cash and cash equivalents                               1,073       655
    Banks                                                   7,382     7,683
    Loans and advances                                     86,851    79,305
    Financial assets at fair value
      through the income statement                          3,052     2,983
    Financial assets available for
      sale                                                  6,412     5,531
    Other financial assets                                 13,457     8,002
    Associates and joint ventures                             109       106
    Property and equipment                                     21        23
    Other assets                                              176       208

    Total assets                                          118,533   104,496

    Banks                                                   6,037     5,615
    Funds entrusted                                         7,677     7,070
    Subordinated loans                                         92       174
    Debt securities                                        92,321    79,935
    Financial liabilities at fair value
       through the income statement                           649       351
    Other financial liabilities                             9,320     8,854
    Other liabilities                                         178       244
    Total liabilities                                     116,274   102,243

    Equity                                                  2,259     2,253

    Total liabilities and equity                          118,533   104,496

                       Consolidated income statement 2010

                               In millions of euro

                                                           2010        2009

    -                    Interest income                1,898      2,628
    -                    Interest expenses              1,488      2,291
    Interest result                                           410         337

    Income from associates and joint ventures                   2           2

    -                    Commission income                 35         36
    -                    Commission expenses                6          6
    Commission result                                          29          30

    Result financial transactions                             -37          40

    Addition to the loan loss provision                        -4           -
    Other results                                               0           2
    Total income                                              400         411

    -                    Staff costs                       35         35
    -                    Other administrative expenses     26         24
    Staff and other administrative expenses                    61          59

    Depreciation                                                2           2
    Total expenses                                             63          61

    Profit before tax                                         337         350

    -                    Movement in deferred tax          -1          -
    -                    Tax                              -79        -72
    Taxation                                                  -80         -72

    Net profit                                                257         278

    For further information:

    Aart Rietveld, spokesman BNG
    P.O. Box 30305
    2500 GH THE HAGUE
    The Netherlands


Contact person: Aart Rietveld, T +31-70-3750-609, E mc at

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