Consolidated Financial Performance Results of OJSC ROSNO for the 6 Months of the Year 2007, Based on the International Financial Reporting Standards (IFRS)

Consolidated Balance Sheet as of 30 June 2007(thousand US Dollars)

	30 June 2007	31 December 2006
Assets
Cash and cash equivalents	73 030	82 210
Deposits with banks	180 424	149 045
Financial assets recognized at fair value (through profit or loss)	292 164	288 265
Promissory notes and originated loans, net	1 831	4 919
Investment securities available for sale (AFS)	38 167	19 589
Receivables, net	208 208	127 974
Prepayments, net	125 640	90 257
Reinsurers’ share of provision for unearned premiums	47 724	27 699
Reinsurers’ share of loss provision	17 174	11 687
Deferred acquisition costs, net	100 218	76 403
Goodwill, net	8 673	10 294
Deferred income tax assets	3 599	4 838
Other assets	1 114	1 704
Investments in affiliates	980	987
Investment property	3 641	3 641
Capital assets	49 881	51 614

Total assets	1 152 468	951 126

Liabilities
Provision for unearned premiums	471 890	344 265
Loss provision	172 104	138 591
Unexpired risk provision	-	-
Payables	160 738	137 265
Obligatory medical insurance liability	159 467	144 269
Other liabilities	1 828	3 572
Deferred income tax liability	11 826	11 650

Total liabilities	977 853	779 612

Equity
Share capital	78 547	78 547
Paid-in capital	30 884	30 884
Contingency reserves	5 405	5 078
Statutory insurance reserves	64 856	52 516
Fair value reserve for securities available for sale	6 012	4 861
Translation reserve	23 554	14 275
Accumulated deficit	(37 829)	(22 221)

Equity attributable to the parent company shareholders	171 429	163 940

Minority interest	3 186	7 574

Total equity	174 615	171 514

Total liabilities and equity	1 152 468	951 126

Consolidated Income Statement for the 6-Month Period Ending on 30 June 2007 (Thousand US Dollars)

	Period Ending on 30 June 2007		Period Ending on 30 June 2006

	Six	Three	Six	Three
	months	months	months	months

INSURANCE
Gross premiums written	578 541	256 229	407 989	181 539
Premiums ceded	(80 092)	(22 590)	(51 024)	(14 327)
	498 449	233 639	356 965	167 212

Change in provision for unearned premiums, gross	(143 698)	(27 419)	(116 800)	(29 017)
Change in reinsurers’ share of provision for unearned premiums	25 765	(5 595)	13 144	(6 205)
	(117 933)	(33 014)	(103 656)	(35 222)

Net premiums earned	380 516	200 625	253 309	131 990


Gross claims paid	(197 200)	(106 933)	(109 521)	(61 401)
Reinsurers’ share in claims paid	4 105	3 149	995	589
	(193 095)	(103 784)	(108 526)	(60 812)
Claims handling expenses	(16 177)	(8 931)	(8 216)	(5 188)

Change in loss provision, gross	(31 720)	(17 174)	(14 633)	(11 380)
Change in reinsurers’ share of loss provision	5 371	4 147	(4 086)	2 219
	(26 349)	(13 027)	(18 719)	(9 161)

Net actual losses	(235 621)	(125 742)	(135 461)	(75 161)

Acquisition costs, net	(96 703)	(53 537)	(57 612)	(30 904)
Change in unexpired risk provision			4 233	2 806
Insurance-related operating expenses	(61 082)	(32 730)	(40 818)	(20 509)
Change in provision for impairment of insurance receivables	(531)	670	(5 655)	(2 589)
Other insurance income	-		541	131


Result from insurance operations	(13 421)	(10 714)	18 537	5 764


INVESTMENT OPERATIONS
Interest income	13 794	7 138	4 486	2 555
Income less expenses on investment securities available for sale	10	10	(42)
Income less expenses on financial assets recognized at fair value (through profit or loss)	5 355	1 936	9 412	1 043
Other investment income / (expenses)	109	(20)	(83)	(112)
Change in provision for impairment of promissory notes and originated loans	(559)	(428)	674	625
Investment-related operating expenses	(3 935)	(2 140)	(1 879)	(699)

Result from investment operations	14 774	6 496	12 568	3 412

MISCELLANEOUS
Other commission income	14 305	8 672	10 950	4 783
Other operating expenses	(16 153)	(7 759)	(13 056)	(6 939)
Foreign exchange translation gains / (losses), net	(13)	530	(8 226)	(3 701)
Change in provision for impairment of other receivables	(39)	(6)	5	5
Impairment loss	(114)	(88)	(257)	(11)
Other income	7 099	3 351	4 204	2 380

Result from miscellaneous operations	5 085	4 700	(6 380)	(3 483)

Operating profit	6 438	482	24 725	5 693
Share of affiliates in operating profit/loss, net of tax	3	14	176	221

Profit before tax	6 441	496	24 901	5 914
Income tax expense	(4 900)	(1 533)	(9 399)	(1 974)

Net profit	1 541	(1 037)	15 502	3 940

Attributable to:
Parent company shareholders	2 557	(184)	15 359	3 634
Minority shareholders	(1 016)	(853)	143	306