1. Country SpecificCaseStudy Czech, Hungary, Romania 1 Nordcap Limited 2009

3. Flexible monetary policy

4. Low vulnerability of financial sector

5. Significant IMF and EU balance of payments support

6. Strong influence on fiscal policy by IMF/EU

7. Significant IMF and EU balance of payments support

8. Low public sector debt levels and high roll-over rates of banks’ external financing

10. Wide external financing gap and C/A rebalancing risk

11. High FX leverage in domestic private sector

12. Heavy reliance on external demand

13. High share of the automotive sector in total value added

14. Interim government lacks political mandate

15. High public sector debt levels (above 80% in 2009)

16. Still wide external financing gap

17. High FX leverage in domestic private sectorData: UCG MIB

19. Some countries will take it longer to recover what might be observed in unstable currencies and extreme debt to GDP

20. Romania and Hungary are clear examples of such countries

21. Contrary Czech Republic seems to cope with the crisis much better

22. In general that means the end of „one fit all” private equity model for CEE countries – each country must be evaluated separately

23. Additionally in many CEE countries banks have expropriated capital hence financing must be also contemplated separatelyNordcap Limited 2009 3

25. However concern about the economic environment still exists with 51% respondents still expecting further economic deterioration.Nordcap Limited 2009 4 Source: Deloitte

26. Czech Republic gains in terms of investment value (2007/2008) Nordcap Limited 2009 5

27. And moves up in the ranking of investments / GDP Nordcap Limited 2009 6

29. However in Czech Rep there was much more growth capital put to work

32. That money sooner or later will need to be put to work

33. However new funds are still being raised: Nordcap Limited 2009 9 Source: Deloitte

34. Selected investments in last half of the year Nordcap Limited 2009 10 Source: Deloitte

36. Czech Republic is the clear winner of the three countries discussed, Hungary is characterized by strong uncertainty on how much worse the economy will detoriate while Romania additionally is the least mature of the three

37. As the result we may expect more deals in Czech than elsewhere

38. Mega buy-outs model seems to be a dead one so fund managers need to be creative and flexible

39. New deals may include distressed assets, mezzanine finance opportunities, small deals in the €10-25 million range and family-owned companies with succession issues

40. We can also expect some extra VC activity caused by the state sponsored actions

41. Due diligence is utmost important, valuations should be more market based and planned exit scenarios should be realistic

42. It is a good time to evaluate the relative strength of existing portfolio companies with a view to managing towards increased efficiency and, as concerns non-performing or troubled assets, developing a realistic plan to address these problemsNordcap Limited 2009 11

44. In November 2007 Nordcap sold its seed investment DRSA, to an industrial conglomerate listed on the Warsaw Stock Exchange.

45. Nordcap’s professional team consist of business analysts with expertise in information technology, telecoms, marketing and real estate.

46. Nordcap provides both:Venture capital Mezzanine capital Nordcap Limited 2009 12 www.nordcap.co.uk