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VIII. Relations with affiliated companies and affiliated persons

1. Affiliated companies

At the end of the business year, the largest shareholder was FI Equity Partners B.V., a wholly-owned subsidiary of ABN AMRO N.V., which held 23.44% of shares. ABN AMRO N.V. is the bank sponsoring the Tulip ABCP program. Receivables amounting to € 119.3 million (previous year € 50.7 million) had been sold to the program as of the balance sheet date. During the business year 2006, the company took out two loans of € 10 million each from the ABN AMRO Bank N.V. These loans have a term of 48 months, and interest is charged on them on the basis of 3-M-Euribor plus margin. During the business year, the interest expenses from this amounted to € 1.1 million (€ 0.7 million). During the reporting year, an interest rate swap with the ABN AMRO Bank N.V. with a nominal volume of € 25.0 million was reversed; its positive fair value of € 0.4 million was dissolved via the revaluation reserve.

The ERGO Versicherungsgruppe AG holds an indirect share of 15.88% of GFKL Financial Services AG via a 100% holding in the ERGO companies VICTORIA Versicherung AG and Hamburg-Mannheimer Sachversicherungs AG. A collection agreement was concluded with companies in the ERGO Versicherungsgruppe AG, according to which the insurance companies will have their defaulting receivables collected by Sirius Inkasso GmbH. Moreover, sales were generated during the business year from sales and services in the Systems segment to companies in ERGO Versicherungsgruppe AG.

In addition, WestLB AG holds 4.67% of GFKL Financial Services AG. Receivables amounting to € 147.3 million (previous year € 50.5 million) had been sold to WestLB AG’s Compass ABCP program as of the balance sheet date.

During the business year 2007, GFKL sold two NPL loans to the special purpose company Compass Exporec managed by WestLB AG for the purpose of refinancing unsecured non-performing receivables. In principle, the purchase price corresponds to the cash value of the payment flows forecast for the non-performing receuvables less an individually calculated rate for servicing costs, and is refinanced by the purchasing special purpose company through the emission of top-priority senior notes (typically 75%) and subordinate junior notes (typically 25%). The senior notes pertaining to the respective transactions are subscribed in full by WestLB AG. Moreover, there are currently two promissory note bonds with amounts of € 35.0 million and € 100.0 million respectively, the issue of which was arranged by WestLB. The percentage of shares subscribed by WestLB AG amounts to € 10.5 million and € 8.0 million respectively. These loans are due for repayment in September 2009 and April 2010 respectively, and interest is charged on them on the basis of 6-M-Euribor plus margin.

In addition, loan and forfeiting lines exist on a smaller scale for refinancing leasing and hire-purchase receivables for German GFKL subsidiaries in the Credit segment.

During the reporting year, an interest rate swap with the WestLB AG with a nominal volume of € 25.0 million was reversed; its positive fair value of € 0.4 million was dissolved via the revaluation reserve.

The following overviews show transactions with affiliated persons and companies. In the following tables, business incidents with and without any effect on income are bundled into transactions. Compensation paid to the Executive and Supervisory Board is not included. This is described in detail under section VIII.2 “Affiliated persons”. The sales and inventories of ABCP programs and the inventories of security reserves (Compass € 6.6 million and Tulip € 7.5 million) have already been described, and are not taken into consideration in the table.

Liabilities and expenses

Transactions and inventories connected with the Goldman Sachs Group are largely derived from the refinancing of a leasing transaction for the British subsidiary Universal Leasing Ltd. As regards the ABN Group, both loans assumed and obligations to transfer payments from collected leasing installments to the Tulip ABCP program relevant as of the key dates are shown. The WestLB figures also refer to loans assumed and obligations to transfer payments to the Compass ABCP program. The transactions with associated companies largely refer to operate lease agreements concluded by the Spanish leasing company Universal Lease Iberia S.A. The item “Companies in which key persons exert a major influence” largely refers to vehicle repairs and transfer fees for Ruhrland Automobile Beteiligungs AG and its holdings, in which one of the members of GFKL’s Executive Board has a majority holding.

Receivables and income

Transactions and inventories connected with the Goldman Sachs Group are largely derived from NPL portfolio servicing by companies in the Collection segment. Transactions with the ERGO group refer to the purchase of hardware from the GFKL company ADA – Das SystemHaus GmbH and from collection services rendered for the ERGO group.

2. Affiliated physical persons

In its meeting of April 24, 2007, the Supervisory Board passed a resolution revoking the ongoing appointment of Dr. Peter Jänsch and Dr. Tom Haverkamp as of April 30, 2007, and reappointing Dr. Jänsch and Dr. Haverkamp as members of the Executive Board for the period from May 1, 2007 to April 30, 2012. Moreover, a resolution was passed to conclude new employment agreements with all members of the Executive Board. All contracts were concluded with the members of the Executive Board on the same day.

The members of the Supervisory Board receive a fixed compensation amounting to a total sum of € 140k (previous year: € 140k) per year for their activities in accordance with § 15 of the statutes of GFKL Financial Services AG. Moreover, the members of the Supervisory Board receive an attendance fee of € 1k per meeting, however no more than € 6k per business year.

For the period covered by the report, the total payments to the Executive Board and the compensation entitlements of the members of the Supervisory Board covered by the statutes developed as follows:

A portion of 5.71% of the shares (previous year 5.65%) is in the direct or indirect possession of members of the Executive and Supervisory Board and their families.

For another 2.45% (431,282 shares, previous year 2.45%), members of the Executive Board have the option to acquire shares from other shareholders.

The item “Earned pension entitlement” discloses all expenses incurred during the period through the award of a pension to an Executive Board member in accordance with actuarial evaluations. As part of the negotiation of new employment contracts for the Executive Board members in 2007, an upper limit to pensionable emoluments was agreed. During the business year, this led to a reduction in pension entitlements amounting to € 258k. For further information, please refer to section III.34 “Pension provisions”.