3. pants

Acquiring of Rights; Entry into Force

By signing this Payment Agreement, Latvia will acquire all rights conferred upon it according to the Agreement and Statutes with effect from the date its membership enters into force.

This Payment Agreement shall enter into force when the Agreement concerning the Bank, signed 11 February 2004 has entered into force.

This Payment Agreement has been signed in English in two counterparts, one for Latvia and one for the Bank.

Done in Helsinki on 17 December 2004

For and on behalf of

For and on behalf of

of the Government

THE REPUBLIC

THE NORDIC

OF LATVIA

INVESTMENT BANK

Nordic Investment Bank Annex 1

Explanatory Note on Equity and Reserves

Equity

EUR ‘000

EUR

Authorised and subscribed capital

4 000 000

of which callable capital

-3 595 740

Paid-in capital

404 260

404 260 110.00

Statutory reserve

644 982 835.99

Credit risk reserves

337 000 000.00

Special credit risk fund (PIL)

98 200 000.00

Reserve for HIPC initiative

4 300 000.00

Value adjustments IAS

9 532 283.17

Profit for the year 1

151 334 450.72

Total equity

1 649 609 679.88

Paid-in capital

-404 260 110.00

Allocation for dividend payment (proposal)

-41 334 450.72

Accumulated reserves and profits after distribution of dividends for 2003

1 204 015 119.161) not yet allocated to separate reserve accounts