BANK OF BAKU
AUDITORS REPORT AND FINANCIAL STATEMENTS AT 31 DECEMBER 1999

During 1999 and 1998, a number of banking transactions were entered into with related parties in the normal course of business. These mainly included loan disbursements and deposit taking. These transactions were priced predominantly at market rates. The outstanding balances at year-end and the interest expenses and income for the year with related parties are as follows:

	1999
Loans and advances to customers
Loans outstanding at year-end	1,304,575
Interest income earned	81,762
Customer accounts
Outstanding balance at year-end	176,336
Interest expense paid	160
Other
Rent payments made for office premises	25,225

Note 1 Principal Activities 
Note 2 Basis of Presentation 
Note 3 Significant Accounting Policies 
Note 4 Cash and short-term Funds 
Note 5 Loans and Advances to Banks 
Note 6 Loans and Advances to Customers 
Note 7 Other Assets 
Note 8 Premises and Equipment 
Note 9 Due to Banks 
Note 10 Customer Accounts 
Note 11 Other Borrowed Funds 
Note 12 Other Liabilities
Note 13 Paid-in Capital 
Note 14 Retained earnings / Accumulated Deficit 
Note 15 Fees and Commission Income 
Note 16 Fees and Commission Expense
Note 17 General, Administrative and Other Operating Expenses 
Note 18 Taxation 
Note 19 Dividends 
Note 20 Asset and Liability Concentration 
Note 21 Risk Management 
Note 22 Commitments and Contingent Liabilities 
Note 23 Reconciliation of Azeri Accounting Rules to International Accounting Standards 
Note 24 Related Party Transactions