REPORT OF THE BOARD OF DIRECTORS · 2011. 8. 10. · SIF MOLDOVA SA 4 1.1. Description of the...

REPORTOF THE BOARD OF DIRECTORS

The first half of 2011Drafted in compliance with the provisions of CNVMRegulation no. 1/2006

Contents * 1. Analysis of activity 3

1.1 Description of the primary activity1.2 General information1.3 Evaluation of activity

a. Achievement of objectivesb. Structure of managed assetsc. Assets portfolio management

c.1. Share portfolioc.2. Securities portfolioc.3. Monetary and fixed revenue instruments portfolio

2. Financial and accounting statusa. Balance sheet b. Income statementc. Financial indicatorsd. Cash flowse. Degree of realization of the Revenue and Expense Budget

3. Risk management 374. SIF 2 shares on the BVB 425. Protection of SIF Moldova interests – status of litigations 446. Relations with shareholders. Dividend policy. 467. Compliance control 488. Corporate governance 509. Human resource management 53

Annexes1. Status of net assets as of 30.06.2011. Detailed status of SIF Moldova assets as of 30.06.20112. Financial statements as of 30.06.20113. Status of litigations as of 30.06.20114. BVB, CNVM reports for the 1st half of 2011

SIF MOLDOVA SA

• NOTE: The structure of the report complies with the provisions of CNVM Regulation no. 1 / 2006 regarding issuers and operations with securities. We specify that in order to ensurethe comparability and continuity at the level of the information provided to shareholders / investors, the structure of the report complies with the main points of the yearly report(annex 32 to CNVM Regulation no . 1 / 2006), an approach that covers all information provided in the model for the half year report (annex 31)

2

1. Analysis of activity 1.1 Description of the primary activity1.2 General information1.3 Evaluation of activity

3

SIF MOLDOVA SA

4

1.1. Description of the primary activity

• SIF Moldova is a financial investment company of the closed type, constituted inaccordance with the provisions of Law no. 133 / 1996 for the transformation ofPrivate Property Funds into financial investment companies, classified in the “non‐UCITS ‐ Undertakings for Collective Investment in Transferable Securities (A.O.P.C.)category, with a diversified investment policy”, attested by the National SecuritiesCommission (CNVM) with Attestation no. 258 / Dec 14, 2005.

Legal framework

• the management of its assetsGoal

•Management of financial instruments designated as such by CNVM regulations;• Other associated activities, in compliance with legal regulations in force.• According to the classification of activities in the national economy CAEN Rev. 2, theactivities conducted by SIF Moldova are included in the 6499 class “Other financialintermediary services not classified somewhere else” .

Field of activity

TYPE OF INVESTMENT COMPANY

SIF Moldova is a non‐UCITS,active mainly on theRomanian market, as aclosed fund investing inshares, with a medium levelof risk and temporaryinvestments of liquidities infixed revenue instruments.

SIF MOLDOVA SA

5

Company management

Costel CEOCEAPresident &CEO

Claudiu DOROSVice‐president & Deputy

CEO

Elena ANDREIMember

Dumitru BONTASMember

Alexandru MATEIMember

Emilian BADICAMember

Iosefina MOROSANMember

Book‐keeping of shares and shareholders: Depozitarul Central SAAsset depository and custody services BRD ‐ GSG SAFinancial auditor: Deloitte Audit SRL

SIF MOLDOVA SA

6

1.2. General information

Date of incorporation: 1992 Company head office: Bacau,str.Pictor Aman, nr.94C,

post code 600164Unique registration number in the Trade Register: RO 2816642Incorporation Number in the Trade Register: J04/2400/1992CNVM Register No: PJR09SIIR/040001/14.12.2005Subscribed and paid‐in share Capital: 51.908.958,8 RONNumber of shares issued: 519.089.588Nominal value: 0,1 RON/shareShareholding structure: 100% private Free float: 100%Regulated market trading Issued securities: Bursa de Valori Bucuresti – 1st Tier

Tel: 004 0234 576740Fax: 004 0234 570062E‐mail: [email protected] site: www.sifm.ro

Bucharest Stock Exchange: SIF2ISIN: ROSIFBACNOR0Bloomberg: BBG000BMN5F5Reuters: SIF2.BX

GEN

ERAL

DATA

CONTACT

DA

TA

IDEN

TIFICA

TIO

N DATA

SIF MOLDOVA SA

7

1.3. Evaluation of activity /a. Fulfilment of objectives

Directions Structural objectives*

Increase in value of listed securities:

TARGET- at least 70% CURRENTLY – 64%

Increase in value of listed securities:

TARGET- at least 70% CURRENTLY – 64%

Decrease in the weight of non-listed securities (excludingthe BCR investment) TARGET- no more than 2%CURRENTLY 3%

Decrease in the weight of non-listed securities (excludingthe BCR investment) TARGET- no more than 2%CURRENTLY 3%

Decrease in the weight of listed / non-listed investments withoutgrowth potential or not liquid (CURRENTLY approx. 4,6% oftotal assets) together with the increse in volume of speculativeoperations

Decrease in the weight of listed / non-listed investments withoutgrowth potential or not liquid (CURRENTLY approx. 4,6% oftotal assets) together with the increse in volume of speculativeoperations

Holdings between 0-10% of the share capital of portfolio companies. TARGET – decrease to70%. CURRENTLY – 79%. Holdings between 10-20% of the share capital of portfoliocompanies TARGET – increase to 10% CURRENTLY - 5%

Holdings between 0-10% of the share capital of portfolio companies. TARGET – decrease to70%. CURRENTLY – 79%. Holdings between 10-20% of the share capital of portfoliocompanies TARGET – increase to 10% CURRENTLY - 5%

Maintaining a minimum weight of 50% of the financial and banking sector.CURRENTLY – 61%. Increasing the weight (at least 20%) of the energy sector.CURRENTLY – 14 %

Maintaining a minimum weight of 50% of the financial and banking sector.CURRENTLY – 61%. Increasing the weight (at least 20%) of the energy sector.CURRENTLY – 14 %

Maintaining a level of liquidities (deposits, current accounts and cash) of at least 5%. CURRENTLY 4,5%Maintaining a level of liquidities (deposits, current accounts and cash) of at least 5%. CURRENTLY 4,5%

In accordance with the Activity Program for 2011 and withthe Declaration of Investment Policies for 2011 – 2013,approved by the General Assembly of Shareholders of Apr22, 2011, SIF Moldova has elaborated and isimplementing, in the given market conditions, a medium /long term investment policy focused on the followingobjectives: exploiting the experience on the national market and

the adjustment of exposures in favor of domesticinvestments;

consolidation of FIC Moldova's strategic position on thecapital market by continuing partnerships with theshareholding of other powerful entities acting in themarket;

management of the BCR holding – a strategic objectiveaimed at increasing the weight of listed assets in totalassets;

increasing the speed and effectiveness of restructuringand balancing the portfolio;

decreasing the number of low‐performanceinvestments and sectors;

improving the management of liquidities so that SIFMoldova may ensure:‐ the continuity of activity and the continuation of theinvestment process in 2011 at maximal levels‐the “cash management” for monetary investmentsand highly liquid investments‐the rapid exploitation of market opportunities.

* Relative to the total value of assets

SIF MOLDOVA SA

8

1.3. Evaluation of activity /a. Fulfilment of objectives

Indicator (mil. RON) 2008 2009 H12010 2010Q1 2011

H12011

REB 2011

% REALIZED

Net profit 94 101 57 96 10.5 34 69 49


H12011

REB 2011

% REALIZED

Revenue from ceded financial investments 51 97 56 104 28 40 186 22

Revenue from dividends 46 72 12 21 0 16 5 320

Revenue from interest 5 13 4 6 0.8 2 2 100


S12011

Program2011

% REALIZED

Investments in securities 56 52 89 171 16,4 27 100 27

94 101

57

96

10.534

2008 2009 S1 2010 2010 T1 2011 S1 2011

Evolution of net profit (mil. RON)

51

97

56

104

284046

72

12 210

165 13 4 6 0.8 2

2008 2009 S1 2010 2010 T1 2011 S1 2011

Evolution of revenue (mil. RON)

Revenue from ceded financial investments

Revenue from dividends

Revenue from interest

56 52

89

171

16.4 27

2008 2009 S1 2010 2010 T1 2011 S1 2011

Evolution of investments in securities (mil. RON)

SIF MOLDOVA SA

9

1.3. Evaluation of activity /b. The structure of assets managed

b.1. Approach from the perspective of CNVM regulations*

STRUCTURE OF ASSETS of SIF Moldova (RON) 2008 2009 H12010 2010 Q1 2011 H12011

H12011/H12010 (%)

Government securities 22.854.969 13.435.298 59Liquidities 915.261 329.566 471.693 548.687 1.571.921 415.536 88Receivables 18.309.294 10.896.275 3.621.111 1.922.444 558.508 23.172.276 640Bank deposits 40.925.801 127.847.158 85.161.229 55.542.495 57.216.746 43.325.228 51Municipal bonds 723.155 811.187 686.806 540.782 397.830 399.382 58Corporate bonds ‐ 957.560 1.019.973 1.055.260 1.072.521 1.035.273 102Listed stock 436.974.232 698.534.990 676.598.406 643.081.355 816.319.389 793.041.821 117Unlisted stock 454.838.651 326.553.139 373.218.089 335.758.760 336.582.648 340.294.217 91UCITS securities 1.680.650 14.724.614 24.001.995 102.096.831 29.618.153 26.978.326 112Other assets 19.361.672 18.907.229 18.793.765 30.671.428 18.355.259 17.066.078 91Total assets 975.049.046 1.199.561.718 1.206.428.036 1.171.218.043 1.261.695.975 1.259.163.435 104Total liabilities 19.252.348 17.724.478 43.623.801 28.216.905 21.776.528 58.038.171 133Precollected revenue 10.792 10.380 10.155 9.930 9.817 9.705 96Net assets 955.785.906 1.181.826.860 1.162.794.080 1.142.991.208 1.239.909.630 1.201.115.559 103BVS (book value of shares) 1,8413 2,2767 2,2401 2,2019 2,3886 2,3139 103

Market price (end of year‐RON) 0,5300 1,1400 0,9400 1,1620 1,4720 1,2540 133

Discount (‐) Market price/BVS ‐ 71% ‐ 50% ‐58% ‐ 47% ‐ 38% ‐ 46%

*In annex 1 to the Report are presented: (1) the status of net assets as of 30.06.2011(annex 16) as well as (2) the detailed status of SIF Moldova assets as of 30.06.2011 (annex17) – drafted in compliance with the provisions of Law 297 / 2004 and CNVM Regulationno. 15 / 2004.

‐ 1.0000 2.0000 3.0000 4.0000 5.0000

2008 2009 S1 2010 2010 T1 2011 S1 2011

lei

Evolution of the BVS – Market price combination

VUAN Pret paia

SIF MOLDOVA SA

10

1.3 Evaluation of activity /b. The structure of assets managed

b. 2. operational approach*

STRUCTURE OF ASSETS 2008 2009 H12010 2010 Q1 2011 H12011

Shares, of which: 91,46 85,46 87,02 89,65 91,38 90,01

‐ listed 44,82 58,23 55,26 60,98 63,16 64,12

‐ unlisted 46,65 27,22 31,76 28,67 27,35 25,89non‐UCITS securities (fundunits, ETF) 0,17 1,23 0,95 1,54 1,33 1,33

Monetary instruments (deposits, liquidities, etc) 4,43 10,69 8,99 4,79 4,54 4,54

Bonds (municipal, corporate, fund units, bonds) 0,07 0,15 1,18 1,24 1.14 0,93

Other assets 3,86 2,48 1,86 2,78 2.48 3,19

*for the relevance of the presentation and in relation with the information presented in the following part of the report regarding the various components of the asset portfolio, the following decisions weremade: (1) to record (as of Dec 12, 2010) of the Property Fund shares in the “listed shares” category – an approach different from that of CNVM regulations that mandated the recording of PF shares in 2010 inthe fund units category and (2) the recording of fund units issued by Bonds funds in the “bonds” category.

Listed shares 44.82%

Non‐listed shares 46.65%

Non‐UCITS securities 0.17%

Monetary market

instruments 4.43%

Bonds 0.07%

Other assets 3.86%

STRUCTURE OF ASSETS ‐ 31/12/2008

Listed shares58.23%

Non‐listed shares27.22%


Monetary market

instrument 10.69%

Bonds0.15%

Other assets2.48%


Listed shares60.98%



Monetary market

instruments 4.79%

Bonds1.24%

Other assets2.78%


Listed shares64.12%



Monetary market

instrument 4.54%

Bonds0.93%

Other assets3.19%


SIF MOLDOVA SA

11

1.3. Evaluation of activity /c. Asset portfolio management

SHARES24,96 mil. RON invested in shares,

representing 92%

of the total 27,08 mil. RON invested in

securities as of the 1° half of

2011

c.1. Share portfolio/Operations

The main investments carried out in the 1st half of 2011 were focused on shares of listed and liquid issuers in:

energy and utilities sector(Transgaz, CEZ Cehia, OMV AG Austria) ‐10,45 mil. RON (41,96 % of total share investments)

banking sector (Banca Transilvania, Erste Bank) ‐ 1,6 mil. RON (9,8% of total share investments)

The Property Fund – over 3 mil. RON (12,25% of total share investments), together with the initiation of sale operations favoredby the volatility of the share on the market, that led to the recording of a profit representing over 24% of the profit realized fromceded financial investments related to the reporting period.

Institutions active on the capital market ( BVB, BRK, Depozitarul Central) – over 3 mil. RON (12,37% of total share investments)

During 2011, investment programs aimed at issuers listed on foreign markets were continued: Austria (Wiener Borse) ‐ OMV AG(petrol), SEMPERIT (synthetic rubber), VOESTALPINE (metallurgy ); Polonia (Warsaw Stock Exhange) – Asseco (IT), Warsaw StockExhange (financial); Cehia (Prague Stock Exhange) – Cez AS (energy sector);Canada (Toronto Stock Exchange) – Gabriel Resources(mining – gold deposits). The value of investments made in the aforementioned issuers amounts to 6,85 mil. RON, representingover 27% of the total investments in shares.

In the 1st half of 2011, profit markings were made for part of the investments in the period and / or previous periods. These operationswere aimed at stock of Fondul Proprietatea, BRD, Azomures, Bursa de Valori Bucuresti , Conpet, CEZ (Cehia), Mobam, Retrasib,Semperit (Austria). At the end of the 1st half of 2011, the total value of revenue from sale of shares is of 36,9 mil. RON and a profit of de19,4 mil. RON.

SIF MOLDOVA SA

12

1.3. Evaluation of activity /c. Share portfolio management

c.1. Share portfolio / Structural evolutions

•Evolution of the share portfolio according to number of investments

As of 30.06.2011 the portfolio comprises share investments in 219 companies.

COMPA

RED TO THE FIRS

T HAL

F OF 2010

COMPA

RED TO 31/12

/201

0

The number of companies in the share portfolio decreased by 11 from 230 to 219 issuers. The variation in the number of companies in theportfolio was motivated by current trading operations, as well as the writing off of issuers. Thus, in the reporting period, the followingoperations were recorded: transfers from the portfolio, through the sale of 9 companies (6 listed and 3 closed companies) and through the write off of 9 companies in

the historical portfolio, as a consequence of completing liquidation procedures, in compliance with Law 85 / 2006; transfers into the portfolio – a number of 7 companies resulting from acquisitions of shares undertaken on the internal market as well as on

external markets (Varsovia, Viena, Praga, Frankfurt).

The number of companies in the share portfolio decreased by 4 from 223 to 219 issuers as a consequence of the following operations: transfers from the portfolio, through the sale of 3 listed companies and through the write off of 4 companies in the historical portfolio, as a

consequence of completing liquidation procedures, in compliance with Law 85 / 2006; transfers into the portfolio – a number of 3 companies resulting from acquisitions of shares undertaken on the domestic market as well as

on foreign markets: Zentiva Bucuresti (SCD), OMV AG Viena (OMV AG), Voestalpine AG Linz (VOE). Acquisitions were aimed at liquidshares, in sectors presenting a strategic interest for SIF Moldova: finance, energy.

SIF MOLDOVA SA

13

1.3. Evaluation of activity /c. Asset portfolio managementc.1. Share portfolio / Structural evolutionsEvolution of the share portfolio according to trading market

Portfolio structure by trading market relative to market value* (thousand RON)

2008 2009 H12010 2010 Q1 2011 H12011

S12011/

S12010(%)

Traded stock, of which: 436.974 686.935 666.692 640.142 796.959 793.042 119Listed (REGS) 360.508 602.702 580.599 556.394 725.500 714.634 123Listed (RGBS) 27.858 25.580 28.450 28.489 27.174 26.140 92Unlisted (UNLS) 8.914 7.489 6.132 6.341 5.815 5.341 87Listed (XMBS) 38.956 49.591 43.217 41.588 35.987 36.781 85Listed (SBX) ‐ ‐ 1.782 1.460 2.483 2.648 149Listed on the international market ‐ 1.573 6.512 5.870 10.906 7.497 115

Temporary shares ‐ ‐ ‐ 27 ‐ ‐ -Non‐traded shares, of which: 454.839 338.153 383.124 338.671 345.037 340.294 89Closed companies 370.019 326.553 373.218 329.418 330.768 326.031 87Listed, not traded in last 90 days companies 84.820 11.600 9.906 9.253 14.269 14.263 144

Total 891.813 1.025.088 1.049.816 978.840 1.152.902 1.133.336 108

COMPARED TO H12010 COMPARED TO 31/12/2010

The market value of traded sharesincreased by 19% in the first half of 2011;

The market value of non‐traded sharesdecreased by 11%, an evolution causedmainly by disinvestments from thisportfolio;

The market value of shares listed onforeign markets increased significantly, asa consequence of the increase by 4 of thenumber of issuers / securities subjectedto acquisition and of the increase in prices.

The market value of traded shares increased by approx. 24% as aconsequence of subscription in the increase in share capital of theTransilvania bank; investing / divesting operations carried out in this period;the increase in the quotations of traded shares (on the domestic andinternational market) and the variation of the exchange rate;

The market value of non‐traded shares increased by approximately 0.5%, anevolution determined mainly by the increase in owners' equity in unlistedbanks (excepting BCR), recording the increase in share capital in SC TurismLotus Felix SA (investment) and recovery from insolvency of SC Hyperion SA;

The market value of shares listed on foreign markets has increasedsignificantly, as a consequence of the purchase of shares in two new issuers,of increases in quotations and of the variation in the foreign currencyexchange rates.

436.974

686.935640.142

454.839

338.153 338.671

2008 2009 2010

Evolution of the share portfolio (thousand RON)

Traded stock Non‐traded stock

666.692

793.042

383.124 340.294

S1 2010 S1 2011

Evolution of the share portfolio (thousand RON)

Traded stock Non‐traded stock

The market value is determined in accordance with CNVM Regulation no. 15 / 2004

SIF MOLDOVA SA

14



Structure and evolution of the share portfolio by the weight of shares held in the issuer share capital

(thousand RON) 2008 2009 H12010 2010 Q1 2010 H12011 H12011/H12010No. of comp.

Market value*

No. of

comp.

Market value

No. of

comp.

Market value

No. of comp.

Market value

No. of

comp.

Market value

No. of comp.

Market value (%)

Insignificant shares: = 50% 8 35.857 8 41.068 8 35.956 8 40.722 8 41.381 8 46.696 130Total participatii 243 891.813 229 1.025.088 230 1.049.816 223 978.840 223 1.152.902 219 1.133.336 108

COMPARED TO H12010 The market value of the portfolio increased in absolute

value by 83.5 mil. RON, as a result of variations in shareprice together with the increase in quality of issuers in theportfolio (by selling non‐liquid investments withoutgrowth potential and replacing them with listed issuerswith growth potential);

The number of insignificant shares decreased by 1 issuerand the market value of this category increased by 8%compared to H1 2010;

Significant shares decreased by 9 issuers, mainly as aconsequence of the sale of some investments, the transferof existing issuers in other categories of holdings; write‐offof some issuers;

The number of control investments decreased by 1 as aconsequence of the sale of an issuer and of a write‐off;

� At the level of „majority holdings”, theirnumber remained unchanged and the market valuedecreased by 30%, mainly determined by the acquisitionsof shares of Tesatoriile Reunite (TERU) and Regal (REGL)

784,342

892,485

920,929

848,118

997,903

66,477

85,913

87,612

85,225

83,770

5,137

5,621

5,320

4,776

4,967

35,857

41,068

35,956

40,722

46,696

2008

2009

S1 2010

2010

S1 2011

majority >= 50% control: (33% ‐ 50%)

significant: (10% ‐ 33%) insignificant:

SIF MOLDOVA SA

15



•Structure and evolution of the portfolio by field of activityDistribution of

investments by field of activity weight in total

assets(%)

2008 2009 H12010 2010 Q1 2011 H12011 H12011‐ H12010

Financial 72,45 67,54 63,26 61,84 63,02 61,39 ‐1,87Energy 4,34 4,47 8,68 13,28 14,97 14,05 5,37Manufacturing 10,62 8,00 8,42 8,55 6,85 6,95 ‐1,47Pharmaceuticals 1,34 2,35 2,29 2,32 2,47 2,37 0,08Commerce 0,64 0,49 0,53 0,37 1,79 1,79 1,26Construction 0,17 0,20 0,19 0,16 0,93 0,98 0,79Agriculture 0,49 0,40 0,98 0,85 1,12 1,10 0,12Others 1,41 2,01 2,67 2,28 0,50 1,38 ‐1,29TOTAL 91,46 85,46 87,02 89,65 91,37 90,01 2,99

Financial 63.26%

Energy8.68%

Industry 8.42%

Pharma2.29%

Others3.39%

Exposure by sector in H12010

Financial 61.39%

Energy14.05%

Industry 6.95%

Pharma2.37%

Others5.25%

Exposure by sector in H12011

EVOLUTIONS Taking into consideration the SIF Moldova portfoliorestructuring strategy through sector rebalancing (reducingexposure to the financial and banking sector and theconsolidation of the exposure to the energy sector) thefollowing aspects are noticed (compared to the total value ofthe assets managed);The decrease of the exposure to the financial and bankingsector by 1,87% compared to the H12010; The increase in the weight of the energy sector

(production, transportation, distribution) by 5,37%compared to the same period of the previous year,through direct investments in companies active in thissector, as well as through investments in the shares of theProperty Fund (taking into consideration its exposure toRomanian energy companies – approx. 85% ‐ with nodirect access for investors).

SIF MOLDOVA SA

16



•Top companies in the portfolio (1)

2008 2009 2010

TOP COMPANIES IN THE PORTFOLIO

% held in the issuer's share capital

Weight >1% of the total value of assets





BRD 5,00 29,57 4,74 35,74 3,86 27,98

BCR 6,00 30,73 6,00 23,37 6,00 24,87

BANCA TRANSILVANIA 3,89 6,81 3,69 6,45 4,60 6,90

FONDUL PROPRIETATEA Holding is not in the top 0,26 1,21 1,14 6,07

OMV PETROM 0,17 1,95 0,17 2,06 0,16 2,64

SNTGN TRANSGAZ Holding is not in the top 0,68 1,03 0,94 2,47

BIOFARM 11,46 1,20 11,46 2,20 12,21 2,20

TESATORIILE REUNITE 71,20 1,55 88,14 1,72 88,79 1,49

AEROSTAR Holding is not in the topHolding is not in the

top 12,09 1,22

BURSA DE VALORI BUCURESTI Holding is not in the topHolding is not in the

top 4,74 1,17

TRANSELECTRICA 1,01 1,01 Holding is not in the top 1,01 1,15

MECANICA CEAHLAU 55,13 1,35 Holding is not in the top 55,11 1,03

BANCPOST 5,13 4,32 ‐ ‐ ‐ ‐

TOTAL 78,49 73,78 79,21

SIF MOLDOVA SA

17



Top companies in the portfolio(2)

H12011

NAME % held in the issuer's share capital Number of shares held

BRD 3,73 25.966.458

BCR 6,00 47.548.125

BANCA TRANSILVANIA 4,95 73.104.220

FONDUL PROPRIETATEA 1,05 144.883.189

OMV PETROM 0,16 93.317.375

SNTGN TRANSGAZ 1,12 132.391

BIOFARM 12,21 133.734.144

TESATORIILE REUNITE 88,93 425.625

TRANSELECTRICA 1,02 747.620

BURSA DE VALORI BUCURESTI 4,99 383.709

MECANICA CEAHLAU 55,11 132.202.332

AEROSTAR 12,16 14.246.020

1. BRD | 29.61%

2. BCR | 22.52%

3. TLV | 6.94%

4. FP | 6.06 %

5. SNP | 2.98%

6. TGN | 2.69%

7. BIO | 2.20%

8. TERU | 1.61%9. TEL | 1.28%

10. BVB | 1.23%

11. MECF | 1.20%12. ARS | 1.15%

Weight in the total value of assets(weights >1% ‐

H12011)

SIF MOLDOVA SA

18


c.1. •Share portfolio – qualitative selections

Main section (1) ‐ sharesCH

ARAC

TERISTICS / CR

ITER

IA

Represents 84.4% of the total value of assets, with a value of 1.074 mil RON (250 mil euro).In the total value of assets managed, BCR and BRD holdings represent 52%.

Companies in this portfolio were selected based on the following criteria:Good / very good liquidity;Valuable patrimony not always reflected in market value or in accounting value of the share forunlisted companies (implicitly in the registration value in the SIF Moldova net assets); Good perspective for business; Good dividend rate of return;For closed companies in the portfolio there are reserves for the increase of the price per share atthe moment of SIF Moldova exit.

With a few notable exceptions (Aerostar, Tesatoriile Reunite, Mecanica Ceahlau and theaforementioned two banks) and a few less significant ones (Regal, Conted, Concivia, Elerom,Rulmenti, Carpatex, unlisted companies), this portfolio is the result of strategies applied by SIFMoldova in the last few years, with the objective of restructuring the historical portfolio andreplacing it with a liquid portfolio consisting of companies traded on the stock market(BancaTransilvania, Fondul Proprietatea, OMV – Petrom, Transgaz, Biofarm, Transelectrica, Bursa deValori Bucuresti)

SIF MOLDOVA SA

19


c.1. Share portfolio – qualitative selections

Main section (1) ‐shares

NO SECTOR / NAME SYMBOL

NUMBER OF SHARES IN

THE PORTFOLIO

% HELD IN THE SHARE CAPITAL

% IN THE TOTAL

VALUE OF ASSETS

FINANCE AND BANKING

1 BANCA COMERCIALA CARPATICA BCC 3.265.091 0,103 0,020

2 BANCA TRANSILVANIA TLV 73.104.220 4,946 6,938

3 BCR 47.548.125 6,000 22,515 4 BRD BRD 25.966.458 3,726 29,6125 ERSTE BANK * EBS 4.054 0,001 0,047 6 EXIMBANK 414.740 0,311 0,281 7 RAIFFEISEN BANK 8.961.091 0,075 0,131 8 BROKER SSIF BRK 11.172.500 3,859 0,231

9 BURSA DE VALORI BUCURESTI BVB 383.709 4,999 1,229

10 BURSA DIN VARSOVIA * GPW 10.000 0,024 0,043

11 SIBEX SIBIU STOCK EXCHANGE SBX 1.671.217 4,999 0,208

12 BURSA ROMANA DE MARFURI 46 0,609 0,001

13 CASA ROMANA DE COMPENSATI 852.039 7,879 0,059

14 DEPOZITARUL CENTRAL 6.373.925 2,924 0,047

15 DEPOZITARUL SIBEX 6.480 2,824 0,025 subtotal finance and banking sector 61,387


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

ENERGY

1 ARMAX GAZ ARAX 15.527.756 2,529 0,211

2 CEZ AS * BAACEZ 5.000 0,001 0,062

3 CONPET COTE 16.150 0,187 0,056

4 DAFORA DAFR 1.980.000 0,203 0,019

5 ELECTROMAGNETICA ELMA 10.355.300 1,532 0,267

6 FONDUL PROPRIETATEA FP 144.883.189 1,052 6,061

7 OIL TERMINAL OIL 800.000 0,137 0,021

8 OMV PETROM SNP 93.317.375 0,165 2,984

9 OMV AG OMV AG 20.600 0,007 0,196

10 PROSPECTIUNI PRSN 2.930.830 0,408 0,055

11 ROMPETROL WELL SERVICES PTR 1.808.000 0,650 0,060

12 TRANSELECTRICA TEL 747.620 1,020 1,278

13 TRANSGAZ TGN 132.391 1,124 2,693

Subtotal energy sector 14,052

SIF MOLDOVA SA

20

1.3. General evaluation /c. Asset portfolio management


Main section (1) ‐shares(continued)


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

RAW MATERIALS

1 GABRIEL RESOURCES* GBU 104.900 0,031 0,173

Subtotal raw materials sector 0,173IT

1 ASSECO POLAND SA * ACP 10.276 0,013 0,044 IT sector 0,044MECHANICAL

1 AEROSTAR ARS 14.246.020 12,162 1,148 2 ALRO ALR 13.900 0,002 0,004

3 ALUMIL ROM INDUSTRY ALU 170.110 0,544 0,019

4 ARTROM ART 65.800 0,057 0,010

5 COMELF CMF 1.400 0,006 0,000

6 COMPA CMP 1.099.500 0,502 0,053

7 DUCTIL DUCL 832.498 0,452 0,037

8 MECANICA CEAHLAU MECF 132.202.332 55,105 1,199

9 RULMENTI RBL 2.408.645 6,005 0,301

10 SANTIERUL NAVAL ORSOVA SNO 28.350 0,248 0,008

11 TURBOMECANICA TBM 307.500 0,083 0,002 12 VOESTALPINE AG * VOE 2.200 0,001 0,025

Sub‐total mechanical sector 2,805


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

PHARMACEUTICALS

1 ANTIBIOTICE ATB 2.346.733 0,491 0,092

2 BIOFARM BIO 133.734.144 12,215 2,202

3 HYPERION 116.433 29,399 0,055

4 ROPHARMA RPH 53.213 0,018 0,004

5 ZENTIVA SA SCD 120.000 0,029 0,013

subtotal pharmaceuticals sector 2,366

TEXTILES

1 CARPATEX 52.335 5,000 0,070

2 CONFECTII BIRLAD 16.655 5,000 0,084

3 CONTED CNTE 2.812 1,173 0,004

4 TESATORIILE REUNITE TERU 425.625 88,934 1,614

Subtotal textiles sector 1,772

SIF MOLDOVA SA

21





NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

CONSTRUCTII1 CEMACON CEON 1.030.500 0,392 0,008 2 CERAMICA IASI CERE 6.701.999 5,866 0,318 3 COMCM CMCM 35.700 0,015 0,000 4 CONCIVIA COKJ 118.337 11,582 0,065 5 CONDMAG COMI 2.669.610 0,700 0,071 6 CONSTRUCTII BIHOR COBJ 1.419 0,135 0,003 7 IMOTRUST ARCV 2.187.111 0,515 0,014 8 IMPACT IMP 394.340 0,197 0,0129 PREFAB PREH 37.800 0,078 0,007 10 TERAPLAST TRP 1.001.700 0,336 0,042

11 TRANSILVANIA CONSTRUCTII COTR 1.276 0,135 0,003

Subtotal construction sector . 0,543

FOOD

1 ALBALACT ALBZ 4.192.314 0,642 0,076

2 ARGUS UARG 533.686 1,492 0,093

3 BERMAS BRM 453.242 2,103 0,028

4 BOROMIR PROD SPCU 245.000 0,101 0,005

5 LACTATE NATURA INBO 147.847 5,986 0,075

Subtotal food sector 0,278


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

ELECTROTECHNICAL

1 ELEROM ELER 23.357 8,930 0,021

2 IPROEB IPRU 662.000 1,392 0,075

Subtotal electrotechnicalsector 0,096

COMMERCE

1 REGAL REGL 16.272.358 92,966 0,512

2 UNIREA SHOP CENTER SCDM 200 0,007 0,001

Subtotal commerce sector 0,513

TOURISM

1 CASA DE BUCOVINA BCM 10.304.334 6,158 0,067

2 TURISM FELIX TUFE 3.697.026 0,745 0,051

3 TURISM LOTUS FELIX 7.375.000 1,436 0,029

Subtotal tourism sector 0,147

SIF MOLDOVA SA

22





NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

AGRICULTURE

1 AGROCOMPLEX BIRLAD 67.343 7,188 0,033

2 AVICOLA BUZAU AVZU 1.823.000 0,426 0,005 3 COMCEREAL TULCEA CTUL 780.242 27,125 0,323

Subtotal agricultural sector 0,361

CHEMICALS1 AMONIL AMO 66.000 0,006 0,000 2 AZOMURES AZO 335.000 0,064 0,020 3 VRANCART VNC 164 0,000 0,000

Subtotal chemical sector 0,020

Other sectors

1 ARTEGO ARTE 42.200 0,424 0,008

2 COREMAR REMO 49.400 0,076 0,001

Subtotal other sectors 0,009

TOTAL PORTFOLIO 1 (30.06.2011) 84,476

A significant weight in this portfolio is held by the BCRinvestment. Starting from the necessity to protect SIFMoldova interests and implicitly those of its shareholders andtaking into consideration the characteristics of the issuer BCRand of the relationship with the majority shareholder – duringthe first quarter of 2011 the efforts to prepare the listing ofBCR securities were continued. From the perspectivesannounced, the BCR listing represents a major objective forthe following period – in concert with the policy aimed atincreasing the value of assets managed and at optimizing theportfolio structure.

SIF MOLDOVA SA

23



Section 2 ‐ sharesCH

ARAC

TERISTICS /

CRITER

IARepresents 3,5% of the total value of assets, respectively approximately 45 mil RON (approx 10 mil Euro). Companies inthis subportfolio are part of the historical investments (in many cases, holdings are important as a percentage held in theshare capital).

The companies in this portfolio were selected based on the following criteria:Low liquidity in the case of listed companies; The market price does not reflect the value of companies;The patrimony may be valuable, without being reflected in all cases in the market value or in the accounting value of the share for unlisted companies (implicitly in the registration value in SIF Moldova's net assets);Have profitable assets but with low performance, presenting potential for improvement after the recovery from recession;Need restructuring and financing plans for development;There are reserves for the growth of the price / share at the moment of exit.


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

COMMERCE1 ALIMENCO 53.857 28,465 0,0162 ALIMENTARA 10.468.044 18,376 0,3213 CASA 274.890 99,967 0,1414 COMAT GALATI COTM 1.028.875 9,455 0,0165 COMMETEX 134.558 31,873 0,0216 COMPPIL TG MURES 92,082 59.191 0,0337 GALGROS GALV 580.196 13,993 0,1858 GASTROINVEST 187.378 95,692 0,1469 HUMOREANCA 16.896 25,385 0,00510 ISTRU ISTR 218.489 47,255 0,16111 LUCEAFARUL MEBY 66.903 24,663 0,06412 PARTMEN 75.748 26,592 0,054

Subtotal commerce sector 1,164


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

MECHANICAL

1 ARCELOR MITTAL TUBULAR PRODUCT ROMAN

PTRO 2.034.312 14,084 0,353

2 ARCELOR MITTAL TUBULAR PRODUCT IASI TPRO1.963.984 3,014 0,129

3 FAM FAMZ 108.237 23,356 0,0284 LAMINORUL LMRU 460.378 0,953 0,0305 SANTIERUL NAVAL C‐TA SNC 1.310.901 2,017 0,0306 SPIT BUCOVINA SPTU 1.162.275 19,547 0,0787 STX RO OFFSHORE 1,134,162 3.682 0,1828 UPSS UPSS 608.600 16,721 0,049

Subtotal mechanical sector 0,878CONSTRUCTION

1 SANEX 12.082.650 6,522 0,420Subtotal construction sector 0,420

SIF MOLDOVA SA

24



Section 2 – shares (continued)


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

TEXTILE

1 BUCOVINA‐TEX BUTE 77.820 28,488 0,164

2 CONFECTIA TG.JIU CNFG 75.938 31,609 0,040

3 FAVIL FAVL 730.000 19,942 0,065

4 FILBAC FILC 36.789 20,767 0,022

5 IASITEX IASX 611.069 29,027 0,253

6 MATASEA ROMANA MASA 210.389 24,789 0,020

7 STOFE STOF 322.224 16,226 0,017

8 TEXTILA OLTUL TEXU 393.106 14,339 0,053

9 TRANSILANA TRSK 7.352.083 15,080 0,018

10 VASTEX VASX 147.105 13,935 0,079

Subtotal textiles sector 0,729

AGRICULTURE

1 AGROGAL 302.649 6,674 0,020

2 COMCEREAL BRAILA 25.603 1,573 0,001

Subtotal agriculture sector 0,021


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

ALIMENTAR

1 AGRICOLA INTERNATIONAL6,639,150 1.223 0,069

2 MARTENS MABE 72.203 7,743 0,015

3 PANIMON 9.810 5,000 0,017

4 VASCAR 148.900 21,450 0,035

5 VINIA 11.634 0,163 0,001


CHEMICALS

1 CEPROHART CPHA 84.385 30,252 0,023

2 CHIMCOMPLEX CHOB 3.394.967 2,626 0,062


TRANSPORTATION

1 ATLAS GALATI ATLK 17.036.782 33,995 0,079

2 ATLAS BRAILA 22.337 14,985 0,005

3 AUTO MOLDOVA 1.267 2.238 0,013

Subtotal transportation sector 0,097

TOTAL PORTFOLIO 2 (30.06.2011) 3,529

SIF MOLDOVA SA

25


c.1. Share portfolio – qualitative selectionsSection 3 – shares

CHAR

ACTERISTICS

/ CR

ITER

IAThis portfolio represents 1,1% of the total value of assets, with a value of 14,5 mil. RON (3,4 mil. Euro). Although SIFMoldova holdings are important (as percentages of the issuers' share capital), we consider that the growth probability ofthis portfolio is low in a medium timeframe (1‐3 years).

Companies whose shares are not liquid (in the case of listed companies) Companies without special perspective Patrimony without a close potential for valuation, requiring a discount for sale


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

ENERGY1 RAFO RAF 952.936 0,109 0,089

Subtotal energy sector

0,089

CONSTRUCTION

1 CONSTRUCTII FEROVIARE GALATI CORO 82.540 8,456 0,009

2 CIMEX 26.432 5,526 0,008

3 ROMLUX LIGHTING COMPANY 5 0,001 0,000

Subtotal construction sector 0,017

AGRICULTURE1 AGRALMIXT 22.884 20,880 0,0152 AGRIBAC‐FORTUNA 39.587 44,509 0,0003 AGRODELTA SIREASA 239.731 20,645 0,0234 AGROIND CORA 12.631 7,907 0,001

5 PISCICOLA MURIGHIOL253.026 30,000 0,676

6 SEROMGAL 6.335 17,421 0,000Subtotal agriculture 0,715


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

CHIMIC1 GENKO MED GROUP FAMO 140.522 0,551 0,009


FOOD1 DELTA LACT DLCT 22.413 11,160 0,004

2 DYONISOS 772.824 12,410 0,011


MECHANICAL1 URB RULMENTI URUL 1.790.020 15,874 0,028

2 VITIMAS VITK 10.497 1,477 0,004Subtotal mechanical sector

0,032

COMMERCE1 ADMET ADMY 125.400 23,842 0,065

2 BUMBACARIA ROM 597.125 48,686 0,044

3 DANUBIUS 22.742 28,954 0,008

Subtotal commerce 0,116

SIF MOLDOVA SA

26



Section 3 – shares (continued)


NUMBER OF SHARES IN

THE PORTFOLIO


% IN THE TOTAL

VALUE OF ASSETS

TEXTILES

1 INDOR INDP 36.002 4,481 0,010

2 OLTCOTTON OLBA 237.507 51,112 0,028

3 SIMAT SIMA 95.172 37,908 0,059Subtotal textiles sector 0,097

TRANSPORTATION

1 DELTA SERVICE 9.458 34,390 0,029

2 TRANSTEC TRCS 286.699 41,031 0,019Subtotal transportation sector 0,048

Other sectors

1 APA‐CANAL 7.812 6,723 0,000

Subtotal other sectors 0,000

TOTAL PORTFOLIO 3 (30.06.2011) 1,138

Section 4 – shares

This portfolio includes the shares of 70 companies in various stages of:administrative liquidation (2), judicial liquidation (59), insolvency (7) and judicialreorganization (2). These securities are recorded in the assets managed at zerovalue, according to the provisions of CNVM regulation no. 15 / 2004 art. 202 (4).These companies originate in the historical portfolio, being an effect of theallocation through legislation that formed the basis of the constitution of SIFMoldova and not of selection based on portfolio management principles. Theevolution of these companies is being monitored, without a significant allocationof human resources.

SIF MOLDOVA SA

27

1.3. Evaluation of activity /c. Asset portfolio managementc.2. The securities portfolio (share investment funds, diversified investment funds, ETF's) – section 5

CRITER

IA Represents 1,3% of the total value of assets. The allocation of resources for this type of assets wasaimed at attaining performance by the dispersion of the risk associated with the assets portfolio, involatile market conditions and obtaining rates of return superior to those of monetary investments

Nr Name Number of fund units in the SIF

Moldova portfolio% in total value of assets

Diversified share investment funds SAI Swiss Capital

1 FDI ACTIVE DINAMIC 161.676 0,142SAI BT Asset Management

1 BT INVEST 1 100 0,0882 BT MAXIM 200.000 0,120

SAI CERTINVEST1 CERTINVEST PROPERTIES RO 10 0,188

SAI GLOBINVEST1 FDI NAPOCA 8.229.728 0,2322 FDI Transilvania 43.724 0,107

SAI SIRA1 FDI OMNITRUST 58.889 0,013

SAI OTP Asset Management1 OTP GREEN ENERGY 3.932 0,0562 OTP WiseRO 5.434 0,077

SAI STK Financial1 STK Emergent 5.847 0,022

SAI SAFI INVEST 1 FONDUL OAMENILOR DE AFACERI 3.120 0,000

SAI Intercapital Invest Management1 iFond Financial Romania 7.801 0,1182 iFond Gold 2.475 0,028

SAI ING Investment Management

1ING INTL Romanian Equity class X‐Capitalisation

492 0,032

2 ING INVEST Global Opportunities Class I 18 0,0343 ING INVEST Global High Dividend Class I 391 0,0344 ING INVEST Emerging Europe Class I 1.579 0,033

TOTAL INVESTMSNE FUNDS 30/06/2011 1,324

OPERATIONS

The SIF Moldova investment policy for the 2011 – 2013period plans for a holding in investment funds of up to10%. From the total investments realized in the 1st half(27,08 mil. RON), 7,8% were destined for theacquisition of fund units.

Taking into consideration the good rates of return ofinvestments in fund units compared to those of bankdeposits, the liquidation of the holding in the OpenInvestment Fund BT CLASIC, was considered profitable,an operation that led to obtaining revenue amountingto 1,18 mil. RON and a profit of approx. 0,12 mil. RON.

This strategy of divestment from fund units was alsoapplied for the ESPA Bond Danubia Bonds Fund (section6 of the portfolio), as a consequence of the necessity tobalance SIF investments in this type of financialinstruments (holdings in the Bonds funds had a weightof approx. 44% of the total). The sale of approx. 50% ofthe total units held in ESPA Bond resulted in revenue ofapprox. 3 mil. RON and a profit of 0,16 mil. RON,amounts that may be oriented towards otherinvestments generating rates of return superior tothose of bank deposits.

SIF MOLDOVA SA

28

1.3. Evaluation of activity /c. Asset portfolio managementc.3. Fixed revenue and monetary instruments portfolio – section 6

CHAR

ACTERISTICS

/ CR

ITER

IAIn this category are included investments in the portfolio with a reduced degree of risk, that have a weight of approximately5,4% of the total value of SIF Moldova assets ‐ Bonds funds, Municipal / city bonds, Corporate bonds, Bank deposits

Investment funds in this subportfolio have the following characteristics: a low level of risk; attractive rates of return.

Nr Name Number of fund units in

the SIF Moldova patrimony

% in the total value of assets

Bonds funds1 BRD Bonds 8.860 0,091

2 BCR Bonds 388.995 0,457

3ESPA BOND DANUBIA 5.379 0,268

TOTAL 0,816

Municipal bonds1 PRIMARIA BACAU 2.000 0,015

2 PRIMARIA HOREZU 20.000 0,017

TOTAL 0,032

Corporate bonds

1BANCA EUROPEANA DE INVESTITII 10.000 0,082

Nr Name Value (RON) % in the total value of assets

1Monetary instruments (deposits)

57.548.933 4,570

(exclusiv depozite garantii materiale)GENERAL TOTAL (30.06.2011) 5,500

Monetary instruments recorded as of Jun 30, 2011 represent 4,5% of the total value ofassets managed.

Type of investment 2008 2009 S 1 2010 2010 H12011

Bank deposits (RON) 40.389.101 91.050.268 56.758.530 23.563.134 17.645.467 Bank deposits (foreign currency in RON equivalent)

33.420.242 28.031.440 31.901.360 25.679.761

Current accounts (banks and cash office)

858.631 213.084 193.624 409.591 415.536

Deposits for material pledges 244.975 265.241 267.860 274.990 372.871

Government securities 1.291.759 ‐ 22.849.891 ‐ 13.435.298

Total 42.784.466 124.948.835 108.101.345 56.149.075 57.548.933

From the analysis of monetary investments in the Jan 1 ‐ Jun 30, 2011 period, thefollowing observations were drawn: For investments in RON ‐ an average return rate of 6,88 % / year; For investments in foreign currency (Euro) ‐ an average rate of return of 3,96 % /

year; For investments in government securities – an average rate of return of 7,15%/year

SIF MOLDOVA SA

29


c.4. General picture of the assets portfolio

MAIN SHARES PORTFOLIO (1)

84.4%of total assets

(cap 1.3.c.1 – section 1)

FIXED REVENUE AND MONETARY INSTRUMENTS

PORTFOLIO5,4%

of total assets

(chapter 1.3.c.3)

SHARES PORTFOLIO

(2)3,5%

of total assets(chapter 1.3.c.1

– section 2)

UCITSSECURITIES PORTFOLIO

1,3%of total assets

(chapter 1.3.c.2)

SHARES PORTFOLIO

(3)1,1%

of total assets(chapter 1.3.c.1 –

section 3)

In accordance with the strategicobjective regarding the portfoliooptimization and theaforementioned selection criteria,the overall structure of themanaged asset portfolio isillustrated in the following chart:

2. Financial and accounting status

a. Balance sheet b. Income statementc. Financial indicatorsd. Cash flowse. Degree of realization of the Revenue and Expense Budget

30

SIF MOLDOVA SA

31

2. Financial and accounting status/ a. Balance sheet

The financial statements were drafted and presented in compliance with Accounting Regulations harmonized withEuropean Economic Community 4th Directive applicable to institutions regulated and supervised by the NationalSecurities Commission („CNVM”), approved by Order no. 13 / 2011 and Regulation no. 4 / 2011.The reporting currency for the financial statements is the RON.The financial statements drafted for June 30, 2011 are audited by SC Deloitte Audit SRL Bucuresti.

Items (RON) 2008 2009 H12010 2010 Q1 2011 H12011 H12011/H12010 (%)Non‐current assetsI. Intangible assets 120.945 474.133 570.969 826.339 875.411 979.686 172II. Tangible assets 8.525.122 18.038.896 17.724.859 15.852.118 15.660.499 15.485.480 87III. Financial assets, of

which: 21.423.458 349.344.310 398.708.991 478.980.497 520.787.329 502.051.431 126

Securities and other financial instruments held as non‐current assets

288.589.765 312.487.787 358.428.415 440.639.903 481.520.815 464.049.357 129

Non‐current assets – Total 340.069.525 367.857.339 417.004.819 495.658.954 537.323.239 518.516.597 124Current assetsI. Inventory 27.561 37.899 31.589 33.805 22.346 22.982 73II. Receivables, of which: 60.562.312 138.923.912 114.189.015 65.391.991 59.325.097 66.434.946 58

Trade receivables 42.288.268 127.932.287 110.284.724 55.645.324 57.344.495 56.865.710 52III. Short term financial

investments 776.581 10.712.458 11.588.342 15.514.286 13.747.469 11.892.635 103

IV. Cash and bank accounts 860.357 214.543 201.352 411.029 208.266 244.631 121Current assets – Total 62.226.811 149.888.812 126.010.298 81.351.111 73.303.178 78.595.194 62Prepaid expenses 58.686 77.055 690.852 116.391 184.088 172.296 25Current liabilities 19.252.348 17.724.478 43.623.801 26.126.305 19.810.998 58.038.171 133

Current assets less net currentliabilities 43.022.357 132.231.009 83.067.194 55.331.267 53.666.451 20.719.614 25

Total assets minus currentliabilities 383.091.882 500.088.348 500.072.013 550.990.221 590.989.690 539.236.211 108

TOTAL ASSETS 402.344.230 517.812.826 543.695.814 577.116.526 610.800.688 597.274.382 110

* Trade receivables in gross value include short term bank deposits amounting to 43.207.437 RON (Jan 1, 2011: 55.464.494 RON), government securities amountingto 13.372.122 RON (Jan 1, 2011: 0 RON) and associated interest calculated up to Jun 30, 2010, of 208.041 RON, of which for bonds 27.074 RON (Jan 1, 2011: 57.882RON).

SIF MOLDOVA SA

32

2. Financial and accounting status/ a. Balance sheet

Items (RON) 2008 2009 H12010 2010 Q1 2011 S2 2011 H12011/S2 2011 (%)

Provisions 42.432.257 44.071.216 43.120.574 52.086.852 51.990.995 44.835.395 104Deferred revenue 10.792 10.380 10.155 9.930 9.817 9.705 96

Equity and reserves1. Subscribed and paid‐in

registered capital 51.908.959 51.908.959 51.908.959 51.908.959 51.908.959 51.908.959 100

2. Revaluation reserves 15.122.842 15.170.030 14.932.216 13.323.302 13.339.248 13.355.193 893. Total reserves, of which: 179.695.166 263.998.022 309.263.127 315.194.457 344.605.166 323.838.741 105

Legal reserves 10.381.792 10.381.792 10.381.792 10.381.792 10.381.792 10.381.792 100Reserves constituted fromadjustments for devaluation offinancial non‐current assets

143.630.350 94.601.896 124.937.993 125.728.526 95.898.272 117.233.155 94

4. Reported result 23.607.297 23.607.297 22.182.702 118.676.448 71.758.588 3045. Result of fiscal year 93.932.658 101.332.824 57.239.840 96.293.949 10.468.874 33.539.335 596. Profit appropriation ‐ ‐ ‐Owners’ Equity ‐ Total 340.659.625 456.017.132 456.951.439 498.903.369 538.998.695 494.400.816 108

TOTAL LIABILITIES AND EQUITY 402.344.230 517.812.826 543.695.814 577.116.526 610.800.688 597.274.382 110

Structure of financial non-current assets (RON) Gross value Adjustments for devaluation Net accounting valueFinancial non‐current assets, of which: 661.803.479 159.752.048 502.051.431 Shares held in affiliated entities 32.174.056 6.645.808 25.528.248 Participation interest 39.514.184 27.432.705 12.081.479 Securities held as non‐current assets 589.722.892 125.673.535 464.049.357 Other receivables 392.347 ‐ 392.347

SIF MOLDOVA SA

2. Financial and accounting status / b. Income statement

Items (RON) 2008 2009 S11 2010 2010 Q1 2011 H12011 H12011 /H12010 (%)

A. Revenue from operations total, of which: 141.263.791 192.416.867 94.381.878 175.914.315 29.591.980 74.762.167 79

1. financial non‐current assets 46.282.258 72.017.626 12.065.437 21.301.365 39.710 16.429.195 1362. ceded financial investments 51.135.627 96.631.878 56.246.186 103.983.529 27.791.562 40.197.345 713. interest 4.938.017 12.721.785 3.860.178 6.200.045 793.762 1.536.491 404. provisions, reactivated claims 36.060.918 7.986.213 12.068.519 32.310.035 193.779 9.678.216 805. other revenue 2.846.971 3.059.365 10.141.558 12.119.341 773.167 6.920.920 68B. Expenses with operations total,of which: 42.954.697 84.070.171 28.440.287 65.232.372 17.192.044 39.338.755 138

1. ceded financial investments 15.872.442 38.096.855 7.735.557 16.904.427 12.149.340 20.499.125 2652. exchange rate variations 445.156 560.648 1.963.512 3.840.779 1.246.629 1.528.013 783. commissions and fees 2.479.020 1.990.194 1.178.615 2.618.267 562.285 1.142.678 97%4. depreciations, provisions, lossesfrom various debtors 7.520.286 30.675.053 5.163.195 22.683.490 260.926 2.820.327 55

5. banking and similar services 38.068 48.411 23.631 42.206 10.151 23.905 1016. materials 496.986 304.207 96.070 227.662 78.352 178.191 1857. electricity and water 216.289 199.525 91.261 190.963 52.297 110.162 1218. expenses with staff 14.717.693 10.967.482 11.516.389 16.180.859 2.284.422 12.067.999 1059. external services 914.891 823.583 527.791 2.231.683 435.070 844.169 160

10. taxes and similar payments 253.866 404.213 144.266 312.036 112.572 124.186 86

C. Gross profit 98.309.094 108.346.696 65.941.591 110.681.943 12.399.936 35.423.412 54D. Profit tax 4.376.436 7.013.872 8.701.751 14.387.994 1.931.062 1.884.077 22

E. Net profit 93.932.658 101.332.824 57.239.840 96.293.949 10.468.874 33.539.335 59

Ceded financial investments (RON) H12011

Revenue 40.197.345

costs 20.499.125

Trading commissions 95.119

Net results of activity 19.603.101

Provision (RON) Balance as of Jan 1,2011

TransfersBalance as of Jun 30, 2011incoming outgoing

Provisions for litigation 45.120 45.120Provisions for taxes 44.793.801 168.748 172.274 44.790.275Other provisions 7.247.931 ‐ 7.247.931 ‐TOTAL 52.086.852 168.748 7.420.205 44.835.395

SIF MOLDOVA SA

34

2. Financial and accounting status / c. Financial indicators

Items (RON) 2009 H12010 2010 H12011

Liquidity indicators (no. of times)

‐ Current ratio = current assets / current liabilities 8,45 2,90 3,11 1,35

‐ Quick ratio = (current assets ‐ inventories)/current liabilities 8,45 2,90 3,11 1,35

Activity indicators (no. of times)

‐ Non‐current assets turnover = revenue from operations / non‐current assets 0,52 0,23 0,36 0,14

‐ Total assets turnover = revenue from operations / total assets 0,37 0,17 0,30 0,13

‐ Trade receivables turnover = average receivables balance / turnover x 365 (days) 28 14 22 23

Profitability indicators

‐ Return on working capital = profit before interest and profit tax / working capital*100 (%) 23,76 14,43 22,19 7,16

‐ Earnings per common share (RON/share) 0,1952 0,1103 0,1855 0,0646

SIF MOLDOVA SA

35

2. Financial and accounting status / d. Cash flows

Items (RON) 2008 2009 H12010 2010 H12011

1. cash at beginning of period (a+b) 38.276.158 42.784.466 124.948.835 124.948.835 56.149.075

a. Current accounts 2.759.890 858.632 213.084 213.084 409.591b. Financial investments ‐ DEPOSITS 35.516.268 41.925.834 124.735.751 124.735.751 55.739.484A. Operations (2‐3) (19.665.403) (20.166.802) (16.106.867) (18.195.355) (20.037.451)

2. Cash inflows 5.379.672 2.998.054 1.084.308 14.799.054 1.297.353

3.Cash outflows 25.045.075 23.164.856 17.191.175 32.994.409 21.334.804

B.Investment activity (4‐5) 47.355.314 120.141.504 4.516.458 (27.590.377) 26.696.395

4. Cash inflow 92.533.971 172.880.700 80.903.602 148.190.875 53.829.202

5.Cash outflow 45.178.657 52.739.196 76.387.144 175.781.252 27.132.807

C. Financing activity (6‐7) (23.181.603) (17.810.333) (5.257.080) (23.014.028) (5.612.271)

6. Cash inflow 2.342.353 1.627.173 4.547 624.127 678

7.Cash outflow 25.523.956 19.437.506 5.261.627 23.638.155 5.612.949

TOTAL CASH FLOW (A+B+C) 4.508.308 82.164.369 (16.847.490) (68.799.760) 1.046.673

CASH AT END OF PERIOD 42.784.466 124.948.835 108.101.345 56.149.075 57.195.748

a. cash office ‐ RON 3.975 2.979 2.661 2.553 3.098

b. banks – RON 847.605 209.991 170.744 127.455 95.483

c. banks ‐ foreign currency 7.051 114 20.219 279.583 144.737

d. deposits 40.389.101 124.470.510 84.789.970 55.464.494 43.207.437

e. government securities 1.291.759 ‐ 22.849.891 ‐ 13.372.122

f. deposit pledges 244.975 265.241 267.860 274.990 372.871

SIF MOLDOVA SA

36

2. Financial and accounting status /e. Degree of fulfilment of the Revenue and Expense Budget

Indicator Planned for 2011 Realized H12011 % REALIZED

A. Total revenue 206.094.266 74.762.167 36∙ Revenue from financial investments (dividends) 5.140.000 16.429.195 320∙ Revenue from receivables (banking interest + bonds) 2.000.000 1.536.491 77∙ Revenue from ceded financial investments 186.000.000 40.197.345 22∙ Revenue from exchange rate differences ‐ 1.341.226∙ Revenue from provisions ‐ 303.285‐ Other revenue from operations 12.954.266 12.601.217 97

B. Total expenses 123.882.745 39.338.755 32∙ Expenses related to ceded financial investments 91.000.000 20.499.125 23∙ Expenses related to commissions for transactions 600.000 123.780 21∙ Expenses related to exchange rate diff. ‐ 1.528.013∙ Expenses with banking services 55.000 23.905 43‐ Expenses with provisions ‐ 2.321.847∙ Other financial expenses ‐ 193.668‐ Other expenses with operations 32.227.745 14.648.417 45

C. Gross profit 82.211.521 35.423.412 43D. Profit tax 12.360.327 1.884.077 15

E. Net profit 69.851.194 33.539.335 48

Degree of fulfilment of the investment program

Indicator Planned for 2011 Realized H12011 % REALIZED

Investments in securities (RON) 100.000.000 27.082.818 27

3. Risk management

1. Risk management and portfolio performance optimization

2. Compliance of the categories of assets in the portfolio with ownership limitations provided in legal regulations

37

SIF MOLDOVA SA

3. Risk management / 3.1. Risk management and portfolio performance optimization

INSTRUMENTS

The Application for Risk Managementand Investment Portfolio PerformanceOptimization within the IntegratedComputer System has the followingcharacteristics: The reference portfolio of SIF

Moldova is divided intosubportfolios, with the aim ofimplementing investment strategiesby type of asset, time horizon,strategic objectives, etc.

The comprised subportfolios useadvanced quantitative techniques asan instrument of analysis, with therole of measuring and optimizingportfolio risk depending on theexpected rate of return

The analyzed portfolio indicatorsrepresent the specific risk and rate ofreturn. Alpha, beta, volatility, VAR,etc. are used.

The dynamic optimization ofportfolio holdings takes into accountthe continuous optimization of theperformance / risk ratio, taking intoconsideration the quality of assets inthe portfolio and the effort todiversify existing investments

CONCLUZII

a. The market risk of the portfolio of listed financial instruments traded on the domestic and foreign markets –the value of the beta coefficient as of 30.06.2011, of 0.92, maintains the SIF Moldova portfolio in the moderatemarket risk category, with a volatility ~8% less than the market portfolio

b. The market risk of the SIF Moldova portfolio comprising listed financial instruments compared to the BET Cmarket porfolio – as of 30.06.2011, from 65 issuers in the market portfolio represented by BET C, 38 are in the SIFMoldova portfolio, all contributing to the total rate of return of the Listed shares portfolio, which are traded with5,13% and an associated risk of 10,61%.

c. The market risk of the SIF Moldova share compared to that of other SIFs – we can say that in the first half of2011, the SIF share was an attractive share that increased in value compared to the first half of 2010, contributingto the rate of retirn of the BET FI index, being one of the drivers of this index.

d. The BVS analysis for SIF Moldova – BET C – the analysis of the evolution of the market portfolio representedby the BET C index relative to the evolution of the BVS of SIF Moldova and the closing price of the SIF2 share inthe 01.01.2011‐30.06.2011 period shows the fact that the value of the SIF Moldova portfolio is stronglyinfluenced by the evolution of the market (BET C)

SIF MOLDOVA SA

39

3. Risk Management / 3.2. Compliance of the categories of assets in the portfolio with legal ownership limits(art.188 of CNVM Reg. nr. 15/2004)

*the calculation has not taken into consideration (according to art. 275 (2) of CNVM Regulation no. 15 / 2004 the holding in theRomanian Commercial Bank SA Bucuresti; including it, the weight is 29,35 %

allowed limit: 20% of the totalassets (Securities and monetarymarket instruments not acceptedfor trading ) .

Type of asset Value of asset according to CNVM Regulation no. 15/2004–RON‐

Weight in total assets ‐%‐

Shares held in closed type issuers * Bank depositsMunicipal bonds

39.806.52843.325.228

215.034

3,163,440,02

TOTAL 83.346.791 6,62

b) Securities and / or monetary market instruments issued by the same issuer – admitted limit: 10% of the total assets:

The 10% may be increased up to amaximum of 40%, on the conditionthat the total value of the securitiesand monetary market instrumentsheld by the Company in each of theissuers in which it holds a share ofover 40% should not exceed 80% ofthe value of its assets.

As of Jun 30, 2011 the 10% level provided is exceeded in the BRD Bucuresti holding ( 29.90 %) of the total assets,for which the provisions of the following paragraph are applicable: “In compliance with art. 275 para.(2) of CNVMRegulation CNVM no. 15 / 2004, BRD‐GSG is exempted from the calculation regarding ownership limitationsprovided in art. 188, b)”.

a) Securities and monetary market instruments not accepted for trading

SIF MOLDOVA SA

40

c) Financial instruments issued by entities belonging to the same group

allowed limit: 50% of the totalassets. In the case of the groupSAI belongs to, the allowedlimit is 40%.

Group nameValue of asset according to CNVM

Regulation no. 15/2004–RON-Weight in total assets -%-

Banca Transilvania group, of which :Banca Transilvania sharesBanca Transilvania depositsBT Invest 1 securitiesBT Maxim securities

88.200.24131.012.2301.109.1851.512.000

7,002,460,090,12

BANCA TRANSILVANIA GROUP TOTAL 121.833.656 9,67

The BRD‐GSG, group, of which :BRD – GSG sharesBRD bank depositsBRD Obligatiuni fund units

376.451.32212.312.9981.151.025

29,900,980,09

BRD – GSG GROUP TOTAL 389.915.345 30,97

The Erste Bank‐BCR group, of which :BCR sharesErste Bank sharesBCR Obligatiuni fund unitsESPA BOND DANUBIA fund units

286.224.885591.847

5.754.5253.375.744

22,730,050,460,27

ERSTE BANK – BCR GROUP TOTAL 295.947.001 23,51

The OTP group, of which :OTP Green Energy fund unitsOTP Wise RO fund units

699.155972.128

0,060,08

OTP GROUP TOTAL 1.671.283 0,13

‐ From the BRD‐GSG group – incompliance with art. 275 para.(2) ofCNVM Regulation CNVM no. 15 /2004, BRD shares are exempted, theweight of this group reaching from30,97% to 1,07% .

‐ From the ERSTE BANK‐BCR group –in compliance with art. 275 para.(2) ofCNVM Regulation CNVM no. 15 /2004, BCR shares are exempted, theweight of this group reaching from23,50% to 0,77%

3. Risk Management / 3.2. Compliance of the categories of assets in the portfolio with legal ownership limits (continued)

SIF MOLDOVA SA

d) Exposure to counterpart risk in a transaction with derivative financial instruments outside regulated markets ‐ not applicable

allowed limit: 10% of the total assets In the net assets as of Jun 30, 2011, the value of current accounts and cash is 243.318 RON, representing 0,02%of the value of the assets.

e) The value of current accounts and cash

f) Bank deposits constituted and held in the same bank

allowed limit: 30% of the total assets Total holdings in bank deposits amount to 43.325.228 RON, representing 3,44 % of the assets value.

g) Overall exposure to derivative financial instruments

Allowed limit: may not exceed thetotal net assets value. The value of the derivative financial instruments = 11.250 RON, for net assets worth 1.201.115.559 RON.

h) non‐UCITS securities

allowed limit: 50% of total assets

Non‐UCITS Name Value of asset according to CNVM Regulation no. 15/2004–RON-

Weight in total assets -%-

BT Invest 1 1.109.185 0,09Certinvest Properties RO 2.371.182 0,19Fondul Oamenilor de Afaceri 5.215 0,00OTP Green Energy 699.155 0,06OTP WiseRO 972.128 0,08STK Emergent 278.128 0,02iFOND Financial Romania 1.487.114 0,12iFOND Gold 354.409 0,03TOTAL Non‐UCITS 7.276.516 0,58

3. Risk Management / 3.2. Compliance of the categories of assets in the portfolio with legal ownership limits (continued)

4. SIF 2 shares on the BVB

42

SIF MOLDOVA SA

Market Indices Position within its category

Shares issued by SIF Moldovaare admitted and traded onthe Bucharest Stock Market inthe 1st tier, since Nov 1, 1999.The register of shares andshareholders is maintained incompliance with legalprovisions by the CentralDepository (“S.C. DepozitarulCentral S.A.”) independentdepository company.

June 30, 2011Stock market capitalization:648.861.985 RON(155 mil EURO)Pret: 1,2540 RONEPS: 0,19 RONPER: 7,20P/BV: 1,39DIV Y: 6,7452 m: 0.9250 RON/share52 M: 1.5080 RON/share

SIF 1 SIF 2 SIF 3 SIF 4 SIF 5

BVS 30/06/2011 (RON) 2,6298 2,3139 1,3381 1,6970 2,9046

BVS 31/12/2010 (RON) 2,4810 2,2019 1,3790 1,7500 2,6840

EVOLUTION BVS H1(%) +5,9 + 5,1 ‐2,9 ‐3,0 +8,2

PRICE share 30/06/2011 1,0000 1,2540 0,5130 0,6895 1,3700

DISCOUNT PRICE /BVS (%) ‐60 ‐ 46 ‐62 ‐60 ‐53

EVOLUTION share 2011 (%) +1,2 + 7,9 ‐5,6 +7,1 +8,7PROFIT AS OF H12011 (mil. RON) 14 34 90 10 29

VALUE OF ASSETS(mil euro) 356 297 361 351 430

Evolution of the SIF2 share (June 2010 – June 2011) Relative Performance ‐ SIF 2 versus BET FI (June 2010 –June 2011) 30/06/2010 - 30/06/2011 (BUH)

PriceRON

.1234

0.96

0.99

1.02

1.05

1.08

1.11

1.14

1.17

1.2

1.23

1.26

1.29

1.32

1.35

1.38

1.41

1.44

1.47

PriceRON

.12

20,000

20,400

20,800

21,200

21,600

22,000

22,400

22,800

23,200

23,600

24,000

24,400

24,800

25,200

25,600

26,000

26,400

26,800

05 12 19 26 02 09 16 23 30 06 13 20 27 04 11 18 25 01 08 15 22 29 06 13 20 27 03 10 17 24 31 07 14 21 28 07 14 21 28 04 11 18 26 02 09 16 23 30 06 14 20 27July 2010 August 2010 September 2010 October 2010 November 2010 December 2010 January 2011 February 2011 March 2011 April 2011 May 2011 June 2011

30/06/2010 - 30/06/2011 (BUH)

PriceRON

.1234

0.96

1

1.04

1.08

1.12

1.16

1.2

1.24

1.28

1.32

1.36

1.4

1.44

VolumeRON

.1234500,000

1M

1.5M

2M

2.5M

3M

3.5M

4M

4.5M

05 12 19 26 02 09 16 23 30 06 13 20 27 04 11 18 25 01 08 15 22 29 06 13 20 27 03 10 17 24 31 07 14 21 28 07 14 21 28 04 11 18 26 02 09 16 23 30 06 14 20 27July 2010 August 2010 September 2010 October 2010 November 2010 December 2010 January 2011 February 2011 March 2011 April 2011 May 2011 June 2011

5. Protection of SIF Moldova interests –status of litigations

44

SIF MOLDOVA SA

45

Litigations in which SIF Moldova is a PLAINTIFF ()

1. Litigations involving the repealment of illegal resolutions ofGeneral Assemblies of Shareholders in the SIF Moldova portfolio= 41 cases, of which 6 cases finalized up to 30.06.2011 and 41 incourt in various stages of litigation.

‐ total litigations = 166cases, of which 145 casesare in court in variousjudicial stages and 21cases are solved;

‐ value of litigations incourt: 52.515.776 RON(12.528.640 RONinsolvency procedure,39.987.135 RON claims)800.000 USD ‐contestations forfulfillment.

Litigations in which FIC MOLDOVA is a defendant (annex 3)

3. Litigations involving the insolvency procedure = 21 cases incourt .

2. Litigations involving claims = 63 cases, of which 3 cases weresolved as of 30.06.2011, 60 cases remaining in court in variousjudicial stages.

4. Litigations with various objects = 11 cases, of which 7 werein court in various stages and 4 were solved

5. Criminal litigations = 17 cases, of which 4 cases werefinalized as of 30.06.2011 and 13 remain in court in priorinvestigations or in trial.

6. Litigations involving draft oppositions and contestations tothe foreclosure of promissory notes endorsed by FPP IIMoldova = 7 cases.

‐ total litigations = 73cases,of which 69 cases are incourt in various judicialstages and 4 cases aresolved;

‐ value of litigations incourt: 422.354 RON claims23.598.575 RON ‐contestations forfulfillment.

1. Litigations with various objects and claims cases = 16 cases incourt in various judicial stages .

2. Litigations with contestations for fulfillment = 42 casesinitiated by AVAS, as a consequence of foreclosures by SIFMoldova in litigations involving judicial expenses and thecancellation of foreclosure against AVAS.

3. Litigations involving the repealment of decisions of GeneralAssemblies of Shareholders of SIF Moldova = 6 cases in court invarious judicial stages .

Detailed presentation by category / case in

annex 3

6. Relations with shareholders. Dividend policy

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47

a. In relation to capital market institutions b. In relations with shareholders

Periodic reports towards CNVM and BVB Continual reports towards CNVM and

continuous reports towards BVB Monthly reports towards CNVM in

compliance with Instruction no. 1/2007 Monthly reports towards BNR / CNVM in

compliance with EC Regulation no. 958/2007annex 4

in the year 2010, obligations to inform SIF Moldova shareholders were respected and ensured by the issuance ofpress releases, publishing of reports, information through the electronic system of the capital market and posted onthe Company website, offering equal treatment to shareholders. Communication with shareholders takes placethrough all methods at their disposal. Most of the correspondence is aimed at information related to the payment ofdividends (amount, means of payment, procedures, deadlines, etc.), transfers occasioned by death (procedures,amount of dividends due, etc.), update of personal information, means of trading, financial reporting data (periodicreports, net assets, etc.), information related to tax regulations, tax regimes for non‐residents (direct correspondence,custodians or other proxies) and information related to the conduct of the General Assemblies of Shareholders, etc.

Transparency and financial reporting

Shareholding structure as of 30/06/2011

Status of dividends paid as of 30/06/2011

Consolidated structure

30/06/2011

Natural Persons Legal Persons TOTAL

Shareholders Shares % SC Shareholders Shares % SC Shareholders Shares % SC

Residents 5.824.172 288.158.347 55,51 365 96.959.961 18,68 5.824.537 385.118.308 74.19

Non-residents 1.468 11.208.422 2,16 99 122.762.858 23.65 1.567 133.971.280 25,81

TOTAL 5.825.640 299.366.769 57,67 464 219.722.819 42.33 5.826.104 519.089.588 100,00

Dividend payments:Dividend 2008 Dividend 2009 Dividend 2010

0.0450 RON /share 0.0600 RON/share 0.0900 RON/share

1 Total dividend payable (RON) 23.359.032 31.145.375 46.718.063

2 Total paid up to 30/06/2011 (RON) 18.012.158 23.190.437 4.784.050

% paid as of 30/06/2011 77.11 74.46 10.24

7. Compliance control

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SIF MOLDOVA SA

49

Activitatea de audit intern Internal control activity

The internal auditing activity is carried out based on the engagement plan set inaccordance with the Company objectives. The plan for internal auditingactivities and the necessary resources are approved by the Auditing Committeeand approved by the Board of Directors. Also, significant intermediary changesarisen are submitted for approval. The auditing plan for 2011 was approved inthe meetings of the Board of Directors of February 25, 2011.

The internal auditing missions carried out in the Jan 1, 2011 – Jun 30, 2011period were aimed at:

the organization and conduct of the meetings of the Board of Directors‐ assurance mission;

The drafting of the yearly financial statements drafted as of 31.12.2010‐ assurance mission;

Participation in the analysis and drafting of materials subject to debatein the EGAS and OGAS of Apr 21 / 22, 2011 – consultancy mission;

Transactions with financial instruments and derivative financialinstruments – assurance mission;

The elaboration of opinions on request by managers or acting leaders.

The recommendations formulated as a result of consultancy missions carriedout at the request of specific mission were communicated to the PresidentGeneral Manager to the end of being used in order to serve as the basis formanagement decisions. The internal auditor's opinion, activity results,conclusions, recommendations and proposals, as well as the plan of actionsapplied in the course of the audit activity, were included in the periodic internalaudit report presented to the Auditing Committee and to the Board ofDirectors.

In compliance with the provisions of art. 37‐41 of CNVM Regulation no. 15 / 2004and with the Investigations Plan approved in the the Board of Directors’ meeting ofFeb 25, 2011 and transmitted to CNVM with address no. 1543/28.02.2011, theactivity of the Internal Control Department in the first half of 2011 consisted of thefollowing:

Control regarding compliance with CNVM regulations and internal regulationsand procedures regarding the SIF Moldova investment policy.

Control regarding compliance with � CNVM regulations and internalregulations and procedures regarding the regime of privileged information.

Control regarding compliance with � CNVM regulations and internalregulations and procedures regarding the evaluation of assets held.

Permanent activities of the Internal Control Department: Diligences for preventing and proposals for correcting the situations of

non‐compliance with laws and regulations in force relevant to thecapital market or internal regulations and procedures by SIF Moldova orits employees;

Informing SIF Moldova and its employees about the legal regulationsapplicable to the capital market;

Monitoring of compliance with prudence regulations; Examining the effectiveness of the information system and of internal

procedures; Analysis and approval of documents and reports sent to CNVM and

capital market entities; informative and advertising materials; internaldocuments comprising operations subjected to the internal control visa;

Record‐keeping and supervising the resolution of complaints; Examining the effectiveness of the risk control system.

The irregularities and recommendations were communicated to themanagement of SIF Moldova SA and remedied / implemented during thecontrols carried out.

Within SIF Moldova, ensuring conformity is an integrated, procedural process, mainly aimed at Internal Auditing,Internal Control and Risk Management activities. The whole of this mechanism is used to fundament, elaborate andadopt decisions.

8. Corporate governance

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SIF MOLDOVA SA

51

SIF Moldova, as an issuer listed in the 1st tierof the BVB, is permanently aiming atrespecting corporate governance principlesset forth in the Corporate GovernanceRegulation – in the following directions:

Corporate governance structures

Respecting shareholder

rights

Activity of the Board of Directors

Transparency, financial reporting, internal

control and risk

management

Conflicts of interest and transactions

with involved persons

The regime of corporate information

The issuer’s social

responsibility

SIF Moldova has elaborated aRegulation of Corporate Governancethat describes the main aspects ofcorporate governance, a documentapproved by the Board of Directors.The corporate governance regulationos posted on the Company website,www.sifm.ro. In the Regulation ofCorporate Governance are definedcorporate governance structures,functions, competencies andresponsibilities of the Board ofDirectors and of executivemanagement.

On the website, information isdisseminated regarding the SIFMoldova corporate governance policy:Description of corporate governancestructures; list of BD members, of themembers of executive leadership,with the short variant of the resumefor each memberUpdated articles of associationInternal functioning rules comprisingessential aspects for the organizationand functioning of internalcompartments, in the form of„Internal regulations”, a documentsubmitted for the approval of CNVM(the latest update, through CNVMapproval no. 20/14.06.2011)Declaration „Apply or Explain”

In the process of optimizing internal structures,Internal Regulations were revised and re‐approved– the main changes involving the independence ofthe risk management activity as well as temporaryand limited delegations of responsibility towardsnon‐executive managers. CNVM has approved themodifications in the Internal Regulations withapproval no. 20/14.06.2011.

9. Human resource management

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53

increasing the degree ofspecialization of staff in order toallow the exploitation of thecapabilities of the integratedcomputer system

periodic analysis of the functionalpositions and the way in whichthey respond to the requirementsto cover the general assignmentsof the departments within theorganizational chart.(approved byCNVM – approval no.20/14.06.2011)

number of employees as of30.06.2011: 78 permanentemployees, 2 executive managerswith management contracts and 5non‐executive managers withadministration contracts.

FIELDS OF AC

TION / M

AIN DATA

Evaluation of employee individualperformance in order to measureresults compared toorganizational ibjectives and therequired standard and level ofcompatence.

GENERAL ASSEMBLY OF SHAREHOLDERS

BOARD OF DIRECTORS

PRESIDENT GENERAL MANAGER

VICEPRESIDENT ASSISTANT GENERAL MANAGER

ECONOMIC DEP

ARTM

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INVE

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LICIES DEP

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FIELD OFFICES

AUDITING COMMITTEE

INTERNAL AUDITING

INTERNAL CONTROL

LEGAL

SER

VICE

INVESTMENT POLICIES AND STRATEGIES COMMITTEE

SIF MOLDOVA SA

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Annexes

1. Status of net assets as of 30.06.2011. Detailed status of SIF Moldova assets as of 30.06.2011.2. Financial statements as of 30.06.2011 accompanied by the revision report drafted by the financialauditor.3. Status of litigations as of 30.06.20114. Reports towards BVB, CNVM in the first half of 2011

Approvals

The report of the Board of Directors was approved in the Board of Directors' meeting of 28.07.2011and is signed on its behalf by the President.

Signatures

President & CEOFinancial Manager

Costel CEOCEA Liana MARIN

Internal controlNicolae RADULESCU

Internal auditingVirginia SOFIAN

REPORT OF THE BOARD OF DIRECTORS · 2011. 8. 10. · SIF MOLDOVA SA 4 1.1. Description of the...

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