ABN AMRO BANK NV, 20-F, 2000-04-20

ABN AMRO BANK NV
20-F, 2000-04-20

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SECURITIES AND EXCHANGE COMMISSION
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FORM 20-F

(MARK ONE)

<TABLE>
<S> <C>
/ / REGISTRATION STATEMENT PURSUANT TO SECTION 12(B) OR (G)
OF THE SECURITIES EXCHANGE ACT OF 1934
OR
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
FOR THE FISCAL YEAR ENDED DECEMBER 31, 1999
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
</TABLE>

COMMISSION FILE NUMBERS 1-14624, 5-52647

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ABN AMRO HOLDING N.V.
ABN AMRO BANK N.V.

(EXACT NAME OF REGISTRANTS AS SPECIFIED IN THEIR CHARTERS)

THE NETHERLANDS

(JURISDICTION OF INCORPORATION OR ORGANIZATION)

GUSTAV MAHLERLAAN 10, 1082 PP AMSTERDAM
THE NETHERLANDS
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

Securities registered pursuant to Section 12(b) of the Act.

<TABLE>
<CAPTION>
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH REGISTERED
- ------------------- -----------------------------------------
<S> <C>
Ordinary Shares(1)........................... New York Stock Exchange(1)
American Depositary Shares, each representing
one Ordinary Share......................... New York Stock Exchange
</TABLE>

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(1) Not for trading, but only in connection with the listing of American
Depositary Shares, pursuant to the requirements of the New York Stock
Exchange.

Securities registered pursuant to Section 12(g) of the Act.

None

Securities for which there is a reporting obligation pursuant to
Section 15(d) of the Act.

None

Indicate the number of outstanding shares of ABN AMRO Holding N.V.'s classes
of capital or common stock as of the close of the period covered by the annual
report.

<TABLE>
<S> <C>
Ordinary Shares (NLG 1.25).................................. 1,468,159,769
Non-cumulative Preference Shares (NLG 5.00)................. 362,503,010
Convertible Preference Shares (NLG 5.00).................... 1,420,089
Priority Share (NLG 5.00)................................... 1
</TABLE>

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months and (2) has been subject to such filing
requirements for the past 90 days.

Yes /X/ No / /

Indicate by check mark which financial statement item the registrant has
elected to follow.

Item 17 / / Item 18 /X/

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<PAGE>
TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Certain Definitions......................................... ii
Enforcement of Civil Liabilities............................ ii
Presentation of Information................................. ii
Cautionary Statement on Forward-Looking Statements.......... iii
Exchange Rates.............................................. iii

ITEM CAPTION

PART I
1. Description of Business.................................. 1
2. Description of Property.................................. 50
3. Legal Proceedings........................................ 51
4. Control of Registrant.................................... 51
5. Nature of Trading Market................................. 53
6. Exchange Controls and Other Limitations Affecting
Security Holders.......................................... 54
7. Taxation................................................. 55
8. Selected Financial Data.................................. 58
9. Management's Discussion and Analysis of Financial
Condition and Results of Operations....................... 63
9A. Quantitative and Qualitative Disclosures About Market
Risk...................................................... 90
10. Directors and Officers of Registrant.................... 90
11. Compensation of Directors and Officers.................. 92
12. Options to Purchase Securities from Registrant or
Subsidiaries.............................................. 93
13. Interest of Management in Certain Transactions.......... 94

PART II

14. Description of Securities to Be Registered.............. 95

PART III
15. Defaults upon Senior Securities......................... 95
16. Changes in Securities and Changes in Security for
Registered Securities and Use of Proceeds................. 95

PART IV

17. Financial Statements.................................... 95
18. Financial Statements.................................... 95
19. Financial Statements and Exhibits....................... 95
</TABLE>

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CERTAIN DEFINITIONS

As used herein, "Holding" means ABN AMRO Holding N.V. The terms "ABN AMRO,"
"us," "we" and "our company" refer to Holding and its subsidiaries. The "Bank"
means ABN AMRO Bank N.V. and its subsidiaries.

As used herein, "EUR" refers to euros, "NLG" refers to Dutch guilders and
"USD" or "$" refers to U.S. dollars.

ENFORCEMENT OF CIVIL LIABILITIES

Holding is organized under the laws of The Netherlands and the members of
its Supervisory Board, with one exception, and its Managing Board are residents
of The Netherlands or other countries outside the United States. Although
certain of our affiliates have substantial assets in the United States,
substantially all of Holding's assets and the assets of the members of the
Supervisory Board and the Managing Board are located outside the United States.
As a result, it may not be possible for investors to effect service of process
within the United States upon Holding or such persons or to enforce against
Holding or such persons in United States courts judgments of such courts
predicated upon the civil liability provisions of United States securities laws.
Holding has been advised by legal counsel in The Netherlands that the United
States and The Netherlands do not currently have a treaty providing for
reciprocal recognition and enforcement of judgments in civil and commercial
matters. Therefore, a final judgment for the payment of money rendered by any
federal or state court in the United States based on civil liability, whether or
not predicated solely upon United States federal securities laws, would not be
enforceable in The Netherlands. However, if the party in whose favor such final
judgment is rendered brings a new suit in a competent court in The Netherlands,
such party may submit to a Dutch court the final judgment which has been
rendered in the United States. If the Dutch court finds that the jurisdiction of
the federal or state court in the United States has been based on grounds that
are internationally acceptable and that the final judgment concerned results
from proceedings compatible with Dutch concepts of due process, to the extent
that the Dutch court is of the opinion that reasonableness and fairness so
require, the Dutch court would, in principle, under current practice, recognize
the final judgment that has been rendered in the United States and generally
grant the same claim without relitigation on the merits, unless the consequences
of the recognition of such judgment contravene public policy in The Netherlands.

PRESENTATION OF INFORMATION

Holding was incorporated under Dutch law on May 30, 1990. Holding owns all
of the shares of the Bank, and itself has no material operations.

The consolidated financial statements of ABN AMRO include the consolidated
financial statements of the Bank, which itself had total assets of EUR
457,966 million as of December 31, 1999. As of such date and for the year then
ended, the Bank accounted for approximately 100% of ABN AMRO's consolidated
assets, consolidated total revenue and consolidated net profit.

Unless otherwise indicated, the financial information contained in this
Annual Report on Form 20-F has been prepared in accordance with Dutch generally
accepted accounting principles, or Dutch GAAP, which, as disclosed in note 43 to
the Consolidated Financial Statements, vary in certain significant respects from
accounting principles generally accepted in the United States, or U.S. GAAP.

Unless otherwise indicated, references to loans include advances, finance
leases and operating leases, and market share statistics for the Netherlands
Division are based on monthly compilations of statistics by De Nederlandsche
Bank N.V., the Dutch Central Bank. Additionally, geographic analyses of loans
are, unless otherwise specifically indicated, based on the location of the
branch or office from which the loan is made.

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All annual averages in this Report are based on month-end figures.
Management does not believe that such month-end averages present trends
materially different than those that would be presented by daily averages.

All Ordinary Share and per share data have been retroactively adjusted for a
four-for-one stock split of the Ordinary Shares effected on May 12, 1997. Unless
otherwise indicated, all amounts from prior years shown herein have been
restated in euros.

The financial information for periods prior to January 1, 1999 has been
converted from Dutch guilders to euros using the Dutch guilder to euro fixed
conversion rate determined as of December 31, 1998 by the participating
countries of the European Monetary Union of 1 EUR=2.20371 NLG.

CAUTIONARY STATEMENT ON FORWARD-LOOKING STATEMENTS

Certain of the statements contained in this Report that are not historical
facts, including, without limitation, certain statements made in the sections
hereof entitled Item 1--"Description of Business," Item 5--"Nature of Trading
Market," Item 8--"Selected Financial Data," and Item 9--"Management's Discussion
and Analysis of Financial Condition and Results of Operations," are statements
of future expectations and other forward-looking statements under Section 21E
under the Securities Exchange Act of 1934, as amended, that are based on
management's current views and assumptions and involve known and unknown risks
and uncertainties that could cause actual results, performance or events to
differ materially from those expressed or implied in such statements. Actual
results, performance or events may differ materially from those in such
statements due to, without limitation, (i) general economic conditions,
(ii) performance of financial markets, (iii) interest rate levels,
(iv) currency exchange rates, including the euro-- or Dutch guilder--U.S. dollar
exchange rate, (v) changes in laws and regulations, including monetary
convergence and the European Monetary Union, (vi) changes in the policies of
central banks and/or foreign governments, and (vii) competitive factors, in each
case on a global, regional and/or national basis. See Item 9--"Management's
Discussion and Analysis of Financial Condition and Results of
Operations--Introduction."

EXCHANGE RATES

The following table shows, for the years indicated, certain information
regarding the Noon Buying Rate in the City of New York for cable transfers in
euros as certified for customs purposes by the Federal Reserve Bank of New York
expressed in euros per U.S. dollar. For the years 1995 through 1998, the USD/EUR
rate was derived by dividing the USD/NLG rate in those years by the Dutch
guilder to euro fixed conversion rate of 2.20371.

<TABLE>
<CAPTION>
PERIOD AVERAGE
YEAR END(1) RATE(1)(2) HIGH LOW
- ---- -------- ---------- -------- --------
<S> <C> <C> <C> <C>
1995 0.73 0.73 0.79 0.69
1996 0.79 0.77 0.80 0.73
1997 0.92 0.89 0.96 0.79
1998 0.85 0.90 0.95 0.82
1999 0.99 0.93 0.99 0.86
</TABLE>

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(1) In certain cases, the Noon Buying Rate at such dates differed from the rates
used in preparation of the Consolidated Financial Statements. See "Currency
Translation" under "Accounting Policies" in the Consolidated Financial
Statements.

(2) The average rate for each period is the average of the Noon Buying Rates on
the last day of each month during the period.

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A significant portion of our assets and liabilities are denominated in
currencies other than the euro. Accordingly, fluctuations in the value of the
euro relative to other currencies can have an effect on our financial
performance. See Item 9--"Management's Discussion and Analysis of Financial
Condition and Results of Operations." In addition, changes in the exchange rate
between the euro and the U.S. dollar are reflected in the U.S. dollar equivalent
to the price of the Ordinary Shares on the AEX Stock Exchange and, as a result,
affect the market price of Holding's American Depositary Shares, or ADSs, in the
United States. Cash dividends are paid by Holding in respect of the Ordinary
Shares in euros, and exchange rate fluctuations will affect the U.S. dollar
amounts of the cash dividends received by holders of ADSs on conversion by
Morgan Guaranty Trust Company of New York, the Depositary for the ADSs.

iv
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PART I

ITEM 1. DESCRIPTION OF BUSINESS

We are a "universal banking" group offering a wide range of commercial and
investment banking products and services on a global basis through our network
of approximately 3,600 offices and branches in 76 countries. Our company is one
of the largest banking groups in the world, with total consolidated assets of
EUR 457.9 billion at December 31, 1999. In addition to being the largest banking
group based in The Netherlands, we also have a substantial presence in the
United States, as one of the largest foreign banking groups based on total
assets held in the country. We also have a significant presence in Brazil, which
together with The Netherlands and the Midwestern United States, is one of the
Bank's three "home" markets.

Our strategy is to use our strong capital base to pursue both organic growth
and expansion through acquisitions with the goal of enhancing our position in
key regions, broadening the range of products and services we offer and entering
new markets that we believe have significant long-term growth and profitability
potential without compromising our ability to achieve our targets for financial
performance. Our expansion strategy targets relatively homogeneous market areas
which offer an attractive long-term macro-economic environment and adequate
critical mass for commercial and investment banking services, with a focus on
Europe and the United States.

In 1999, we acquired interests in each of Banca di Roma, Banca Nazionale
dell'Argricoltura and Interbanca SpA. Additionally, we acquired a controlling
interest in Great Pacific Savings Bank and increased our controlling interest in
Banco Real. In addition, we made an offer to purchase all of the outstanding
shares of Bouwfonds, a Dutch mortgage and real estate institution. The offer was
declared unconditional in January 2000 and has been accepted by all of the
shareholders and is worth approximately EUR 1.2 billion. The acquisition is
designed to form a strategic alliance between us and Bouwfonds for the
development, financing and management of real estate in Europe. The acquisition
also considerably increases our consolidated share of the Dutch residential
mortgage market.

As part of our strategy, we also have made a substantial investment in
e-commerce, to, among other things, facilitate e-commerce initiatives, stimulate
initiatives in new markets and increase our effectiveness by leveraging
e-commerce resources worldwide. For example, during 1999, we launched an
Internet e-broker service as part of the positioning of e-banking in its focus
areas of Europe, the U.S. Midwest and Brazil. Additionally, in the
business-to-business segment, during 1999, we launched a service targeted at
small- and medium-sized enterprises internationally, which is intended to lower
trade barriers to these companies by opening up global supplier and buyer
information. We also are participating in Identrus, a global certificate
authority. In an effort to coordinate our use of e-commerce, in June 1999, we
created a new Directorate General for e-commerce.

The Bank is the result of a merger, effective September 22, 1991, between
Algemene Bank Nederland N.V. and Amsterdam-Rotterdam Bank N.V. Prior to the
merger, these banks were, respectively, the largest and second-largest banks in
The Netherlands. The Bank traces its origin to the formation of the
"Nederlandsche Handel--Maatschappij, N.V." in 1825 pursuant to a Dutch Royal
Decree of 1824.

OPERATING DIVISIONS

The Bank and its numerous subsidiaries are organized into three operating
divisions: the Netherlands Division, the International Division and the
Investment Banking Division. In addition, the Bank owns ABN AMRO Lease Holding
N.V., an independently managed subsidiary. The operating divisions are supported
by common staff functions that include the Risk Management Division, the
Resources Management Division and Policy Support. During 2000, the Netherlands
Division, together

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with the operations from the International Division in the EU countries and
Switzerland, will be incorporated into a newly established European Division.

The following table indicates for 1999 the contribution made to total
revenue, operating profit before taxes and risk-weighted total assets by each
operating division and ABN AMRO Lease Holding, as well as the number of offices
and branches for each division and ABN AMRO Lease Holding.

<TABLE>
<CAPTION>
OPERATING
PROFIT RISK-WEIGHTED OFFICES AND
TOTAL REVENUE BEFORE TAXES TOTAL ASSETS BRANCHES
------------------- ------------------- ------------------- -----------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES, OFFICES AND BRANCHES)
<S> <C> <C> <C> <C> <C> <C> <C>
Netherlands Division..................... 3,989 26% 1,369 32% 74,901 31% 915
International Division................... 8,639 55% 2,206 52% 143,065 58% 2,606(1)
Investment Banking Division.............. 2,347 15% 502 12% 20,473 8% 69(1)
ABN AMRO Lease Holding................... 552 4% 128 3% 7,935 3% 37
Non-allocated results.................... 25 1%
Release from Fund for general banking
risks.................................. 20
------ --- ----- --- ------- --- -----
Total.................................... 15,527 100% 4,250 100% 246,374 100% 3,589
====== === ===== === ======= === =====
</TABLE>

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(1) 38 offices are shared by the International and Investment Banking Divisions.

NETHERLANDS DIVISION

Operating through the Bank's network of 915 branches and complementary
distribution channels such as electronic and telephone banking, the Netherlands
Division provides a wide range of retail and corporate banking products and
services, including deposit accounts, commercial and personal loans, mortgage
lending, consumer finance, structured finance, securities brokerage services and
insurance. The Bank services the entire Dutch retail and corporate banking
market, with products and services targeted to the financial needs of specific
customers.

At December 31, 1999, the Netherlands Division had total customer loans of
EUR 88.6 billion and total customer deposits of EUR 91.9 billion, resulting in a
19% share of total lending and a 25% share of total client accounts, making us
one of the leading financial institutions in The Netherlands. Lending activity
is comprised of commercial lending to small, medium- sized and large
corporations, representing 43% of total private sector loans of the Netherlands
Division at December 31, 1999 and home mortgage and other retail lending,
representing 57% of total private sector loans at the same date. Retail and
corporate customers hold approximately 3.5 million and 0.5 million current
accounts, respectively, which provide the Bank with a stable source of funding.

We believe that a market-oriented, commercial organization centered on the
customer's interests is the key to successfully responding to market
developments. The responsibility for customer satisfaction, which we frequently
measure, market share, profitability and the quality of local operations has
over the last few years been moved to the local branches, many of which have
been transformed into local businesses that operate with substantial autonomy
and are capable of providing on a real-time basis products and services
responsive to client needs. In order to further enhance the quality of our
customer service, we also have in place uniform guidelines for all staff in the
Netherlands Division that work directly with customers.

Our company also has introduced new distribution channels to meet the needs
of its customers, particularly younger customers. For example, we have broadened
our distribution channels through electronic and Internet banking, cash
dispensers, direct mail and "ABN AMRO 24 X 7," an around-the-clock telephone
banking and securities trading service.

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Part of our growth strategy in The Netherlands also is to position the Bank
as a provider of integrated banking and insurance products. The Bank currently
acts as an insurer and authorized underwriting agent directly or through
subsidiaries and also provides insurance brokerage activities.

The Netherlands Division is being incorporated into a new European Division,
effective in the course of 2000. The resulting broader market base will support
more substantial investment in meeting clients' requirements. The organizational
structure in the Netherlands will be adapted to that of the future European
Division by dividing the three main functions of the bank into identifiable
streams--client management or sales, business development and operations. The
aim is to further deepen our client contacts and improve our time-to-market
while also enhancing our internal efficiency.

INTERNATIONAL DIVISION

The International Division provides banking and other financial services,
including complex financial products, to our multinational corporate client base
through our network of 2,606 offices and branches in 68 countries and
territories worldwide. Through acquisitions of local financial services
businesses and organic growth, we also have established in selected countries a
significant local business franchise that provides banking and other financial
products and services to larger local business clients with a regional or
multinational orientation, in addition to servicing private banking and consumer
banking clients.

At year-end 1999, the Bank had consumer banking operations in 23 countries.
We intend to pursue consumer banking on a selective basis through potential
acquisitions of strong local banks in major economies or emerging markets and
the integrated delivery of customized financial products and services supported
by a standard information technology platform, uniform marketing, multichannel
distribution and data base mining. In considering expansion into a particular
geographic region, our evaluation includes not only the local opportunity but
also the potential for contribution to the rest of our global network.

The following table indicates the contribution for 1999 made to total
revenue, operating profit before taxes and total risk-weighted assets by each
region in the International Division, as well as the number of offices and
branches of the International Division at December 31, 1999 by region.

<TABLE>
<CAPTION>
OPERATING PROFIT RISK-WEIGHTED OFFICES AND
TOTAL REVENUE BEFORE TAXES TOTAL ASSETS BRANCHES
-------------------- ------------------------- ------------------- -----------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES, OFFICES AND BRANCHES)
<S> <C> <C> <C> <C> <C> <C> <C>
Europe (excluding The
Netherlands)....... 1,590 18% 353 16% 30,478 21% 175
North America........ 3,706 43% 1,129 51% 74,722 52% 445
Latin America and the
Caribbean.......... 2,289 26% 576 26% 12,504 9% 1,716
Middle East and
Africa............. 139 2% (52) (2)% 2,165 2% 70
Asia/Pacific......... 915 11% 200 9% 23,196 16% 200
----- --- ----- ---- ------- --- -----
Total International
Division........... 8,639 100% 2,206 100% 143,065 100% 2,606
===== === ===== ==== ======= === =====
</TABLE>

EUROPE (EXCLUDING THE NETHERLANDS)

We use our network of 175 offices and branches in 27 European countries and
territories outside The Netherlands, including all of the member states of the
European Union, to deliver sophisticated corporate banking and other financial
services to multinational and large local corporations. Products include trade
finance, structured and project finance, electronic banking services, cash
management and

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netting of international payments. We also provide private banking services to
clients in, among other, the following countries: France; Germany; Jersey;
Luxembourg; Monaco; and Switzerland.

Throughout 2000, offices and branches in EU-countries and Switzerland will
be structured to a newly established European Division. Operations in Central
and Eastern Europe will be combined with those in the Middle East & Africa into
a new region.

We intend to continue to expand our Western European business through both
internal growth and acquisitions. In 1999, we acquired an 9.65% interest in
Banca di Roma, a major Italian banking group, for EUR 0.7 billion. We also
intend to increase our ownership interest in Banca Antoniana Populare Veneta, a
rapidly growing bank operating in Northern Italy. We also acquired an ownership
interest in Interbanca, a merchant bank majority controlled by Banca Antoniana
Populare Veneta. We believe that the trend towards consolidation in the European
financial sector will continue.

In Central and Eastern Europe, we have established significant consumer
banking operations in Hungary and Poland through the acquisition of local banks,
and currently have offices in the Czech Republic, Kazakstan, Romania, Russia and
Uzbekistan. We believe that this region continues to provide attractive growth
opportunities. As a result, our strategy in this region is to continue to grow
internally and to pursue selective acquisitions that satisfy our acquisition
criteria, including expanding our network in Central Europe by opening in 2000 a
branch in Baku, Azerbeijan to offer our clients in the oil and gas industry a
better service.

NORTH AMERICA

We are one of the largest foreign banking groups in the United States, based
on total assets held in the United States of EUR 133.9 billion, or
$134.3 billion, at December 31, 1999. We have 439 offices and branches and
18,755 full-time equivalent employees in the United States. We also have 6
offices and branches in Canada and Mexico.

Our principal U.S. banking operations are in the Midwestern United States,
where we have had a substantial presence since 1979. The banks and savings
institutions which form the LaSalle Group comprise one of the largest banking
groups in the Chicago metropolitan area and provide retail, private banking and
home mortgage banking services in the Chicago metropolitan area and small and
middle market business loans in the Midwest and other regions. Our Midwestern
operations also include Standard Federal and our Bell Federal Bank division in
Chicago, which were acquired during 1997. The mortgage origination and servicing
entities of the LaSalle Group and Standard Federal have been integrated and are
the eighth largest mortgage originators in the United States.

In the metropolitan New York City area, we own European American Bank, which
provides retail banking, private banking and small and middle market business
loans. European American Bank also has recently entered the equipment leasing
business. In addition, in early 2000, it purchased Olympian Bank, a small
privately held commercial bank in Brooklyn, New York.

In 1999, we acquired Atlantic Mortgage & Investment Corporation, a Florida
based mortgage servicing provider, establishing a presence in the south-eastern
United States. As the consolidation of the U.S. banking and financial services
industries continues, we will continue to consider additional acquisition
opportunities.

One of our capital markets subsidiaries, ABN AMRO Securities (USA)
underwrites and trades corporate debt and equity securities, subject to certain
limitations. ABN AMRO Incorporated, which was The Chicago Corporation, a
Chicago-based investment bank, before it was acquired in 1997, provides us with
futures, securities and options clearing and trading capability, in addition to
providing investment banking services to middle market corporate customers,
particularly in the Midwestern United States. We also own Sage Clearing Limited
Partnership, a leading market maker clearing firm, which we acquired in 1998.

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In addition, our company operates eleven branches or agencies in major
cities throughout the United States. These branches and agencies are dedicated
primarily to servicing major local corporations and large multinational
corporations in their U.S. activities.

LATIN AMERICA AND THE CARIBBEAN

At December 31, 1999, we had 1,716 offices and branches in 14 Latin American
and Caribbean countries. The acquisitions of Banco Real and Bandepe in 1998
reflect our strategy of becoming a leading regional network bank in Latin
America and the Caribbean, and we are now the fourth-largest privately held bank
in Brazil and the leading local provider of consumer finance. The Bank also has
a strong market position in Columbia, Paraguay and Uruguay. In connection with
our acquisition of a controlling interest in Banco Real, we also acquired a
number of related businesses, including a residential mortgage finance company,
an asset management company and insurance companies with activities in Brazil
and five other Latin American and Caribbean countries.

Our regional network in Latin America facilitates the delivery of trade
finance and other banking services to multinational corporations and other
businesses, as well as structured finance and capital markets services,
particularly in Argentina, Brazil and Chile. In addition, we have implemented
uniform information technology standards in most countries in the region and has
a regional processing center in Miami in order to increase operating
efficiencies. Additionally, in April 2000, Banco Real and Banco ABN AMRO were
integrated into Banco ABN AMRO Real. This new combination has 1,581 branches and
19,936 employees. This will allow us to better realize certain cost synergies.

MIDDLE EAST AND AFRICA

In the Middle East, we have offices in Bahrain, Lebanon, Saudi Arabia,
through our 40% interest in Saudi Hollandi Bank, and the United Arab Emirates.
In Africa, the Bank's operations are located in Kenya, Morocco and South Africa.
Our network in this region consists of 70 offices.

ASIA/PACIFIC

Our network of 200 offices and branches in this region is extensive, with
locations in Australia, China, Hong Kong, India, Indonesia, Japan, Malaysia,
Pakistan, the Philippines, Singapore, South Korea, Sri Lanka, Taiwan, Thailand
and Vietnam. Management and product specialists for the region are centralized
in Singapore. Our corporate banking activities in the Asia/Pacific region have
emphasized project finance, reflecting the financing requirements of the region
for major infrastructure improvements, energy facilities and telecommunications.

Despite the recent crisis in the Asian financial markets, we are committed
to the goal of substantially increasing the contribution of Asian operations. In
1998, the Bank purchased 77% of the equity of Bank of Asia, a Thai bank focusing
principally on middle market corporate and retail customers. In 1999, we
purchased from Bank of America the consumer banking business in Taiwan,
Singapore and India and the credit card issuance and acquiring businesses in
Taiwan. Total expansion of staff was about 760. In Taiwan, the acquisition is
expected to provide critical mass to the Taiwan card business and costs
synergies by merging the two card operations. Furthermore, we acquired a
controlling stake in the Great Pacific Savings Bank, headquartered in Manila,
the Philippines. We intend to further expand our consumer banking activities in
the Asia/Pacific Region. In addition, the Bank is seeking to increase the
delivery of non-lending corporate products, such as treasury, cash management
and trade finance in the region.

INVESTMENT BANKING DIVISION

The Investment Banking Division provides integrated investment banking
services, primarily under the "ABN AMRO" name, to large corporations,
governments, institutional investors and private

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investors in 48 countries. We are one of the largest European securities firms
in terms of geographic spread, new issues activities, trading and placement
volume and research.

In recent years, we have acquired a number of major investment banking
businesses in various markets around the world. These include Hoare Govett in
the United Kingdom, CIMO in Italy, Alfred Berg in Scandinavia, Chicago
Corporation in the United States, HG Asia in the Far East and a stake in
Huysamer Stals in South Africa. In addition, we have established or acquired
securities subsidiaries in various markets in Central and Eastern Europe and
Latin America. In June 1999, we acquired a 59% interest in Delta Egypt, a
stockbroker located in Egypt, in order to expand our network and develop our
pan-European trading strategy.

In addition, the Bank has established a joint venture with Mellon Bank for
custody services. The joint venture, which operates under the name ABN AMRO
Mellon Global Securities Services, is engaged in the joint marketing and sale of
global custody services in most countries outside of the United States.

The delivery of products and services by the Investment Banking Division is
organized through global lines of business. The principal products and services
are capital markets and treasury activities, financial advisory and merger and
acquisition services, asset management, trust services and capital investment
and structured project finance. The Investment Banking Division is also
responsible for trading activities on behalf of clients and for our own account.

Capital markets and treasury trading activities are conducted principally
from Amsterdam, London, Chicago, New York, Hong Kong and Singapore offices. We
actively trade government and corporate debt instruments, equity securities and
currencies. In 1999, two new dealing rooms were opened in Amsterdam and London.

The Bank's international equity origination business is conducted through
the ABN AMRO Rothschild joint venture. We believe that the relationships and
distribution capacity of our integrated investment banking business and its high
quality research capabilities, combined with ABN AMRO Rothschild's ability to
draw upon capital markets and financial advisory and merger and acquisition
expertise centralized in London and Amsterdam, are attractive to issuers and
have resulted in ABN AMRO Rothschild being selected as lead manager for an
increasing number of equity capital market transactions.

Financial advisory and mergers and acquisitions activities focus principally
on cross border transactions in Europe and Asia and in specific industry sectors
in North and South America. These activities are supported by sector specialists
in Amsterdam and London.

The Investment Banking Division provides asset management services for
institutional and individual clients, as well as trust and custody services. At
December 31, 1999, we had EUR 112.9 billion of assets under management. Asset
management activities primarily are conducted from three regional centers in
Amsterdam/London, Chicago and Hong Kong, which perform not only portfolio
management, both through investment funds and discretionary management, but also
account management, marketing, institutional sales, product development and
research. We believe that the European market offers particularly attractive
opportunities to increase assets under management as a consequence of the
ongoing privatization of social security and pension funds.

We also develop and market complex financing structures for a large variety
of industries, including arranging for the financing of capital goods exports
and large-scale project finance. An investment capital group provides capital to
both newer enterprises as well as to management and leveraged buyouts in The
Netherlands and, increasingly, elsewhere in Europe. In addition, we provide
global clearing services for futures, options and equities, both to
institutional investors and private banking clients.

6
<PAGE>
ABN AMRO LEASE HOLDING

ABN AMRO Lease Holding is a fleet and equipment leasing holding company
operating through numerous subsidiaries in 25 countries in Europe, North and
South America and Asia, as well as in Australia, New Zealand and South Africa.
ABN AMRO Lease Holding offers a wide variety of leasing services, such as fleet
management, equipment leases and other services such as fuel cost management. In
fleet leasing, ABN AMRO Lease Holding provides a comprehensive range of services
for corporate users of vehicles, including financing, purchasing, maintenance,
repairs, insurance and insurance claim processing. ABN AMRO Lease Holding
currently has approximately 610,000 cars under management, and is the largest
car leasing operation in Europe not affiliated with a major automobile
manufacturer. Lease Plan, an ABN AMRO Lease Holding subsidiary, specializes in
offering open calculation contracts which afford large corporate customers the
opportunity to share in the residual value of leased vehicles.

GENERAL

COMPETITION

We operate in a highly competitive environment in all of our markets. Many
large financial services groups compete in the provision of sophisticated
banking and/or investment banking services to corporate and institutional
customers on a global basis, while local banks and other financial services
companies, which may be of substantial size, often provide significant
competition within national markets. We also compete with other banks, money
market funds and mutual funds for deposits and other sources of funds. In
certain jurisdictions, many of our competitors are not subject to the same
regulatory restrictions that we are subject to.

EMPLOYEES

At December 31, 1999, we had 105,855 full-time employees, an increase of 29
over 1998. Approximately 10,000 of these employees hold managerial and executive
positions. A breakdown of employees by division and for ABN AMRO Lease Holding
at December 31, 1999 is set forth in Item 9--"Management's Discussion and
Analysis of Financial Condition and Results of Operations."

All of our employees in The Netherlands, other than senior management, are
covered by collective labor agreements which are periodically renegotiated on an
industry-wide basis. The Bank participated in collective negotiations in the
banking industry and has based its employment agreement with its employees on
the relevant collective agreement. The current collective agreement expires on
June 1, 2000 and the Bank is currently negotiating its own collective labor
agreement and does not intend to participate any further in the industry wide
labor agreement. The Bank intends to place a stronger emphasis on variable and
performance related rewards and wider individual choices for several kinds of
benefits for employees. Additionally, beginning in January 2000, we changed our
pension plan from a final pay system to a system based on average salaries.
Furthermore, our standard retirement age was decreased from 65 to 62.

Under Dutch law, the Central Works Council of our company in The
Netherlands, whose members are elected by the employees, has certain defined
powers, including the right to make non-binding recommendations for appointments
to Holding's Supervisory Board and the right to enter objections against
proposals for appointments to the Supervisory Board.

We have not experienced any significant strike, work stoppage or labor
dispute in recent years. Our management considers its relations with its
employees to be good.

7
<PAGE>
RISK MANAGEMENT

Virtually all of our activities contain elements of risk. The most important
types of risk are credit risk, cross-border risk, market risk, liquidity risk,
operational risk and legal risk. Market risk has several components, including
interest rate, currency and equity price risks.

A major factor in risk management is the strong emphasis throughout the Bank
on remaining alert to the various types of risk. The Bank's corporate culture is
dedicated to promoting continuous risk awareness. This culture is reinforced by
the integration of the "ABN AMRO Values" (integrity, teamwork, respect and
professionalism) into the Bank's centralized consensus-based risk management
structure.

Our risk management policy is designed to identify and analyze credit risk,
market risk and other risks at an early stage, to set appropriate limits, and to
continually monitor these risks and limits by means of reliable information
systems. Risk management policies and systems require continuous modification
and enhancement to reflect dynamic changes in markets and products and are
periodically revised. Some of the key characteristics of our risk management
processes are:

- Commercial lines of business are fully responsible for the risks they
incur, with an independent risk function--Risk Management Division, or
RMD, --developing policies for, and approving and controlling, such risks.

- The extent of a delegated authority to approve risks depends on a
combination of volume (Global One Obligor Exposure, including all forms of
individual counterparty exposure) and internal risk rating (calibrated
against public ratings). Typically, committees approve risk positions
unanimously, basing their decisions on proposals from the business
concerned and independent advice.

The independent Risk Management Division covers credit risk, country risk
and market risk, and designs policies for operational risk. The Division reports
directly to the Managing Board and is led by three Senior Executive Vice
Presidents (two for corporate credit risks, one for financial institutions and
market risks). Regional risk managers in Europe, North America, Asia and Latin
America have similar responsibilities in the regions and have a functional
reporting line to the Risk Management Division.

The formulation of risk management policy and the monitoring of risks also
occur at the most senior management levels of our company. The Managing Board
regularly discusses risk management policies and meets to make major credit
decisions at least twice a week. In addition, the Group Credit Committee and the
Group Asset & Liability Committee, both established by the Managing Board and
both of which include members of the Managing Board and Senior Executive Vice
Presidents, are responsible for the development of effective risk management
policy and controls. The Bank's guidelines stipulate that risk-sensitive
decision must, in most instances, be taken by a specific committee and always by
at least two officers.

We have created regional risk management committees for The Netherlands,
North America and Asia/Pacific and Latin America which have delegated authority
to approve credits up to specified limits. Similarly, authority has also been
delegated to individual countries and even local offices or branches. The level
of authority depends on the size and sophistication of each entity and the
importance of its market. Delegation of approval authority and an increase in
the use of information systems means that more time can be devoted to the
evaluation of substantial and complex counterparty exposures and to monitoring
the risk management organization. The overall credit review framework also
incorporates dedicated credit committees for capital markets products. In
addition, we use uniform standard for the presentation of credit proposals and
consistently work at improving the effectiveness and efficiency of the credit
approval process. The Bank's credit rating model also permits the systematic
evaluation of risk to bank counterparties.

8
<PAGE>
CREDIT RISK

Credit risk encompasses all forms of counterparty exposure, i.e., where
counterparties may default on their obligations to us in relation to lending,
trading, hedging, settlement and other financial activities. The Group Credit
Committee, in its policy-making capacity, is responsible for establishing the
credit policies and the mechanisms, organization and procedures required to
analyze, manage and control credit risk. In its approving capacity, the Group
Credit Committee authorizes counterparty exposures subject to limits set by the
Managing Board. The Risk Management Division is responsible for implementing
risk management policy.

As in the three previous years, specific provisions for loan losses in 1999
were historically low in proportion to the Bank's portfolio size. This is a
reflection of favorable economic conditions in The Netherlands, the United
States and most other countries where we have substantial operations. The Bank
remains committed to the continuation of its current credit acceptance policy,
which management considers to be a prudent approach toward maintaining credit
quality in less favorable economic conditions.

COUNTRY OR CROSS-BORDER RISK

All countries are subject to country risk measurement, except EU members,
Australia, Canada, Japan, New Zealand, Norway, Singapore, Switzerland, Taiwan
and the United States. The Risk Management Division undertakes exposure
measurement of all other countries, covering cross-border exposure, including
mitigated exposure and sovereign exposure.

Cross-border exposure management covers all on- and off-balance sheet assets
that would be directly affected by transfer restrictions. We have monitored
cross-border exposure closely for many years, and experience has shown that this
is the type of exposure that is most affected by a country's payment crises.
Like market risk, we use a value-at-risk, or VAR, model to determine the
cross-border risk on the total portfolio. Limits for each country are set within
the total portfolio limit. The Asian, Brazilian and Russian crises were captured
by the model, which enabled us to take what we believe were prudent actions and
avoid over-reacting.

Mitigated exposure is exposure whose cross-border risk is significantly
lower. Products in this category are, among others, loan underwritings,
co-finance structures, trade finances and exposures covered by political risk
insurance. The remaining EUR 12.7 billion exposure at the end of 1999 consisted
in significant part of credits to multinationals and large corporations in the
relevant countries.

Sovereign exposure covers all on- and off-balance sheet assets that are
either directly the responsibility of, or guaranteed by, the sovereign of a
country. The overall exposure level takes into account the business done by all
of our booking centers. A sovereign limit is determined by the sovereign warning
level, which is an absolute amount based on gross domestic product, the
country's sovereign indebtedness and our business objectives in the country. The
crises in Russia and, more

9
<PAGE>
recently, in Ecuador demonstrated the value of sovereign exposure measurement.
It helps us to continue to operate in a country while limiting exposure to the
government.

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN BILLIONS OF EUR)
<S> <C> <C> <C>
Total cross-border exposure
Latin America............................................... 5.5 5.9 5.3
Asia........................................................ 7.1 7.2 9.7
Central and Eastern Europe.................................. 3.3 2.2 2.7
Middle East and Africa...................................... 5.0 4.2 2.4
---- ---- ----
Total....................................................... 20.9 19.5 20.1
</TABLE>

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN BILLIONS OF EUR)
<S> <C> <C> <C>
Excluding mitigated exposure
Latin America............................................... 3.2 3.6 3.5
Asia........................................................ 5.3 5.2 7.5
Central and Eastern Europe.................................. 2.1 1.6 1.3
Middle East and Africa...................................... 2.1 2.7 1.6
---- ---- ----
Total....................................................... 12.7 13.1 13.9
</TABLE>

MARKET RISK

Market risk is the uncertainty concerning the extent to which changes in the
financial markets in which we operate may affect our financial position and
future earnings.

ABN AMRO uses the VAR method as its primary mechanism for the management and
day-to-day monitoring of trading-related market risks. The VAR is an estimate,
with a confidence level of 99%, of the loss that could arise from adverse market
movements if trading positions were held unchanged during one trading day. On
the basis of historical data, the measurement is calibrated so that a loss
exceeding the VAR figure might have occurred, on average, once every 100 days.
The VAR limit was not exceeded during 1999. The VAR is calculated using the
Historical Simulation method, which is based on four years of historical data
and has the ability to accommodate all types of instruments and the specific
advantage of accommodating instantaneous correlations implicitly. The positions
captured by our VAR calculations include both derivative and cash positions that
are reported as trading assets and liabilities. The VAR is reported by trading
portfolio, by line of business and for the Bank as a whole on a daily basis and
submitted to the responsible members of the Managing Board and the top
management of the Investment Banking Division and the Risk Management Division.

<TABLE>
<CAPTION>
1999
------------------------------ DECEMBER 31,
MARKET RISK AVERAGE MINIMUM MAXIMUM 1999
- ----------- -------- -------- -------- ------------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Overall portfolio.................................... 32 * * 31
Interest rate........................................ 23 15 34 25
Currency............................................. 6 1 20 8
Equity............................................... 5 3 12 6
</TABLE>

- ------------------------

* The minimum (maximum) for each risk category occurred on different days so
it is not meaningful to the overall portfolio total. The overall portfolio
is adjusted to reflect the negative correlations between certain of the
components of market risk. During 1999, the minimum daily value at risk

10
<PAGE>
for the overall portfolio was EUR 22 million and the maximum daily value at
risk was EUR 46 million.

Other controls measures used in the market risk management process include
net open positions, interest rate sensitivity per basis point, spread
sensitivities, option parameters, position concentrations and position aging.
The use of statistical VAR and the other conventional limits is complemented in
certain cases with stress tests which are performed daily to assess the impact
of extreme market conditions on trading positions. These non-statistical
measures help further reduce trading risks. In addition, trading activities have
been concentrated in the Amsterdam, London, Chicago, New York, Singapore and
Hong Kong offices to facilitate centralized risk management control and
monitoring.

INTEREST RATE RISK

One of the objectives of asset and liability management is to manage and
control the sensitivity of our net interest revenue to changes in market
interest rates. The Group Asset & Liability Committee seeks to ensure that the
risk of earnings being affected by adverse interest rate movements is kept
within specified limits determined by the Managing Board.

A number of measures are used to monitor and measure interest rate risk.
These methods include interest rate gap analysis and scenario analysis.
Sensitivity tests are applied to estimate the impact of market rate movements on
net interest revenue. Because net interest revenue is the outcome of interest
paid and received on millions of contracts and transactions involving hundreds
of different products in a large number of currencies, models and estimation
techniques are used to calculate net interest revenue sensitivities. Assumptions
about the future behavior of clients play an important role in these
calculations. The interest rate risk caused by the repricing gap between assets
and liabilities is initially measured on the basis of contractual interest rate
maturities. Yield curve changes, as opposed to contractual interest rate
maturities, may affect the actual duration. This could occur, for instance, with
lending products where a client is entitled, but not obliged, to repay the
outstanding amount early. To manage this type of risk, the Bank uses assumptions
based on historical behavior, industry standards and/or theoretical valuation.
This allows the Bank to estimate the impact of interest rate movements on cash
flows and on the interest rate gap. In cases where the pricing of products is
not linked to market rates, simulation models are used to predict client
responses to price changes.

The sensitivity of net interest revenue to interest rate conditions has been
tested assuming an immediate and lasting interest rate movement of 100 basis
points. Such a sharp upward movement would depress net interest revenue by 2.9%
in the first year while a downward movement would boost net interest revenue by
1.0%.

CURRENCY RISK

We are an active participant in global foreign exchange markets. The major
foreign currencies in which the Bank conducts transactions are U.S. dollars,
pounds sterling, Swiss francs and Japanese yen. Of total assets and total
liabilities at December 31, 1999, the equivalent of EUR 324 billion and EUR
321 billion, respectively, was denominated in currencies other than euros,
corresponding to approximately 71% of total assets and 72% of total liabilities,
excluding shareholders' equity.

Exposure to exchange rate movements in trading portfolios is included in the
VAR analysis as well as in other non-statistical limits. Exchange rate risks
from lending activities are limited as the Bank's operating units, on an
individual basis, are required to hedge the currencies in which their assets and
liabilities are denominated. Any short or long positions are monitored to ensure
compliance with the limits established by the Group Asset & Liability Committee.
The currency positions arising out of wholesale foreign exchange dealing are
also subject to limits. Capital invested in operations outside The Netherlands
is largely funded in euros. Our currency risk policy is designed to protect the
Bank's Tier 1

11
<PAGE>
and Tier 2 capital ratios against fluctuations in the rate of the U.S. dollar.
See "Supervision and Regulation."

Foreign exchange dealings expose the Bank to settlement risk, i.e., the risk
that one of the parties engaged in a foreign exchange transaction delivers the
currency sold but does not receive the currency purchased. The rapid growth of
the currency markets has prompted the G-10 countries to step up their efforts to
develop procedures such as multilateral netting of currency transactions in
order to reduce settlement risk.

LIQUIDITY RISK

The objective of liquidity management is to ensure the availability of
sufficient cash flows to meet all of our financial commitments while
capitalizing on opportunities for expansion. Liquidity management is designed to
ensure that members of our group are at all times able to meet deposit
withdrawals either on demand or at contractual maturity, to repay borrowings as
they mature, and to fund new loans and investments as opportunities arise.

We are active in 76 countries, whose national financial markets vary widely
in terms of scope and depth. Customers, products and competitors also differ at
each location. This means that liquidity management must also take local funding
requirements into account. Local line management is responsible for continuously
satisfying the local liquidity requirements established by the Group Asset &
Liability Committee. Furthermore, contingency plans for different liquidity
deterioration scenarios are required to be drawn up at the country level.

Client accounts are the primary source of liquidity for our banking
operations, together with funding in the interbank market. Our core client
accounts of the bank affiliates at December 31, 1999 were EUR 200.1 billion (of
which EUR 91.9 billion was in The Netherlands, EUR 46.8 billion was in the
United States and EUR 4.7 billion was in Brazil), which approximated 91.4% of
total loans excluding professional securities transactions at that date.

We hold a portfolio of marketable securities--including Netherlands
government bonds, U.S. Treasury and U.S. government agency paper and other
O.E.C.D. government paper--and other short-term investments which can be readily
converted to cash. Our bank is also an active participant in the capital
markets, issuing commercial paper and medium-term notes, as well as debentures,
subordinated debt and preferred stock.

We consider funding in the interbank market to be an additional source of
liquidity for our investment banking activities. Loans from banks totaled EUR
81.0 billion at December 31, 1999, as compared to loans to banks of EUR
47.2 billion. Interbank funding showed a decrease compared to 1998 from
EUR 104.9 billion to EUR 81.0 billion, due to lower volumes of interbank
borrowing and lending. We also hedge the interest rate risk from the use of
interbank funding to purchase marketable securities by the use of derivative
financial instruments to convert fixed rate payments received on the marketable
securities into floating rate payments. As part of the expansion of our trading
and other investment banking activities, we had used interbank funding to
increase our portfolio of marketable interest-earning securities. In the event
of a sharp rise in short-term interest rates, this portfolio of marketable
securities could be liquidated.

OPERATIONAL RISK

Like all large financial institutions, we are exposed to diverse types of
operational risk. These include potential losses caused by a breakdown in
information, communication, transaction processing and settlement systems and
procedures, fraud by employees or outsiders, and unauthorized transactions by
employees.

12
<PAGE>
In 1999, we created an Operational Risk Policy & Support unit within our
Risk Management Division. We have commenced the introduction of operational risk
management policies and developed enterprise-wide operational risk management
processes. Through improved measurement systems, operational risk will be
translated into an economic capital requirement. This is consistent with
bringing regulatory and economic capital closer together. We have introduced a
system of bottom-up risk self-assessment on the grounds that operational risk is
integral to management responsibilities at all levels.

LEGAL RISK

Legal risk arises from uncertainties about the legal enforceability of the
obligations of the Bank's customers and counterparties (including with respect
to derivatives), as well as the possibility that legal or regulatory changes may
adversely affect the Bank's position. We seek to minimize legal risk through the
use of industry standard legal agreements for financial products and through
consultation with internal and external legal counsel in the countries where it
conducts business.

RISK ASPECTS OF FINANCIAL DERIVATIVES

The principal activities of traditional banking include borrowing and
lending money and trading in currencies and securities. Products derived from
these activities are called "derivatives" and can be subdivided, according to
the nature of the underlying contracts, into interest rate contracts (interest
rate swaps, interest rate options, forward rate agreements and interest rate
futures), currency contracts (currency swaps, currency options and forward
exchange dealings) and other contracts (options and swaps on shares, bonds,
currencies and commodities). Transactions in derivatives are effected for
hedging purposes and, within set limits, as part of our trading activities.
Complex instruments such as leveraged derivatives are used and sold on a limited
scale. The principal financial instruments we utilize to hedge exchange rate
fluctuations are currency swaps, forward forex contracts, currency options and
currency futures. The currencies in which a material amount of our hedging
activities occur include the U.S. dollar, the euro, the Swiss franc and the
Japanese yen.

The total volume of our derivatives business, both in number of transactions
and outstanding or notional amounts, and the increasing complexity of these
products require an advanced administrative organization and strict internal
controls as well as close monitoring of interest rate, currency and other market
risks. The recommendations published by the Bank for International Settlements,
or BIS, and international organizations like the Group of 30 are the guiding
principles in formulating and implementing our requirements in this respect.

Our derivatives trading takes place mainly in the global trading units in
Amsterdam, London, Chicago and Singapore, subject to limits which are set by the
Group Asset & Liability Committee with a view to adequate risk management.
Derivatives used for trading purposes are valued daily at market prices. If
market prices are not available, valuation models, which we believe are
appropriate, are used to calculate the approximate market value. Movements in
market value are incorporated in our financial results on a current basis.
Valuation of OTC derivative financial instruments is highly complex and
differences in the valuation methodology employed could affect financial
results.

Derivatives form an integral part of our bank's interest rate and currency
risk management. Results of derivatives transactions entered into as part of
such risk management are attributed to the same reporting period as the
recognition of gains and losses on the hedged assets and liabilities.

The notional amounts of derivatives, which totaled EUR 2,020 billion at
December 31, 1999, only give an indication of the scale of our derivatives
business, but not of the related credit risk. The credit risk is the loss that
would arise if a counterparty were to default and we were to face a partly open
position. This actual risk represents only a fraction of the notional amounts.
By entering into agreements which provide under certain circumstances for the
settlement on a net basis of all contracts

13
<PAGE>
between us and a counterparty, we attempt to minimize this credit risk. To
facilitate risk monitoring and management, substantial enhancements in computer
systems and software have been made as part of the continuing expansion of our
derivatives business.

To quantify the credit risk, the cost of the replacement transactions which
would be necessary if a counterparty defaulted is calculated and is then
increased by a percentage of the notional amounts. The applied percentage
depends on the nature and remaining maturity of the contract. The credit risk
equivalent for our total derivatives business was calculated at EUR
32.1 billion at December 31, 1999. When weighted for the counterparty risk
(mainly banks) for capital adequacy purposes, the credit risk equivalent
represents only EUR 8.8 billion or 3.6% of total risk-weighted assets at
December 31, 1999.

See note 24 to the Consolidated Financial Statements for further analysis of
our derivatives activities, including an analysis at December 31, 1999 of our
trading and hedging derivatives portfolios.

14
<PAGE>
SELECTED STATISTICAL INFORMATION

AVERAGE BALANCE SHEET

The following tables present our average balances, based on month-end
averages, and interest amounts and average rates for each of the past three
years.

<TABLE>
<CAPTION>
1999 1998 1997
------------------------------ ------------------------------ ------------------------------
AVERAGE AVERAGE AVERAGE
AVERAGE INTEREST RATE AVERAGE INTEREST RATE AVERAGE INTEREST RATE
BALANCE REVENUE (%) BALANCE REVENUE (%) BALANCE REVENUE (%)
-------- -------- -------- -------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ASSETS(1)
Banks
The Netherlands............ 18,674 1,140 6.1 46,961 2,674 5.7 32,524 1,612 5.0
North America.............. 9,267 616 6.6 3,478 230 6.6 2,069 126 6.1
Rest of the world.......... 38,508 1,642 4.3 43,269 1,756 4.1 32,542 1,729 5.3
Loans(2)
Public sector(3)
The Netherlands............ 5,756 411 7.1 4,930 330 6.7 5,584 380 6.8
North America.............. 694 43 6.2 610 37 6.1 586 38 6.4
Rest of the world.......... 3,653 270 7.4 1,339 96 7.2 1,043 101 9.7
Private sector
The Netherlands............ 95,282 6,732 7.1 84,878 5,508 6.5 79,338 4,937 6.2
North America.............. 76,826 6,197 8.1 73,452 5,152 7.0 57,756 4,162 7.2
Rest of the world.......... 64,641 5,176 8.0 60,454 4,498 7.4 53,979 4,104 7.6
Interest-earning
securities(4)
Investment portfolio
The Netherlands............ 20,675 1,356 6.6 16,750 1,069 6.4 15,703 1,020 6.5
North America.............. 23,937 1,616 6.8 18,830 1,100 5.8 12,565 869 6.9
Rest of the world.......... 11,087 1,086 9.8 9,280 848 9.1 9,724 653 6.7
Trading portfolio and other
securities
The Netherlands............ 16,718 880 5.3 9,442 447 4.7 5,882 268 4.6
North America.............. 7,896 700 8.9 6,640 474 7.1 8,268 548 6.6
Rest of the world.......... 23,072 1,197 5.2 31,226 1,415 4.5 5,821 248 4.3
------- ------ ---- ------- ------ --- ------- ------ ---
Total interest-earning
assets..................... 416,686 29,062 7.0 411,539 25,634 6.2 323,384 20,795 6.4
Non-interest-earning
assets..................... 42,584 34,284 34,428
------- ------ ---- ------- ------ --- ------- ------ ---
Total average assets......... 459,270 29,062 6.3 445,823 25,634 5.8 357,812 20,795 5.8
======= ====== ==== ======= ====== === ======= ====== ===
</TABLE>

- ------------------------

(1) Assets temporarily sold (subject to repurchase) are included in the relevant
balance sheet item.

(2) For purposes of presentation in this table, loans include professional
securities transactions.

(3) Public sector represents central, regional and local governments and
governmental authorities.

(4) Balance sheet item. Short-dated government paper is included in the table
above, partially in investment portfolio and partially in other securities.

15
<PAGE>

<TABLE>
<CAPTION>
1999 1998 1997
------------------------------ ------------------------------ ------------------------------
AVERAGE AVERAGE AVERAGE
AVERAGE INTEREST RATE AVERAGE INTEREST RATE AVERAGE INTEREST RATE
BALANCE EXPENSE (%) BALANCE EXPENSE (%) BALANCE EXPENSE (%)
-------- -------- -------- -------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
LIABILITIES AND GROUP
EQUITY
Banks
The Netherlands.......... 26,030 1,720 6.6 60,248 3,504 5.8 34,085 1,706 5.0
North America............ 18,057 1,194 6.6 14,437 711 4.9 13,122 590 4.5
Rest of the world........ 59,428 2,650 4.5 70,458 2,994 4.2 50,902 2,350 4.6
Savings accounts
The Netherlands.......... 29,520 1,170 4.0 28,587 1,090 3.8 29,088 1,169 4.0
North America............ 25,117 1,043 4.2 22,688 991 4.4 22,264 1,037 4.7
Rest of the world........ 11,984 557 4.6 7,593 319 4.2 5,700 215 3.8
Deposits and other customer
accounts(1)
The Netherlands.......... 62,350 3,080 4.9 47,313 1,526 3.2 47,501 1,646 3.5
North America............ 45,355 2,730 6.0 44,270 2,272 5.1 27,452 1,255 4.6
Rest of the world........ 51,041 2,329 4.6 47,422 2,015 4.2 35,301 1,553 4.4
Debt securities
The Netherlands.......... 14,480 975 6.7 10,297 663 6.4 10,078 664 6.6
North America............ 18,712 1,336 7.1 13,989 880 6.3 12,683 826 6.5
Rest of the world........ 12,511 893 7.1 11,586 826 7.1 14,256 909 6.4
Subordinated debt
The Netherlands.......... 5,926 429 7.2 5,014 391 7.8 4,572 351 7.7
North America............ 4,031 263 6.5 3,841 250 6.5 3,462 226 6.5
Rest of the world........ 81 6 7.3 64 4 6.4 56 4 6.5
------- ------ ------ ------- ------ --- ------- ------ ---
Total interest-bearing
liabilities.............. 384,623 20,375 5.3 387,807 18,436 4.8 310,522 14,501 4.7
Non-interest-bearing
liabilities.............. 59,040 43,403 35,795
Group equity(2)............ 15,607 14,613 11,495
------- ------ ------ ------- ------ --- ------- ------ ---
Total average liabilities
and Group equity......... 459,270 20,375 4.4 445,823 18,436 4.1 357,812 14,501 4.1
======= ====== ====== ======= ====== === ======= ====== ===
</TABLE>

- ------------------------

(1) For purposes of presentation in this table, deposits and other customer
accounts includes professional securities transactions.

(2) Group equity includes minority interests.

16
<PAGE>
CHANGES IN NET INTEREST REVENUE: VOLUME AND RATE ANALYSIS

The following tables allocate, by categories of interest-earning assets and
interest-bearing liabilities, changes in interest revenue and expense due to
changes in volume and in rates for 1999 compared to 1998 and 1998 compared to
1997. Volume and rate variances have been calculated on movements in average
balances and changes in interest rates. Changes due to a combination of volume
and rate have been allocated proportionally.

LOANS(1)
Public Sector
The Netherlands............................ 81 59 22 (50) (44) (6)
North America.............................. 6 5 1 (1) 1 (2)
Rest of the world.......................... 174 171 3 (5) 25 (30)
Private sector
The Netherlands............................ 1,224 710 514 571 354 217
North America.............................. 1,045 245 800 991 1,104 (113)
Rest of the world.......................... 678 323 355 394 483 (89)

INTEREST-EARNING SECURITIES
Investment portfolio
The Netherlands............................ 287 256 31 48 67 (19)
North America.............................. 516 328 188 231 382 (151)
Rest of the world.......................... 238 174 64 195 (31) 226
Trading portfolio and other securities
The Netherlands............................ 433 378 55 179 168 11
North America.............................. 226 99 127 (74) (114) 40
Rest of the world.......................... (218) (404) 186 1,167 1,151 16
------ ------ ----- ----- ----- ----
3,428 813 2,615 4,838 4,925 (87)
====== ====== ===== ===== ===== ====
</TABLE>

- ------------------------

(1) For purposes of presentation in this table, loans includes professional
securities transactions.

17
<PAGE>

<TABLE>
<CAPTION>
1999 OVER 1998 1998 OVER 1997
------------------------------- -------------------------------
CHANGE DUE TO CHANGE DUE TO
TOTAL INCREASE TOTAL INCREASE
CHANGE IN (DECREASE) IN CHANGE IN (DECREASE) IN
INTEREST ------------------- INTEREST -------------------
EXPENSE VOLUME RATE EXPENSE VOLUME RATE
--------- -------- -------- --------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
INTEREST EXPENSE
Banks
The Netherlands............................ (1,784) (2,209) 425 1,798 1,481 317
North America.............................. 483 204 279 121 62 59
Rest of the world.......................... (344) (486) 142 643 843 (200)
Savings accounts
The Netherlands............................ 80 36 44 (79) (20) (59)
North America.............................. 52 102 (50) (46) 20 (66)
Rest of the world.......................... 238 201 37 103 77 26
Deposits and other customer accounts
The Netherlands............................ 1,554 581 973 (119) (6) (113)
North America.............................. 458 56 402 1,017 847 170
Rest of the world.......................... 314 160 154 462 517 (55)
Debt securities
The Netherlands............................ 312 281 31 (1) 14 (15)
North America.............................. 456 326 130 54 83 (29)
Rest of the world.......................... 67 66 1 (82) (182) 100
Subordinated debt
The Netherlands............................ 38 67 (29) 39 35 4
North America.............................. 13 13 -- 25 25 --
Rest of the world.......................... 2 1 1 -- -- --
------ ------ ----- ----- ----- ----
1,939 (601) 2,540 3,935 3,796 139
====== ====== ===== ===== ===== ====
</TABLE>

YIELDS, SPREADS AND MARGINS

The following table presents selected yield, spread and margin information
applicable to us for each of the past three years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN PERCENTAGES)
<S> <C> <C> <C>
GROSS YIELD(1)
The Netherlands.......................................... 6.7 6.2 5.9
North America............................................ 7.7 6.8 7.1
Rest of the world........................................ 6.6 5.9 6.6
ABN AMRO................................................. 7.0 6.2 6.4
INTEREST RATE SPREAD(2)
The Netherlands.......................................... 1.4 1.4 1.5
North America............................................ 1.8 1.6 2.1
Rest of the world........................................ 1.9 1.4 1.9
ABN AMRO................................................. 1.7 1.5 1.8
NET INTEREST MARGIN
The Netherlands.......................................... 2.1 1.8 1.9
North America............................................ 2.3 1.8 2.2
Rest of the world........................................ 2.1 1.7 1.7
ABN AMRO................................................. 2.1 1.7 1.9
</TABLE>

- ------------------------

(1) Gross yield represents the interest rate earned on average interest earning
assets.

(2) Interest rate spread represents the difference between the interest rate
earned on average interest-earning assets and the rate paid on average
interest-bearing liabilities.

18
<PAGE>
ASSETS

SECURITIES

The following table shows the book value of our securities portfolios at
December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Investment portfolios............................. 57,864 48,574 43,800
Trading portfolios................................ 32,476 43,863 24,328
Other securities.................................. 12,618 21,349 18,428
------- ------- ------
Total interest-earning securities................. 102,958 113,786 86,556
Shares............................................ 16,990 13,271 8,596
------- ------- ------
Total securities portfolios....................... 119,948 127,057 95,152
======= ======= ======
</TABLE>

INVESTMENT PORTFOLIOS

The following is an analysis of the fair market value of our investment
portfolios at December 31, 1999, 1998 and 1997. In the tables below, fair market
value is based on quoted prices for traded securities and estimated fair market
value for non-traded securities.

<TABLE>
<CAPTION>
PREMIUMS GROSS GROSS FAIR
BOOK OR AMORTIZED UNREALIZED UNREALIZED MARKET
VALUE DISCOUNTS COST GAINS LOSSES VALUE
-------- --------- --------- ---------- ---------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
DECEMBER 31, 1999
Dutch government (1)............................. 4,770 234 5,004 47 (239) 4,812
U.S. Treasury and U.S. government agencies....... 7,454 (123) 7,331 59 (253) 7,137
Other OECD governments........................... 18,112 560 18,672 175 (451) 18,396
Mortgage-backed securities....................... 17,900 (66) 17,834 145 (695) 17,284
Other interest-earning securities................ 9,628 31 9,659 241 (53) 9,847
------ ---- ------ ----- ------ ------
Total interest-earning securities................ 57,864 636 58,500 667 (1,691) 57,476
Shares........................................... 4,815 4,815
------ ------
Total investment portfolios...................... 62,679 62,291
====== ======

DECEMBER 31, 1998
Dutch government (1)............................. 5,974 188 6,162 387 (3) 6,546
U.S. Treasury and U.S. government agencies....... 7,014 117 7,131 141 (3) 7,269
Other OECD governments........................... 14,670 181 14,851 998 (77) 15,772
Mortgage-backed securities....................... 13,228 32 13,260 135 (80) 13,315
Other interest-earning securities................ 7,688 (122) 7,566 536 (10) 8,092
------ ---- ------ ----- ------ ------
Total interest-earning securities................ 48,574 396 48,970 2,197 (173) 50,994
Shares........................................... 3,171 3,171
------ ------
Total investment portfolios...................... 51,745 54,165
====== ======
</TABLE>

19
<PAGE>

<TABLE>
<CAPTION>
PREMIUMS GROSS GROSS FAIR
BOOK OR AMORTIZED UNREALIZED UNREALIZED MARKET
VALUE DISCOUNTS COST GAINS LOSSES VALUE
-------- --------- --------- ---------- ---------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
DECEMBER 31, 1997
Dutch government (1)............................. 6,578 195 6,773 312 (1) 7,084
U.S. Treasury and U.S. government agencies....... 8,238 39 8,277 196 (18) 8,455
Other OECD governments........................... 10,514 37 10,551 499 (87) 10,963
Mortgage-backed securities....................... 11,884 (52) 11,832 184 (23) 11,993
Other interest-earning securities................ 6,586 101 6,687 362 (38) 7,011
------ ---- ------ ----- ------ ------
Total interest-earning securities................ 43,800 320 44,120 1,553 (167) 45,506
Shares........................................... 2,257 2,257
------ ------
Total investment portfolios...................... 46,057 47,763
====== ======
</TABLE>

- ------------------------------

(1) Dutch government includes Dutch central, regional and municipal government
obligations.

The following table analyzes interest-earning investment securities by
maturity and weighted average yield at December 31, 1999. Yields on tax exempt
obligations have not been computed on a tax equivalent basis.

<TABLE>
<CAPTION>
AFTER 1 YEAR AFTER 5 YEARS
AND AND
WITHIN 1 YEAR WITHIN 5 YEARS WITHIN 10 YEARS AFTER 10 YEARS
------------------- ------------------- ------------------- -------------------
YIELD YIELD YIELD YIELD
AMOUNT (%) AMOUNT (%) AMOUNT (%) AMOUNT (%)
-------- -------- -------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dutch government.......................... 397 3.9 1,663 5.9 1,559 5.9 1,385 6.0
U.S. Treasury and U.S. government
agencies................................ 616 5.9 1,885 6.0 1,614 6.2 3,216 6.9
Other OECD governments.................... 5,405 2.7 5,110 6.8 6,121 5.4 2,036 8.4
Mortgage-backed securities (1)............ 20 6.9 1,188 6.6 7,481 6.8 9,145 6.7
Other securities.......................... 1,925 8.8 4,011 7.5 2,593 6.6 1,130 5.1
Total amortized cost...................... 8,363 4.4 13,857 6.8 19,368 6.2 16,912 6.8
Total market value........................ 8,335 14,125 18,980 16,036
</TABLE>

- ------------------------------

(1) Maturity dates have been estimated based on historical experience.

TRADING PORTFOLIOS

The following table analyzes the book value, which is equal to fair market
value because the trading portfolios are marked-to-market, of securities in our
trading portfolios at December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Dutch government.................................... 947 3,096 2,191
U.S. Treasury and U.S. government agencies.......... 4,147 5,542 4,346
Other OECD governments.............................. 17,420 26,480 11,173
Other interest-earning securities................... 9,962 8,745 6,618
------ ------ ------
Total interest-earning securities................... 32,476 43,863 24,328
Shares.............................................. 6,952 5,251 3,095
------ ------ ------
Total trading portfolios............................ 39,428 49,114 27,423
====== ====== ======
</TABLE>

20
<PAGE>
OTHER SECURITIES

The following table analyzes the fair market value of other securities at
December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
1999 1998 1997
------------------------------- ------------------------------- -------------------------------
FAIR FAIR FAIR
BOOK AMORTIZED MARKET BOOK AMORTIZED MARKET BOOK AMORTIZED MARKET
VALUE COST VALUE VALUE COST VALUE VALUE COST VALUE
-------- --------- -------- -------- --------- -------- -------- --------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Short-dated government
paper................... 3,114 3,114 3,139 2,172 2,172 2,181 6,935 6,935 6,946
Other debt securities..... 4,873 4,757 4,873 3,781 3,717 3,647 4,159 4,155 4,141
Other bank paper.......... 4,631 4,631 4,535 15,396 15,389 15,392 7,334 6,944 7,277
------ ------ ------ ------ ------ ------ ------ ------ ------
Total interest-earning
securities.............. 12,618 12,502 12,547 21,349 21,278 21,220 18,428 18,034 18,364
Shares.................... 5,223 5,252 4,849 4,855 3,244 3,272
------ ------ ------ ------ ------ ------
Total other securities.... 17,841 17,799 26,198 26,075 21,672 21,636
====== ====== ====== ====== ====== ======
</TABLE>

CONCENTRATION

At December 31, 1999, we held the following securities positions in issuers
which exceeded 10% of our shareholders' equity at that date:

<TABLE>
<CAPTION>
BOOK VALUE FAIR MARKET VALUE
---------- -----------------
(IN MILLIONS OF EUR)
<S> <C> <C>
Japanese central bank............................. 2,282 2,295
Dutch central government.......................... 5,502 5,539
German central government......................... 3,638 3,661
U.S. Treasury..................................... 8,565 8,480
U.S. domestic government agencies................. 5,640 5,400
French central government......................... 1,498 1,507
Italian central government........................ 7,021 7,077
Belgian central government........................ 6,009 6,012
Bank Nederlandse Gemeenten........................ 1,230 1,241
Spanish central government........................ 4,061 4,105
Austrian central government....................... 1,422 1,435
Brazilian central government...................... 2,847 2,884
Finish central government......................... 3,400 3,453
</TABLE>

BANKS

The following tables show loans to banks at December 31, 1999, 1998 and
1997, and an analysis of their remaining life at December 31, 1999.

21
<PAGE>
LOANS TO BANKS

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
The Netherlands..................................... 14,529 21,638 31,934
North America....................................... 5,507 2,970 3,144
Rest of the world................................... 27,165 36,286 28,535
------ ------ ------
Total loans to banks (gross)........................ 47,201 60,894 63,613
====== ====== ======
</TABLE>

MATURITIES

<TABLE>
<CAPTION>
AFTER 1 YEAR AND
WITHIN 1 YEAR WITHIN 5 YEARS AFTER 5 YEARS TOTAL
------------- ---------------- ------------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
The Netherlands............... 13,962 303 264 14,529
North America................. 5,481 25 1 5,507
Rest of the world............. 26,278 709 178 27,165
------ ----- --- ------
Total loans to banks
(gross)..................... 45,721 1,037 443 47,201
====== ===== === ======
</TABLE>

LOANS

Our loan portfolio consists of loans, overdrafts, assets subject to
operating leases, finance lease receivables to governments, corporations and
consumers and reverse repurchase agreements. The following table analyzes our
portfolio by sector at the dates indicated.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Public sector.................................. 12,097 7,334 6,783 7,351 8,077
Commercial..................................... 130,003 110,757 101,869 93,139 87,205
Retail......................................... 81,679 72,739 64,089 44,390 38,722
------- ------- ------- ------- -------
Total private sector........................... 211,682 183,496 165,958 137,529 125,927
Total loans (gross) excluding professional
securities transactions...................... 223,779 190,830 172,741 144,880 134,004
Professional securities transactions(1)........ 40,742 34,058 31,370 8,046 2,524
------- ------- ------- ------- -------
Total loans (gross) including professional
securities transactions...................... 264,521 224,888 204,111 152,926 136,528
======= ======= ======= ======= =======
Total loans (net)(2)........................... 259,723 220,512 201,105 150,474 132,810
======= ======= ======= ======= =======
</TABLE>

- ------------------------------

(1) Professional securities transactions for 1999, 1998, 1997 and 1996 include
receivables from professional securities transactions. Receivables from
professional securities transactions are included in commercial loans for
1995.

(2) The difference between total loans (gross) and total loans (net) represents
our specific allowance for loan losses and, in 1995, the portion of the
Provision for general contingencies allocated to the balance sheet item
Loans. For a discussion of our provisioning policy, see "Analysis of Loan
Loss Experience: Provisions and Allowances for Loan Losses."

Our lease portfolio aggregated EUR 10,910 million, EUR 8,713 million and EUR
7,158 million at December 31, 1999, 1998, and 1997, respectively. At
December 31, 1999, the lease portfolio was comprised of finance lease
receivables of EUR 3,568 million and assets subject to operating leases of
EUR 7,342 million.

22
<PAGE>
In addition to loans, at December 31, 1999, we had loan commitments,
guarantees, letters of credit, endorsements and similar products, amounting
to EUR 159,002 million, of which EUR 115,441 million represented undrawn
loan facilities.

OUTSTANDING LOANS BY REGION

The following table analyzes our loans by region at the dates indicated.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
THE NETHERLANDS
Public sector.................. 3,749 5,087 5,031 5,673 6,665
Commercial..................... 47,575 43,131 42,455 40,289 40,349
Retail......................... 50,282 45,695 38,248 32,321 29,022
------- ------- ------- ------- -------
101,606 93,913 85,734 78,283 76,036

NORTH AMERICA
Public sector.................. 871 601 612 507 421
Commercial..................... 35,827 26,093 21,711 20,464 16,196
Retail......................... 22,130 20,397 21,478 8,650 7,051
------- ------- ------- ------- -------
58,828 47,091 43,801 29,621 23,668

REST OF THE WORLD
Public sector.................. 7,477 1,647 1,140 1,171 991
Commercial..................... 46,601 41,533 37,704 32,386 30,660
Retail......................... 9,267 6,646 4,362 3,419 2,649
------- ------- ------- ------- -------
63,345 49,826 43,206 36,976 34,300
------- ------- ------- ------- -------
Total loans (gross)............ 223,779 190,830 172,741 144,880 134,004
======= ======= ======= ======= =======
</TABLE>

MATURITIES

The following table provides an analysis of loan maturities at December 31,
1999. Determinations of maturities are based on contract terms.

<TABLE>
<CAPTION>
AFTER 1 YEAR
AND
WITHIN 1 YEAR WITHIN 5 YEARS AFTER 5 YEARS TOTAL
------------- -------------- ------------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
The Netherlands................ 34,121 13,318 54,167 101,606
North America.................. 20,479 24,383 13,966 58,828
Rest of the World.............. 47,003 10,103 6,239 63,345
------- ------ ------ -------
Total Loans (gross)............ 101,603 47,804 74,372 223,779
======= ====== ====== =======
</TABLE>

23
<PAGE>
INTEREST RATE SENSITIVITY

The following table analyzes at December 31, 1999 the interest rate
sensitivity of loans due after one year.

<TABLE>
<CAPTION>
AT AT AT
VARIABLE RATE(1) ADJUSTABLE RATE(2) FIXED RATE(3) TOTAL
---------------- ------------------ ------------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
DUE AFTER 1 AND WITHIN 5
YEARS
The Netherlands............. 1,940 1,237 10,141 13,318
North America............... 8,673 5,019 10,691 24,383
Rest of the world........... 3,690 1,979 4,434 10,103
DUE AFTER 5 YEARS
The Netherlands............. 1,036 39,767 13,364 54,167
North America............... 1,359 3,311 9,296 13,966
Rest of the world........... 2,206 1,316 2,717 6,239
</TABLE>

- ------------------------

(1) Variable rate loans are EURIBOR, London interbank offering rate (LIBOR),
prime rate-based loans as well as adjustable rate loans with fixed interest
periods of up to one year.

(2) Adjustable rate loans are loans with fixed interest rates for a period which
is shorter than the entire term of the loan.

(3) Fixed rate loans are loans for which the interest rate is fixed for the
entire term.

PRIVATE SECTOR LOANS BY TYPE OF COLLATERAL

The following table analyzes private sector loans by type of collateral at
the dates indicated. Unsecured loans include loans for which we have the right
to require collateral.

RETAIL
Public authority guarantees.................... 3,628 3,596 3,633 3,824 4,689
Mortgages...................................... 58,082 50,523 43,936 27,196 24,153
Other types of collateral and unsecured........ 19,969 18,620 16,520 13,370 9,880
------- ------- ------- ------- -------
81,679 72,739 64,089 44,390 38,722
------- ------- ------- ------- -------
Total private sector loans (gross)............. 211,682 183,496 165,958 137,529 125,927
======= ======= ======= ======= =======
Total private sector loans (net) (1)........... 206,974 179,211 162,977 135,106 122,208
======= ======= ======= ======= =======
</TABLE>

- ------------------------------

(1) The difference between total private sector loans (gross) and total private
sector loans (net) represents our specific allowance for loan losses and in
1995, the portion of the Provision for general contingencies allocated to
the balance sheet item Loans. For a discussion of our provisioning policy,
see "Analysis of Loan Loss Experience: Provisions and Allowances for Loan
Losses."

24
<PAGE>
COMMERCIAL LOANS BY INDUSTRY

The following table analyzes commercial loans by industry at the dates
indicated.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy................. 10,718 8,957 8,445 9,058 6,166
Manufacturing.................................. 30,948 26,649 22,846 23,055 20,691
Construction and real estate................... 15,067 12,624 10,185 8,473 8,908
Wholesale and retail trade..................... 19,257 17,536 15,798 15,013 15,608
Transportation and communications.............. 10,451 9,568 9,040 7,383 7,217
Financial services............................. 17,639 16,348 16,013 12,595 9,186
Business services.............................. 12,290 8,477 9,036 6,851 8,772
Education, health care and other services...... 13,633 10,598 10,506 10,711 10,657
------- ------- ------- ------- -------
Total commercial loans (gross)................. 130,003 110,757 101,869 93,139 87,205
======= ======= ======= ======= =======
</TABLE>

Set forth below is an analysis of our loan portfolio by region. The loan
portfolio of our Dutch, European and North American operations comprised 85.8%
of our total loan portfolio at December 31, 1999. The remainder of the total
loan portfolio at December 31, 1999 is comprised of 9.4% from Asian operations,
4.0% from Latin American operations and 0.8% from Middle East and African
operations.

NETHERLANDS LOAN PORTFOLIO

The Netherlands loan portfolio is comprised of loans made from offices and
branches located in The Netherlands. The following tables analyze, at the dates
indicated, the Netherlands loan portfolio by location of the borrower, and, in
the case of private sector loans, type of collateral and industry of the
borrower.

LOANS BY CUSTOMER LOCATION

PRIVATE SECTOR
The Netherlands................................ 87,925 81,490 73,336 67,961 64,261
Rest of Europe................................. 2,689 2,085 2,664 2,636 2,769
North America.................................. 3,088 1,674 2,265 533 528
Rest of the world.............................. 4,155 3,577 2,438 1,480 1,813
------- ------- ------- ------- -------
9,932 7,336 7,367 4,649 5,110
------- ------- ------- ------- -------
Total private sector loans (gross)............. 97,857 88,826 80,703 72,610 69,371
======= ======= ======= ======= =======
</TABLE>

25
<PAGE>
PRIVATE SECTOR LOANS BY TYPE OF COLLATERAL

RETAIL
Public authority guarantees.................... 3,607 3,594 3,623 3,814 4,391
Mortgages...................................... 35,491 30,747 23,934 19,062 17,487
Other types of collateral and unsecured........ 11,184 11,354 10,691 9,445 7,144
------- ------- ------- ------- -------
50,282 45,695 38,248 32,321 29,022
------- ------- ------- ------- -------
Total private sector loans (gross)............. 97,857 88,826 80,703 72,610 69,371
======= ======= ======= ======= =======
</TABLE>

COMMERCIAL LOANS BY INDUSTRY

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy................. 4,908 3,658 3,869 4,000 3,906
Manufacturing.................................. 8,498 7,688 6,472 7,070 7,036
Construction and real estate................... 3,976 3,886 3,586 3,847 4,303
Wholesale and retail trade..................... 7,564 7,538 7,064 7,434 8,435
Transportation and communications.............. 3,567 3,234 2,919 2,549 3,290
Financial services............................. 8,955 8,898 8,171 6,561 4,964
Business services.............................. 5,079 3,343 4,487 3,123 2,828
Education, health care and other services...... 5,028 4,886 5,887 5,705 5,587
------- ------- ------- ------- -------
Total commercial loans (gross)................. 47,575 43,131 42,455 40,289 40,349
======= ======= ======= ======= =======
</TABLE>

EUROPEAN LOAN PORTFOLIO

The European loan portfolio is comprised of loans made from offices and
branches located in Europe, excluding The Netherlands. The following tables
analyze, at the dates indicated, the European private sector loan portfolio by
type of collateral and industry of the borrower.

26
<PAGE>
PRIVATE SECTOR LOANS BY TYPE OF COLLATERAL

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
COMMERCIAL
Public authority guarantees.................... 1,511 952 1,519 2,089 1,189
Mortgages...................................... 649 851 531 674 335
Securities..................................... 193 486 427 33 1,725
Bank guarantees................................ 639 649 1,236 536 141
Other types of collateral and unsecured........ 21,187 18,284 17,766 15,663 16,959
------- ------- ------- ------- -------
24,179 21,222 21,479 18,995 20,349
RETAIL
Public authority guarantees.................... 9 -- 46 2 263
Mortgages...................................... 265 263 281 353 349
Other types of collateral and unsecured........ 1,416 1,091 857 774 652
------- ------- ------- ------- -------
1,690 1,354 1,184 1,129 1,264
------- ------- ------- ------- -------
Total private sector loans (gross)............. 25,869 22,576 22,663 20,124 21,613
======= ======= ======= ======= =======
</TABLE>

COMMERCIAL LOANS BY INDUSTRY

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy................. 1,052 1,397 1,952 1,388 1,119
Manufacturing.................................. 6,689 6,038 4,581 5,093 5,114
Construction and real estate................... 1,555 1,312 1,407 1,274 2,327
Wholesale and retail trade..................... 3,558 3,549 3,422 3,085 2,350
Transportation and communications.............. 2,524 2,272 3,034 2,417 1,635
Financial services............................. 3,269 2,832 3,370 2,788 3,148
Business services.............................. 3,091 1,907 2,011 1,767 2,534
Education, health care and other services...... 2,441 1,915 1,702 1,183 2,122
------- ------- ------- ------- -------
Total commercial loans (gross)................. 24,179 21,222 21,479 18,995 20,349
======= ======= ======= ======= =======
</TABLE>

NORTH AMERICAN LOAN PORTFOLIO

The North American loan portfolio is comprised of loans made by the LaSalle
Group and European American Bank, loans made by offices and branches located in
the United States, Canada and Mexico and, beginning in 1997, loans made by
Standard Federal. The Standard Federal loan portfolio consists primarily of
mortgage loans. The following tables analyze, at the dates indicated, the North
American private sector loan portfolio by type of collateral and by industry of
the borrower.

27
<PAGE>
PRIVATE SECTOR LOANS BY TYPE OF COLLATERAL

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Public authority guarantees.................... 868 832 698 372 547
Mortgages...................................... 7,898 5,171 4,310 3,003 2,606
Securities..................................... 424 384 294 328 344
Bank guarantees................................ 180 79 72 85 25
Other types of collateral and unsecured........ 26,457 19,627 16,337 16,676 12,674
------- ------- ------- ------- -------
35,827 26,093 21,711 20,464 16,196
RETAIL
Public authority guarantees.................... 2 2 9 8 --
Mortgages...................................... 19,821 18,201 18,511 7,030 5,756
Other types of collateral and unsecured........ 2,307 2,194 2,958 1,612 1,295
------- ------- ------- ------- -------
22,130 20,397 21,478 8,650 7,051
------- ------- ------- ------- -------
Total private sector loans (gross)............. 57,957 46,490 43,189 29,114 23,247
======= ======= ======= ======= =======
</TABLE>

COMMERCIAL LOANS BY INDUSTRY

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy................. 2,539 2,699 2,367 2,539 817
Manufacturing.................................. 8,495 5,905 5,637 6,434 5,723
Construction and real estate................... 8,219 6,067 4,395 2,664 1,949
Wholesale and retail trade..................... 5,173 3,553 2,572 2,880 2,999
Transportation and communications.............. 2,216 2,494 1,514 1,472 1,321
Financial services............................. 1,804 1,923 1,482 463 822
Business services.............................. 2,628 1,682 1,381 1,422 899
Education, health care and other services...... 4,753 1,770 2,363 2,590 1,666
------- ------- ------- ------- -------
Total commercial loans (gross)................. 35,827 26,093 21,711 20,464 16,196
======= ======= ======= ======= =======
</TABLE>

28
<PAGE>
ANALYSIS OF LOAN LOSS EXPERIENCE: PROVISIONS AND ALLOWANCES FOR LOAN LOSSES

As used in this Report, the term "provisions" denotes the charge to income,
while "allowance" denotes the accumulated balance sheet position created by such
provisions and held against the value of the assets.

PROVISIONING POLICY

Credit officers continually monitor the quality of loans. If doubt exists as
to repayment, loans are transferred to special credit departments. After
assessment, the special credit departments determine the amount, if any, of the
specific provision that should be made, taking into account the value of
collateral. Three times a year, the Group Credit Committee evaluates the
specific allowances for credit risks that are above a certain level and reviews
loans identified as special mention credits because of credit or industry
factors to determine whether additional provisioning is required. It is our
policy to establish and maintain, through charges against income, a specific
allowance sufficient to cover the estimated loss when credit risks or economic
or political factors make recovery doubtful.

Provisioning for consumer loans and residential mortgages takes place on a
portfolio basis with the specific allowance being maintained at a level
commensurate with the size of the portfolio and with historical loss experience.

We also establish specific allowances for country risk. Country risk
concerns a country's inability to service its external debt, as often evidenced
by rescheduling or payment arrears. Specific allowances for country risk are
based on provisioning level ranges suggested by the Dutch Central Bank. See Item
9--"Management's Discussion and Analysis of Financial Condition and Results of
Operations" for additional information concerning specific allowances for
country risk.

For collection purposes, our company continues to accrue interest on
doubtful loans, which are loans classified as "doubtful" or "loss," but a
provision is made for interest in suspense against interest revenue in the
income statement for non-performing doubtful loans. Doubtful loans are not
written off until it is clear that repayment of principal can be ruled out. As
provisioning is tax deductible in The Netherlands, it is unnecessary for the
Bank, as is the case for U.S. banks, to write off doubtful loans to achieve tax
savings. U.S. banks stop accruing interest when loans become overdue by 90 days
or more or when recovery is doubtful. For these reasons the relative level of
allowance and doubtful loans is generally higher for Dutch banks than for U.S.
banks.

The following table shows our specific allowances for loan losses and for
country risk.

Nonperforming loans as a percentage of total private sector loans (gross)
decreased to 2.26% in 1999 from 2.39% in 1998 after increasing from 1.59% in
1997. On balance, the quality of the loan portfolio remains good. The Dutch
economy continued to be strong, with the level of doubtful loans increasing only
moderately despite volume growth. Strong economies in the United States and
certain other countries in which we have substantial operations were also
reflected in a continuation of a low

29
<PAGE>
level of specific provisioning for individual credits in those countries.
Although we operate in emerging market countries, our exposure in terms of loans
and trading portfolios in those countries is relatively small compared to the
Bank's worldwide credit business. Accordingly, the specific provisions for loan
losses as a percentage of total private sector loans (gross) was 0.32% in 1999,
as compared to 0.35% and 0.36% in 1998 and 1997, respectively. At December 31,
1999, total specific allowances were EUR 381 million or 8.3% higher than at
December 31, 1998, due primarily to currency translation differences. Specific
allowances for loan losses as a percentage of total private sector loans (gross)
decreased to 2.11% at December 31, 1999, as compared to 2.25% and 1.74% at
December 31, 1998 and 1997, respectively.

Provision for loan losses fell from EUR 941 million in 1998 to EUR
653 million in 1999. In light of the 1998 losses on transactions with Russian
banks and increased cross-border exposure to a number of countries, including
Indonesia, Thailand and Pakistan, in 1999, EUR 25 million could be released from
provision for loan losses. In 1998, EUR 303 million had been added for
cross-border risks. The remaining addition in 1999 of EUR 678 million to
provision for loan losses related to specific bad debt provisions. In 1998,
specific bad debt provisions totaled EUR 638 million.

Movements in the Fund for general banking risks during 1999 resulted in a
level of EUR 1,232 million at December 31, 1999. As a result, EUR 20 million was
released from the Fund for general banking risks in 1999. The combined provision
for loan losses and release from the Fund for general banking risks amounted to
EUR 633 million in 1999 compared to EUR 840 million in 1998.

The table below shows, for the five years ended December 31, 1999, the
composition of the aggregate charge to income regarding the specific provision
for loan losses and additions to the Fund for general banking risks for 1999,
1998, 1997 and 1996 and for the provision for general contingencies for 1995.

<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Net provisions for loan losses (1).......................... 678 638 595 638 389
Net provisions for country risk (1)......................... (25) 303 (48) (69) (61)
--- ---- --- --- ---
Total specific provisions................................... 653 941 547 569 328
Addition to Fund for general banking risks.................. (20) (101) 179 66 --
Addition to provision for general contingencies............. -- -- -- -- 307
--- ---- --- --- ---
Total charge against profit................................. 633 840 726 635 635
=== ==== === === ===
</TABLE>

- ------------------------

(1) Net of recoveries and releases. See "Movements in Specific Allowances for
Loan Losses" and "Movements in Specific Allowances for Country Risk."

The following tables analyze the movements of the specific allowances for
loan losses and country risk: amounts written off (net of recoveries), new
provisions charged against profit (increases and releases) and growth of the
allowance as a consequence of the charge of interest to doubtful loans. The
allowance for interest in suspense is included in the specific allowance for
loan losses.

30
<PAGE>
MOVEMENTS IN SPECIFIC ALLOWANCES FOR LOAN LOSSES

<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Balance at beginning of year............................. 4,116 2,894 2,402 2,469 2,581
Acquisitions, currency translation differences and other
adjustments............................................ 178 957 233 (88) (32)
Amounts written off......................................
The Netherlands........................................ (132) (187) (181) (380) (361)
North America.......................................... (236) (238) (161) (137) (90)
Rest of the world...................................... (403) (102) (123) (233) (142)
----- ----- ----- ----- -----
(771) (527) (465) (750) (593)
Recoveries............................................... 119 77 54 48 38
Subtotal................................................. 3,642 3,401 2,224 1,679 1,994
Provision for interest in suspense....................... 138 77 75 85 86
New and increased specific provisions....................
The Netherlands........................................ 196 241 273 458 373
North America.......................................... 273 203 270 165 119
Rest of the world...................................... 735 706 381 372 355
----- ----- ----- ----- -----
1,204 1,150 924 995 847
Releases of specific provisions..........................
The Netherlands........................................ (107) (109) (114) (139) (305)
North America.......................................... (60) (132) (58) (83) (57)
Rest of the world...................................... (240) (194) (103) (87) (58)
----- ----- ----- ----- -----
(407) (435) (275) (309) (420)
Recoveries...............................................
The Netherlands........................................ (3) (6) (2) (3) (7)
North America.......................................... (47) (46) (42) (31) (22)
Rest of the world...................................... (69) (25) (10) (14) (9)
----- ----- ----- ----- -----
(119) (77) (54) (48) (38)
New and increased specific provisions (net).............. 678 638 595 638 389
----- ----- ----- ----- -----
Balance at end of year................................... 4,458 4,116 2,894 2,402 2,469
===== ===== ===== ===== =====
</TABLE>

MOVEMENTS IN SPECIFIC ALLOWANCES FOR COUNTRY RISK

<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Balance at beginning of year................................ 494 410 418 478 718
Currency translation differences............................ 74 (23) 47 27 (33)
Provisions charged (released) against profit and loss
account................................................... (25) 303 (48) (69) (61)
Other movements............................................. (10) (196) (7) (18) (146)
--- ---- --- --- ----
Balance at end of year...................................... 533 494 410 418 478
=== ==== === === ====
</TABLE>

31
<PAGE>
SPECIFIC ALLOWANCE FOR LOAN LOSSES BY INDUSTRY

The following table analyzes the allowance for loan losses by industry at
December 31, 1999, 1998, 1997, 1996 and 1995.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy........................... 183 158 141 73 57
Manufacturing............................................ 1,234 1,268 565 513 404
Construction and real estate............................. 277 190 214 203 306
Wholesale and retail trade............................... 941 867 537 434 466
Transportation and communications........................ 244 208 255 208 128
Financial services....................................... 388 424 304 244 196
Business services........................................ 349 227 253 159 269
Education, health care and other services................ 350 277 245 212 344
----- ----- ----- ----- -----
Total commercial......................................... 3,966 3,619 2,514 2,046 2,170
Retail................................................... 492 497 380 356 299
----- ----- ----- ----- -----
Total private sector..................................... 4,458 4,116 2,894 2,402 2,469
===== ===== ===== ===== =====
</TABLE>

NET SPECIFIC PROVISIONS FOR LOAN LOSSES BY INDUSTRY

The following table analyzes the percentage of loans in each industry to
total private sector loans at December 31, 1999, 1998, 1997, 1996 and 1995.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN PERCENTAGES)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy........................... 5.1 4.9 5.0 6.4 4.9
Manufacturing............................................ 14.6 14.5 13.8 16.3 16.4
Construction and real estate............................. 7.1 6.9 6.1 6.0 7.1
Wholesale and retail trade companies..................... 9.1 9.6 9.5 10.6 12.4
Transportation and communications........................ 4.9 5.2 5.5 5.2 5.7
Financial services....................................... 8.3 8.9 9.7 11.6 7.3
Business services........................................ 5.8 4.6 5.4 4.8 7.0
Education, health care and other services................ 6.5 5.8 6.4 7.6 8.5
----- ----- ----- ----- -----
Total commercial......................................... 61.4 60.4 61.4 68.5 69.3
Retail................................................... 38.6 39.6 38.6 31.5 30.7
----- ----- ----- ----- -----
Total private sector..................................... 100.0 100.0 100.0 100.0 100.0
===== ===== ===== ===== =====
</TABLE>

32
<PAGE>
NET SPECIFIC PROVISIONS FOR LOAN LOSSES BY INDUSTRY

The following table analyzes net specific provisions for loan losses
(inclusive of provision for interest in suspense) by industry for 1999, 1998,
1997, 1996 and 1995.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------------
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy.............................. 77 49 67 42 --
Manufacturing............................................... 101 249 114 126 62
Construction and real estate................................ 44 6 34 33 59
Wholesale and retail trade companies........................ 128 85 134 139 95
Transportation and communications........................... 84 26 18 66 28
Financial services.......................................... 14 4 35 24 7
Business services........................................... 28 38 91 40 50
Education, health care and other services................... 76 57 24 105 48
--- --- --- --- ---
Total commercial............................................ 552 514 517 575 349
Retail...................................................... 264 201 153 148 126
--- --- --- --- ---
Total private sector........................................ 816 715 670 723 475
of which interest in suspense............................... 138 77 75 85 86
--- --- --- --- ---
Total specific provisions (net)............................. 678 638 595 638 389
=== === === === ===
</TABLE>

ANALYSIS OF WRITE-OFFS BY INDUSTRY

The following table analyzes the amounts written off by industry during
1999, 1998, 1997, 1996 and 1995.

<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Agriculture, mining and energy.............................. 13 19 21 21 25
Manufacturing............................................... 67 45 46 131 75
Construction and real estate................................ 55 32 32 138 110
Wholesale and retail trade.................................. 57 67 129 108 103
Transportation and communications........................... 31 25 24 34 11
Financial services.......................................... 31 50 16 41 8
Business services........................................... 90 36 34 67 81
Education, health care and other services................... 40 64 49 77 99
--- --- --- --- ---
Total commercial............................................ 384 338 351 617 512
Retail...................................................... 387 189 114 133 81
--- --- --- --- ---
Total private sector........................................ 771 527 465 750 593
=== === === === ===
</TABLE>

POTENTIAL CREDIT RISK LOANS

The table below provides an analysis of our doubtful loans for 1999, 1998,
1997, 1996 and 1995. "Doubtful loans" are all loans classified as "doubtful" or
"loss" for which in general a specific provision has been made, although
doubtful loans can still be performing. The amounts are stated before deduction
of the value of collateral held, the specific allowances carried and interest in
suspense. As we are not required by Dutch regulations to classify loans as
"non-accrual," "accruing past due," "restructured" and "potential problem"
loans, as defined by the Securities and Exchange Commission, the table below is
based on available data for 1999, 1998, 1997, 1996 and 1995.

33
<PAGE>
DOUBTFUL LOANS

<TABLE>
<CAPTION>
INTEREST INCLUDED INCLUDED INCLUDED
REVENUE IN IN IN
NOT INTEREST INTEREST INTEREST
RECOGNIZED REVENUE REVENUE REVENUE
1999 1998 1997 1996 1995 1999 (4) 1999 (5) 1998 (5) 1997 (5)
-------- -------- -------- -------- -------- ---------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
NON-ACCRUAL LOANS (1)
The Netherlands.............. 379 528 582 810 791 35 -- -- --
North America................ 443 155 167 210 218 38 9 1 2
Rest of the world............ 721 761 410 536 487 22 1 -- 1
----- ----- ----- ----- ----- --- --- --- ---
1,543 1,444 1,159 1,556 1,496 95 10 1 3
NON-PERFORMING LOANS FOR
WHICH INTEREST HAS BEEN
SUSPENDED (2)
The Netherlands.............. 401 591 500 466 583 38 -- -- --
North America................ 53 186 303 155 179 9 -- 2 1
Rest of the world............ 2,794 2,162 683 391 440 91 4 3 11
----- ----- ----- ----- ----- --- --- --- ---
3,248 2,939 1,486 1,012 1,202 138 4 5 12
ACCRUING LOANS (3)
The Netherlands.............. 1,682 1,560 1,946 1,526 1,597 -- 120 113 110
North America................ 93 26 22 92 132 -- 7 2 1
Rest of the world............ 1,014 609 394 301 200 -- 40 30 27
----- ----- ----- ----- ----- --- --- --- ---
2,789 2,195 2,362 1,919 1,929 -- 167 145 138
----- ----- ----- ----- ----- --- --- --- ---
TOTAL DOUBTFUL LOANS......... 7,580 6,578 5,007 4,487 4,627 233 181 151 153
===== ===== ===== ===== ===== === === === ===
</TABLE>

(1) "Non-accrual loans" are loans placed on a non-accrual basis but not yet
written off.

(2) "Non-performing loans" are loans on which we continue to accrue interest,
but which is included in interest revenue only if interest is actually
received.

(3) "Accruing loans" are loans on which we continue to charge interest that is
included in interest revenue.

(4) "Interest not recognized" is the difference between the interest revenue
that would have been recognized under original contractual terms and the
interest revenue actually recognized in the relevant year.

(5) "Included in interest" is the amount of interest revenue that is recognized
in the relevant year.

The following table sets forth the outstanding principal balance of loans as
of December 31, 1999, 1998, 1997, 1996 and 1995 that were restructured.

<TABLE>
<CAPTION>
INCLUDED INCLUDED INCLUDED
IN IN IN
INTEREST INTEREST INTEREST
REVENUE REVENUE REVENUE
1999 1998 1997 1996 1995 1999 1998 1997
-------- -------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
The Netherlands........................... -- -- -- 22 37 -- -- --
North America............................. 10 15 16 2 4 -- 1 --
Rest of the world......................... 369 316 43 144 166 9 50 10
--- --- -------- --- --- -------- -------- --------
379 331 59 168 207 9 51 10
=== === ======== === === ======== ======== ========
</TABLE>

34
<PAGE>
COUNTRY RISK EXPOSURE AND RELATED SPECIFIC ALLOWANCES

The following table sets forth our country risk exposure and related
specific allowances at December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
AT DECEMBER 31,
----------------------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C>
Country risk exposure....................... 1,342 1,778 944
Country risk specific allowances............ (533) (494) (410)
----- ----- ----
Net exposure................................ 809 1,284 534
===== ===== ====
Net exposure as a percentage of group
capital................................... 2.8% 5.3% 2.2%
</TABLE>

Total country risk exposure, excluding trade debts, decreased by EUR
436 million in 1999 due to the release of a number of countries which no longer
required provision allowances. Specific allowances for country risk represented
40% of total country risk exposure at December 31, 1999, as compared to 28% at
December 31, 1998 and 43% at December 31, 1997. Of the total country risk
exposure at December 31, 1999, EUR 426 million, or 32%, was collateralized
mainly by U.S. Treasury zero coupon bonds issued as part of Brady
restructurings. This collateral is designed to cover fully the principal due on
maturity. In determining specific allowances for country risk the estimated
current value of this collateral has been taken into account.

CROSS-BORDER OUTSTANDINGS

Our operations involve significant exposure in non-local currencies. These
cross-border outstandings are controlled by the Group Credit Committee through a
country risk management system that requires frequent monitoring of outstandings
to avoid concentrations of transfer, economic and political risk. Cross-border
outstandings are based on the country of domicile of the borrower and comprise
loans denominated in currencies other than the borrower's local currency.

Cross-border outstandings exceeding 1% of total assets at December 31, 1999,
1998 and 1997 are shown in the following table. These figures are not netted for
any legally enforceable written guarantees of principal or interest by domestic
or other non-local third parties. At the dates below, there are no outstandings
exceeding 1% of total assets in any country where current conditions give

35
<PAGE>
rise to liquidity problems which are expected to have a material impact on the
timely repayment of interest or principal. The table does not include
off-balance sheet items.

<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL TOTAL PRIVATE
ASSETS AMOUNT BANKS GOVERNMENT SECTOR
---------- -------- -------- ---------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C>
DECEMBER 31, 1999
United Kingdom................................. 3.7 16,976 9,808 39 7,129
United States.................................. 3.9 17,845 3,719 1,192 12,934
Germany........................................ 2.7 12,430 7,487 3,865 1,078
France......................................... 1.3 5,838 2,751 1,187 1,900
Belgium........................................ 2.6 11,795 5,513 4,321 1,961
Italy.......................................... 3.0 13,542 2,830 9,693 1,019
Japan.......................................... 1.2 5,406 769 -- 4,637

DECEMBER 31, 1998
United Kingdom................................. 5.0 21,407 10,879 1,764 8,764
United States.................................. 3.4 14,906 3,527 3,115 8,264
Germany........................................ 3.4 14,823 4,938 9,143 742
France......................................... 2.5 10,865 6,474 3,378 1,013
Belgium........................................ 2.3 10,106 5,381 3,354 1,371
Italy.......................................... 2.1 8,840 2,666 5,353 821

DECEMBER 31, 1997
United Kingdom................................. 5.6 21,273 9,926 1,218 10,129
United States.................................. 3.0 11,352 2,329 2,810 6,213
Germany........................................ 2.7 10,389 5,125 4,613 651
Belgium........................................ 1.9 7,043 4,594 995 1,454
Japan.......................................... 1.8 6,968 4,792 117 2,059
France......................................... 1.8 6,758 5,099 290 1,369
Italy.......................................... 1.6 5,899 3,287 1,832 780
</TABLE>

CROSS-BORDER OUTSTANDINGS BETWEEN 0.75% AND 1% OF TOTAL ASSETS

Cross-border outstandings to borrowers in countries in which such
outstandings amounted to between 0.75% and 1% of total assets totaled EUR
3,848 million at December 31, 1999 and related entirely to Spain. At
December 31, 1998, these outstandings totaled EUR 3,314 million and related
entirely to Switzerland. At December 31, 1997, these outstandings totaled EUR
5,907 million and related to Sweden and Switzerland.

LOAN CONCENTRATIONS

One of the principal factors influencing the quality of our earnings and
loan portfolio is diversification of loans by region, industry and borrower. A
concentration exists when loans are made to a multiple number of borrowers
engaged in similar activities all of whom are subject to roughly the same
effects of economic conditions or other changes. At December 31, 1999, there was
no concentration of loans exceeding 10% of our total loans (gross).

36
<PAGE>
LIABILITIES

Deposits and short-term borrowings are included in the balance sheet items
Banks, Total customer accounts and Debt securities.

DEPOSITS

The following table presents the average amount of and the average rate paid
on each deposit category representing in excess of 10% of average total deposits
during the three most recent fiscal years. The geographic allocation is based on
the location of the office or branch where the deposit is made.

<TABLE>
<CAPTION>
1999 1998 1997
------------------- ------------------- -------------------
AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE AVERAGE
AMOUNT RATE (%) AMOUNT RATE (%) AMOUNT RATE (%)
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C>
BANKS
The Netherlands
Time deposits(1)................................. 9,226 6.7 43,925 5.8 22,714 5.3
Demand deposits/Current accounts................. 16,804 6.5 16,323 5.9 11,371 4.4
Foreign
Time deposits(1)................................. 52,566 5.5 70,454 4.6 53,110 4.8
Demand deposits/Current accounts................. 24,919 3.8 14,440 3.2 10,914 3.5

TOTAL CUSTOMER ACCOUNTS
The Netherlands
Savings accounts................................. 29,520 4.0 28,587 3.8 29,088 4.0
Time deposits(1)................................. 18,313 5.8 16,441 4.0 21,937 4.1
Demand deposits/Current accounts................. 33,355 3.9 24,647 2.1 20,048 2.3
Others........................................... 10,682 6.8 6,226 5.6 5,517 5.4
Foreign
Savings accounts................................. 37,101 4.3 30,281 4.3 27,964 4.5
Time deposits(1)................................. 67,364 5.7 70,559 4.9 46,499 4.7
Demand deposits/Current accounts................. 18,104 3.5 12,545 2.9 9,669 3.0
Others........................................... 10,928 5.5 8,589 5.1 6,585 4.9
</TABLE>

- ------------------------

(1) Includes our Eurodollar deposit activities and professional securities
transactions. Time deposits are funds whereby the original term, the period
of notice and interest payable have been agreed upon with the counterparty.

Average amounts of deposits by foreign customers in the Dutch branches and
offices included under Banks were for 1999, 1998 and 1997, EUR 34.9 billion, EUR
27.0 billion and EUR 26.0 billion, respectively, and for Total client accounts
were for 1999, 1998 and 1997, EUR 18.2 billion, EUR 14.7 billion and EUR
14.7 billion, respectively.

37
<PAGE>
DEPOSITS OF USD 100,000 OR MORE

At December 31, 1999, deposits of USD 100,000 or more or the equivalent in
other currencies, held in the United States, in time deposits and certificates
of deposits by term remaining until maturity were:

<TABLE>
<CAPTION>
AT DECEMBER 31, 1999
--------------------
(IN MILLIONS OF EUR)
<S> <C>
3 months or less.......................................... 7,267
more than 3 months but less than 6 months................. 1,836
more than 6 months but less than 12 months................ 581
over 12 months............................................ 6,629
Total..................................................... 16,313
</TABLE>

SHORT-TERM BORROWINGS

Short-term borrowings are borrowings with an original maturity of one year
or less. These are included in our consolidated balance sheet under the items
Banks, Total customer accounts and Debt securities. Categories of short-term
borrowings for which the average balance outstanding during the preceding three
fiscal years was equal to or greater than 30% of consolidated shareholders'
equity at December 31, 1999 were included in the item Debt Securities and
consisted of certificates of deposits and commercial paper. An analysis of the
balance and interest rates paid on such item is provided below.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR EXCEPT
PERCENTAGES)
<S> <C> <C> <C>
Year-end balance.................................... 29,156 19,174 23,249
Average balance..................................... 24,053 20,500 22,215
Maximum month-end balance........................... 31,278 23,168 23,725
Average interest rate during the year............... 6.1% 6.0% 6.3%
Average interest rate at year-end................... 6.0% 5.9% 6.0%
</TABLE>

For an analysis of the maturities of our liabilities at December 31, 1999,
see the notes to the Consolidated Financial Statements.

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<PAGE>
SUPERVISION AND REGULATION

REGULATION IN THE NETHERLANDS

GENERAL

Holding and its subsidiaries, on a worldwide basis, are extensively
regulated in The Netherlands by the Dutch Central Bank.

The bank regulatory system in The Netherlands is a comprehensive system
based on the provisions of the Act on the Supervision of the Credit System 1992
or the ASCS 1992. Certain European Union banking directives made it necessary to
amend the Act on the Supervision of the Credit System that had regulated the
Dutch banking system since 1978, and the new ASCS 1992 entered into force on
January 1, 1993.

The Bank is a "universal bank" under the terms of the ASCS 1992 because it
is engaged in the securities business as well as the banking business. Certain
provisions of the ASCS 1992, summarized below, may restrict the Bank's ability
to make capital contributions or loans to its subsidiaries and to make dividends
and distributions to Holding.

SUPERVISION OF CREDIT INSTITUTIONS

In general, under the ASCS 1992, credit institutions are supervised by the
Dutch Central Bank. No enterprise or institution established in The Netherlands
shall pursue the business of a credit institution unless it has obtained prior
authorization from the Dutch Central Bank. Its supervisory activities under the
ASCS 1992 focus on monetary supervision and supervision of solvency, liquidity
and administrative organization including internal control and risk management.
In addition, the ASCS 1992 contains provisions regarding the structure of credit
institutions. The Dutch Central Bank is authorized to issue directives in each
of those areas of supervision. If, in the opinion of the Dutch Central Bank, a
credit institution fails to comply with the Dutch Central Bank's directives
concerning solvency, liquidity or administrative organization, the Dutch Central
Bank will so notify the credit institution, and it may instruct the credit
institution to behave in a certain manner. If the credit institution does not
respond to any such instructions to the satisfaction of the Dutch Central Bank,
the Dutch Central Bank may exercise additional supervisory measures, which may
include the revocation of the license of the credit institution.

The ASCS 1992 provides that each supervised credit institution shall submit
periodic reports to the Dutch Central Bank. In accordance with the Dutch Central
Bank directives promulgated pursuant to the ASCS 1992, the Bank files monthly
reports with the Dutch Central Bank. At least one monthly report for each given
year must be certified by a registered accountant. The report to be certified is
selected by the registered accountant in its discretion.

SOLVENCY SUPERVISION

The Solvency Guidelines of the Dutch Central Bank, as amended on January 1,
1991, in accordance with the solvency guidelines of the Council of the European
Communities and the Basle Accord, require that we maintain a minimum level of
total capital (as defined below) to support the risk-weighted total value of
balance sheet assets and off-balance sheet items, the latter of which includes
guarantees, documentary credits, certain interest-and currency-related
contracts, unused portions of committed credit facilities with an original
maturity of over one year, note issuance facilities and revolving underwriting
facilities. This minimum level of total capital is the Capital Adequacy Ratio.
The risk-weighting considers the debtor's risk, which depends on the debtor's
classification, whether or not security is provided, and the country of origin
of the debtor. The required minimum Capital Adequacy Ratio currently is 8.00%.
On January 1, 1996 additional solvency guidelines became effective, implementing
the Capital Adequacy Directive of March 15, 1993 (93/6/EEC) issued by the
Council of the European Communities. Due to the adoption of this directive to
the regulations for market risk of the Basle Committee, internal value at risk
models for the calculation of solvency requirements for

39
<PAGE>
trading portfolios have been in use since the beginning of 1998. The Solvency
Guidelines are applied to the world-wide assets of Dutch credit institutions.

For our company, total capital consists of core capital (also referred to as
Tier 1 capital) and secondary capital (also referred to as Tier 2 capital). As
of January 1, 1996, pursuant to the Capital Adequacy Directive, we may also
maintain an additional form of regulatory capital, Tier 3 capital, to support
the market risks of financial instruments in its trading book and foreign
exchange risk of all business activities. Tier 1 capital consists of
shareholders' equity and minority interests. Secondary or Tier 2 capital is
divided into upper Tier 2 capital and lower Tier 2 capital. Upper Tier 2 capital
consists of revaluation reserves and perpetual subordinated debt; lower Tier 2
capital consists mainly of long-term subordinated debt. Tier 3 capital consists
of subordinated debt that has a minimum original maturity of at least two years,
is not subject to redemption prior to maturity without the prior written consent
of the Dutch Central Bank (other than in the event of a winding-up of the Bank)
and is subject to a provision which provides that neither interest nor principal
may be paid if, prior to or as a result of such payment, our Capital Adequacy
Ratio would be less than the required minimum.

The amount of lower Tier 2 capital may not exceed 50% of the amount of Tier
1 capital, and the amount of Tier 2 capital included in total capital may not
exceed the amount of Tier 1 capital. In addition, Tier 3 capital may not exceed
250% of the amount of Tier 1 capital that is necessary to support market and
foreign exchange risks and the sum of Tier 2 and Tier 3 capital may not exceed
Tier 1 capital. Goodwill and interests of more than 10% in non-consolidated
banking and financial subsidiaries must be deducted from Tier 1 capital and
total capital, respectively.

See Item 8--"Selected Financial Data" and Item 9--"Management's Discussion
and Analysis of Financial Condition and Results of Operations--Capital
Resources" for information concerning the Bank's capital ratios.

EXPOSURE SUPERVISION

The Dutch Central Bank has issued specific rules with respect to large
exposures to a single borrower or group of interconnected borrowers or in
relation to certain other businesses that involve a concentration of risk. These
large exposure rules implement the Large Exposures Directive of December 21,
1992 (92/121/EEC) and the Capital Adequacy Directive. Large exposures generally
include all assets and off-balance sheet items of a credit institution with
respect to a single borrower or a group of connected borrowers which exceed 10%
of a credit institution's total capital. Large exposures must be reported once
every quarter to the Dutch Central Bank. There is a limit of 25% of total
capital for a single large exposure being part of the banking book. Trading book
positions may exceed this limit subject to additional solvency requirements. The
aggregate amount of all large exposures of a credit institution may not exceed
800% of its total capital.

In addition, under the Solvency Guidelines, certain other exposures are
limited as a percentage of total capital as follows: exposures to the Dutch
central government, the Dutch local government and other central governments of
the so-called "Zone A" countries, which include the OECD countries, have no
limit; exposures to local governments of OECD countries are weighted at 50%;
exposures to banks with a remaining maturity of up to or less than one year or
more than one year are weighted at 20% and 50%, respectively; and exposures to
others are weighted at 100%. Equity participations in insurance companies are
exempt up to a level of 40% of total capital of the credit institution.

Facilities and loans to, and investments in, non-banks by credit
institutions of 1% or more of total capital must be registered with the Dutch
Central Bank. For banks, the threshold is 3% of total capital. Regulations of
the Dutch Central Bank also bar a credit institution from lending (on either a
secured or an unsecured basis) to any director or member of senior management of
the credit institution without the prior approval of the Dutch Central Bank more
than the lesser of 5% of its total capital and, if the loan is unsecured, five
times the monthly salary of the borrower.

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<PAGE>
LIQUIDITY SUPERVISION

The Dutch Central Bank has issued liquidity directives designed to ensure
that liquid assets are held against liquid liabilities, defined as liabilities
with a remaining term to maturity of less than one year, so that such
liabilities can be met on the due date or on demand, as the case may be. Actual
liquidity must be equal to or greater than the required liquidity, and actual
cash liquidity, which includes assets with a very high liquidity such as
deposits with central banks and other banks, must be equal to or greater than
the amounts of very liquid debts. Certain assets are deemed to be liquid only in
part, depending on their negotiability. The liquidity requirements associated
with non-term liabilities depend on the credit institution's expectations as to
claims relating to such liabilities. In determining liquidity requirements
associated with term liabilities, assets and liabilities with the same term, to
the extent that the remaining term to maturity is less than one year, are offset
against each other. After giving effect to any offset of term assets, the
liquidity requirement is 20%. For obligations amounting to more than 3% of total
liabilities, there are additional liquidity requirements.

We report to the Dutch Central Bank on a monthly basis concerning its
compliance with the liquidity requirements. Compliance reports concerning
liquidity requirements of foreign subsidiaries are submitted to appropriate
foreign regulatory authorities as required. In every country in which we
operate, our liquidity satisfies the standards imposed by the applicable
regulatory authorities.

STRUCTURAL SUPERVISION

The ASCS 1992 requires a declaration of no objection from the Dutch Minister
of Finance upon consultation with the Dutch Central Bank for certain changes in
the structure of credit institutions, such as mergers, participations of over 5%
in the outstanding share capital of a credit institution or 10% or more in a
non-financial institution by voting or otherwise (each being a "qualifying
participation"), the addition of a managing partner to the credit institution,
repayments of capital or distribution of reserves of the credit institution and
financial reorganization. Approval will be denied if, among other things, the
Dutch Central Bank determines that sound banking policy may be jeopardized, that
an undesirable effect on the Dutch credit system might result or that a conflict
might arise in respect of certain solvency directives.

The Dutch Central Bank together with the Dutch Minister of Finance has
developed a "structural policy" for equity participations by credit institutions
in non-financial institutions. Under this policy, an equity participation is not
allowed if the value of the participation would exceed 15% of a credit
institution's total capital or if the participation would cause the value of the
credit institution's aggregate qualifying participations in non-financial
institutions to exceed 60% of its total capital. Certain types of participations
will be approved in principle, although in certain circumstances such
declaration of no-objection will have a limited period of validity, such as, in
the case of a debt rescheduling or rescue operation or when the participation is
acquired and held as part of an issue underwriting operation. The approval
generally will be given where the value of the non-financial institution
concerned or the value of the participation does not exceed certain threshold
amounts.

SUPERVISION OF THE SECURITIES BUSINESS

The Bank is also subject to supervision of its activities in the securities
business. The Act on the Supervision of the Securities Trade 1995, the ASST
1995, together with the decrees and regulations promulgated pursuant thereto,
provide a comprehensive framework for the conduct of securities trading in or
from The Netherlands. The ASST 1995 replaced the Act on the Supervision of the
Securities Trade 1992 and came into effect on December 31, 1995. It incorporates
two European Union directives, the Investment Services Directive of May 10, 1993
( 93/22/EEC) and the Capital Adequacy Directive. The Securities Board of The
Netherlands (Stichting Toezicht Effectenverkeer, the "STE") is charged by the
Dutch Minister of Finance with supervision of the securities industry.

41
<PAGE>
The ASST 1995 also recognizes the self-regulatory supervision of certain
securities exchanges, including the AEX Stock Exchange and the AEX Option
Exchange. Although such exchanges themselves are, as self-regulatory
organizations, responsible for establishing rules and ensuring compliance
therewith, they are subject to reporting obligations to, and ultimate
supervision by the STE. As an institution permitted to trade on the AEX Stock
Exchange and the AEX Option Exchange, the Bank must comply with the rules of
those exchanges. Exchanges have the power to take disciplinary action against
admitted institutions if their rules are violated. In turn, the Securities Board
of The Netherlands, as the supervisor over certain exchanges, monitors whether
those exchanges duly enforce their own rules.

SUPERVISION OF INVESTMENT BUSINESS

The Bank and/or certain subsidiaries of the Bank are also active as managers
and/or custodians of collective investment plans, which comprise both investment
funds and investment companies. Collective investment plans are subject to
supervision by the Dutch Central Bank pursuant to the Act on the Supervision of
Investment Institutions 1990.

REGULATION IN THE EUROPEAN UNION

Within the European Union, the creation of a single financial market at the
end of 1992 has involved continued negotiations among member states towards
establishing greater freedom in the cross-border banking and securities business
through a harmonized institutionally based regulatory environment, with emphasis
on the role of the home country regulator. The Second Banking Co-ordination
Directive established a framework for the mutual recognition of such European
Economic Area member state's supervision of banks, enabling a bank authorized in
one European Economic Area member state to carry out banking and investment
activities on a branch or cross-border service basis in other European Economic
Area member states on the basis of a single license provided by the home country
supervisory authority. An equivalent measure for securities firms carrying out
investment business, the Investment Services Directive, was implemented in The
Netherlands as part of the ASST 1995.

Supporting the Second Banking Co-ordination Directive are the Solvency and
Own Funds directives, which establish a minimum harmonization of regulatory
capital requirements to enable banks to operate throughout the EU under their
authorization granted by the regulators of the home member state (Home Country
Control). The Capital Adequacy Directive establishes minimum capital standards
for the investment business of securities firms and banks.

On January 1, 1999, the European banking sector ventured into uncharted
territory, with eleven EU countries adopting the euro and relinquishing their
monetary independence. At present, the European Central Bank, together with the
EU national central banks, define and implement EU monetary policy, hold and
manage some or all of member states' official foreign currency reserves and
promote the smooth operation of payment systems. The implementation of EU
monetary policy in the participating member states is carried out by their
respective national central banks pursuant to their powers under national
legislation, which has been amended to reflect the introduction of the euro and
the European Central Bank. Foreign exchange operations, particularly open market
operations, are strictly coordinated by the European Central Bank, but are
largely carried out by national central banks.

The euro is now in a transitional period. During the transitional period,
the euro can be used as a calculation unit and for payments in book-entry form.
In early 2002, euro notes and coins are due to come into circulation which will
end the transitional period and complete the introduction of the euro as a
single currency unit in the eleven countries that have adopted the euro. As of
July 1, 2002 at the latest, the eleven participating EU currencies will cease to
exist.

42
<PAGE>
See Item 9--"Management's Discussion and Analysis of Financial Condition and
Results of Operations--Introduction."

REGULATION IN THE UNITED STATES

The Bank's operations in the United States are subject to extensive
regulation and supervision by federal and state banking authorities. The Bank's
branches and agencies in the United States are licensed by state banking
authorities under the banking laws of the states in which such branches and
agencies are located. The Bank's branches and agencies are examined by such
state banking authorities, and must observe the banking regulations of such
states.

Under the International Banking Act of 1978, or the IBA, as amended by the
Foreign Bank Supervision Enhancement Act of 1991, or the FBSEA, the Bank's
branches, agencies and representative offices are subject to examination and
supervision by the Board of Governors of the Federal Reserve System, or the
Federal Reserve. The FBSEA also provides that the Federal Reserve may order a
foreign bank which operates a state branch or agency to terminate the activities
of such branch or agency if the Federal Reserve finds that the foreign bank is
not subject to comprehensive supervision or regulation on a consolidated basis
by the appropriate authorities in its home country, or if there is reasonable
cause to believe that such foreign bank, or any affiliate of such foreign bank
has committed a violation of law or engaged in an unsafe or unsound banking
practice in the United States, and as a result of such violation or practice,
the continued operation of such branch or agency would not be consistent with
the public interest or with the IBA, the Bank Holding Company Act of 1956, as
amended, BHCA, or the Federal Deposit Insurance Act, the FDIA.

The activities of the Bank's branches and agencies are limited both by the
laws of the state in which they are located and by the IBA. The FBSEA provides
that, commencing on December 19, 1992, a state branch or agency of a foreign
bank may not engage in any type of activity that is not permissible for a
federal branch or agency of a foreign bank unless the Federal Reserve has
determined that such activity is consistent with sound banking practice. Based
upon the activities presently conducted by the Bank's branches or agencies, the
Bank does not believe that this provision materially limits the activities of
any branch or agency in the United States. The Bank's branches and agencies are
also subject to reserve requirements, restrictions on the payment of interest on
demand deposits, and restrictions on the size of loans to a single borrower
pursuant to the IBA and implementing regulations of the Federal Reserve.

The Bank must obtain the prior approval of the Federal Reserve, as well as
any state authorities, to establish an additional branch, agency or
representative office, and the Bank is restricted from opening new full service
branches outside the State of Illinois, its "home state" designated in
accordance with the requirements of the IBA, unless specifically permitted by
the law of the state in which any new branch is to be located. A foreign bank is
also permitted, with the approval of the Federal Reserve (and either the Office
of the Comptroller of the Currency or the state banking agency), to upgrade an
agency or a limited branch to a full service branch outside its home state if
the establishment and operation of such branch is permitted by such state and
the agency or branch was in operation in such state on the day before
September 29, 1994 or has been in operation in such state for a period of time
that meets the state's minimum age requirement for the interstate merger of
banks.

As a result of its indirect ownership of a number of U.S. subsidiary banking
organizations, the Bank also is registered with the Federal Reserve as a bank
holding company and, as a result of such status and its operation of branches
and agencies in the United States, is subject to restrictions both on its
non-banking activities in the United States and on interstate banking (such
restrictions being similar to those applicable to U.S. domestic bank holding
companies). A bank holding company must obtain Federal Reserve approval before
acquiring, directly or indirectly, ownership or control of any voting shares of
a bank or bank holding company if, after such acquisition, it would own or
control 5% or more of such shares. A bank holding company must also obtain
Federal Reserve approval before

43
<PAGE>
acquiring all or substantially all of the assets of another bank or bank holding
company or merging or consolidating with another bank holding company. In
September 1994, the Reigle-Neal Interstate Banking and Branching Efficiency Act
of 1994, Riegle-Neal Act, was enacted. Effective September 29, 1995, bank
holding companies are permitted to acquire banks in any state subject to state
deposit caps and a 10% nationwide cap. In addition, as of June 1, 1997,
Riegle-Neal Act provides for full interstate branching by bank merger. States
were permitted to "opt-out" of this branching provision prior to the effective
date and, alternatively, states were permitted to "opt in" earlier than
June 1997. Texas and Montana adopted legislation to opt out of the branching
provisions.

The BHCA also prohibits a bank holding company, with certain limited
exceptions, from acquiring or retaining direct or indirect ownership or control
of 5% or more of the voting shares of any company which is not a bank or a bank
holding company, or from engaging in any activities other than those of banking,
managing or controlling banks, or providing services for its subsidiaries. The
principle exceptions to these prohibitions involve certain activities which the
Federal Reserve has determined to be closely related to the business of banking
or managing or controlling banks.

A subsidiary bank of a bank holding company is prohibited from extending
credit or furnishing other services on the condition that the customer obtain
some additional credit or service from an affiliate of the bank, or that the
customer not obtain credit or services from competitors of the bank or its
affiliate (tying arrangements), except for some traditional bank product and
some other limited exemptions. Subsidiary banks of a bank holding company are
also subject to certain restrictions imposed by the Federal Reserve Act on any
extensions of credit to the bank holding company or any of its subsidiaries, or
investment in the stock or other securities thereof, and on the taking of such
stocks or securities as collateral for loans. Section 23A of the Federal Reserve
Act imposes restrictions on "covered transactions" between a bank (and its
subsidiaries) and its affiliate. Covered transactions refer to loans to
affiliates and other transactions resulting in a flow of funds from the bank to
the affiliate. Generally, covered transactions with any one affiliate cannot
exceed 10% of the bank's capital and transactions with all affiliates cannot
exceed 20% of the bank's capital, extensions of credit must be collateralized,
low quality assets cannot be purchased from an affiliate, and all transactions
must be on safe and sound terms. Section 23B of the Federal Reserve Act
generally requires that all covered transactions as well as sales of assets, the
furnishing of services to, and certain other transaction with an affiliate be on
arms' length terms, prohibits a bank (and its subsidiaries) from purchasing as a
fiduciary any securities from an affiliate, as well as securities underwritten
by an affiliate as principal underwriter when certain conditions are met, and
imposes certain advertising restrictions. The Federal Reserve possesses cease
and desist powers over bank holding companies if their actions represent unsafe
or unsound practices or violations of law.

The Bank's U.S. national bank subsidiary is subject to supervision by the
Office of the Comptroller of the Currency. The Bank's U.S. savings bank
subsidiary is subject to supervision by the Office of Thrift Supervision. The
Federal Reserve has primary federal supervisory responsibility for the Bank's
U.S. state member bank subsidiary. The Bank's state banks are also subject to
supervision by the bank supervisory authorities in their respective states.
Various federal and state laws and regulations apply to many aspects of the
operations of the Bank's subsidiary banks, including interest rates paid on
deposits and loans, investments, mergers and acquisitions and the establishment
of branch offices and facilities. The payment of dividends by the Bank's
subsidiary banks are also subject to certain statutory restrictions and to
regulation by governmental agencies.

On December 16, 1988, the Federal Reserve adopted final risk-based capital
guidelines for its examination and supervision of bank holding companies and
banks. The guidelines have three main goals: (1) to make regulatory capital
requirements more sensitive to differences in risk profiles among banking
organizations: (2) to take off-balance-sheet risk exposures into explicit
account in assessing capital adequacy; and (3) to minimize disincentives to
holding liquid, low-risk assets. A bank holding company's ability to pay
dividends and expand its business through the acquisition of new banking
subsidiaries could be restricted if its capital falls below the level
established by these guidelines. The

44
<PAGE>
risk-based capital ratios were fully implemented by the end of 1992. In 1991,
the Federal Reserve required bank holding companies and banks to adhere to
another capital guideline referred to as the Tier 1 leverage ratio. This
guideline places a constraint on the degree to which a banking institution can
leverage its equity capital base. In 1995 and 1997 respectively, the risk-based
capital guidelines were modified to incorporate interest rate and market risk.
The federal banking agencies issued a joint policy statement setting forth
prudent interest rate risk management principles. A bank with material
weaknesses in its risk management process or high levels of exposure relative to
its capital will be directed by the appropriate federal agency to take
corrective action. For bank holding companies and banks with substantial trading
activity, the market risk guideline requires that the bank holding company or
bank reflect in its capital adequacy calculation the general market risk and
specific risk of debt and equity positions in its trading account and the
general market risk associated with its foreign exchange and commodity
positions. The U.S. bank subsidiaries of the Bank substantially exceed the
requirements of these capital guidelines.

In June 1999, the Basel Committee on Banking Supervision issued a
consultative paper, "A New Capital Adequacy Framework," that proposed revisions
to the Capital Accord of the Basel Committee to reflect current market
realities. The paper addresses minimum capital standards, the supervisory review
process and the effective use of market discipline. U.S. regulators have not yet
issued their version of the proposal. In February 2000, the Federal Reserve, the
Federal Deposit Insurance Corporation and the Offices of the Comptroller of
Currency and Thrift Supervision, issued a joint proposal to change their
risk-based capital standards to address the regulatory capital treatment of
recourse obligations and direct credit substitutes that expose banking
organizations to credit risk. The agencies noted that the proposal is moving in
the same direction as the Basel consultative paper with respect to capital
treatment of securitization by looking to external credit ratings issued by
qualifying external credit assessment institutions as a basis for determining
the credit quality and resulting capital treatment of securitization.

In December of 1991, the Federal Deposit Insurance Corporation Improvement
Act of 1991, or FDICIA, was enacted. FDICIA, among other things identifies the
following capital standards for depository institutions: well capitalized,
adequately capitalized, undercapitalized, significantly undercapitalized and
critically undercapitalized. A depository institution is well capitalized if it
significantly exceeds the minimum level required by regulation for each relevant
capital measure, adequately capitalized if it meets each such measure,
undercapitalized if it fails to meet any such measure, significantly
undercapitalized if it is significantly below any such measure, and critically
undercapitalized if it fails to meet any critical capital level set forth in the
regulations. FDICIA requires a bank that is determined to be undercapitalized to
submit a capital restoration plan, and the bank's holding company must guarantee
that the bank will meet its capital plan. Subject to certain limitations, FDICIA
also prohibits banks from making any capital distribution or paying any
management fee if the bank would thereafter be undercapitalized. The Bank's U.S.
bank subsidiaries currently meet the well capitalized standards.

FDICIA grants the Federal Deposit Insurance Corporation authority to impose
special assessments on insured depository institutions to repay Federal Deposit
Insurance Corporation borrowings from the U.S. Treasury or other sources and to
establish semiannual assessment rates on Bank Insurance Fund member banks so as
to maintain such fund at the designated reserve ratio defined in FDICIA. As part
of the 1997 Omnibus Consolidated Appropriations Act which provided a framework
for the merger of the Bank Insurance Fund and the Savings Association Insurance
Fund (SAIF) in 1999, Bank Insurance Fund member banks are now responsible for
certain obligations of the SAIF.

Section 6(b) of the IBA generally requires insurance of deposits of a U.S.
branch of a foreign bank unless the branch does not accept deposits of less than
$100,000 or unless the Federal Deposit Insurance Corporation determines by order
or regulation that the branch is not engaged in "domestic retail deposit
activity" requiring deposit insurance protection. Under the FDICIA and Federal
Deposit Insurance Corporation regulations, a state-licensed branch of a foreign
bank will not be deemed to be

45
<PAGE>
engaged in "domestic retail deposit activity" if all initial deposits fall
within the DE MINIMIS exemption. At this time, the Bank is not required to
obtain deposit insurance protection for the deposit-taking activities of its
U.S. branches to ensure continued compliance with the Federal Deposit Insurance
Corporation regulation. The Bank believes that any such action would not have a
material effect on its operation.

Effective March 11, 2000, the BHCA is amended by the Gramm-Leach-Bliley Act,
or the GLBA, to permit a bank holding company to become a financial holding
company and to thereby engage in and affiliate with insurance firms, securities
firms and other companies engaged in activities that are financial in nature or
complementary thereto under the GLBA.

A financial holding company is a bank holding company each of whose
subsidiary depository institutions are and remain well capitalized, well
managed, and, if insured, have a satisfactory or better rating under the
Community Reinvestment Act of 1977 at its most recent examination, and that has
an effective declaration to become a financial holding company filed with the
Federal Reserve. For this purpose, "well capitalized" is defined the same as
under FDICIA, as a total capital to total risk-weighted assets ratio of 10% or
greater, a Tier I capital to total risk-weighted assets ratio of 6% or greater
and a leverage ratio, the ratio of Tier 1 capital to total consolidated assets,
of 5% or greater, and "well managed" is defined as receiving at least a
satisfactory composite rating and at least a satisfactory rating for management
at the most recent inspection, examination or subsequent review. A foreign bank
that operates a branch or agency or controls a commercial lending company in the
U.S., and any company that controls such foreign bank, will be eligible to
become a financial holding company if the foreign bank is and remains well
capitalized and well managed and has an effective declaration to become a
financial holding company filed with the Federal Reserve. A foreign bank that
owns a subsidiary U.S. bank and that operates a U.S. branch or agency or owns or
controls a U.S. commercial lending company must comply with the requirements
applicable to a bank holding company to be a financial holding company
(discussed above) and must meet the standards for a foreign bank to be a
financial holding company. Further, for a tiered foreign banking organization,
the well capitalized and well managed tests apply to each foreign bank that has
U.S. operations in the form of a branch, agency or commercial lending company
subsidiary and that is part of a foreign banking organization seeking
certification as a financial holding company.

A foreign bank will be considered "well capitalized" if (i) if the foreign
bank's home country supervisor has adopted risk-based capital standards
consistent with the Basel Accord and (x) the foreign bank maintains a Tier 1
capital to total risk-based assets ratio of 6% and a total capital to total
risk-based assets ratio of 10%, as calculated under its home country standard;
(y) the foreign bank maintains a Tier 1 capital to total assets leverage ratio
of at least 3%; and (z) the foreign bank's capital is comparable to the capital
required for a U.S. bank owned by a financial holding company or (ii) the
Federal Reserve determines upon request from the foreign bank that the foreign
bank's capital is otherwise comparable to the capital that would be required of
a U.S. bank owned by a financial holding company. The Federal Reserve believes
that the imposition of a 3% leverage ratio is necessary to implement GLBA's
requirement that the Federal Reserve establish "comparable" capital standard for
foreign banks. A foreign bank will be considered "well managed" if: (i) each of
the U.S. branches, agencies, and commercial lending subsidiaries of the foreign
bank has received at least a satisfactory composite rating at its most recent
assessment; (ii) the home country supervisor of the foreign bank considers the
overall operations of the foreign bank to be satisfactory or better; and
(iii) that the management of the foreign bank meets standards comparable to
those required of a U.S. bank owned by a financial holding company. As of
March 13, 2000, we became approved as a financial holding company.

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<PAGE>
In the event that a foreign bank were to cease to meet the standards for a
financial holding company, the foreign bank would be obligated to notify the
Federal Reserve about such noncompliance and enter into an agreement with the
Federal Reserve to return to compliance. Until the Federal Reserve determines
that the foreign bank has again complied, the Federal Reserve may impose any
limitations or conditions on the conduct of the U.S. activities of the foreign
bank and its affiliates they find appropriate and the foreign bank may not
engage in any new activity in the U.S. whose activities are financial in nature
without the approval of the Federal Reserve. If the noncompliance is not
corrected within 180 days (or such additional time as the Federal Reserve may
permit), the foreign bank may be ordered by the Federal Reserve to liquidate or
divest its U.S. banking operations. The foreign bank could also decide that
instead of taking such action it would cease to engage in all activities that
are not permissible for a foreign bank that is not a financial holding company
to conduct under Sections 2(h) and 4(c) of the BHCA.

A financial holding company is permitted to engage in all activities defined
by the GLBA as "financial in nature" and incidental thereto which include those
expressly provided for by the GLBA (which include all activities currently
permitted to a bank holding company, securities, insurance and merchant banking
activities) as well as those defined as such by the Federal Reserve (in
conjunction with Department of Treasury), and activities complementary thereto
as defined by the Federal Reserve. The GLBA gives the Federal Reserve the
authority to impose restrictions on transactions between a depository
institution subsidiary and any affiliate and to impose firewalls between a U.S.
branch, agency or commercial lending company subsidiary of a foreign bank and
any U.S. affiliate on the same basis as for a domestic banking holding company.
Sections 23A and 23B of the Federal Reserve Act (as discussed above) will
continue to apply to transactions between a member or insured bank and its
affiliates.

The GLBA repeals Sections 20 and 32 of the Glass Steagall Act and permits a
financial holding company to engage in underwriting and dealing in securities,
including distribution of mutual fund shares and to issue and sell instruments
representing interests in pools of assets permissible for a bank to hold
directly. Thus, a financial holding company is clearly no longer subject to any
revenue limit for its securities and underwriting and dealing activities. The
Federal Reserve issued an interim rule on March 10, 2000 to impose two operating
standards on financial holding companies engaged in securities underwriting and
dealing activities, requiring that intra-day extensions of credit from an
affiliated bank, thrift or U.S. branch or agency be on market terms consistent
with Section 23B of the Federal Reserve Act and applying Sections 23A and 23B of
the Federal Reserve Act to certain covered transactions between a U.S. branch or
agency of a foreign bank and a U.S. securities affiliate. The Bank operates a
U.S. securities subsidiary in reliance on this provision. The revenue limit and
certain operating standards in addition to those applicable to a financial
holding company securities affiliate would continue to apply to a securities
subsidiary of a bank holding company.

GLBA permits a financial holding company to engage through a U.S. company or
a non-U.S. company in insurance underwriting and agency activities.

A financial holding company is permitted to acquire ownership interests in
companies to the extent such acquisitions are made by a securities affiliate (or
affiliate thereof or a registered investment company adviser to an insurance
company or an affiliate thereof), as part of a bona fide underwriting, merchant
or investment banking activity, including activities engaged in for the purpose
of appreciation and ultimate resale or disposition of the investment provided
such investments are held for such period of time to enable the investment to be
sold on a reasonable basis consistent with the financial viability of the
activity and the financial holding company does not routinely manage or operate
the company except as necessary to obtain a reasonable return on the investment
upon disposition, referred to as merchant banking.

On March 17, 2000, the Federal Reserve and Department of Treasury issued an
interim rule to implement the merchant banking provisions of the GLBA. A
financial holding company and any

47
<PAGE>
subsidiary other than a depository institution may acquire or control merchant
banking investments if the financial holding company controls any registered
securities broker or dealer or controls both an insurance underwriter and a
registered investment adviser that provides investment advice to the insurance
company. A "bona fide" requirement is imposed to prevent the merchant banking
authority from being used to make strategic investments or other types of
investments not otherwise permitted under the BHCA, as amended. The Interim Rule
permits merchant banking investments to be made directly or through investment
funds (that the financial holding company either controls or is a passive
investor in) and: (i) imposes a 10-year holding period (subject to extension by
the Federal Reserve in exceptional circumstances); (ii) limitations on
cross-marketing; (iii) defines certain merchant banking investments as
"affiliates" for purposes of Sections 23A and 23B of the Federal Reserve Act;
and (iv) prohibits routine management and operation of merchant banking
investment. If a financial holding company controls a fund or invests in a fund
that the financial holding company sponsors and advises, certain of the
foregoing restrictions apply to the fund. Merchant banking investments can also
be made through "qualifying" private equity funds (as defined by the Federal
Reserve), which may have a life of up to 15 years. A financial holding company
that exceeds the requisite holding period for merchant banking must: (i) deduct
an amount equal to 100% of the carrying value of the financial holding company's
interest from the Tier 1 capital of the financial holding company and exclude
all unrealized gains from its Tier 2 capital; (ii) not enter into any additional
transaction (including extending credit) with the portfolio company without
Federal Reserve approval; and (iii) abide by any other restrictions the Federal
Reserve may impose. The interim rule sets forth an aggregate limit on merchant
banking investments (the lesser of 30% of Tier 1 capital or $6 billion and the
lesser of 20% of Tier 1 capital or $4 billion after excluding investments made
in qualifying private equity funds), and record keeping and reporting
requirements. The Federal Reserve has also proposed to impose a 50% capital
deduction on portfolio investments (which include merchant banking). Under the
proposal, 50% of the value of all portfolio investments made by the financial
holding company or by its subsidiaries must be deducted from the consolidated
parent banking organization's core capital components. It is not clear whether
the Federal Reserve will directly or indirectly impose this capital deduction on
foreign banks, such as the Bank.

Merchant banking activities may also be conducted by an insurance
underwriting company, that is affiliated with a depository institution, that
makes such investments in the ordinary course of business in accordance with
relevant state law governing such investments provided that the financial
holding company does not routinely manage or operate the company except as may
be necessary to obtain a reasonable return on its investment.

In addition to the merchant banking authority, a financial holding company
is also permitted to engage in investment activities currently permitted to a
bank holding company subject to the conditions imposed by the Federal Reserve on
such activities, i.e., passive non-controlling investment in U.S. and foreign
companies and certain other investments in foreign companies.

The GLBA does not expand the leasing, commodities or real estate activities
permitted to a bank holding company. However, the Federal Reserve may find
certain of such activities to be financial in nature, incidental or
complementary thereto.

The GLBA also permits a national bank to engage through a "financial
subsidiary" in activities that are financial in nature other than insurance
underwriting or providing annuities, real estate development or investment, and
merchant banking (at least until 2004), if the bank is well capitalized, well
managed and has at least a satisfactory Community Reinvestment Act rating. For
this purpose, "well capitalized" is defined the same as under FDICIA, as a total
capital to total risk-weighted assets of 10% or greater, a Tier 1 capital to
total risk-weighted assets ratio of 6% or greater and a leverage ratio, the
ratio of Tier 1 capital to total consolidated assets, of 5% or greater, and
"well managed" is defined as having a composite rating of 1 or 2 under the
Uniform Financial Institutions Rating System (or an equivalent rating under an
equivalent rating system) in connection with its most recent examination or
subsequent review of the institution and at least a rating of 2 for management,
if such a

48
<PAGE>
rating is given. National banks in the largest 100 banks by consolidated total
assets must also meet certain rating requirements to own a financial subsidiary
(engaged in other than agency activities). (For the top 50 banks, at least one
issue of outstanding eligible debt must be rated in one of the 3 highest
investment grade ratings by a nationally recognized statistical rating
organization; for the second 50, either the same criteria apply or such other
criteria as the Federal Reserve and Treasury decide). Further, aggregate
consolidated total assets of all financial subsidiaries may not exceed the
lesser of 45% of consolidated total assets of the parent national bank or
$50 billion (subject to adjustment by an index). The Office of the Comptroller
of Currency has authority to impose firewalls between a national bank and its
financial subsidiaries. Further, Sections 23A and 23B of the Federal Reserve Act
are extended to apply to transactions between a national bank and a financial
subsidiary, except that covered transactions between a national bank and any
individual financial subsidiary may exceed 10% of the bank's capital and surplus
but are subject to the 20% aggregate limit on transactions with all affiliates.

In the event that the national bank were to cease to meet the standards to
own a financial subsidiary, the Office of the Comptroller of Currency will
notify the national bank about such non-compliance and the national bank be
obligated to enter into an agreement with the Office of the Comptroller of
Currency to return to compliance. Until the Office of the Comptroller of
Currency determines that the national bank has again complied, the Office of the
Comptroller of Currency may limit the activities of the national bank or any of
its subsidiaries. If the non-compliance is not corrected within 180 days, the
national bank may be ordered by the Office of the Comptroller of Currency to
divest its financial subsidiaries. In addition, a national bank that does not
continue to meet the eligible debt rating requirement may not purchase or
acquire any additional equity capital of any financial subsidiary until the
non-compliance is corrected.

The GLBA permits well capitalized national banks to engage in municipal
revenue bond underwriting effective March 12, 2000. GLBA also generally
prohibits a national bank and its subsidiaries from underwriting insurance
except for certain "authorized products." Authorized products are products the
Office of the Comptroller of Currency, as of January 1, 1999, had determined in
writing (which has not been overturned by a court) that a national bank may
provide as principal or products national bank were in fact lawfully providing
as of January 1, 1999.

Effective May 12, 2001, the GLBA will end the general exemptions for a bank
from the definition of "broker" and "dealer," and will modify the bank exemption
from the definition of "investment adviser" currently contained in the U.S.
securities laws to exclude a bank providing investment advice to a U.S.
registered investment company. A bank will continue to be exempt from
registration as a broker or dealer if it engages only in certain limited
activities, including with respect to identified banking products (which
include, among other things, credit and equity swaps, other equity swaps sold
directly to any person that is not a qualified investor) and hybrid products not
found to be securities. The effect of this will be to "push out" any securities
activities not falling within the exceptions from the Bank's subsidiary banks
and thrifts and U.S. branches and agencies to a registered broker-dealer
affiliate or subsidiary. The Bank believes that the "push-out" provision will
not have a material effect on its operations.

The GLBA authorizes the Federal Reserve to be the umbrella supervisor with
overall supervisory responsibility for the activities conducted by financial
holding companies and their subsidiaries. However, the primary regulator of
certain affiliates will be functional, i.e., the primary regulator of securities
activities is to be the Securities Exchange Commission and the primary regulator
of insurance activities will be the relevant state insurance regulators. The
Federal Reserve will retain its power to require reports, make examinations, and
impose capital adequacy guidelines subject to the requirements of functional
regulation.

Effective November 13, 2000, under the GLBA, a financial institution may not
disclose to nonaffiliated third parties any nonpublic personal information about
a consumer, unless such consumer

49
<PAGE>
has been provided with a clear and conspicuous disclosure of the financial
institution's policy and procedures with respect to disclosing and protecting
such information (including categories of information collected and persons to
whom information is disclosed) and the consumer has not opted out of such
disclosure, except that nonpublic personal information can be provided to
nonaffiliated third parties performing marketing services on behalf of the
financial institution under certain circumstances. The U.S. banking agencies
have issued proposed regulations implementing the GLBA privacy provisions.
Nonpublic personal information means "personally identifiable financial
information" provided by a consumer to a financial institution or resulting from
any transaction with the consumer. Any list, description, or other grouping of
consumers--and "publicly available information" pertaining to them--that is
derived using any nonpublic personal information other than publicly available
information also is included in the definition of nonpublic personal
information. Personally identifiable financial information means any information
provided by a consumer to a bank to obtain a financial product or service or
resulting from any transaction with the bank. Personally identifiable financial
information does not include a list of names and addresses of customers of an
entity that is not a financial institution. The proposed rules define publicly
available information to mean any information that is lawfully made available to
the general public from any government records, widely distributed media, or
disclosure to the general public as required by law.

Generally, the Hart Scott Rodino Act prohibits certain large acquisitions of
assets or voting securities from being consummated until the parties have filed
a Premerger Notification and Report Form with the Federal Trade Commission and
the Antitrust Division of the Department of Justice and specified waiting
periods have expired. There are several threshold tests which must be satisfied
for the Hart Scott Rodino Act to apply: the "commerce," "size-of-the-parties,"
and "size of the transaction" tests. When all tests are met, only qualification
for an exemption removes the necessity of filing under the Hart Scott Rodino
Act. Under current law, an applicant is exempted from the Hart Scott Rodino's
requirements for transactions that require the approval of the Federal Reserve
under Section 4 of the BHCA on the condition that any documents filed with the
Federal Reserve be filed contemporaneously with the Federal Trade Commission and
Department of Justice. Since the GLBA eliminated the prior approval requirement
for a financial holding company to engage in financial activities (and thus the
availability of the BHCA exemption for the Hart Scott Rodino filing), a
financial holding company may now need to file the requisite Hart Scott Rodino
applications for certain large acquisitions of assets or voting securities.

REST OF THE WORLD

We operate in many other countries and its offices, branches and
subsidiaries are subject to certain reserve, reporting requirements and controls
imposed by the relevant central banks and regulatory authorities.

ITEM 2. DESCRIPTION OF PROPERTY

At December 31, 1999, we operated 921 offices and branches in The
Netherlands and 2,668 offices and branches in 75 other countries. Of these
offices and branches, 447 were in North America, 1,723 were in South and Central
America, 209 were in Europe, 75 were in the Middle East and Africa and 214 were
in the Asia/Pacific region. Approximately 45% of the offices and branches are
owned by us and 55% are leased under long-term lease agreements.

We completed construction of, and moved into our new headquarters in
Amsterdam-Buitenveldert. The new headquarters will be used in conjunction with
our prior headquarters in Foppingadreef in Amsterdam- Zuidoost, and will permit
the consolidation of head office functions.

In addition, we completed the construction on of a new 280,000 gross square
foot office building at 250 Bishopsgate in London in which all of the Bank's
existing London-based activities are concentrated. We expect this to yield
synergies when serving our large corporate and institutional client base in the
United Kingdom.

50
<PAGE>
ITEM 3. LEGAL PROCEEDINGS

Legal proceedings have been initiated against us in a number of
jurisdictions, but on the basis of information currently available, and having
taken counsel with legal advisers, the Managing Board is of the opinion that the
outcome of these proceedings is unlikely to have a material adverse effect on
our consolidated operations and financial position.

ITEM 4. CONTROL OF REGISTRANT

The institutions listed in the table below reported the following direct
holdings of ABN AMRO Holding shares and Preference shares. The figures reflect
the holdings as a percentage of the total outstanding common shares and
depositary receipts of preference shares at December 31, 1999, respectively.
Depositary receipts of preference shares are issued by Stichting
Administratiekantoor ABN AMRO Holding. This foundation held 362,466,011
Preference Shares (99.99%) at year-end 1999.

<TABLE>
<CAPTION>
% OF TOTAL OUTSTANDING (1)
-----------------------------
DEPOSITARY
ORDINARY RECEIPTS OF
SHARES PREFERENCE SHARES
--------- -----------------
<S> <C> <C>
Aegon N.V................................................... 1.07 16.30
Fortis N.V.................................................. 0.71 10.33
Delta Lloyd Leven........................................... 0.14 9.90
ING Groep N.V. (2).......................................... 19.27 17.64
Rabobank Nederland.......................................... 0.15 10.31
De Zonnewijser (investment fund)............................ -- 12.22
</TABLE>

- ------------------------

(1) Other than Stichting Administratiekantoor ABN AMRO Holding, which is also
referred to as Stichting, the holders of Preference Shares listed in the
table above hold certificates entitling them to the economic benefits of the
Preference Shares. The Preference Shares represented by such certificates
are held by Stichting and the voting rights in respect of such Preference
Shares are held by Stichting. Stichting will, upon request of a certificate
holder, issue a proxy to such certificate holder to vote on the Preference
Shares at his own discretion, unless certain conditions apply.

(2) The Ordinary Shares owned by ING Groep N.V. may not be voted because ING
Groep N.V. has not received a declaration of no objection from the Dutch
Ministry of Finance permitting it to vote such shares.

Stichting holds Preference Shares representing 49.63% of the total capital
outstanding on December 31, 1999. Stichting has issued a corresponding number of
certificates representing beneficial interest in the Preference Shares, which
are listed on the AEX Stock Exchange. The voting rights of the Preference Shares
are held by Stichting in its capacity as shareholder. On January 10, 2000, the
charter of Stichting was amended in order to enable Stichting to grant proxies
to certificate holders to vote on the Preference Shares at their own discretion
at a meeting of shareholders. Stichting will issue a proxy upon request of a
certificate holder for each meeting of shareholders, unless certain conditions
apply, such as a public bid on our shares or any other circumstance which may
adversely affect our interest. Voting rights on Preference Shares granted to a
certificate holder by proxy will correspond to the amount of certificates held
by such certificate holder in relation to the stock price of the ordinary shares
at the close of the last trading day of the AEX Stock Exchange in the month
preceding the convocation of the shareholders meeting. Stichting will exercise
the voting rights on the Preference Shares for which it has not issued a proxy
according to their economic value. Because Stichting has undertaken to vote on
the Preference Shares in the same manner and pro rata to the votes of the
certificate holders who vote by proxy, Stichting can no longer determine the
outcome of any shareholder vote. Also, on December 15, 1999 certain changes in
Dutch corporate law became

51
<PAGE>
effective, which enables proxy solicitation by the Managing Board or certain
shareholders of a Dutch company, giving shareholders further ability to exercise
their voting rights at shareholder meetings of Dutch companies.

Stichting is a non-membership organization, i.e., an entity without
shareholders or other members that is similar to a trust or foundation, with a
self-appointing Managing Board organized under the laws of The Netherlands. As
of December 31, 1999, the members of the Managing Board of Stichting were:

<TABLE>
<CAPTION>
NAME OCCUPATION
- ---- ------------------------------------------------------------
<S> <C>
P. Schwencke.................. Former Deputy Director of Nederlandsche Participatie
Maatschappij N.V.
A. Heeneman................... Former Group Controller of Shell International Petroleum
Ltd.
P. J. Kalff................... Chairman of the Managing Board of Holding
</TABLE>

Neither Mr. Heeneman nor Mr. Schwencke has any management or other material
relationship with Holding or its subsidiaries or other group companies. Under
the governing instruments of Stichting, one of the members of the Managing Board
of Stichting is the Chairman of the Managing Board of Holding.

As of December 31, 1999, 99.99% of the Preference Shares were held of record
by Stichting. To the extent that Stichting disposes of any Preference Shares
held by it, or Holding issues new Preference Shares to any person or entity
other than Stichting, Preference Shares only may be held by, in addition to
Stichting, (i) natural persons, (ii) Holding or (iii) such other legal entities
as are approved by the Managing Board and the Supervisory Board of Holding in
connection with a partnership with or takeover of another enterprise by merger
or by acquisition of a participating interest or expansion thereof. Except in
connection with a transaction of a type described in clause (iii) of the
preceding sentence, or a transfer to Holding or Stichting, Preference Shares may
not be transferred or issued to an acquiring party if the acquiring party holds
more than 1% of the Preference Shares or if the acquiring party would hold more
than 1% of the Preference Shares after the acquisition. Any transfer of
Preference Shares made in accordance with the foregoing sentence only can be
made to a person that is permitted to hold Preference Shares pursuant to the
Articles of Association.

Pursuant to the Articles of Association of Holding, the holder of the one
priority share, par value NLG 5.00, the Priority Share, Stichting Prioriteit ABN
AMRO Holding, determines the number of members of the Managing Board of Holding,
which may not be less than five, and the number of members of the Supervisory
Board of Holding, which may not be less than ten. Any shareholders' resolution
to amend the Articles of Association of Holding or to dissolve Holding requires
not only the approval of the Supervisory Board but also the prior approval of
the holder of the Priority Share. Stichting Prioriteit ABN AMRO Holding is a
non-membership organization organized under the laws of The Netherlands with a
self appointing managing board. Its objective is to protect the interests of
Holding and interested parties, including in the event of a hostile takeover
attempt. The Managing Board of Stichting Prioriteit ABN AMRO Holding is composed
of the members of the Supervisory Board and Managing Board of Holding.
Accordingly, the Priority Share and its ownership by Stichting Prioriteit ABN
AMRO Holding serve essentially as a mechanism by which the Supervisory Board and
the Managing Board may determine their own size and approve or disapprove
amendments to the Articles of Association of Holding.

Holding knows of no arrangements that may lead to a change of control of
Holding. Under the ASCS 1992, a declaration of no objection from the Dutch
Minister of Finance upon consultation with the Dutch Central Bank would be
required for holding, acquiring or increasing a direct or indirect holding of
shares of capital stock equal to more than 5% of the total capital interest in
Holding. A separate declaration of no objection also would be required to
exercise directly or indirectly voting rights with respect to shares of capital
stock representing more than 5% of the voting rights (or the

52
<PAGE>
ability to exercise a comparable degree of control) in Holding. The Dutch
Minister of Finance may attach restrictions or stipulations to its declaration
of no objection.

ITEM 5. NATURE OF TRADING MARKET

TRADING MARKETS

The principal trading market for the Ordinary Shares is the AEX Stock
Exchange. The Ordinary Shares also are listed on the London, Paris, Brussels,
Frankfurt, Hamburg, Dusseldorf, Singapore, New York and The Swiss Stock
Exchanges. American Depositary Receipts evidence the ADSs, each of which
represents the right to receive one Ordinary Share. As of December 31, 1999,
19,997,080 million Ordinary Shares were held in the form of ADSs. The ADSs are
listed on the New York Stock Exchange under the symbol "ABN."

At December 31, 1999, 1,468,159,769 Ordinary Shares were outstanding, with
approximately 58% of the Ordinary Shares held by Dutch investors and the
remaining 42% by foreign investors. Major geographical concentrations of holders
of Ordinary Shares outside The Netherlands are in the United Kingdom, estimated
at 16%, and the United States, estimated at 8%.

The Ordinary Shares may be held in bearer or registered form. Ordinary
Shares may be converted from registered to bearer form, and following approval
of the Managing Board may be converted from bearer to registered form. On
December 31, 1999, approximately 84% of the outstanding Ordinary Shares were
held in bearer form with the balance in registered form.

MARKET PRICE INFORMATION

The following table sets forth, for the calendar quarters indicated, the
high and low daily quoted closing prices for Ordinary Shares as reported in the
Official Price List of the AEX Stock Exchange, the high and low prices for the
ADSs on the New York Stock Exchange, and the average daily turnover (counting
both purchase and sale transactions) of Ordinary Shares on the AEX Stock
Exchange. Differences in the rate of change between the prices of Ordinary
Shares and the prices of ADSs for the calendar quarters indicated are
attributable principally to fluctuations in the U.S. dollar-euro exchange rate.

<TABLE>
<CAPTION>
AMERICAN
ORDINARY DEPOSITARY
SHARES SHARES AVERAGE DAILY
------------------- ------------------- TURNOVER
HIGH LOW HIGH LOW AEX
-------- -------- -------- -------- ----------------
(IN EUR) (IN USD) (IN THOUSANDS OF
ORDINARY SHARES)
<S> <C> <C> <C> <C> <C>
1998
First Quarter.................................... 22.37 17.56 24.06 18.50 9,242.3
Second Quarter................................... 25.00 20.47 27.44 22.06 8,528.4
Third Quarter.................................... 24.23 14.57 26.69 16.63 8,923.7
Fourth Quarter................................... 18.60 12.62 21.94 14.75 9,332.8

1999
First Quarter.................................... 20.05 16.40 23.62 19.25 10,080.0
Second Quarter................................... 22.65 19.05 24.19 20.56 8,790.6
Third Quarter.................................... 23.45 19.35 24.81 20.87 9,707.4
Fourth Quarter................................... 25.00 20.75 25.75 22.31 7,970.1
</TABLE>

DIVIDEND POLICY

Dividends on Ordinary Shares may be paid out of profits as shown in the
consolidated financial statements of Holding, as adopted by the Supervisory
Board and approved by the general meeting of shareholders, after the payment of
dividends on the Priority Share, Preference Shares and Convertible

53
<PAGE>
Preference Shares and the establishment of any reserves. Reserves are
established by the Managing Board subject to approval of the Supervisory Board.

Holding has paid an interim and final dividend for each of the last five
years. The following table sets forth dividends paid in respect of the Ordinary
Shares for 1995 through 1999, as adjusted for the four-for-one stock split
effected on May 12, 1997:

<TABLE>
<CAPTION>
1999 1999 1998 1997 1996 1995
-------- -------- -------- -------- -------- --------
USD EUR EUR EUR EUR EUR
<S> <C> <C> <C> <C> <C> <C>
Interim dividend............................................ 0.31 0.30 0.27 0.24 0.20 0.18
Final dividend.............................................. 0.48 0.50 0.31 0.30 0.28 0.23
---- ---- ---- ---- ---- ----
Total dividend per Ordinary Share........................... 0.79 0.80 0.58 0.54 0.48 0.41
Total dividends per share as a % of net profit per share.... 46.5 46.9 45.5 45.4 46.8
</TABLE>

- ------------------------

(1) The interim 1999 dividend has been translated into U.S. dollars at the
applicable rate on date of payment, and the final 1999 dividend has been
translated into U.S. dollars at the March 31, 2000 exchange rate.

Both the interim dividend and the final dividend are made available, at the
shareholder's option, either wholly in cash or wholly in Ordinary Shares. With
respect to the 1999 final dividend, which will be declared during 2000, the
value of the cash dividend will be between 2 and 5% higher than the stock
dividend. An aggregate of 14,044,630 and 8,339,489 Ordinary Shares were issued
with respect to the 1998 final and the 1999 interim dividends, respectively. The
1999 final dividend was announced on February 24, 2000. Elections to receive
Ordinary Shares with respect to the 1999 final dividend will be required to be
received by Holding during the period May 11 through May 24, 2000 and any
Ordinary Shares to be issued in respect of an election will be issued on
May 29, 2000. Holding currently intends to offer its shareholders, including its
shareholders in the United States, a choice between dividends in cash or in
Ordinary Shares (or ADSs) for future dividends.

Holding currently intends to pursue a policy of generally declaring
dividends of between 45% and 50% of net profits attributable to Ordinary Shares.

ITEM 6. EXCHANGE CONTROLS AND OTHER LIMITATIONS AFFECTING SECURITY HOLDERS

There are no limitations under the laws of The Netherlands or in the
Articles of Association of Holding as currently in effect on the rights of
non-residents or foreign owners, as such, to hold or vote Ordinary Shares.
However, under the ASCS 1992, a declaration of no-objection from the Dutch
Minister of Finance, upon consultation with the Dutch Central Bank, is required
for any person or entity, irrespective of residence, to hold more than 5% of the
total capital interest or voting rights in Holding. In addition, certain
notifications under the Disclosure Act apply to shareholders exceeding or
falling below such levels. See Item 4--"Control of Registrant."

There are currently no exchange controls in effect in The Netherlands,
although the Dutch External Financial Relations Act of March 25, 1994 does
authorize the Minister of Finance or the Dutch Central Bank to issue such
regulations. Cash dividends payable in Dutch guilders and stock dividends on
Netherlands registered shares and bearer shares may be transferred from The
Netherlands and converted into any other currency without Dutch legal
restrictions. For statistical purposes, such payments and transactions if
individually in excess of NLG 25,000 must be reported to the Dutch Central Bank.

There are currently no other limitations under Dutch law affecting the
remittance of dividends or other payments to non-resident holders of Holding
securities (except, in respect of residents of Iraq, Serbia and the Federal
Republic of Yugoslavia in order to comply with United Nations and European Union
sanctions).

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<PAGE>
ITEM 7. TAXATION

The following is a summary of the principal and material Dutch tax and U.S.
federal income tax consequences for holders of Ordinary Shares or ADRs of
Holding and, in particular, for U.S. Shareholders, as defined below. The
descriptions of the Dutch tax laws and U.S. federal income tax laws and
practices set forth below are based on the statutes, treaties, regulations,
rulings, judicial decisions and other authorities in force and applied in
practice on the date hereof, all of which are subject to change, retroactively
as well as prospectively.

For purposes of this description, a "Shareholder" is a holder of Ordinary
Shares or ADRs that does not own a "substantial interest" or a "deemed
substantial interest" in Holding. The circumstances under which a "substantial
interest" exists include where a holder alone or together with his/her spouse,
his/her spouse or any other certain of their close relatives holds/hold or
has/have held during the past five years at least 5% of the issued share
capital, at least 5% of a certain class of shares or options giving right to
acquire at least 5% of the issued share capital or of a certain class of shares
of Holding. For purposes of this description, a "U.S. Shareholder" is a
Shareholder of Ordinary Shares or ADRs who is a "U.S. Person," which means an
individual citizen or resident of the United States or a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof. A "U.S. Person" also means
an estate the income of which is subject to U.S. federal income taxation
regardless of its source or a trust, if a court within the United States is able
to exercise primary supervision over the administration of the trust and one or
more U.S. persons have the authority to control all substantial decisions of the
trust.

In general, for Dutch tax and U.S. federal income tax purposes, U.S.
Shareholders of ADRs will be treated as the beneficial owners of the Ordinary
Shares represented by such American Depositary Receipts.

DUTCH TAXATION

WITHHOLDING TAX ON DIVIDENDS

The Netherlands imposes a withholding tax on any distribution of dividends
at a statutory rate of 25%, which does not apply to any distribution of stock
dividends paid out of the share premium account of Holding recognized as such
for Dutch tax purposes.

An individual or corporation not resident in The Netherlands which owns or
is deemed to own Ordinary Shares or ADRs can be eligible for a partial exemption
or refund of the above withholding tax under a tax convention which is in effect
between the country of residence of such individual or corporation and The
Netherlands. In order to qualify for the withholding tax reduction or exemption,
a Shareholder will be required to provide certain documentation establishing its
status as a resident of a country with which The Netherlands has concluded a tax
convention.

The current convention between The Netherlands and the United States for the
avoidance of double taxation and the prevention of fiscal evasion with respect
to taxes on income became effective as of January 1, 1994, which is known as the
1992 Treaty.

A U.S. Shareholder can only claim the benefits of the 1992 Treaty if such
person is a resident of the United States, as defined in the 1992 Treaty, and
such person's entitlement to such benefits is not limited by the limitations on
benefits provisions of Article 26 of the 1992 Treaty (treaty shopping rules).
Under the 1992 Treaty, dividends paid by Holding to such U.S. Shareholder are
generally eligible for a reduction of the 25% withholding tax to 15%, provided
that such U.S. Shareholder does not carry on a business in The Netherlands
through a permanent establishment or permanent representative (other than an
independent broker acting in the ordinary course of its business) to which or to
whom the Ordinary Shares or ADRs are attributable. If and to the extent the
Ordinary Shares or ADRs are

55
<PAGE>
attributable to such permanent establishment or permanent representative, Dutch
withholding tax will, depending on the particular circumstances, amount to 25%.

NET WEALTH TAX

Shareholders will not be subject to Dutch net wealth tax in respect of the
Ordinary Shares or ADRs, provided that such holder is not an individual or, if
he or she is an individual, provided that:

- such holder is not a resident or a deemed resident of The Netherlands; or

- such holder does not have an enterprise or an interest in an enterprise,
which carries on a business in The Netherlands through a permanent
establishment or a permanent representative to which or to whom the
Ordinary Shares or ADRs are attributable.

TAXES ON INCOME AND CAPITAL GAINS

A Shareholder will not be subject to Dutch taxes on income or capital gains
derived from Ordinary Shares or ADRs provided that the conditions of the
preceding paragraph are met.

GIFT, ESTATE AND INHERITANCE TAX

No gift, estate or inheritance tax is payable in The Netherlands on a gift
of Ordinary Shares or ADRs by, or upon the death of, a Shareholder neither
resident nor deemed resident in The Netherlands, unless such Shareholder has an
enterprise or an interest in an enterprise that is, in whole or in part, carried
on through a permanent establishment or a permanent representative in The
Netherlands to which or to whom the Ordinary Shares or ADRs are attributable.

UNITED STATES FEDERAL INCOME TAX

This summary of principal United States federal income tax consequences of
an investment by a U.S. Shareholder in Ordinary Shares or ADRs does not discuss
all of the tax consequences that may be relevant to a particular investor or to
certain investors subject to special treatment under U.S. tax laws, such as
banks, insurance companies, dealers and tax-exempt entities, and persons for
whom the U.S. dollar is not their functional currency.

Distributions (whether in cash or stock), to the extent paid out of the
current or accumulated earnings and profits of Holding, as determined under U.S.
tax accounting principles, will be treated as dividends for U.S. federal income
tax purposes. Such dividends (including Dutch withholding taxes deducted
therefrom) will be taxed to U.S. Shareholders as ordinary income and will not be
eligible for the dividends-received deduction generally available to corporate
U.S. Shareholders. In addition, such dividends generally will be considered
dividends from sources outside of the United States for foreign tax credit
purposes and "passive income" or "financial services income" for purposes of the
foreign tax credit basket. Such dividends will not be subject to U.S. federal
withholding tax and generally will not be subject to U.S. Rules federal income
tax in the hands of persons who are not U.S. Shareholders unless such dividends
are effectively connected with the conduct of a trade or business in the United
States. Distributions in excess of current and accumulated earnings and profits
will be treated as a return of capital to the extent of a U.S. Shareholder's
basis in the Ordinary Shares and ADRs and thereafter as capital gain.

Distributions on Ordinary Shares and ADRs will be made by Holding in euros.
It is anticipated that the Depositary will, in the ordinary course, convert
euros received by it as distributions on the ADRs into U.S. dollars. To the
extent that the Depositary does not convert the euros into U.S. dollars at the
time that a U.S. Shareholder is required to take the distribution into account
for U.S. federal income tax purposes, a U.S. Shareholder may recognize foreign
exchange gain or loss on the later conversion of the euros into U.S. dollars,
which will generally be treated as U.S.-source ordinary

56
<PAGE>
income or loss. The gain or loss recognized will generally be based upon the
difference between the exchange rate in effect when the euros are actually
converted and the "spot" exchange rate in effect at the time the distribution is
taken into account.

As discussed above, a resident of the United States may be entitled under
the 1992 Treaty to a reduction of the Dutch dividend withholding tax rate. See
"Dutch Taxation--Withholding Tax on Dividends." A U.S. Shareholder may, subject
to limitations and conditions under the U.S. Internal Revenue Code, credit
against his, her or its U.S. federal income tax liability or, alternatively,
deduct from his, her or its U.S. federal taxable income, the amount of any Dutch
withholding taxes. However, to the extent that Holding is treated for Dutch tax
purposes as (i) having paid a dividend on Ordinary Shares or ADRs out of income
that it received from its non-Dutch subsidiaries and/or foreign branches and
(ii) being entitled to a credit for Dutch tax purposes for non-Dutch taxes
attributable to such income, it is possible the Internal Revenue Service will
take the position that the amount of the Dutch withholding tax that may be
credited or deducted by a U.S. Shareholder is less than the amount actually
withheld. The amount of the credit that Holding may receive is limited, however,
so that, for example, a U.S. Shareholder entitled to the 15% dividend
withholding rate under the 1992 Treaty would in no event be treated for U.S.
foreign tax credit purposes as having paid a withholding tax of less than 12%.
U.S. Shareholders should consult their own tax advisors concerning the
availability of a foreign tax credit with respect to the credit that Holding
received for the 1999 dividend. Holding intends to notify its U.S. shareholders
of the extent to which the Dutch withholding tax on their dividends may be
affected.

Any gain or loss on a sale or exchange of Ordinary Shares or ADRs by a U.S.
Shareholder will generally be capital gain or loss for U.S. federal income tax
purposes if such Ordinary Shares or ADRs are held as a capital asset. If held
for more than one year, such gain or loss will generally be long-term capital
gain or loss. The amount of the gain or loss will be the difference between the
amount realized and the U.S. Shareholder's adjusted tax basis in the Ordinary
Shares or ADRs. Holders of Ordinary Shares or ADRs who are not U.S. Persons will
generally not be subject to U.S. income tax on the gain or loss realized on
disposition unless such gain or loss is effectively connected with the conduct
of a trade or business in the United States or, in the case of an individual,
such holder is present in the United States for 183 or more days in the taxable
year of such disposition and certain other conditions are met.

Based on the manner in which it currently operates its business, Holding has
determined that it is not a passive foreign investment company for U.S. federal
income tax purposes. If, however, it were determined to be such a company, then
certain U.S. Shareholders may, with respect to their Ordinary Shares and ADRs,
have to (i) pay an interest charge on distributions and gains that are deemed as
having been deferred and/or (ii) recognize ordinary income on dispositions that,
but for the passive foreign investment company provisions, would have been
treated as long-term or short-term capital gain.

U.S. BACKUP WITHHOLDING AND INFORMATION REPORTING

In general, information reporting requirements will apply to dividend
payments (or other taxable distributions) in respect of Ordinary Shares or ADRs
made within the United States to a noncorporate U.S. Person, and backup
withholding at the rate of 31% will apply to such payments if the holder or
beneficial owner fails to provide an accurate taxpayer identification number in
the manner required by the U.S. Internal Revenue Code and applicable regulations
thereunder, if (i) there has been notification from the Internal Revenue Service
of a failure by the holder or beneficial owner to report all interest or
dividends required to be shown on its U.S. federal income tax returns or
(ii) in certain circumstances, if the holder or beneficial owner fails to comply
with applicable certification requirements. Certain corporations and persons
that are not U.S. Persons may be required to establish

57
<PAGE>
their exemption from information reporting and backup withholding by certifying
their status on Internal Revenue Service Form W-8, W-8BEN, W-8ECI or any
successor form.

In general, payment of the proceeds from the sale of Ordinary Shares or ADRs
by or through the U.S. office of a broker is subject to both backup withholding
and information reporting unless the holder or beneficial owner certifies its
non-U.S. status under penalties of perjury or otherwise establishes an
exemption. Information reporting and backup withholding generally will not apply
to a payment of the proceeds of a sale of Ordinary Shares or ADRs by or through
an office outside the United States of a non-U.S. broker. However, information
reporting requirements (but not backup withholding) will apply to a payment of
the proceeds of a sale of Ordinary Shares or ADRs by or through an office
outside the United States of a broker (i) that is a U.S. Person, (ii) that
derives 50% or more of its gross income for a specified three-year period from
the conduct of a trade or business in the United States, (iii) that is a
"controlled foreign corporation" as to the United States or (iv) with respect to
payments made after December 31, 2000, that is a foreign partnership, if at any
time during its tax year, one or more of its partners are U.S. Persons who, in
the aggregate, hold more than 50% of the income or capital interests in the
Partnership or if, at any time during its tax year, such foreign partnership is
engaged in a U.S. trade or business, unless the broker has documentary evidence
in its records that the holder or beneficial owner is a non-U.S. Person or the
holder or beneficial owner otherwise establishes an exemption.

Amounts withheld under the backup withholding rules may be credited against
a holder's tax liability, and a holder may obtain a refund of any excess amounts
withheld under the backup withholding rules by filing the appropriate claim for
refund with the Internal Revenue Service.

Each shareholder should consult its own tax advisor about the specific tax
consequences to them of acquiring, owning and disposing of Ordinary Shares or
ADRs under the tax laws of The Netherlands, the United States and other
jurisdictions, including, in the case of a U.S. Shareholder, its eligibility for
reduced rates of Dutch dividend withholding tax under the 1992 Treaty and the
availability of credits or deductions for such Dutch withholding tax.

ITEM 8. SELECTED FINANCIAL DATA

The selected financial data set forth below have been derived from our
audited consolidated financial statements. Our consolidated financial statements
for each of the five years ended December 31, 1999 have been audited by Ernst &
Young Accountants, independent auditors. These selected financial data should be
read in conjunction with and are qualified by reference to the Consolidated
Financial Statements and notes thereto for 1997, 1998 and 1999 included
elsewhere in this Report.

Our financial statements have been prepared in accordance with Dutch GAAP,
which varies in certain significant respects from U.S. GAAP. For a discussion of
the differences and a reconciliation of certain Dutch GAAP amounts to U.S. GAAP,
see note 43 to the Consolidated Financial Statements. For selected financial
data in accordance with U.S. GAAP, see page 62.

58
<PAGE>
SELECTED CONSOLIDATED INCOME STATEMENT DATA

<TABLE>
<CAPTION>
1999 1999 1998 1997 1996 1995
------------ --------- --------- --------- --------- --------
(IN MILLIONS (IN MILLIONS OF EUR
OF USD)(1) EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
Net interest revenue................. 9,195 8,687 7,198 6,294 5,230 4,645
Net commissions...................... 4,715 4,455 3,388 2,846 2,249 1,899
Results from financial
transactions....................... 1,454 1,374 1,153 1,105 854 544
Other revenue........................ 1,071 1,011 799 540 330 266
Total revenue........................ 16,435 15,527 12,538 10,785 8,663 7,354
Operating expenses................... 11,230 10,609 8,704 7,450 5,867 4,962
Provision for loan losses............ 691 653 941 547 569 328
(Release from)/Addition to Fund for
general banking risks.............. (21) (20) (101) 179 66 308
Operating profit before taxes........ 4,499 4,250 2,897 2,626 2,175 1,743
Net profit........................... 2,720 2,570 1,828 1,748 1,499 1,187
Net profit attributable to Ordinary
Shares............................. 2,636 2,490 1,747 1,666 1,414 1,075
Dividends on Ordinary Shares......... 1,238 1,170 825 762 648 510

PER SHARE FINANCIAL DATA
Average number of Ordinary Shares
outstanding (in millions) (2)...... 1,451.6 1,422.1 1,388.7 1,346.3 1,232.4
Net profit per Ordinary Share (in
EUR) (2)(3)........................ 1.72 1.23 1.20 1.05 0.87
Fully diluted net profit per Ordinary
Share (in EUR) (2)(3).............. 1.71 1.22 1.19 1.03 0.83
Dividend per Ordinary Share (in EUR)
(2)(3)............................. 0.80 0.58 0.54 0.48 0.41
Net profit per ADS (in USD)
(2)(3)(4).......................... 1.82 1.37 1.35 1.37 1.21
Dividend per ADS (in USD)
(2)(3)(5).......................... 0.79 0.67 0.58 0.58 0.54
</TABLE>

- ------------------------

(1) Euro amounts have been translated into U.S. dollars at the rate equal to the
average of the month-end rates for 1999.

(2) All Ordinary Share and per share data have been retroactively adjusted for a
four-for-one stock split of the Ordinary Shares effected on May 12, 1997.

(3) Adjusted for increases in share capital, as applicable.

(4) This item has been translated into U.S. dollars at the rate equal to the
average of the month-end rates for the applicable year.

(5) This item has been translated into U.S. dollars at the applicable rate on
the date of payment, other than for the 1999 final dividend, which has been
translated into U.S. dollars at the March 31, 2000 exchange rate.

59
<PAGE>
SELECTED CONSOLIDATED BALANCE SHEET DATA

<TABLE>
<CAPTION>
1999 1999 1998 1997 1996 1995
------------ ----------- ---------- ---------- ---------- ----------
(IN MILLIONS (IN MILLIONS OF EUR
OF USD)(1) EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Banks......................... 47,433 47,201 60,894 63,613 54,580 59,596
Loans......................... 261,002 259,723 220,512 201,106 150,474 132,810
Interest-bearing securities... 93,039 92,583 106,067 75,007 46,020 34,750
Total assets.................. 460,139 457,884 432,083 379,560 271,938 248,003

LIABILITIES
Banks......................... 81,388 80,990 104,898 94,598 71,510 65,548
Total customer accounts....... 231,125 229,992 205,554 180,012 125,569 119,326
Debt securities............... 54,495 54,228 37,947 41,110 33,767 27,999

CAPITALIZATION
Fund for general banking
risks....................... 1,238 1,232 1,140 1,127 907 --
Shareholders' equity.......... 12,046 11,987 10,723 11,728 11,334 9,189
Minority interests............ 4,969 4,945 3,530 2,054 955 692
Subordinated debt............. 10,770 10,717 8,980 9,121 6,947 5,310
------- ----------- ---------- ---------- ---------- ----------
Group capital................. 29,023 28,881 24,373 24,030 20,143 15,191

PER SHARE FINANCIAL DATA
Ordinary Shares outstanding
(in millions)(2)............ 1,465.5 1,438.1 1,405.6 1,364.5 1,255.6
Shareholders' equity per
Ordinary Share (in
EUR)(2)..................... 7.59 6.85 7.71 7.62 6.21
Shareholders' equity per ADS
(in USD)(2)(3).............. 7.63 8.01 8.42 9.71 8.54
</TABLE>

- ------------------------

(1) Euro amounts have been translated into U.S. dollars at an exchange rate of
$1.00 = EUR 0.9951, the exchange rate on December 31, 1999.

(2) All Ordinary Share and per share data have been retroactively adjusted for a
four-for-one stock split of the Ordinary Shares effected on May 12, 1997.

(3) This item has been translated into U.S. dollars at the applicable year-end
rate.

60
<PAGE>
SELECTED RATIOS

<TABLE>
<CAPTION>
1999 1998 1997 1996 1995
-------- -------- -------- -------- --------
(IN PERCENTAGES)
<S> <C> <C> <C> <C> <C>
PROFITABILITY RATIOS
Net interest margin(1).................................. 2.1 1.7 1.9 2.0 2.1
Non-interest revenue to total revenue................... 44.1 42.6 41.6 39.6 36.8
Efficiency ratio(2)..................................... 68.3 69.4 69.1 67.7 67.5
Return on average total assets(3)....................... 0.56 0.41 0.49 0.52 0.49
Return on average Ordinary Shareholders' equity(4)...... 23.7 16.9 15.7 16.4 13.9

CAPITAL RATIOS
Average shareholders' equity on average total assets.... 2.43 2.71 3.21 3.39 3.61
Dividend payout ratio(5)................................ 46.5 46.9 45.5 45.4 46.8
Tier 1 capital ratio(6)................................. 7.20 6.94 6.96 7.21 6.51
Total capital ratio(6).................................. 10.86 10.48 10.65 10.89 10.80

CREDIT QUALITY RATIOS
Specific provision for loan losses (net) to private
sector loans (gross)(7)(8)(9)......................... 0.32 0.35 0.36 0.46 0.31
Nonperforming loans to private sector loans
(gross)(8)(10)........................................ 2.26 2.39 1.59 1.87 2.14
Specific allowance for loan losses to private sector
loans (gross)(8)(11).................................. 2.11 2.25 1.74 1.75 1.96
Specific allowance for loans losses to nonperforming
loans (gross)(8)(11).................................. 93.0 93.9 109.4 93.5 91.5
Write-offs to private sector loans (gross)(8)........... 0.36 0.29 0.28 0.55 0.47
</TABLE>

- ------------------------

(1) Net interest revenue as a percentage of average interest- earning assets.

(2) Operating expenses as a percentage of net interest revenue and total
non-interest revenue.

(3) Net profit as a percentage of average total assets.

(4) Net profit attributable to Ordinary Shares as a percentage of average
Ordinary Shareholders' equity.

(5) Dividend per Ordinary Share as a percentage of net profit per Ordinary
Share.

(6) Tier 1 capital and total capital as a percentage of risk-weighted assets
under BIS guidelines. See Item 9--"Management's Discussion and Analysis of
Financial Condition and Results of Operations--Capital Resources."

(7) Excludes specific provision for country risk.

(8) Excludes professional securities transactions.

(9) Excludes additions to and releases from the Fund for general banking risks
for 1999, 1998, 1997 and 1996 or the addition to the provision for general
contingencies for 1995.

(10) Nonperforming loans are non-accrual loans and nonperforming loans for which
interest has been suspended. See Item 1--"Description of Business--Selected
Statistical Information--Doubtful Loans."

(11) Excludes the amount of the Fund for general banking risks for 1999, 1998,
1997 and 1996 and the provision for general contingencies for 1995.

61
<PAGE>
APPROXIMATE AMOUNTS IN ACCORDANCE WITH U.S. GAAP

<TABLE>
<CAPTION>
1999 1999 1998
--------------------- ------------------ ------------------
(IN MILLIONS OF USD (IN MILLIONS OF EUR
EXCEPT SHARE DATA)(1) EXCEPT SHARE DATA)
<S> <C> <C> <C>
Net interest revenue........... 8,167 7,716 6,073
Other revenue.................. 7,169 6,773 5,979
Total revenue.................. 15,336 14,489 12,052
Pre-tax profit................. 3,741 3,534 3,133
Net profit..................... 2,065 1,951 1,912
Shareholders' equity........... 17,600 17,514 17,058
Minority interests............. 4,978 4,954 3,530
Total assets................... 472,988 470,670 447,580
Basic earnings per Ordinary
Share(2)..................... 1.37 1.29 1.29
Diluted earnings per Ordinary
Share(2)..................... 1.36 1.28 1.28
Basic earnings per ADS (in
USD)(2)(3)................... -- 1.37 1.43
Shareholders' equity per
Ordinary Share(2)............ 11.42 11.36 11.25
Shareholders' equity per ADS
(in USD)(2)(4)............... -- 11.42 13.15
</TABLE>

- ------------------------

(1) Euro amounts for income statement items have been translated into U.S.
dollars at the rate equal to the average of the month-end rates for 1999 and
for balance sheet items at an exchange rate of $1.00 = EUR 0.9951, the
exchange rate on December 31, 1999.

(2) Per share data have been retroactively adjusted for a four-for-one stock
split of the Ordinary Shares effected on May 12, 1997.

(3) This item has been translated into U.S. dollars at the rate equal to the
average of the month-end rates for the applicable year.

(4) This item has been translated into U.S. dollars at the applicable year-end
rate.

SELECTED RATIOS IN ACCORDANCE WITH U.S. GAAP

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN PERCENTAGES)
<S> <C> <C>
PROFITABILITY RATIOS
Net interest margin......................................... 2.0 1.7
Non-interest revenue to total revenue....................... 46.7 49.6
Efficiency ratio (excluding goodwill amortization).......... 70.2 67.5
Return on average total assets.............................. 0.43 0.41
Return on average Ordinary Shareholders' equity............. 11.3 11.8

CREDIT QUALITY RATIOS
Provision for loan losses (net) to private sector loans
(gross)(1)................................................ 0.31 0.29
Nonperforming loans to private sector loans (gross)......... 2.26 2.39
Allowances for loan losses to private sector loans
(gross)(2)................................................ 3.00 3.20
Allowances for loan losses to nonperforming loans(2)........ 132.6 133.9
Write-offs to private sector loans (gross).................. 0.36 0.29
</TABLE>

- ------------------------

(1) Includes additions to/releases from the Fund for general banking risks. See
note 43 to the Consolidated Financial Statements.

(2) Includes the amount of the Fund for general banking risks. See note 43 to
the Consolidated Financial Statements.

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<PAGE>
ITEM 9. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

The following discussion is based on, and should be read in conjunction
with, the Consolidated Financial Statements included elsewhere in this Report.
The Consolidated Financial Statements are prepared in accordance with Dutch
GAAP, which varies in certain significant respects from U.S. GAAP. For a
discussion of the differences and a reconciliation of certain Dutch GAAP amounts
to U.S. GAAP, see note 43 to the Consolidated Financial Statements.

INTRODUCTION

The Bank and its numerous subsidiaries are organized into three operating
divisions, the Netherlands Division, the International Division and the
Investment Banking Division. Commencing in 2000 the Netherlands Division will be
incorporated into a newly established European Division, which will also include
all branches and subsidiaries in EU-countries and Switzerland that were
previously in the International Division. The Bank also owns ABN AMRO Lease
Holding, an independently managed subsidiary. The costs of the Bank's support
divisions, including the Risk Management Division, the Resource Management
Division and the corporate policy support units, have been fully allocated to
the three operating divisions based upon the Bank's internal management
evaluations. Because our business is diverse and our operations are integrated,
it is impractical to segregate the assets and contributions of each operating
division with precision. As a result, estimates and judgments have been made to
apportion balance sheet and revenue and expense items.

In 1999, we continued to make progress in implementing our growth strategy,
which contemplates expansion in selected markets with significant long-term
growth and profitability potential. During 1999, we acquired a 9.65% interest in
Banca di Roma, a major Italian banking group for a purchase price of
approximately EUR 0.74 billion. During 1999, ABN AMRO also acquired a 5.71%
interest in Banca Nazionale dell'Argricoltura, a full service commercial bank
with 273 branches in Northern and Central Italy, for a purchase price of
EUR 58 million and a 4.9% interest in Interbanca SpA, a Milan based merchant
bank of which the majority is controlled by Banca Antoniana Populare Veneta, for
a purchase price of EUR 28 million. In addition, we increased our controlling
interest in Banco Real to 70% for an additional EUR 395 million. We also
acquired a controlling interest in the Great Pacific Savings Bank in the
Philippines for EUR 10 million and Bank of America's consumer banking businesses
in India, Singapore and Taiwan for EUR 84 million. In August 1999, we made an
offer, for up to a total of EUR 1.2 billion, to purchase all of the outstanding
shares of Bouwfonds, a Dutch mortgage and real estate institution. The offer was
declared unconditional in January 2000 and has been accepted by all of the
shareholders of Bouwfonds.

In 1998, the Bank also consummated a number of acquisitions. In Brazil, the
Bank acquired a controlling interest in Banco Real, the fourth-largest privately
held bank in the country, for a purchase price of approximately EUR
2.1 billion. We also acquired Bandepe in Brazil in November 1998, for a purchase
price of EUR 132 million. In Asia, we acquired a majority interest in Bank of
Asia, a bank based in Thailand, for an initial purchase price of
EUR 162 million, subject to adjustment based on Bank of Asia's net book at
year-end 1999. The Bank's position in Australia and New Zealand was enhanced
through the acquisition of the local investment banking operations of BZW, for a
purchase price of EUR 81 million. The Bank also purchased the remaining
interests in its Asian securities subsidiary, ABN AMRO Asia Ltd., for a purchase
price of EUR 188 million.

Our earnings and business are affected by general economic conditions, the
performance of the financial markets, interest rate levels, currency exchange
rates, changes in laws, regulations, and the policies of central banks,
particularly the Dutch Central Bank, the European Central Bank, the Federal
Reserve Board and the Brazilian Central Bank, and competitive factors, in each
case on a global, regional and/or national basis. For instance, changes in
general economic conditions, the performance

63
<PAGE>
of financial markets, interest rate levels and the policies and regulations of
central banks may affect, positively or negatively, our financial performance by
affecting the demand for our products and services, reducing the credit quality
of borrowers and counterparties and putting pressure on our loan loss reserves,
changing the interest rate margin realized by the Bank between its lending and
borrowing costs, changing the value of our investment and trading portfolios and
putting pressure on its risk management systems. Changes in currency rates,
particularly in the U.S. dollar-euro exchange rate, affect earnings reported by
our foreign operations, and may affect revenues earned from foreign exchange
dealing. Changes in regulatory policies may significantly increase the cost of
compliance.

We have economic, financial market, credit, legal and other specialists who
monitor economic and market conditions and government policies and actions.
However, because it is difficult to predict with accuracy changes in economic or
market conditions or in governmental policies and actions, it is difficult for
us to anticipate the effects that such changes could have on its financial
performance and business operations.

THE EURO

On January 1, 1999, eleven EU countries, including The Netherlands, embraced
the euro and relinquished their monetary independence. We are striving to become
a leading bank in the euro, both inside and outside Europe, in an increasingly
competitive market.

New euro-related products and initiatives were developed in a range of
different fields during 1999. In addition, we assigned top priority to services
aimed at the conversion of customer-related systems. The Bank opted to adjust
its internal systems in a manner that enables its customers all over the world
to enjoy maximum flexibility in timing the conversion of their contracts and
accounts. The conversion is being carried out free of charge for all the Bank's
customer groups.

E-COMMERCE INITIATIVE

In 1999, we increased investment in e-commerce substantially. The strategy
is based on complete integration of e-commerce into our current activities
throughout the global network. In order to realize our e-commerce ambitions, the
Managing Board has approved further investments, increasing to around
EUR 1.8 billion in the coming years. We developed a governance model for
e-commerce development to improve the use of e-commerce opportunities, which
includes creating a new Directorate General for e-commerce whose task is to
facilitate all of our e-commerce initiatives, to stimulate initiatives in new
markets and to increase our effectiveness by leveraging our e-commerce resources
worldwide. The Directorate General for e-commerce will also secure funding for
major e-commerce initiatives.

Major initiatives to which we have committed so far include the launch of an
Internet e-broker service as part of the positioning of e-banking in Europe, the
U.S. Midwest and Brazil. We are currently involved in approximately 100
e-commerce projects. For example, in the business-to-business segment, we will
launch a service targeted at small- and medium-sized enterprises
internationally. The service is intended to lower trade barriers to these
companies by opening up global supplier and buyer information. These enterprises
will receive additional support from other initiatives in which we are
participating, such as Identrus, which addresses financial and identification
issues that arise when trading internationally. Other alliances with third
parties are Trade-on-Line and Bex.Com. Over the past year, we have invested a
total of over EUR 200 million in private equity investments and strategic
alliances.

64
<PAGE>
FINANCIAL OVERVIEW

The following tables provide an analysis of our total revenue, operating
profit before taxes, total assets, risk-weighted assets and offices and branches
by operating division and independent subsidiary for each of the three most
recently completed years.

<TABLE>
<CAPTION>
OPERATING PROFIT
TOTAL REVENUE BEFORE TAXES
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
Netherlands Division.................................. 3,989 3,717 3,325 1,369 1,157 1,007
International Division
Europe (excluding The Netherlands).................. 1,590 1,455 1,229 353 339 280
North America....................................... 3,706 3,238 2,721 1,129 976 682
Latin America and the Caribbean..................... 2,289 1,073 730 576 235 248
Middle East and Africa.............................. 139 119 99 (52) 45 28
Asia/Pacific........................................ 915 719 516 200 (20) 5
------ ------ ------ ----- ----- -----
8,639 6,604 5,295 2,206 1,575 1,243
Investment Banking Division........................... 2,347 1,779 1,764 502 246 399
------ ------ ------ ----- ----- -----
Subtotal............................................ 14,975 12,100 10,384 4,077 2,978 2,649
ABN AMRO Lease Holding................................ 552 438 401 128 121 108
Unallocated result.................................... 25 (303) 48
Addition to Fund for general banking risks/Provision
for general contingencies........................... 20 101 (179)
------ ------ ------ ----- ----- -----
ABN AMRO.............................................. 15,527 12,538 10,785 4,250 2,897 2,626
====== ====== ====== ===== ===== =====
</TABLE>

<TABLE>
<CAPTION>
TOTAL ASSETS RISK-WEIGHTED ASSETS(1)
AT DECEMBER 31, AT DECEMBER 31,
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
Netherlands Division......................... 99,886 89,823 83,330 74,901 67,294 65,349
International Division
Europe (excluding The Netherlands)......... 46,518 38,614 40,284 30,478 26,317 26,411
North America.............................. 133,926 106,561 91,601 74,722 60,183 57,554
Latin America and the Caribbean............ 16,209 20,385 7,125 12,504 13,673 6,405
Middle East and Africa..................... 3,006 2,685 2,296 2,165 1,739 1,238
Asia/Pacific............................... 42,035 40,426 34,748 23,196 17,856 17,740
------- ------- ------- ------- ------- -------
241,694 208,671 176,054 143,065 119,768 109,348
Investment Banking Division.................. 107,833 126,820 114,606 20,473 22,362 28,655
------- ------- ------- ------- ------- -------
Subtotal................................... 449,413 425,314 373,990 238,439 209,424 203,352
ABN AMRO Lease Holding....................... 8,471 6,769 5,570 7,935 6,345 5,298
------- ------- ------- ------- ------- -------
ABN AMRO..................................... 457,884 432,083 379,560 246,374 215,769 208,650
======= ======= ======= ======= ======= =======
</TABLE>

- ------------------------

(1) Risk-weighted assets are the value of balance sheet assets and off-balance
sheet items weighted for risk in accordance with applicable regulatory
requirements.

65
<PAGE>

<TABLE>
<CAPTION>
FULL-TIME EQUIVALENT STAFF OFFICES AND BRANCHES
------------------------------ ------------------------------
AT DECEMBER 31, AT DECEMBER 31,
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Netherlands Division................................ 25,634 25,369 24,093 915 937 962
International Division
Europe (excluding The Netherlands)................ 8,905 9,100 8,465 175 177 173
North America..................................... 18,978 18,768 17,099 445 443 439
Latin America and the Caribbean................... 23,550 26,989 5,183 1,716 1,704 121
Middle East and Africa............................ 1,243 1,145 1,062 70 70 70
Asia/Pacific...................................... 9,162 7,133 4,108 200 176 53
Central Staff..................................... 325 303 355 -- -- --
------- ------- ------ ----- ----- -----
62,163 63,438 36,272 2,606 2,570 856
Investment Banking Division......................... 7,512 7,277 6,309 69 61 58
of which included in International Division......... (38) (19) (18)
Other divisions and group staff..................... 5,268 4,947 4,642 -- -- --
------- ------- ------ ----- ----- -----
Subtotal.......................................... 100,577 101,031 71,316 3,552 3,549 1,858
ABN AMRO Lease Holding.............................. 5,278 4,795 3,619 37 34 30
------- ------- ------ ----- ----- -----
ABN AMRO............................................ 105,855 105,826 74,935 3,589 3,583 1,888
======= ======= ====== ===== ===== =====
</TABLE>

RESULTS OF OPERATIONS

1999 profit was far above the record level of 1998 as a result of strong
contributions from all divisions. Net profit for 1999 improved by EUR
742 million or 40.6% to EUR 2,570 million from EUR 1,828 million in 1998, which
in turn represented a EUR 80 million or 4.5% increase from 1997. Profit
increased in 1999 as our company benefited from the acquisition of Banco Real
and from generally favorable economic and market conditions in most of the
principal regions in which we operate, particularly in the United States and The
Netherlands, although the devaluation in 1999 of the Brazilian real has had an
impact on our real denominated earnings. Profit also grew in 1998 due to a
strong first half of the year, although, in the second half, results were also
affected by the turmoil in Russia and its impact on several other financial
markets, notably South America. Although economic conditions in the United
States, The Netherlands and most of the rest of Europe continue to appear
favorable at present, financial markets can be volatile, as demonstrated by
events in Latin America, Asia and Russia over the last few years, and there can
be no assurance that the current combination of strong growth, relatively stable
interest rates and near record stock market prices in many of the principal
economies in which we operate will continue.

During 1999, revenues increased by EUR 2,989 million or 23.8% to EUR
15,527 million as compared to EUR 12,538 million in 1998 (a 16.2% increase in
1998 compared to 1997). Operating expenses increased by EUR 1,905 million or
21.9% to EUR 10,609 million as compared to EUR 8,704 million in 1998, which was
a 16.8% increase compared to 1997. The increase in revenues resulted from higher
interest revenues, higher provision income, lower provision for loan losses and
lower (negative) adjustments of fixed financial assets. Operating expenses
increased at a lower level than revenues due to tighter cost control. The
increase in operating expenses was caused by higher staff costs, particularly
salary increases and bonuses, higher IT-expenditure and rising facility costs,
particularly an increase in rent and energy costs.

The provision for loan losses decreased 30.6% from 1998 levels to EUR
653 million, reflecting decreased cross border provisions. The provision for
loan losses had increased 72.0% in 1998 from 1997 levels to EUR 941 million,
reflecting losses due to payment problems of Russian Banks and increased cross
border exposure to a number of countries, including Indonesia, Thailand and
Pakistan. Our efficiency ratio, which is operating expenses as a percentage of
total revenue, improved to 68.3% in

66
<PAGE>
1999 from 69.4% in 1998, as compared to 69.1% in 1997. Acquisition and exchange
rate movements had a minor impact on pre-tax profits for 1999.

After taking into account Preference Share and Convertible Preference Share
dividends, in 1999, profit available for distribution to Ordinary Shares
increased 42.5% to EUR 2,490 million from EUR 1,747 million in 1998, which in
turn was a 4.8% increase from 1997. Net profit per Ordinary Share was EUR 1.72
and EUR 1.23 in 1999 and 1998, respectively, an increase of 39.8% and 2.7%,
respectively, from prior year levels after taking into account the increase in
the average number of Ordinary Shares outstanding from 1,388.7 million in 1997
to 1,422.1 million in 1998 and to 1,451.6 million in 1999.

Our Managing Board has established long-term financial objectives that
include average annual growth in earnings per Ordinary Share of at least 10.0%,
average annual growth in net profit of at least 12.5% and return on
shareholders' equity of at least 18.0%, based on Dutch GAAP. On the basis of the
present favorable economic prospects worldwide, our Managing Board expects us to
outperform our financial targets in 2000 as well. However, there can be no
assurance that such objectives will be achieved. In light of the volatility of
financial markets, our financial performance may fluctuate from period to
period.

NET INTEREST REVENUE

Net interest revenue rose by EUR 1,489 million or 20.7% to EUR
8,687 million as compared to 1998. The total net interest margin for The
Netherlands Division was fractionally lower compared to 3.0% in 1998, although
both retail and commercial lending volume grew substantially. In the
International Division, interest revenue grew, up 29.5%, due to the acquisitions
in Brazil and internal growth in U.S. operations.

In 1998, net interest revenue rose by EUR 904 million or 14.4% to EUR
7,198 million as compared to 1997. The Netherlands Division's guilder net
interest margin was at 3.0%, the same level as in 1997. Retail lending volume
grew in The Netherlands by 19.4%, while commercial lending decreased by 0.6%. In
the International Division, strong volume growth, up 9.6%, due to the
acquisitions in Brazil and Thailand and commercial loan growth in U.S.
operations, more than offset a slightly narrower net interest margin.

NET COMMISSIONS

In 1999, net commissions, which consist of revenue from payment services,
securities, letters of credit and other financial guarantees and commissions
generated from the sale of insurance policies, rose by EUR 1,067 million to EUR
4,455 million, or 31.5% as compared to 1998. The increase was attributable to
the contribution of Banco Real and increases in commissions on securities and
payment services and asset management and trust fee income.

In 1998, net commissions rose by EUR 542 million or 19.1% as compared to
1997. In particular, securities commissions increased 17.0%, reflecting the
continuation of the generally favorable conditions in the financial markets in
Europe and the United States. Payment services commissions and asset management
and trust fee income also showed a significant increase.

RESULTS FROM FINANCIAL TRANSACTIONS

Results from financial transactions, which reflect primarily securities,
foreign exchange and derivatives trading, increased EUR 221 million or 19.2% to
EUR 1,374 million in 1999. Results from financial transactions increased
primarily due to improved performance from trading in emerging market debt
instruments, which went from a 1998 loss of EUR 139 million to a profit of EUR
41 million in 1999. Derivatives trading produced higher revenue as well,
increasing EUR 183 million or 97.3%. However, these increases were partially
offset by the results from securities trading, which fell by EUR 110 million as
a result of lower performance in fixed income bond trading.

67
<PAGE>
In 1998, results from financial transactions increased EUR 48 million or
4.3% to EUR 1,153 million, compared to 1997. Results from financial transactions
were depressed by a loss of EUR 139 million on trading in emerging market debt
instruments, following the Russian financial crisis in the second half of 1998.
Results from securities trading were up EUR 138 million, however, reflecting
favorable financial markets in the developed economies. Foreign exchange dealing
also produced higher revenue, rising EUR 98 million or 22.5%, as the Bank
benefited from the increased volatility of various currency markets, notably in
emerging economies. Results from derivatives were at approximately the same
level as in 1997.

OTHER REVENUE

Other revenues, which consist principally of results from mortgage
origination fees, mortgage servicing fees, leasing activities, participating
interests, insurance activities and securitizations, increased by EUR
212 million or 26.5% primarily due to the full year consolidation of Banco Real
and from the Bank's U.S. mortgage business, which is the eighth largest
originator of mortgage loans in the United States. Revenue from securities and
participating interests, rose by EUR 9 million, primarily from the sale of
several minority interests. Other revenues increased by EUR 259 million or 48.1%
in 1998 over 1997 levels due primarily to an increase in the Bank's U.S.
mortgage business.

OPERATING EXPENSES

Operating expenses, which consists of staff costs, other administrative
expenses and depreciation, increased in 1999 by EUR 1,905 million or 21.9% to
EUR 10,609 million. If the impact of acquisitions and higher exchange rates are
excluded, the increase was 9.9%. Among the factors increasing expenses were
robust internal growth, several information technology projects and higher
performance-related bonuses. Global Transaction Services and the Year 2000
preparations continued to generate considerable IT activity as well.

Operating expenses increased in 1998 by EUR 1,254 million or 16.8% to EUR
8,704 million from 1997 levels. The underlying factors included significant
internal growth, several information technology projects, including the Global
Transaction Services project and Year 2000 preparation, on which we spent more
than EUR 91 million in 1998, and higher performance related bonuses, notably in
the United States. The investment for the euro also was substantial in 1998,
approximately EUR 170 million.

In 1999, staffing costs increased by 23.9% to EUR 5,768 million. In 1998,
staffing costs increased by 18.6% to EUR 4,656 million. The full-time equivalent
work force, including temporary staff, increased by only 29 during 1999 to
105,855 at December 31, 1999 after increasing in 1998 by 41.2% to 105,826 at
December 31, 1998. During 1999, the full-time work force in the International
Division decreased by 2%, mainly due to a new method being used by Banco Real to
calculate part-time employees and holiday workers, which resulted in a decrease
in the number of Banco Real employees. This decrease was partially offset by an
increase in staff in Asia as a result of the integration of the acquired
consumer banking activities from Bank of America in Taiwan, India and Singapore.
The Investment Banking and the Netherlands Divisions slightly increased their
full-time equivalent work forces by 3.2% and 1.0%, respectively, mainly due to
organic growth. During 1998, the full-time work force in the Investment Banking
and International Divisions increased 14.8% and 75.0%, respectively, reflecting
the acquisitions of Banco Real, Bank of Asia and Bandepe and continuing
expansion of the Bank's international and investment banking activities. The
Netherlands Division increased its full-time equivalent work force 4.7% during
1998, principally to expand the delivery of products and services to clients.

Other administrative expenses, which consist of office overhead, automation
costs, advertising costs and other general expenses, increased EUR 660 million
or 19.5% during 1999 to EUR 4,041 million,

68
<PAGE>
after increasing EUR 399 million or 13.4% during 1998 to EUR 3,381 million.
Information technology, housing and consulting costs in particular increased in
both 1998 and 1999 as a result of a variety of automation and efficiency
efforts. Non-recurring expenses partly caused administrative expenses to
increase in both years.

PROVISION FOR LOAN LOSSES

Provision for loan losses fell from EUR 941 million in 1998 to EUR
653 million in 1999. In light of lower exposure in some developing countries,
cross-border provisions of EUR 25 million were released in 1999, as compared to
the addition of EUR 303 million in 1998. Provision for loan losses relating to
specific bad debt provisions were higher in 1999, increasing by EUR 40 million
or 6.3% to EUR 678 million. The provision for loan losses were higher
particularly in the Middle East and Africa and North America, but lower in Asia
and The Netherlands. Without the acquisition of Banco Real, the provision for
loan losses decreased by EUR 24 million. In 1998, EUR 101 million was released
from the Fund for general banking risks and in 1999 EUR 20 million was released.
Movements in the Fund for general banking risks during 1999 resulted in the
Fund's level of EUR 1,232 million at December 31, 1999. The combined provision
for loan losses and release from the fund for general banking risks amounted to
EUR 633 million in 1999 compared to EUR 840 million 1998.

Private sector loans, excluding professional securities transactions and
risk weighted total assets increased sharply in 1998 by 9.9% and 3.4%,
respectively, as compared to 1997. Provision for loan losses rose from EUR
547 million in 1997 to EUR 941 million in 1998. In light of losses on
transactions with Russian banks and increased cross-border exposure to a number
of countries, including Indonesia, Thailand and Pakistan, EUR 303 million was
added to provisions for loan losses for cross-border risks in 1998, as compared
to the release of EUR 48 million in 1997. The remaining addition in 1998 of EUR
638 million to provision for loan losses related to specific bad debt
provisions, which were higher particularly in Asia and Brazil but lower in The
Netherlands and North America. In 1997, specific bad debt provisions totaled EUR
595 million. In 1998, the additions made to provisions at the end of 1997, for
developments in Asia, of approximately EUR 113 million, were allocated to
specific loan losses. As a result, in 1998, EUR 101 million was released from
the Fund for general banking risks. In determining the net asset value of our
1998 acquisitions, especially Banco Real, we had taken into account the
increased exposure in each of the relevant countries. Accordingly, an extra
addition was made to the Fund for general banking risks, resulting in the year
end 1998 level of EUR 1,140 million. The combined provision for loan losses and
release from/addition to the Fund for general banking risks amounted to EUR
840 million in 1998 compared to EUR 726 million in 1997.

For further information concerning our loan loss provisioning policy,
specific allowances for loan losses and country risk, Fund for general banking
risks and credit quality ratios, see Item "Description of Business Selected
Statistical Information "Analysis of Loan Loss Experience: Provisions and
Allowances for Loan Losses," Item "Selected Financial Data Selected Ratios" and
notes 14 and 34 to the Consolidated Financial Statements.

VALUE ADJUSTMENTS TO FINANCIAL FIXED ASSETS

Value adjustments to financial fixed assets included unrealized differences
in the value of some shares in the Bank's investment portfolios arising from a
further decline in the stock market prices of these shares in 1999.

INCOME TAXES

Income taxes in 1999 were up 45.4% or EUR 412 million to EUR 1,320 million,
mainly attributable to higher operating results and the acquisition of Banco
Real. Income taxes in 1998 were up 20.5% or EUR 154 million to EUR 908 million,
mainly attributable to lower tax exempt revenue,

69
<PAGE>
several non-tax deductible losses and higher taxes in a number of countries. The
effective tax rate declined to 31.1% in 1999 from 31.3% in 1998, which was up
from 28.7% in 1997. The effective tax rate is affected by changes in the
relative contributions to income from different countries as well as the level
of tax exempt income. The primary reason for the decline in 1999 was due to
higher tax exempt revenues in The Netherlands.

MINORITY INTERESTS

Minority interests increased from EUR 161 million to EUR 360 million,
reflecting the issuance of additional preferred stock by our U.S. organization,
primarily to finance acquisitions, and the incorporation in the 1999 figures of
the average remaining minority interest of approximately 40% in Banco Real's
results.

In 1998, minority interests increased from EUR 124 million to EUR
161 million, reflecting the issuance of additional preferred stock by our U.S.
organization, primarily to finance acquisitions, and the incorporation of the
minority interest of approximately 60% in Banco Real for the last few months of
1998.

RESULTS OF OPERATIONS BY DIVISION

NETHERLANDS DIVISION

The following table sets forth selected information pertaining to the
Netherlands Division.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR EXCEPT STAFF, OFFICES,
BRANCHES AND PERCENTAGES)
<S> <C> <C> <C>
Net interest revenue..................................... 2,888 2,641 2,413
Net commissions.......................................... 894 837 776
Results from financial transactions...................... 67 76 79
Other revenue............................................ 140 163 57
------ ------ ------
Total revenue............................................ 3,989 3,717 3,325
Operating expenses....................................... 2,511 2,425 2,154
Provisions for loan losses............................... 83 100 164
Value adjustments to financial fixed assets.............. 26 35 --
------ ------ ------
Operating profit before taxes............................ 1,369 1,157 1,007
====== ====== ======
Total assets............................................. 99,886 89,823 83,330
Risk-weighted assets..................................... 74,901 67,294 65,349
Full-time equivalent staff............................... 25,634 25,369 24,093
Number of offices and branches........................... 915 937 962
Efficiency ratio (in %).................................. 62.9 65.2 64.8
Return on Equity (in %).................................. 28.3 22.6 17.8
</TABLE>

In 1999, the Netherlands Division achieved a EUR 1,369 million or 18.3%
increase in operating profit before taxes as compared to 1998, when operating
profit before taxes increased by EUR 150 million or 14.9% as compared to 1997.
Total revenue in 1999 increased EUR 272 million or 7.3% over 1998 levels,
following an increase in 1998 of EUR 392 million or 11.8% as compared to 1997.
Operating expenses increased by EUR 86 million or 3.5% in 1999 as compared to
1998, following an increase in 1998 of EUR 271 million or 12.6% as compared to
1997.

70
<PAGE>
NET INTEREST REVENUE

Net interest revenue grew in 1999 by EUR 247 million or 9.4%. The
improvement came from growth of total assets of EUR 10.1 billion, following
growth of net interest revenue in 1998 by EUR 228 million or 9.4%. The European
Central Bank decreased its interest rates in April 1999, but increased them at
year-end. The EURIBOR 3-month rate averaged 2.96% in 1999 which, was below the
1998 level of 3.45%. At year-end, the EURIBOR rate was back at 3.35%. The
average yield on government bonds averaged 4.61% in 1998 and 4.63% in 1999,
which was essentially unchanged. However, 1999 was generally characterized by an
increasing yield curve.

Net interest revenue grew in 1998 by EUR 228 million or 9.4%. In the guilder
business, growth in total assets due to an increase in mortgages was the
principal reason for this improvement. Market rates fell during the course of
1998. As long-term interest rates fell more sharply than shorter rates, the
yield curve flattened. Uncertainty in the equity markets spurred demand for
fixed-income securities. Due to the absence of inflationary pressures, the
ten-year capital market rate dropped below 4.0% to reach the lowest level of the
past 40 years. Money market rates remained fairly constant, hovering between
3.3% and 3.6%. The Dutch Central Bank maintained its official rates throughout
1998. It was not until the end of the year that the interest rate for special
loans was reduced slightly.

Average total assets rose in 1999, up EUR 9.9 billion or 11.2% as compared
to 1998. Average private sector loan volume increased by 9.4% from EUR
80.2 million in 1998 to EUR 87.7 million in 1999. Loans to corporations
increased by 1.4% from EUR 38.8 billion in 1998 to EUR 39.3 billion in 1999.
Residential mortgage volume increased in 1999 by EUR 7.0 billion or 21.1% over
1998 levels, with interest rates rising in the second half of 1999. This
interest rate rise also caused a significant slowdown in mortgage prepayments
and refinancings.

Average total assets rose less rapidly in 1998 than in previous years, up
only EUR 6.9 billion or 8.5% as compared to 1997. Average private sector loan
volume increased by 8.8% from EUR 73.7 billion in 1997 to EUR 80.2 billion in
1998. Loans to corporations were at approximately the same level as in 1997.
Residential mortgage volume increased in 1998 by EUR 6.6 billion or 22.6% over
1997 levels, with home mortgage borrowers showing a preference for long-term
fixed-rate loans.

NET COMMISSIONS

The following table sets forth total net commissions and the components
thereof for the Netherlands Division for each of the three most recently
completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Payment services............................................ 387 336 324
Insurance................................................... 126 118 109
Securities.................................................. 302 301 272
Asset management and trust services......................... 29 27 24
Other....................................................... 50 55 46
--- --- ---
Total net commissions....................................... 894 837 775
=== === ===
</TABLE>

Net commission revenue from payment services increased in 1999 by 15.2% to
EUR 387 million. Total domestic payment commissions rose as a result of
brokerage commissions from the sales of bank notes denominated in currencies
from countries participating in the European Monetary Union. Commissions revenue
from cross-border payments declined slightly.

Net commissions were higher in 1998 compared to 1997, up EUR 62 million or
8.0%. Payment services showed a modest increase in 1998, rising EUR 12 million
or 3.7% from 1997. Turnover and transaction commissions grew substantially as
electronic payments increased more rapidly than the

71
<PAGE>
traditional methods of payment, and sales of the Bank's OfficeNet and HomeNet
software packages, which permit the electronic delivery of payment instructions,
remained strong. Commissions revenue from corporate and cross-border payments
fell.

Commissions earned on life and non-life insurance products rose in 1999 in
the retail and wholesale markets due to a stronger focus on cross selling.
Insurance commissions, both non-life insurance commissions and life insurance
commissions, were up in 1998 as compared to 1997. The Bank believes that its
increased focus on insurance products and their integration with banking
services will lead to continued expansion of the Bank's insurance brokerage and
operations.

Securities commissions remained relatively unchanged in 1999. The volatile
stock market climate depressed total brokerage commissions, including
commissions from transactions in our investment funds. But the custodial assets
grew to EUR 530 billion, up 15.2% from 1998, causing gross custody fee revenue
to increase by 0.9%. The Bank's electronic share dealing services, such as
HomeNet and its Investment Line telephone service, which are available 24 hours
a day, 7 days a week for securities trading, saw another extremely successful
year. In 1999, 28.0% of securities orders were placed through the Investment
Line, 20.0% via HomeNet and 3.0% via Online Investor (Internet).

Securities commissions rose in 1998, up 10.5% from 1997, in an extremely
volatile trading environment. During 1998, commissions resulting from
transactions in our investment funds increased 11.1%. Custodial assets grew to
EUR 460 million, up 12.7% from 1997, and custody fee revenue increased by 15.0%.
Commission revenue from on-line securities trading by customers using the
Investment Line and HomeNet software packages were substantially higher in 1998
than in 1997.

RESULTS FROM FINANCIAL TRANSACTIONS

The following table sets forth the results from financial transactions and
its components for the Netherlands Division for each of the three most recently
completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Foreign exchange dealing.................................... 25 61 68
Securities and other results from financial transactions.... 42 15 11
-- -- --
Total results from financial transactions................... 67 76 79
== == ==
</TABLE>

For the Netherlands Division, results from financial transactions were down
EUR 9 million or 11.8% due to the introduction of the euro. Foreign exchange
dealing results are no longer realized on the sales of bank notes in currencies
of countries which take part in the European Monetary Union. This decrease was
partly compensated for by higher commission income. Furthermore, higher income
was obtained from the sales of shares. Financial transactions in 1998 produced
slightly lower revenue, down EUR 3 million or 4.6% from 1997. This was the
result of a decrease in revenue from customer currency transactions, though
improved results in derivatives transactions partially offset the overall
decline.

OTHER REVENUE

Other revenue for the Netherlands Division consists principally of results
from insurance activities, participating interests and, to a lesser extent,
property development and rental revenue. Other revenue derived from insurance
consists of the underwriting results, excluding staff expenses, of ABN AMRO
Levensverzekering, our life insurance subsidiary, and our property and casualty
insurance subsidiaries, including ABN AMRO Schadeverzekering.

Although other revenue decreased by 14.1% to EUR 140 million in 1999 due to
smaller gains on the sale of participating interests, other components of other
revenue achieved positive results. As in

72
<PAGE>
1998, the insurance companies achieved growth in gross premium income. ABN AMRO
Levensverzekering and ABN AMRO Schadeverzekering generated gross premium income
of EUR 718 million, which was up 18.4% from EUR 606 million in 1998. New and
well-received insurance products linked to bank products, combined with the
greater attention paid to insurance sales by the branch network, increased
sales. Total insurance revenue earned by ABN AMRO Levensverzekering, including
premium income, technical provisions and investment income amounted to EUR
32 million, as opposed to EUR 20 million in 1998, principally as a result of
higher premium income. In contrast with prior years, part of the commission paid
to the branches was capitalized. ABN AMRO Schadeverzekering had higher revenue,
at EUR 22 million versus EUR 19 million in 1998, principally as a result of
increased premium income. Retail business risks make up most of the portfolio.

OPERATING EXPENSES

The following table sets forth operating expenses for the Netherlands
Division for each of the three most recently completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Staff costs................................................. 1,393 1,297 1,100
Other administrative expenses............................... 822 842 810
Depreciation................................................ 296 286 243
----- ----- -----
2,511 2,425 2,153
===== ===== =====
</TABLE>

Operating expenses in 1999 were up EUR 86 million or 3.5% to EUR
2,511 million, mainly due to an increase in staff costs.

Staff costs rose by EUR 96 million or 7.4% in 1999, partly as a result of a
small increase in staffing levels, the general 3.25% wage increase in June and
October 1999 under the Bank's collective labor agreement and increased staff
overhead costs from supporting divisions. In addition, staff costs for support
services, notably in respect of information technology, the Global Transaction
Services projects and human resources, were substantially higher. Given the
strong performance of the company pension fund in 1999, no contributions were
made, as compared to contributions of EUR 35 million in 1998, which is also only
a part of the normal pension contribution to be paid by the bank. At year-end
1999, the full-time equivalent workforce, including temporary staff, totaled
25,634, representing a rise of 1.0% as compared to 1998.

Other administrative expenses decreased in 1999 by EUR 20 million or 2.4%,
due to tighter cost control.

Depreciation increased by 3.5% in 1999, primarily in connection with housing
and IT. Capital expenditure on IT equipment in The Netherlands was EUR
205 million in 1999.

Operating expenses in 1998 were up EUR 272 million or 12.6% due primarily to
higher staff costs. Staff costs rose by EUR 197 million or 17.9% in 1998, partly
as a result of an increase in staffing levels and the 3% wage increase in
July 1998 under the Bank's collective labor agreement. As in 1997, increased
product sales led to an expansion of staffing capacity. More staff was also
required due to our increased focus on insurance products. At year-end 1998, the
full-time equivalent workforce, including temporary staff, totaled 25,369,
representing a rise of 5.3% as compared to 1997. In addition, staff costs for
support services, notably in respect of IT and the Global Transaction Services
projects, were substantially higher.

Other administrative expenses increased in 1998 by EUR 32 million or 3.8%,
partly reflecting volume growth, such as with respect to payment services,
marketing support for the smart card and

73
<PAGE>
adjustments to hardware for its use. Other administrative expenses also include
the expenditures relating to the Global Transaction Services project and the
euro launch.

Depreciation increased by 17.8% in 1998, primarily in connection with higher
depreciation for hardware and software.

LOANS, PROVISION FOR LOAN LOSSES AND VALUE ADJUSTMENTS TO FINANCIAL FIXED ASSETS

Private sector loans rose by 9.9% to EUR 88.6 billion. The mortgage market
experienced strong volume growth by increasing 20% to EUR 43 billion, with the
growth being especially strong in the first half of 1999 as compared with same
period in 1998, primarily as a result of falling interest rates. Our market
share fell slightly to 22.7%, as a result of the decision to concentrate more on
quality and profitability and less on market share. EUR 2.5 billion of the
mortgage portfolio is securitized. The provision for loan losses decreased in
1999 by EUR 17 million or 17% to EUR 83 million due to a further improvement of
the loan portfolio's quality and the favorable economic situation in the
Netherlands. Risk-weighted total assets of the Netherlands Division amounted to
EUR 74,901 million at year-end 1999, up 11.3% or EUR 7,607 million from 1998.

Value adjustments to financial fixed assets showed a loss of EUR 26 million
in 1999, reflecting unrealized losses on shares held in the share investment
portfolio.

Provision for loan losses in 1998 was EUR 101 million, a decline of EUR
64 million or 38.7% from EUR 164 million in 1997. This decline reflected the
excellent quality of the loan portfolio of the Netherlands Division.
Risk-weighted total assets of the Netherlands Division amounted to EUR
67.3 billion at year-end 1998. The downward adjustment to the value of financial
fixed assets in 1998 related to unrealized losses on shares in the investment
portfolios.

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<PAGE>
INTERNATIONAL DIVISION

The following table sets forth selected information pertaining to the
International Division for each of the three most recently completed years.

<TABLE>
<CAPTION>
1999 1998 1997
---------- ---------- ----------
(IN MILLIONS OF EUR EXCEPT STAFF, OFFICES,
BRANCHES AND PERCENTAGES)
<S> <C> <C> <C>
Net interest revenue...................................... 5,359 4,138 3,498
Net commissions........................................... 2,287 1,581 1,199
Results from financial transactions....................... 523 563 453
Other revenue............................................. 470 322 145
------- ------- -------
Total revenue............................................. 8,639 6,604 5,295
Operating expenses........................................ 5,858 4,507 3,668
Provisions for loan losses................................ 575 505 401
Value adjustments to financial fixed assets............... -- 17 (17)
------- ------- -------
Operating profit before taxes............................. 2,206 1,575 1,243
======= ======= =======
Analysis of operating profit before taxes
Europe (excluding The Netherlands)...................... 353 339 280
North America........................................... 1,129 976 682
Latin America and the Caribbean......................... 576 235 248
Middle East and Africa.................................. (52) 45 28
Asia/Pacific............................................ 200 (20) 5
------- ------- -------
Operating profit before taxes............................. 2,206 1,575 1,243
======= ======= =======
Total assets.............................................. 241,694 208,671 176,054
Risk-weighted assets...................................... 143,065 119,768 109,348
Full-time equivalent staff................................ 62,163 63,438(1) 36,272
Number of offices and branches............................ 2,606 2,570(2) 856
Efficiency ratio (%)...................................... 67.8 68.2 69.3
Return on Equity (%)...................................... 18.2 15.3 12.3
</TABLE>

- ------------------------

(1) 24,407 full-time equivalent staff are attributable to the acquisition of
Banco Real, Bandepe, Bank of Asia and BZW.

(2) 1,698 offices and branches are attributable to the acquisition of Banco
Real, Bandepe, Bank of Asia and BZW.

Operating profit before taxes in 1999 increased by EUR 631 million or 40.1%
to EUR 2,206 million, of which EUR 323 million was attributable to the
acquisition of Banco Real and Bandepe. The International Division's contribution
to pre-tax group profit decreased from 54.0% in 1998 to 52.0% in 1999. The North
America region performed very well again, with operating profit before taxes up
EUR 1,129 million or 15.7% from 1998. Assuming unchanged average exchange rates
and excluding acquisitions, operating profit before taxes of the International
Division would have increased EUR 213 million or 13.5%.

Operating profit before taxes in 1998 increased by EUR 332 million or 26.7%
to EUR 1,575 million, of which EUR 24 million was attributable to higher
exchange rates. Total revenue increased by EUR 1,309 million or 24.7% and
operating expenses increased by 22.9%. The International Division's contribution
to pre-tax group profit increased further, from 47.0% in 1997 to 54.0% in 1998.
The North America region performed extremely well, with operating profit before
taxes up EUR 294 million or 42.9% from 1997. Assuming unchanged average exchange
rates and excluding

75
<PAGE>
acquisitions, operating profit before taxes of the International Division would
have increased EUR 225 million or 18.1%.

NET INTEREST REVENUE

Net interest revenue in 1999 improved by EUR 1,221 million or 29.5%, of
which approximately EUR 395 million was due to internal growth and currency
translation differences and approximately EUR 826 million resulted from
acquisitions, principally the acquisition of Banco Real. Our operations in the
United States contributed again significantly to the growth in interest revenue
as a result of volume growth. The net interest margin for the International
Division increased from 2.00% in 1998 to 2.34% in 1999, due to the acquisition
of Banco Real.

Net interest revenue in 1998 improved by EUR 640 million or 18.3%, of which
approximately EUR 408 million was due to internal growth and approximately EUR
227 million resulted from acquisitions, principally the acquisition of Banco
Real. Our operations in both the United States and the Asia/Pacific region
contributed significantly to the growth in interest revenue as a result of
volume growth. The net interest margin for the International Division narrowed
slightly, from 2.1% in 1997 to 2.0% in 1998, due to lower margins in South
America in particular. In addition, long-term interest rates declined
significantly in the United States in 1998, providing for a flatter yield curve
on average than in 1997. The decrease in interest rates resulted in a
substantial increase in mortgage refinancings in the United States, which
resulted in the replacement of mortgage loans with lower-yielding assets.

NET COMMISSIONS

The following table sets forth total net commissions and its components for
the International Division for each of the three most recently completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Payment services............................................ 792 442 358
Insurance................................................... 49 36 26
Securities.................................................. 670 522 343
Asset management and trust services......................... 303 195 150
Guarantees.................................................. 117 89 81
Other....................................................... 356 297 241
----- ----- -----
Total net commissions....................................... 2,287 1,581 1,199
===== ===== =====
</TABLE>

Net commissions in 1999 improved sharply, up EUR 706 million or 44.7% to EUR
2,287 million. Payment services increased by EUR 350 million or 79.2%, mainly
due to the acquisition of Banco Real. The volatility of world stock markets
further boosted securities commissions by EUR 148 million or 28.4%. In 1999, the
increase in fees from asset management and trust services of EUR 108 million or
55.4% was also mainly due to the acquisition of Banco Real and higher volumes in
Europe. The increase in 1999 in other net commissions, which include mortgage
loan servicing fees and financial advisory fees, including from mergers and
acquisitions, of EUR 59 million or 19.9% was mainly due to increases in the Asia
Pacific region.

Net commissions in 1998 improved sharply, up EUR 382 million or 31.9% to EUR
1,581 million. Payment services in 1998 increased by EUR 84 million or 23.5%,
mainly due to the acquisition of Banco Real and volume growth in the United
States. The volatility of world stock markets throughout the year boosted
securities commissions by EUR 179 million or 52.3%, accounting for almost half
of the total rise in net commissions. In 1998, the increase in fees from asset
management and trust services of EUR 45 million or 29.6% was also mainly due to
the acquisition of Banco Real and higher volumes in the United States. The
increase in 1998 in other net commissions, which include mortgage

76
<PAGE>
loan servicing fees and financial advisory fees, including from mergers and
acquisitions, of EUR 56 million or 23.2% was mainly due to the acquisition of
BZW's operations in Australia and New Zealand.

RESULTS FROM FINANCIAL TRANSACTIONS

The following table sets forth total results from financial transactions and
the principal components thereof for the International Division for each of the
three most recent years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Securities trading.......................................... 138 93 108
Foreign exchange dealing.................................... 358 405 293
Derivatives trading......................................... 93 87 51
Other....................................................... (66) (22) 1
--- --- ---
Total results from financial transactions................... 523 563 453
=== === ===
</TABLE>

Results from financial transactions in 1999 decreased EUR 40 million or 7.1%
as compared to 1998. This decrease was due to lower foreign exchange results
from mainly the Asia/Pacific region and the United States.

Results from financial transactions in 1998 increased EUR 110 million or
24.2% as compared to 1997. This increase was due to the continued volatility in
the currency markets, which sent earnings from foreign exchange dealing sharply
higher, notably in the United States and the Asia/Pacific region. Improved
derivatives trading results were partially offset by lower results from
securities trading. A loss was sustained on capital investments in
hyperinflationary countries, mainly Turkey and Russia.

OTHER REVENUE

Other revenue in 1999 rose significantly by EUR 148 million or 46.0% mainly
due to higher income from the Bank's U.S. mortgage origination, securitization
and servicing business and higher income from insurance companies as a result of
the consolidation of Banco Real.

Other revenue in 1998 rose sharply by EUR 177 million or 122.1% from 1997,
principally from higher earnings from the Bank's U.S. mortgage origination,
securitization and servicing businesses.

OPERATING EXPENSES

The following table sets forth operating expenses for the International
Division for each of the three most recently completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Staff costs................................................. 3,025 2,364 1,884
Other administrative expenses............................... 2,444 1,863 1,572
Depreciation................................................ 389 280 212
----- ----- -----
5,858 4,507 3,668
===== ===== =====
</TABLE>

In 1999, the EUR 1,351 million or 30.0% increase in operating expenses
largely stemmed from acquisitions of EUR 833 million, higher bonuses of EUR
76 million and higher currency exchange rates of EUR 167 million. Staff costs
increased by EUR 661 million to EUR 3,025 million due to the full year
consolidation of Banco Real, increase of the USD against the euro and higher
performance related bonuses. Other administrative expenses, including
depreciation, increased EUR 581 million or

77
<PAGE>
31.2% in 1999 due to the above mentioned acquisition and currency exchange rate
effects, as well as to higher expenditure on IT and facility costs.

In 1998, the EUR 839 million or 22.9% increase in operating expenses largely
stemmed from acquisitions of more than EUR 225 million, higher bonuses of more
than EUR 135 million, especially in the United States reflecting strong results,
and the growth of our business in the United States. The full-time equivalent
workforce rose by 27,202 employees, largely as a result of acquisitions in
Brazil of 21,705 employees and Thailand of 2,202 employees. In addition, in the
United States, approximately 1,450 full-time equivalent employees were added as
a result of internal growth and approximately 179 full-time equivalent employees
were added due to the acquisition of Sage. Other substantial expenditure items
were the launch of the euro, Year 2000 compliance costs and the development of
the Global Transaction Services system.

Other administrative expenses, including depreciation, increased EUR
359 million or 20.2% in 1998 due primarily to acquisitions and higher IT costs
resulting primarily from Year 2000 and euro compliance. The number of branches
and offices grew to 2,570, an increase of 1,714 or 200.2%, almost all due to the
acquisitions of Banco Real and Bandepe in South America, which added 1,586
branches and offices, and Bank of Asia in Thailand, which added 112 branches and
offices.

PROVISION FOR LOAN LOSSES AND VALUE ADJUSTMENTS TO FINANCIAL FIXED ASSETS

Provision for loan losses increased in 1999 by EUR 70 million or 13.9% to
EUR 575 million. Risk-weighted total assets of the International Division
totaled EUR 143.1 billion at December 31, 1999, an increase of 19.5% over
risk-weighted total assets for the International Division at December 31, 1998.
The increase in provision for loan losses in 1999 related mainly to higher
losses in North America and Middle East and African regions, which were
partially offset by lower provisions in Asia.

Provision for loan losses increased in 1998 by EUR 104 million or 25.8% to
EUR 505 million. Risk-weighted total assets of the International Division
totaled EUR 119.8 billion at December 31, 1998, an increase of 9.5% over
risk-weighted total assets for the International Division at December 31, 1997.
The increase in provision for loan losses in 1998 related mainly to realized
losses in Asia anticipated at the end of 1997 and a higher provision associated
with the inclusion of acquired Brazilian operations and the expansion of our
existing Brazilian operations.

For 1999, no adjustments were made in the value of financial fixed assets.
For 1998, the value of financial fixed assets was adjusted downward, due to a
loss of EUR 17 million on Russian government paper.

Set forth below is a discussion, by region, of the operating results of the
International Division.

EUROPE (EXCLUDING THE NETHERLANDS)

Operating profit before taxes rose by 4.1% from EUR 339 million to EUR
353 million. Progress was made in the European market outside The Netherlands in
all four client segments in which our company focuses: large multinational
corporations, European companies with substantial cross border business,
financial institutions and private banking. Growth in business more than
compensated for the reduction in revenue from foreign exchange operations and
corresponding banking caused by the introduction of the euro. The private
banking business did particularly well with contributions from international
private banking in Switzerland and Luxembourg. In France, all business lines
made positive contributions, and the acquisitions of Banque Demachy and Banque
du Phenix in 1998 were completely integrated into our existing operations in
1999. Germany also had positive operations which contributed to our performance.
In Italy, higher profits were achieved in the Milan and Rome branches, and other
southern European countries also reported improved results again, especially

78
<PAGE>
Turkey and Greece. Business was strong in Ireland, benefiting from Ireland's
buoyant economy. The Central and European branches, including Moscow, recovered
well from the Russian crisis, which depressed performance in 1998. The
contribution by Romania rose in part as a result of opening a small number of
branches throughout the country. In Hungary, the extensive restructuring program
to modernize Magyar Hitel Bank continued.

In Central Asia, both Uzbekistan and Kazakhstan had successful years.
Expansions in the Central Asia region are expected in 2000 with the opening of a
branch in Baku, Azerbeijan, to serve our customers in the oil and gas industry.

Operating profit before taxes increased in 1998 by 21.1% to EUR
339 million. Results in Germany improved, due to the reorganizations of the
Bank's German subsidiaries and the successful expansion of our investment
banking business in Germany. In France, where we offered a broad range of
services to corporate and private banking clients, all operations experienced
growth. Belgium, too, reported good performance and strong growth. In the United
Kingdom, we strengthened our position further, notably in the area of complex
financial solutions for multinational corporations, but a lower than expected
result was reported. Our Swiss and Luxembourg private banking operations also
benefited from favorable market conditions. Private banking in these countries
as well as in France made a significant contribution to the improvement of
results in Europe.

Among the southern European countries, Turkey made especially strong
progress in 1998. In Italy, we established a very successful asset management
operation through a joint venture with the Northern Italian Banca Antonveneta.

The good results of our banks in Central and Eastern Europe in 1998 were
offset by the spillover effect of the financial crisis in Russia. The crisis
also had a distinctly negative impact on the performance of our Moscow branch in
1998. Despite the difficult environment, results were satisfactory, notably in
the area of servicing international corporate clients. Our operations in Poland,
Romania and Kazakstan achieved excellent results during 1998.

NORTH AMERICA

Operating profit before taxes rose by 15.7% from EUR 976 million in 1998 to
EUR 1,129 million in 1999. The improvement was primarily attributable to
continued growth of middle market lending volume at LaSalle (Illinois) and EAB's
(New York) strong performance. Average currency rates accounted for EUR
60 million of the increase. One-off organizational costs caused pressure on the
Canadian results.

The North American activities are now focused more sharply on a number of
strategic franchises that take account of our local, national and global
geographic presence. Each franchise targets a market where we can achieve
critical mass and operate profitably while taking advantage of synergies from
combining operations. Taken together, these franchises make up a diversified mix
of businesses that reinforce our position as a global universal bank.

Our local market franchises consist of LaSalle Bank Group in Chicago,
Standard Federal Bank in Troy, Michigan, and EAB in Long Island and Metropolitan
New York. LaSalle also targets high net worth individuals. Complementing its
services to commercial clients in the Midwest, it manages assets for owners and
managers of small- and medium-sized businesses.

Our North American network, together with our branches, provides selected
financial services such as asset-based lending, structured finance, leasing and
mortgage warehouse lending to middle-market and midcap businesses. Additionally,
we provide wholesale mortgage origination, residential mortgage services,
institutional trust and asset management services and securities clearing and
execution services.

79
<PAGE>
In 1999, the contribution of North America to the operating profit before
taxes of the International Division decreased to 51.2% due to the full year
consolidation of Banco Real, which is part of the Latin American and Caribbean
region. North American operating profit before taxes rose from EUR 976 million
in 1998 to EUR 1,129 million in 1999, an increase of 15.7%. This improvement was
primarily attributable to our local banks in the United States, mainly LaSalle
and EAB.

During 1999, the LaSalle Group, EAB and Standard Federal each benefited
again from the continuation of high net interest margins and loan volume growth.
Net interest margins remained at attractive levels in 1999. LaSalle, EAB and
Standard Federal had net interest margins of 2.9% (2.8% in 1998), 3.6% (4.0% in
1998) and 2.5% (2.5% in 1998), respectively. Private sector loans grew 11.4% for
the LaSalle Group, 15.5% for EAB and 1.6% for Standard Federal.

In 1998, the contribution of North America to the operating profit before
taxes of the International Division increased to 62.0%. North American operating
profit before taxes rose from EUR 682 million in 1997 to EUR 976 million in
1998, an increase of 43.1%. This improvement was primarily attributable to
continued growth of middle market lending volume at LaSalle and lower loan loss
provisions.

LaSalle (Illinois), EAB (New York) and Standard Federal (Michigan) each
expanded their middle market lending efforts in 1998. LaSalle opened new lending
offices in Minneapolis and Cleveland. The LaSalle retail organization saw
increased market penetration with the installation of 675 automated teller
machines at Clark Gas Stations throughout the Midwest and the introduction of
on-line banking for bill-paying, funds transfers and balance verification. EAB
increased its in-store banking facilities and expanded its successful leasing
activities and completed its first securitization transaction of leasing assets.
Supported by the significant increase in mortgage refinancing resulting from
lower interest rates, Standard Federal substantially increased its new mortgage
origination.

During 1998, the LaSalle Group, EAB and Standard Federal each benefited from
the continuation of high net interest margins and loan volume growth. Net
interest margins remained at attractive levels in 1998, although somewhat lower
than in 1997. LaSalle, EAB and Standard Federal had net interest margins of 2.8%
(3.1% in 1997), 4.0% (4.2% in 1997) and 2.5% (2.8% in 1997), respectively.
Private sector loans grew 11.7% for the LaSalle Group, 11.1% for EAB and 14.7%
for Standard Federal.

In addition, $3.3 billion of unfunded loan commitments and letters of credit
were securitized at the end of 1998. This transaction provided an additional
funding source and also had the benefit of improving capital ratios.

In 1998, as compared to 1997, our branches in Canada reported lower results,
however, the results of branches in Mexico improved.

LATIN AMERICA AND THE CARIBBEAN

Operating profit before taxes in this region more than doubled from EUR
235 million to EUR 576 million, an increase of 145.1%. Of this increase, EUR
323 million was attributable to Banco Real and affiliates in Brazil, while the
balance resulted from improvements in almost all other countries in the region.
Brazil did well with moderately lower results in consumer finance offset by very
positive results in treasury and corporate banking. Additionally, Banco de
Estado de Pernambuco, which was acquired in November 1998, was reorganized,
streamlined and refocused in 1999. Outside of Brazil, the acquisition of Banco
Real included offices in Argentina, Bolivia, Chile, Colombia, Panama, Paraguay
and Uruguay. In 1999, these offices were fully integrated into our existing
offices in those countries.

Operating profit before taxes in this region fell in 1998 from EUR
248 million to EUR 235 million, despite the contribution from Banco Real in the
closing two months of the year. Our existing Brazilian operations reported
sharply lower results, the principal factors being the release in 1997 of a
provision of EUR 68 million that had been made in earlier years and, in 1998,
the gradual deterioration of spreads on our various activities and the high
level of loan loss provisions. In Argentina, 1998 results failed to meet our
criteria as operating profit before taxes fell EUR 3 million,

80
<PAGE>
with a loss of EUR 6 million in 1998. In Chile, results increased substantially
on an already excellent 1997. Results in Ecuador and Paraguay were highly
satisfactory. The performance of our operations in Venezuela and Uruguay were
below expectations owing to unfavorable economic conditions. Our newly opened
branch in Colombia was still in the start-up phase. Panama reported a
satisfactory result. The results in The Netherlands Antilles and Aruba were well
above the 1997 level while lower results were reported in Surinam.

MIDDLE EAST AND AFRICA

Doubtful debts incurred in 1999 were the primary reason for 1998's pre-tax
profit of EUR 45 million becoming a loss of EUR 52 million. Nevertheless,
commercial and consumer banking showed strong growth in several countries, and
investment banking was also successful mainly as a result of a greater emphasis
on cross-selling. Additionally, Morocco's results improved, although South
Africa's operating results were disappointing. Kenya also had lower than
expected results as a result of poor economic conditions and unfavorable
interest rate moves.

Operating profit before taxes in this region improved in 1998 by EUR
17 million or 60.7% to EUR 45 million, as improved results in the United Arab
Emirates, particularly from private banking, and at Saudi Hollandi Bank in Saudi
Arabia, principally from consumer banking, offset lower results from Morocco.

ASIA/PACIFIC

Operating profit before taxes improved from a loss of EUR 20 million to a
profit of EUR 200 million, as a result of key countries such as Australia,
India, Pakistan and Singapore experiencing moderate growth in most lines of
business, with treasury and fixed income, structured finance and private banking
growing the most. Our consumer banking position was strengthened with the
opening of a new branch in Hong Kong and one in the Pudong area of Shanghai, as
well as the upgrading of its Beijing operations. The customer base in Thailand
reached one million clients in 1999. In Taiwan, the retail operations of Bank of
America which were purchased by us, were integrated into our existing activities
and two additional branches were opened.

Considering the difficult operating conditions brought about by the Asian
financial crisis, results were satisfactory in 1998. Operating profit before
taxes declined from a profit of EUR 5 million in 1997 to a loss of EUR
20 million in 1998, due to the high level of loan loss provisions. Higher
revenue from money market transactions, foreign exchange dealing and deposits
were the main elements of growth in the region.

Operating results in Indonesia, Japan and Korea exceeded expectations in
1998, reflecting extraordinary profits from treasury business and liability
products. Indonesia sustained a loss, however, due to the extremely high level
of loan loss provisions. Hong Kong again saw an excellent year, on the strength
of its balanced mix of corporate, investment and consumer banking activities.
India also performed well despite an impending recession and increased
competition. The operation in Taiwan, one of the East-Asian countries least
affected by the financial crisis, showed a strong performance, with consumer
banking in Taiwan achieving profitability in June 1998.

Results of the global treasury unit in Singapore were negatively affected by
the Asian financial crisis during 1998, offset to some extent by the good
performance of our Singapore branch, before loan losses. Capital controls and
political uncertainty in Malaysia and severe economic problems and political
uncertainty in Pakistan hurt results in those two countries.

The results of our branch in Thailand more than doubled in 1998 despite the
country's ailing financial health. We believe that this increase was due largely
to a "flight to quality" by depositors to well-known foreign banks from domestic
banks.

81
<PAGE>
INVESTMENT BANKING DIVISION

The following table sets forth selected information pertaining to the
Investment Banking Division for each of the three most recently completed years.

Total assets................................................ 107,833 126,820 114,606
Risk-weighted assets........................................ 20,473 22,362 28,655
Full-time equivalent staff.................................. 7,512 7,277 6,309
Number of offices and branches.............................. 69 61 58
Efficiency ratio (%)........................................ 78.2 82.2 76.0
Return on Equity (%)........................................ 38.6 16.5 22.7
</TABLE>

Operating profit before taxes rose by 104.1% or EUR 256 million to EUR
502 million in 1999, as result of improved market conditions and a better
performance of most lines of business. The main contributors to the higher
profits were the equity business, asset management and trust services and fees
from mergers and acquisitions.

Due mainly to the turmoil in the financial markets in the second half of
1998, operating profit before taxes fell by 38.3% to EUR 246 million in 1998 as
compared to 1997. Revenues remained at virtually the same level in 1998 as in
1997. Operating expenses were up 9.1% due to the expansion of our investment
banking operations. The markdown of shares in the equity investment portfolios,
as a result of lower stock prices, also had a negative impact on results.

NET INTEREST REVENUE

In 1999, net interest revenue increased by EUR 3 million or 1.3% to EUR
242 million. Net interest revenue contributes only 10.3% of the total revenue of
the Investment Banking Division.

In 1998, net interest revenue rose by EUR 18 million or 8.1% as compared to
1997, mainly due to a profit on the sale of part of an investment bond
portfolio.

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<PAGE>
NET COMMISSIONS

The following table sets forth total net commissions and its components for
the Investment Banking Division for each of the three most recently completed
years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Securities................................................ 738 614 613
Asset management and trust services....................... 228 182 151
Other..................................................... 192 83 31
----- --- ---
Total net commissions..................................... 1,158 879 795
===== === ===
</TABLE>

Net commissions for 1999 increased by EUR 279 million or 31.7% to EUR
1,158 million, which accounted for 49.3% of total revenue. The increase was
primarily related to securities and other commissions. Securities commissions
increased primarily as a result of higher revenues from our investment funds and
brokerage activities.

Net commissions for 1998 rose by EUR 84 million or 10.6% to EUR
879 million, mainly owing to higher fee income from asset management and trust
and M&A advisory services. Securities commissions remained at 1997 levels, as
strong growth in Europe offset lower results in the Far East.

Custody fee income was EUR 37 million in 1999, an increase of EUR 4 million
or 12.1% from 1998, due to an increase in assets under custody. Custody fee
income was EUR 33 million in 1998, an increase of EUR 6 million or 24.1% from
1997, due to an increase in assets under custody.

Asset management and trust fee income in 1999 increased 25.3% to EUR
228 million. Assets managed worldwide increased 26% from EUR 89 billion at
year-end 1998 to EUR 113 billion at year-end 1999, largely due to organic
growth. Well over 60% of this increase was attributable to new money entrusted
to our asset management and trust services during the year.

Asset management and trust fee income in 1998 increased 20.8% to EUR
182 million. Assets managed worldwide increased 27.0% from EUR 70 billion at
year-end 1997 to EUR 89 billion at year-end 1998, with the International
Division accounting for half of this amount. Strong European investor interest,
our marketing and sales activities and our generally recognized expertise in
European investing combined to boost assets managed in its European portfolios.
For 1998, discretionary portfolio management for institutional and private
clients represented 32.0% of total assets under management, with the balance
represented by ABN AMRO-managed investment funds.

During 1999, the ABN AMRO Rothschild joint venture in equity offerings was
awarded a large number of attractive mandates. We also are active in the field
of M&A advisory services, both in The Netherlands and elsewhere in Europe. We
also have a strong presence in the field of structured finance, and considers
ourselves one of the top project finance banks in the world.

83
<PAGE>
RESULTS FROM FINANCIAL TRANSACTIONS

The following table sets forth total results from financial transactions and
the principal components thereof for the Investment Banking Division for each of
the three most recently completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Securities trading.................................... 279 434 281
Foreign exchange dealing.............................. 116 65 72
Derivatives trading................................... 265 87 131
Other................................................. 124 (72) 89
--- --- ---
Total results from financial transactions............. 784 514 573
=== === ===
</TABLE>

Results from financial transactions increased 52.5% to EUR 784 million in
1999, as a result of the market recovery, with equity derivatives trading
performing strongly and maintaining a good return on capital. Securities trading
declined as a result of lower results from fixed income trading.

In 1998, financial transactions generated lower revenue, down 10.3% to EUR
514 million. Securities trading results increased due to substantially better
results on equity, equity derivatives and bond trading. Foreign exchange dealing
produced slightly lower revenue in 1998. Revenues from derivatives trading
performance also were lower than in 1997, with the decrease attributable mainly
to Europe. Other results from financial transactions were lower due to limited
sales opportunities for ABN AMRO's equity participations as a result of the
uncertain market environment. Sales of equity participations were EUR
67 million in 1998, down from EUR 116 million in 1997. In addition, volatile
market movements, particularly in Russia and Brazil, produced a loss in the LDC
debt trading portfolio of EUR 139 million.

OTHER REVENUE

In 1999, other revenue increased EUR 16 million or 10.9% to EUR
163 million, primarily due to higher revenue from and sales of participating
interests.

In 1998, other revenue fell EUR 29 million or 16.5% to EUR 147 million,
primarily due to lower revenue from participating interests.

OPERATING EXPENSES

The following table sets forth the operating expenses and the components
thereof for the Investment Banking Division for each of the three most recently
completed years.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Staff costs............................................ 1,138 816 778
Other administrative expenses.......................... 606 566 493
Depreciation........................................... 92 81 70
----- ----- -----
1,836 1,463 1,341
===== ===== =====
</TABLE>

Operating expenses increased by 25.5% to EUR 1,836 million in 1999, mainly
due to higher bonuses, as a result of higher profits and market conditions.

Operating expenses rose in 1998 by 9.1% to EUR 1,463 million. Staff costs
increased by 4.9% while staff count rose 14.8%. Bonus payments declined in line
with lower revenue for the whole of 1998. In addition, in 1998, substantial
capital outlays were made in connection with information technology,
particularly to accommodate growth of the London-based investment banking
business.

84
<PAGE>
PROVISION FOR LOAN LOSSES AND VALUE ADJUSTMENTS TO FINANCIAL FIXED ASSETS

A result of the nature of the business, improved quality of the assets and
more favorable market conditions, no provisions for loan losses were necessary
for 1999. The negative adjustment to the value of financial fixed assets in 1999
of EUR 9 million related to unrealized losses on shares in our investment
portfolios.

Risk-weighted total assets of the Investment Banking Division amounted to
EUR 20.5 billion at year-end 1999, compared to EUR 22.4 billion at year-end
1998.

For 1998, provision for loan losses were essentially unchanged from 1997
levels. The introduction of new and more sophisticated risk models facilitated
this substantial reduction.

The downward adjustment to the value of financial fixed assets in 1998
related to unrealized losses on shares in our investment portfolios.

ABN AMRO LEASE HOLDING

The following table sets forth selected information pertaining to ABN AMRO
Lease Holding for each of the three most recently completed years.

<TABLE>
<CAPTION>
1999(1) 1998(1) 1997(1)
---------- ---------- ----------
(IN MILLIONS OF EUR EXCEPT STAFF AND
OFFICES AND BRANCHES)
<S> <C> <C> <C>
Net interest revenue....................................... 198 180 162
Net commissions............................................ 116 91 77
Other revenue.............................................. 238 167 162
----- ----- -----
Total revenue.............................................. 552 438 401
Operating expenses......................................... 404 309 288
Provision for loan losses.................................. 20 8 4
----- ----- -----
Operating profit before taxes.............................. 128 121 109
===== ===== =====

Total assets............................................... 8,471 6,769 5,570
Risk-weighted assets....................................... 7,935 6,345 5,298
Full-time equivalent staff................................. 5,278 4,795 3,619
Number of offices and branches............................. 37 34 30
</TABLE>

- ------------------------

(1) This selected financial information may differ from published financial
statements of ABN AMRO Lease Holding as the data above have been adjusted to
reflect the elimination of intercompany transactions.

In 1999, operating profit before taxes improved from EUR 121 million to EUR
128 million, following 1998's increase of 11.0%. The leasing portfolio grew from
EUR 6.2 billion to EUR 7.8 billion, a 26% increase and consolidated total assets
grew by 25.1% to EUR 8.5 billion at the end of 1999. The number of vehicles
under management increased by 83,000 to 610,000 by the end of 1999.

At the end of 1999, fleet leases made up 78.0% of our leasing portfolio and
equipment lease made up 22.0%. The number of employees grew to 5,278, of whom
more than 1,500 work in The Netherlands.

In 1998, operating profit before taxes increased 11.0% from EUR 109 million
to EUR 121 million, with the leasing portfolio growing by EUR 1.0 billion or
20.4% to EUR 6.2 billion at year-end 1998. In The Netherlands, results before
provision for loan losses and taxes were up EUR 8.6 million or 18.0% to EUR
55.8 million from 1997 levels. Outside The Netherlands, results before provision
for loan losses

85
<PAGE>
and taxes improved EUR 7.3 million over 1997 to EUR 73.1 million, with ABN AMRO
Lease Holding benefiting from favorable economic conditions in the United States
and other countries.

In addition to internal growth of EUR 0.8 billion, the portfolio growth also
stemmed from two major acquisitions, a leasing company in South Africa with
15,000 cars in the first half of 1998 and KPN Autolease, a Dutch leasing company
also with a fleet of 15,000 cars in late 1998. In addition, a contract was
concluded in Australia for the management of 16,500 vehicles. Partly as a result
of these acquisitions, the number of vehicles under management grew from 394,000
at year-end 1997 to 527,000 at year-end 1998.

RECONCILIATION OF NET PROFIT UNDER U.S. GAAP

Net profit in 1999 in accordance with U.S. GAAP was EUR 619 million lower
than net profit in accordance with Dutch GAAP. The decrease was principally the
net result of (i) a decrease in results from financial transactions of EUR
453 million attributable to differences in the accounting for certain derivative
hedge transactions, (ii) a charge of EUR 343 million for goodwill associated
with our acquisitions, of which EUR 155 million related to North American
acquisitions (under Dutch GAAP all goodwill is charged to shareholders' equity
at the time of acquisition), (iii) higher pension costs of EUR 98 million due to
a decrease in average discount rates for the calculation of the service costs,
(iv) a charge of EUR 69 million under U.S. GAAP relating to the adaptation of
computer systems for the Euro and for the year 2000, which were provisioned
under Dutch GAAP in preceding years, offset in part by (a) an increase of EUR
157 million due to capitalization of software costs (following the adoption of
SOP 98-1 "Accounting for the Costs of Computer Software Developed or Obtained
for Internal Use" for US GAAP purposes), (b) an increase in net gains from
securities available for sale of EUR 83 million attributable to differences in
accounting for realized gains and losses in investment portfolios, and (c) the
related tax effects of the reconciliation adjustments. Pre-tax profit for taxes
for North American operations for 1999 in accordance with U.S. GAAP would have
been EUR 155 million lower than operating profit before taxes under Dutch GAAP,
giving effect only to the charges under U.S. GAAP for goodwill amortization for
North American acquisitions.

Net profit in 1998 in accordance with U.S. GAAP was EUR 84 million higher
than net profit in accordance with Dutch GAAP. The increase was principally the
net result of (i) an increase in net gains from securities available for sale of
EUR 405 million relating to differences in accounting for realized gains and
losses in investment portfolios, and (ii) lower pension costs of EUR 69 million
due to an increased return on plan assets, offset in part by (a) a charge of EUR
215 million (of which EUR 149 million related to North American acquisitions)
for goodwill associated with our acquisitions (under Dutch GAAP all goodwill is
charged to shareholders' equity at the time of the acquisition), (b) charges
under U.S. GAAP relating to the adaptation of computer systems for the euro and
for the year 2000, which have been provisioned under Dutch GAAP in preceding
years and (c) the tax effects of the reconciliation adjustments. Operating
profit before taxes for North American operations for 1998 in accordance with
U.S. GAAP would have been EUR 149 million lower than operating profit before
taxes under Dutch GAAP giving effect only to the charges under U.S. GAAP for
goodwill amortization for North American acquisitions.

Net profit for 1997 in accordance with U.S. GAAP was EUR 174 million lower
than net profit in accordance with Dutch GAAP. The reduction was principally the
net result of (i) a charge of EUR 194 million (of which EUR 152 million related
to North American acquisitions) for goodwill amortization associated with our
acquisitions, (ii) higher pension costs of EUR 39 million associated with the
absence of charges under Dutch GAAP for pension costs as a result of strong
pension fund investment results and (iii) the tax effects of the reconciliation
adjustments, offset in part by an increase in net gains from securities
available for sale of EUR 152 million relating to differences in accounting for
realized gains and losses in investment portfolios. Operating profit before
taxes for North American operations for the year ended December 31, 1997 in
accordance with U.S. GAAP

86
<PAGE>
would have been EUR 152 million lower than operating profit before taxes under
Dutch GAAP giving effect only to the charges under U.S. GAAP for goodwill
amortization for North American acquisitions.

CAPITAL RESOURCES

The following table shows our capital at December 31, 1999, 1998 and 1997.

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Ordinary Share capital...................................... 832 818 800
Preference Share capital.................................... 823 823 823
Convertible Preference Shares............................... 3 4 5
------ ------ ------
1,658 1,645 1,628
Ordinary Share premium reserves............................. 2,443 2,409 2,367
Convertible Preference Share premium reserves............... 37 45 55
Other reserves.............................................. 7,849 6,624 7,680
------ ------ ------
Shareholders' equity........................................ 11,987 10,723 11,730
Minority interests.......................................... 4,945 3,530 2,054
------ ------ ------
Group equity................................................ 16,932 14,253 13,784
Fund for general banking risks.............................. 1,232 1,140 1,127
Subordinated debt........................................... 10,717 8,980 9,121
------ ------ ------
Group capital............................................... 28,881 24,373 24,032
====== ====== ======
</TABLE>

Group capital at year-end 1999 totaled EUR 28,881 million, up EUR
4,508 million or 18.5% from year-end 1998. Shareholders' equity, one of the
components of group capital, increased by EUR 1,264 million from EUR
10,723 million to EUR 11,987 million, mainly as a result of retained profits and
stock dividends of EUR 1,840 million and a goodwill charge of EUR 814 million.
The goodwill charge of EUR 814 million represented the difference between cost
and net asset value of acquisitions. The charge was mainly incurred on: the
purchase of an interest in Banca di Roma, a charge of EUR 212 million; the
acquisition of Bank of Asia, a charge of EUR 150 million; Bank of America's
Asian consumer banking business, a charge of EUR 91 million; and on raising ABN
AMRO's interest in Banco Real a charge of EUR 228 million and Bandepe, a charge
of EUR 60 million. Translation losses on capital operations abroad led to a
further EUR 215 million charged to the exchange differences, mainly resulting
from the 27.0% depreciation of the Brazilian real, which translation losses were
partially offset by the rise in the exchange rate of the U.S. dollar.

The exercise of staff options at an average price of EUR 12.62 caused the
number of ordinary shares to increase by 3.8 million. In addition, 0.3 million
preference shares were converted into 1.1 million ordinary shares against an
additional payment of EUR 0.79 per ordinary share. As a consequence,
shareholders' equity rose by EUR 41 million.

Minority interests increased EUR 1,415 million mainly from preferred stock
issued by our U.S. business of $1,250 million and currency translation gains of
EUR 556 million. The partial buyout of minority shareholders in Banco Real led
to a EUR 397 million decrease in minority interests.

The fund for general banking risks increased in 1999, rising by EUR
92 million from EUR 1,140 million to EUR 1,232 million, due to a positive
currency translation difference (a part of the fund is held in US dollars for
covering banking risks denominated in US dollars) of EUR 98 million, a release
to the profit and loss account of EUR 13 million (before taxes) and other
movements of EUR 7 million.

87
<PAGE>
Subordinated capital increased by EUR 1.7 billion. Subordinated debt
increased in 1999 by EUR 819 million as a result of higher currency exchange
rates. New subordinated debt of EUR 1.5 billion was issued, of which
1.4 billion was issued in The Netherlands.

Group capital at year-end 1998 totaled EUR 24,373 million, up EUR
341 million or 1.4% from year-end 1997. Shareholders' equity fell in 1998 by EUR
1,007 million to EUR 10,723 million. Goodwill charges and currency translation
losses were partially offset by retained profit and stock dividends of EUR
1,539 million.

The exercise of staff options at an average price of EUR 14.48 caused the
number of ordinary shares to increase by 3.3 million. In addition, 0.4 million
preference shares were converted into 1.5 million ordinary shares against an
additional payment of EUR 0.79 per ordinary share. As a consequence,
shareholders' equity rose by EUR 49 million.

Goodwill charges under Dutch GAAP of EUR 2.3 billion, representing the
difference between cost and net asset value of acquisitions, largely related to
the acquisitions of Banco Real (EUR 1.5 billion), Bank of Asia (EUR
0.4 billion) and ABN AMRO Asia Ltd. (EUR 0.1 billion). An amount of EUR
322 million was charged to the exchange differences reserve due to currency
translation losses on capital investments in operations abroad, primarily
resulting from the depreciation of the U.S. dollar from EUR 0.92 at year-end
1997 to EUR 0.86 at the end of 1998.

In 1998, minority interests increased EUR 1,476 million, mainly from
preferred stock issued by our U.S. business of $1,250 million and the temporary
minority interest in Banco Real of EUR 671 million, offset by currency
translation losses on minority interests of EUR 195 million.

The fund for general banking risks increased in 1998 from EUR 1,127 million
to EUR 1,140 million. An amount of EUR 66 million net, EUR 101 million gross was
released from the fund. This release related to specific provisions for Asia. As
a portion of the equity of acquisitions was added to the fund, the level of the
fund increased on a net basis.

Subordinated debt decreased in 1998 by EUR 0.1 billion. New subordinated
debt of EUR 0.4 billion was issued, almost all in The Netherlands. The converted
EUR value of subordinated debt fell by EUR 0.4 billion, due to a weaker U.S.
dollar.

For an analysis of our shareholders' equity under U.S. GAAP, see note 43 to
the Consolidated Financial Statements.

Our overall capital resources policy is maintained with reference to the
supervisory requirements of the Dutch Central Bank, which applies a capital
ratio based on BIS guidelines as the principal measure of capital adequacy. Such
ratio compares a bank's capital, which is divided into three tiers, with its
assets and off-balance sheet exposures weighted according to broad categories of
relative credit risk. The minimum total capital ratio standard is 8.0% of risk
weighted assets and the minimum Tier 1 capital ratio is 4.0% of risk weighted
assets.

Total capital base increased by 18.4% to EUR 26,764 million in 1999. At
year-end 1999, our Tier 1 capital ratio was 7.20%, its total capital ratio was
10.86%, and the amount of subordinated loans included in lower Tier 2 capital
was 48.0% of Tier 1 capital. Under BIS guidelines, the amount of subordinated
debt that may be included as lower Tier 2 capital is limited to 50.0% of Tier 1
capital. The Dutch Central Bank has established minimum capital requirements for
the market and other risks associated with trading activities. The capital
adequacy requirement for this market risk at December 31, 1999 was EUR
401 million. The Dutch Central Bank permits the issuance of Tier 3 capital in
the form of subordinated loans with a maturity of two years or greater. The Bank
has issued $500 million of subordinated debt that qualifies as Tier 3 capital.
See Item 1 "Description of Business Supervision and Regulation." At year-end
1999, the total capital ratio and Tier 1 capital ratio of ABN

88
<PAGE>
AMRO North America, Inc., the bank holding company for the LaSalle Group, were
10.87% and 7.14%, respectively, as compared to 10.75% and 7.21%, respectively,
at December 31, 1998.

Risk-weighted assets at December 31, 1999 were EUR 246.4 billion, which is
EUR 30.6 billion or 14.2% higher than at December 31, 1998. The increase
resulted from higher risk weighted assets in the International Division as a
result of the rise of the U.S. dollar against the euro and an increase of loans,
especially in the Netherlands Division. In order to improve capital ratios and
return on equity, a number of securitizations were completed in 1999 (EUR
3.7 billion in The Netherlands).

The following table analyzes our capital ratios at December 31, 1999, 1998
and 1997 in accordance with supervisory requirements.

<TABLE>
<CAPTION>
AT DECEMBER 31,
------------------------------
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR EXCEPT
PERCENTAGES)
<S> <C> <C> <C>
Tier 1 capital.............................................. 17,735 14,985 14,521
Tier 2 capital.............................................. 8,968 7,583 7,593
Tier 3 capital.............................................. 498 428 458
Supervisory deductions...................................... (437) (384) (340)
------- ------- -------
Total capital base.......................................... 26,764 22,612 22,232
======= ======= =======

Risk-weighted assets On balance............................. 194,715 168,427 153,516
Off-balance................................................. 46,649 39,208 41,230
Market risks................................................ 5,010 8,134 13,904
------- ------- -------
Total risk-weighted assets.................................. 246,374 215,769 208,650
======= ======= =======

Tier 1 capital ratio........................................ 7.20% 6.94% 6.96%
Total capital ratio......................................... 10.86% 10.48% 10.65%
</TABLE>

For a discussion of liquidity, see Item 1--"Description of Business Risk
Management Liquidity Risk."

CONSOLIDATED BALANCE SHEET

Consolidated total assets at December 31, 1999 were EUR 457.9 billion, up
EUR 25.8 billion or 6.0% from year-end 1998. Higher year-end exchange rates
increased total assets by EUR 35.2 billion. The growth of total assets occurred
in the International Division, an increase of EUR 33.0 billion, mostly due to
higher exchange rates and in the Netherlands Division, an increase of EUR
10.1 billion, notably from home mortgage lending, while total assets decreased
in the Investment Banking Division, a decrease of EUR 19.0 billion largely as a
result of reduced deposits taken from and placed with other banks.

LOANS

Loans increased by EUR 39.2 billion or 17.8% to EUR 259.7 billion at
December 31, 1999. Private sector loans, excluding repo transactions, increased
15.5% to EUR 207.0 billion. Repo transactions increased by EUR 6.6 billion.
Loans to the public sector rose by EUR 4.8 billion to EUR 12 billion.

In The Netherlands Division, private sector loans rose by 9.9% to EUR
88.6 billion at December 31, 1999, due primarily to an increase in mortgage
lending.

89
<PAGE>
In the International Division, private sector loans increased by EUR
17.4 billion or 19.8% to EUR 105.3 billion at December 31, 1999 due to net
higher exchange rates (EUR 11.1 billion) and organic growth (the remainder).

TOTAL CLIENT ACCOUNTS

Total client account balances increased in 1999 by EUR 24.4 billion or 11.9%
to EUR 230.0 billion. In the Netherlands Division, the increase amounted to EUR
6.5 billion. Total client account balances at the International Division
increased by EUR 18.1 billion due to higher exchange rates and organic growth.

ITEM 9A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information set forth in Item 1 "Description of Business Risk
Management" and in Note 24 to the Consolidated Financial Statements are
incorporated herein by reference.

ITEM 10. DIRECTORS AND OFFICERS OF REGISTRANT

Holding is a public company with limited liability incorporated under the
laws of The Netherlands to which the rules for large companies, as set out in
Sections 152 to 164 inclusive of Book 2 of the Dutch Civil Code, or the "Large
Company Rules", apply. Under the Large Company Rules, companies must have a
two-tier system of corporate governance, consisting of a Supervisory Board and
Managing Board. The Supervisory Board supervises the policy conducted by the
Managing Board, as well as the company's general course of affairs and its
business.

Under the Large Company Rules, our day to day management is vested with the
Managing Board. Subject to certain statutory exemptions, the following powers,
among others, are vested in the Supervisory Board by the Large Company Rules:
(i) appointment of the members of the Supervisory Board; (ii) appointment and
dismissal of the members of the Managing Board; (iii) adoption of the annual
accounts; and (iv) approval of certain resolutions by the Managing Board. In
performing their duties, members of the Supervisory Board must consider the
interests of the company and its business.

Holding's Supervisory Board is an independent and self-appointing entity.
The Supervisory Board appoints a chairman from among its members. It also
appoints a secretary, who may or may not be a member of the Supervisory Board.
Persons employed by Holding or an affiliated company cannot be appointed as
Supervisory Board members.

Supervisory Board members are appointed for a term of four years and may be
re- appointed thereafter. Members of the Supervisory Board have agreed to retire
by the day on which the annual general meeting of Shareholders is held in the
financial year in which he or she reaches the age of seventy.

The remuneration of each member of the Supervisory Board is determined by
the Supervisory Board, subject to approval by the general meeting of
shareholders.

90
<PAGE>
The members of the Supervisory Board of Holding as of April 1, 2000 were as
follows:

<TABLE>
<CAPTION>
YEAR OF
NAME APPOINTMENT PRINCIPAL OCCUPATION
- ---- ----------- ---------------------------------------
<S> <C> <C>
A.A. Loudon 1994 Former Chairman of the Managing Board
Chairman of AKZO Nobel N.V.

F.H. Fentener van Vlissingen 1974 Managing Director of Flint Holding N.V.
Vice-Chairman

H.B. van Liemt 1986 Former Chairman of the Managing Board
of DSM N.V.

W. Overmars 1990 Former Chairman of the Executive Board
of Campina Melkunie B.V.

R.J. Nelissen 1992 Former Chairman of the Managing Board
of Holding and ABN AMRO Bank N.V.

W. Dik 1993 Chairman of the Managing Board of Royal
KPN N.V.

J.M.H. van Engelshoven 1993 Former Managing Director of Royal Dutch
Shell Group of Companies

R. Hazelhoff 1994 Former Chairman of the Managing Board
of Holding and ABN AMRO Bank N.V.

S. Keehn 1996 Former President of the Federal Reserve
Bank of Chicago

C.H. van der Hoeven 1997 President and Chief Executive Officer
of Royal Ahold N.V.

M.C. van Veen 1997 Former Chairman of the Managing Board
of Koninklijke Hoogovens N.V.

A. Burgmans 1998 Chairman of the Managing Board of
Unilever N.V.

Mrs. L.S. Groenman 1999 Crown member Sociaal-Economische Raad
(SER)

D.R.J. de Rothschild 1999 Senior Partner of Rothschild & Cie
Banque, Deputy Chairman N.M. Rothschild
Group (including N.M. Rothschild & Sons
Ltd.)
</TABLE>

<TABLE>
<S> <C> <C>
On May 10, 2000, Mr. F.H. Fentener van Vlissingen will cease to be a member of the
Supervisory Board and the following persons will become Supervisory Board members:
</TABLE>

<TABLE>
<S> <C> <C>
Mrs. T. A. Maas-de Brouwer 2000 Former member Upper house of the Dutch
Parlement/leadership in several
information technology organisations

P.J. Kalff 2000 Former Chairman of the Managing Board
of Holding and ABN AMRO Bank N.V.
</TABLE>

91
<PAGE>
The members of the Managing Board of Holding as of April 1, 2000 were as
follows:

<TABLE>
<CAPTION>
YEAR OF
NAME APPOINTMENT PRINCIPAL OCCUPATION
- ---- ----------- ---------------------------------------
<S> <C> <C>
P.J. Kalff 1977 Chairman of the Managing Board

R.W.J. Groenink 1988 Netherlands Division

R.W.F. van Tets 1988 Investment Banking Division
J.M. de Jong 1989 International Division
W.G. Jiskoot 1997 Investment Banking Division
R.G.C. van den Brink 1997 Resources Management Division
T. de Swaan 1999 Risk Management Division/Corporate
Affairs
J.Ch.L. Kuiper 1999 International Division

On May 10, 2000, P.J. Kalff will resign and be succeeded by R.W.J. Groenink.
</TABLE>

The senior executive vice presidents of the Bank as of April 1, 2000 were as
follows:

<TABLE>
<CAPTION>
YEAR OF
NAME APPOINTMENT PRINCIPAL OCCUPATION
- ---- ----------- ---------------------------------------
<S> <C> <C>
W.M. ten Berg 1985 Planning and Control
J.J. Oyevaar 1985 International Division
J.J. Kamp 1986 International Division
R.A. Kleyn 1987 Resources Management Division
M.H. Reuchlin 1989 Corporate Affairs
F.I.A. Lion 1990 Resources Management Division
H.J. Rutgers 1993 Netherlands Division
J. Koopman 1994 International Division
J.C. ten Cate 1996 Netherlands Division
C.H.A. Collee 1996 Netherlands Division
G. Kuyper 1997 Investment Banking Division
A.C. Tupker 1997 Investment Banking Division
D. Post 1997 Resources Management Division
F.G.H. Deckers 1998 International Division
H. Mulder 1998 Risk Management Division
J. Sijbrand 1998 Risk Management Division
J.P. Votron 1999 E-Commerce
H.Y. Scott Barret 1999 Investment Banking Division
S.A. Lires Rial 1999 International Division
N.W.A. Bannister 1999 Investment Banking Division
W.F.C. Baars 1999 Risk Management Division
G.B.J. Hartsink 2000 Netherlands Division
A.M. Kloosterman 2000 International Division
</TABLE>

ITEM 11. COMPENSATION OF DIRECTORS AND OFFICERS

For the year ended December 31, 1999, the compensation paid to current and
former members of the Managing Board and senior executive vice presidents of the
Bank aggregated EUR 21.8 million, and for current and former members of the
Supervisory Board aggregated EUR 0.6 million.

92
<PAGE>
No amount was set aside to provide pension benefits for current and former
members of the Managing Board and senior executive vice presidents of the Bank
pursuant to plans provided or contributed to by us for the year ended
December 31, 1999, versus 0.3 million for 1998, as a result of the good
performance of the Bank's pension fund.

ITEM 12. OPTIONS TO PURCHASE SECURITIES FROM REGISTRANT OR SUBSIDIARIES

Holding has stock option programs under which employees of the Bank's
operating divisions and support functions located in The Netherlands may receive
stock option grants in lieu of cash profit-sharing or Christmas bonuses. In
addition, under a stock option program for senior management, each year a number
of options to acquire Ordinary Shares are granted to approximately 110 employees
of Holding and its domestic and foreign subsidiaries, including but not limited
to the members of the Managing Board and senior executive vice presidents of the
Bank, with the level of grants based on seniority. The exercise price of options
under these programs is equal to the average of the high and low quoted price of
the Ordinary Shares on the AEX Stock Exchange on the date of grant. Pursuant to
its stock option programs, Holding may issue new shares or shares purchased by
Holding in the open market. The options are fully vested on the date of grant
and are exercisable during specified "window periods" for a period of five
years. Options granted after June 26, 1998 are, in accordance with tax rules,
exercisable during specified "window periods" during the fourth and fifth years
after the option is granted. At December 31, 1999, outstanding options held by
employees were as follows:

<TABLE>
<CAPTION>
AVERAGE EXERCISE
YEAR OF EXPIRATION STAFF OPTIONS PRICE
- ------------------ -------------- ----------------
(IN THOUSANDS) (IN EUR)
<S> <C> <C>
2000............................................ 905 7.19
2001............................................ 2,827 10.93
2002............................................ 7,557 16.58
2003............................................ 15,096 22.55
2004............................................ 7,921 20.19
------ -----
34,306 19.33
====== =====
</TABLE>

The following table identifies as of December 31, 1999 the options on our
shares held by members of our Managing Board.

<TABLE>
<CAPTION>
AVERAGE
NUMBER EXERCISE
OF PRICE (IN EXPIRATION
OPTIONS EUR) PERIOD
-------- --------- ----------
<S> <C> <C> <C>
P.J. Kalff............................................ 121,389 18.18 2004
R.W.J. Groenink....................................... 110,785 18.45 2004
R.W.F. van Tets....................................... 202,283 14.27 2004
J.M. de Jong.......................................... 120,785 18.19 2004
W.G. Jiskoot.......................................... 121,389 18.18 2004
R.G.C. van den Brink.................................. 120,356 18.17 2004
T. de Swaan........................................... 40,356 18.13 2004
J.Ch.L. Kuiper........................................ 28,000 18.10 2004
</TABLE>

At December 31, 1999, 2.3 million Ordinary Shares were issuable upon the
exercise of options held as of such date by members of the Managing Board and
senior executive vice presidents of the Bank taken together as a group.

93
<PAGE>
ITEM 13. INTEREST OF MANAGEMENT IN CERTAIN TRANSACTIONS

There were no material contracts in which members of the Managing Board or
the senior executive vice presidents of the Bank had any interest during 1999.
Loans to members of the Managing Board and to members of the Supervisory Board
totaled EUR 8.8 million and EUR 8.0 million, respectively, at December 31, 1999.
As described under Item 10- "Directors and Officers of Registrant," certain
members of the Supervisory Board are current and former senior executives of
leading multinational corporations based primarily in The Netherlands. Members
of our group may at any time have lending, investment banking or other financial
relationships with one or more of these corporations in the ordinary course of
business on terms which Holding believes are no less favorable to our group than
those reached with unaffiliated parties of comparable creditworthiness.

94
<PAGE>
PART II

ITEM 14. DESCRIPTION OF SECURITIES TO BE REGISTERED

Not required in this Report.

PART III

ITEM 15. DEFAULTS UPON SENIOR SECURITIES

Not Applicable.

ITEM 16. CHANGES IN SECURITIES AND CHANGES IN SECURITY FOR REGISTERED SECURITIES
AND USE OF PROCEEDS

Not Applicable.

PART IV

ITEM 17. FINANCIAL STATEMENTS

Not Applicable.

ITEM 18. FINANCIAL STATEMENTS

See pages F-1 through F-61.

ITEM 19. FINANCIAL STATEMENTS AND EXHIBITS

(A) INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Report of Independent Auditors...................... F-2
Accounting Policies................................. F-3
Consolidated Balance Sheets at December 31, 1998 and
1999................................................ F-7
Consolidated Income Statements for the years ended
December 31, 1997, 1998 and 1999.................... F-8
Consolidated Cash Flow Statements for the years
ended December 31, 1997, 1998 and 1999.............. F-9
Changes in Shareholders' Equity for the years ended
December 31, 1997, 1998 and 1999.................... F-10
Notes to the Consolidated Financial Statements...... F-11
</TABLE>

(B) INDEX TO EXHIBITS

Not Applicable.

95
<PAGE>
SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the registrant certifies that it meets all of the requirements for filing
on Form 20-F and has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized.

<TABLE>
<S> <C> <C>
ABN AMRO HOLDING N.V.
(Registrant)

By: /s/ J.J.DEKKER
------------------------------------------
Name: J.J.Dekker
Title: Principal Accounting Officer

By: /s/ H.T.J.M. VAN DEN HOUT
------------------------------------------
Name: H.T.J.M. van den Hout
Title: Secretary to the managing board
</TABLE>

April 20, 2000

<TABLE>
<S> <C> <C>
ABN AMRO BANK N.V.
(Registrant)

By: /s/ J.J.DEKKER
------------------------------------------
Name: J.J.Dekker
Title: Principal Accounting Offier

By: /s/ H.T.J.M. VAN DEN HOUT
------------------------------------------
Name: H.T.J.M. van den Hout
Title: Secretary to the managing board
</TABLE>

April 20, 2000

96
<PAGE>
FINANCIAL STATEMENTS 1999
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<S> <C>
Report of Independent Auditors.............................. F-2
Accounting Policies......................................... F-3
Consolidated Balance Sheets at December 31, 1998 and 1999... F-7
Consolidated Income Statements for the years ended
December 31, 1997, 1998 and 1999.......................... F-8
Consolidated Cash Flow Statements for the years ended
December 31, 1997, 1998 and 1999.......................... F-9
Changes in Shareholders' Equity for the years ended
December 31, 1997, 1998 and 1999.......................... F-10
Notes to the Consolidated Financial Statements.............. F-11
</TABLE>

F-1
<PAGE>
REPORT OF INDEPENDENT AUDITORS

The Supervisory Board and the Managing Board of
ABN AMRO Holding N.V.

We have audited the accompanying consolidated balance sheets of ABN AMRO Holding
N.V. and subsidiaries as of December 31, 1998 and 1999, and the related
consolidated statements of income, cash flows and changes in shareholders'
equity for each of the three years in the period ended December 31, 1999. These
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in The Netherlands, which do not differ in any material respect from auditing
standards generally accepted in the United States of America. These standards
require that we plan and perform the audit to obtain reasonable assurance about
whether the financial statements are free of material misstatements. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statements presentation. We believe that our
audits provide a reasonable basis for our opinion.

In our opinion, based on our audits, the financial statements referred to above
present fairly, in all material respects, the consolidated financial position of
ABN AMRO Holding N.V. and subsidiaries as of December 31, 1998 and 1999, and the
consolidated results of their operations and their cash flows for each of the
three years in the period ended December 31, 1999, in conformity with accounting
principles generally accepted in The Netherlands.

Accounting principles generally accepted in The Netherlands vary in certain
significant respects from accounting principles generally accepted in the United
States of America. Application of accounting principles generally accepted in
the United States of America would have affected shareholders' equity as of
December 31, 1998 and 1999, and the net profits for each of the three years in
the period ended December 31, 1999 to the extent summarized in note 43 to the
Consolidated Financial Statements.

/s/ ERNST & YOUNG
--------------------------------------
Ernst & Young Accountants

Amsterdam, The Netherlands

March 23, 2000

F-2
<PAGE>
ACCOUNTING POLICIES

GENERAL

The financial statements have been prepared in conformity with generally
accepted accounting principles in the Netherlands. Where necessary, the amounts
reported in the financial statements are based on estimates and assumptions.

Since ABN AMRO Holding N.V. ordinary shares are listed on the New York Stock
Exchange (NYSE) in the form of American Depositary Receipts, ABN AMRO also
publishes an annual report (Form 20-F) that conforms to the Securities and
Exchange Commission (SEC) rules, including those relating to the format and
content of the notes to the financial statements. In addition, the annual report
includes an analysis of equity and results according to accounting principles
generally accepted in the United States (US GAAP).

BASIS FOR INCLUSION OF FINANCIAL INSTRUMENTS

A financial instrument is accounted for as an asset or liability from the
time the respective contractual rights or obligations accrue to the company.
Whenever this ceases to be the case, a financial instrument is no longer shown
in the balance sheet. If ABN AMRO has the right on the grounds of legal or
contractual provisions and the intention to settle financial assets and
liabilities net or simultaneously, they are netted-off in the balance sheet.

BASIS OF CONSOLIDATION

The consolidated financial statements incorporate the assets, liabilities,
revenues and expenses of ABN AMRO Holding N.V., its subsidiaries and other group
companies that form an organisational and economic entity with it. Minority
interests in both equity and results of subsidiaries and other group companies
are stated separately.

CURRENCY TRANSLATION

Assets and liabilities denominated in foreign currencies and financial
instruments hedging these assets and liabilities are translated into euros at
the spot rates of exchange prevailing at balance sheet date. Translation
differences are taken to the income statement. Apart from capital investments in
hyper-inflationary countries, translation differences on capital investments in
foreign branches, subsidiaries and participating interests, including retained
profit, are accounted for in shareholders' equity together with the results from
related hedging instruments, after allowing for taxation.

Results on transactions denominated in foreign currencies are translated at
the rates prevailing at transaction date or, insofar as accruals and deferrals
are involved, on the last day of the month to which the results relate. Results
of foreign branches, subsidiaries and participating interests, apart from those
in hyper-inflationary countries, are translated at the rates prevailing at the
end of the month in which the results are recognized. The results from branches,
subsidiaries and participating interests in hyper-inflationary countries are
translated at the rates prevailing at balance sheet date, after restating the
local currency results for the effects of inflation.

VALUATION AND DETERMINATION OF RESULTS

GENERAL

Except where otherwise stated, assets and liabilities are recorded at cost,
less any allowance deemed necessary. Premiums and discounts are accounted for in
prepayments and accrued income or accruals and deferred income respectively, and
are attributed to the accounting periods throughout the remaining terms of the
underlying items.

F-3
<PAGE>
Except for items forming part of the trading portfolio, interest-earning and
interest-bearing securities on which a large part or all of the interest
receivable or payable is settled on redemption are included at either purchase
price or discounted value on issue plus accrued interest.

Where financial instruments are used to hedge risks associated with
designated assets or liabilities, the valuation and determination of results on
these instruments are effected in accordance with the policies applied to the
hedged items. Transactions are qualified as hedges if they are identified as
such and there is a substantial negative correlation between the hedging results
and the results of the positions being hedged. Gains or losses on the early
termination of a hedge are recognized as assets or liabilities and amortized
over the remaining terms of the hedged positions. Where financial instruments
are used to hedge risks associated with designated assets or liabilities and the
hedged assets or liabilities are sold or terminated, such financial instruments
are no longer qualified as hedges. Results on the settlement of the hedge are
accounted for in the same period as gains or losses on the settlement of the
hedged position. Accounting policies relating to other financial instruments are
explained in the section on trading activities. Revenue and expenses are
recognized in the year to which they relate.

If loan-related fees exceed initial expenses, they are accounted for as
interest in the period concerned. Acquisition commission paid by the life
insurance subsidiary to third parties and the banking operation are capitalized
as initial expenses and amortized. Expenses involved in the issuance of ordinary
and preference shares are charged to shareholders' equity.

LOANS

Loans are generally shown at the principal amount. Loans are classified as
doubtful as soon as there is any doubt about the borrower's capacity to repay
the principal. Where necessary, an allowance for loan losses is applied.

Allowances for loan losses are determined on a statistical basis in
conformity with the nature of the underlying loan or per item, taking into
account the value of collateral. The value of LDC receivables is assessed on a
country by country basis. The allowances are recognized in provision for loan
losses in the income statement.

As soon as the loan liquidation procedure is started, ABN AMRO ceases to
accrue interest on the loan in question (non-accrual loans). Depending on the
chances of the principal being repaid, interest is recorded in the income
statement only when actually received (other non-performing loans) or in
accordance with the standard method of valuation (accruing doubtful loans).
Doubtful loans are not written off until it is clear that repayment of principal
can be ruled out.

TRADING ACTIVITIES

Securities held in the trading portfolios are stated at market value.
Debentures of ABN AMRO group companies, acquired as part of trading activities,
are stated at the lower of market value and purchase price. Foreign exchange
contracts, stock, bond, currency and other options, as well as interest rate
contracts such as interest rate swaps and forward rate agreements, are stated at
market value. The aggregate market value of these contracts is included in other
assets or other liabilities. Gains or losses resulting from the method of
valuation described are recognized in the income statement in results from
financial transactions.

FINANCIAL AND OTHER FIXED ASSETS

INVESTMENTS

Interest-earning securities (other than securities on which a large part or
all of the interest is settled on redemption) held in the investment portfolios
are stated at redemption value. Shares held in

F-4
<PAGE>
these portfolios are included at market value, with changes in value, net of
tax, reflected in shareholders' equity. If the revaluation reserve formed in
this manner is insufficient to absorb diminutions in value, they will be charged
to the income statement in value adjustments to financial fixed assets. Results
on sales are credited to the income statement in the year the investments are
sold. Net capital gains on interest-bearing securities realised prior to
redemption date in connection with replacement operations are recognized as
interest over the remaining average portfolio duration. Investments which are
held under insurance contracts for the account and risk of policyholders are
carried at market value; changes in the value of these investments are accounted
for as other revenue (profits or losses of insurance companies).

SHARES AS PART OF VENTURE CAPITAL ACTIVITIES

Equity investments, i.e. shares acquired as part of venture capital
activities, are stated at purchase price or sustained lower market value.

PARTICIPATING INTERESTS

Participating interests in which ABN AMRO or one of its subsidiaries has a
significant influence on commercial and financial policy are stated at net asset
value determined in conformity with the policies applied in these financial
statements. In accordance with these policies, movements in net asset value are
recorded in shareholders' equity, such as revaluations and goodwill, or in the
income statement. Tax payable on distributions is taken into account at the
moment of the decision to make a distribution.

Goodwill arising from the acquisition of participating interests is charged
to shareholders' equity.

Other participating interests, consisting principally of equity investments
in companies in related lines of business, are shown at estimated proceeds from
sale. Movements in value, net of tax, are recorded in shareholders' equity. If
the revaluation reserve formed in this manner is insufficient to absorb
diminutions in value, such diminutions will be charged to the income statement
in value adjustments to financial fixed assets.

PROPERTY AND EQUIPMENT

Premises used in operations, including land, are stated at current value
based on replacement cost. Buildings and fixtures and fittings are fully
depreciated by the straight-line method over their estimated useful life with a
maximum of fifty years. Movements in value, net of tax, are credited or charged
to shareholders' equity on a long-term basis. Capital expenditures on rented
premises are capitalized and also depreciated on a straight-line basis, taking
into account the term of the lease. Property held for sale is stated at the
lower of cost, including interest during construction, and estimated proceeds
from sale.

Equipment, computer installations and software bought from third parties are
stated at cost less straight-line depreciation over the estimated useful life.

Marketable rights relating to loan servicing activities are capitalized at
the lower of cost and estimated proceeds from sale, and amortized over the
estimated useful life.

PROVISIONS

For the employees in the Netherlands and the majority of staff employed
outside the Netherlands, pension or other retirement plans have been established
in accordance with the regulations and practices of the countries in question.
Most of these plans are administered by separate pension funds or third parties.
The contributions paid are charged to the income statement each year. The amount
of the contribution takes account of increases in pension rights in line with
the development of wages and

F-5
<PAGE>
inflation, as well as of the return achieved by the pension funds in excess of
the actuarial interest rate, which is currently 4% in the Netherlands.

Insurance fund liabilities are related chiefly to provisions for life
insurance. They are determined using actuarial methods and on the basis of the
same principles as those used to calculate the premium. These provisions are
periodically tested by reference to changes in mortality, interest and costs,
and increased when deemed inadequate. Technical provisions for investment
exposure borne by policyholders are determined using the same principles as are
applied for the valuation of the underlying investments.

Self-administered pension plan commitments, which are relatively small, and
provisions for payments to non-active employees are computed on the basis of
actuarial assumptions.

Except for deferred tax liabilities, other provisions for commitments and
risks are included at face value.

TAXES

In determining the effective tax rate, all timing differences between
pre-tax profit determined on the basis of ABN AMRO accounting policies and the
taxable amount in accordance with tax legislation, are taken into account.
Deferred tax liabilities are discounted to their present value on the basis of
the net interest. Deferred tax assets are accounted for only if there is
sufficient assurance about their collectibility. The addition to or withdrawal
from the fund for general banking risks is taken into account when determining
the effective tax rate.

F-6
<PAGE>
CONSOLIDATED BALANCE SHEET AFTER PROFIT APPROPRIATION

<TABLE>
<CAPTION>
NOTES 1999 1998
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
ASSETS
Cash........................................................ 1 6,806 4,478
Short-dated government paper................................ 2,5 10,375 7,719
Banks....................................................... 3 47,201 60,894

Loans to public sector.................................... 12,007 7,243
Loans to private sector................................... 206,974 179,211
Professional securities transactions...................... 40,742 34,058
------- -------
Loans....................................................... 4 259,723 220,512
Interest-earning securities................................. 5 92,583 106,067
Shares...................................................... 5 16,990 13,271
Participating interests..................................... 6 1,884 1,057
Property and equipment...................................... 7 5,205 4,657
Other assets................................................ 8 6,894 5,439
Prepayments and accrued income.............................. 9 10,223 7,989
------- -------
457,884 432,083
======= =======
LIABILITIES
Banks....................................................... 10 80,990 104,898
Savings accounts.......................................... 71,729 61,785
Deposits and other client accounts........................ 128,507 112,741
Professional securities transactions...................... 29,756 31,028
------- -------
Total client accounts....................................... 11 229,992 205,554
Debt securities............................................. 12 54,228 37,947
Other liabilities........................................... 8 42,113 42,419
Accruals and deferred income................................ 9 10,974 9,170
Provisions.................................................. 13 10,706 7,722
------- -------
429,003 407,710

Fund for general banking risks.............................. 14 1,232 1,140
Subordinated debt........................................... 15 10,717 8,980

Shareholders' equity...................................... 16 11,987 10,723
Minority interests........................................ 17 4,945 3,530
------- -------
Group equity................................................ 16,932 14,253

Group capital............................................... 28,881 24,373
------- -------
457,884 432,083
======= =======

Contingent liabilities...................................... 23 43,561 35,100
Committed facilities........................................ 115,441 88,873
</TABLE>

F-7
<PAGE>
CONSOLIDATED INCOME STATEMENT

<TABLE>
<CAPTION>
NOTES 1999 1998 1997
-------- -------- -------- --------
(IN MILLIONS OF EUR
EXCEPT SHARE DATA)
<S> <C> <C> <C> <C>
REVENUE
Interest revenue............................................ 29,062 25,634 20,795
Interest expense............................................ 20,375 18,436 14,501
------ ------ ------

NET INTEREST REVENUE........................................ 26 8,687 7,198 6,294

Revenue from securities and participating interests......... 27 357 348 286

Commission revenue........................................ 4,947 3,819 3,185
Commission expense........................................ 492 431 339
------ ------ ------

Net commissions............................................. 28 4,455 3,388 2,846
Results from financial transactions......................... 29 1,374 1,153 1,105
Other revenue............................................... 30 654 451 254
------ ------ ------

TOTAL NON-INTEREST REVENUE.................................. 6,840 5,340 4,491
------ ------ ------
TOTAL REVENUE............................................... 39 15,527 12,538 10,785

EXPENSES
Staff costs............................................... 31 5,768 4,656 3,926
Other administrative expenses............................. 32 4,041 3,381 2,982
------ ------ ------

Administrative expenses..................................... 9,809 8,037 6,908
Depreciation................................................ 33 800 667 542
------ ------ ------
OPERATING EXPENSES.......................................... 10,609 8,704 7,450
Provision for loan losses................................... 34 653 941 547
Release from / addition to fund for general banking risks... 35 (20) (101) 179
Value adjustments to financial fixed assets................. 36 35 97 (17)
------ ------ ------
TOTAL EXPENSES.............................................. 11,277 9,641 8,159

OPERATING PROFIT BEFORE TAXES............................... 4,250 2,897 2,626
Taxes....................................................... 37 1,320 908 754
------ ------ ------
GROUP PROFIT AFTER TAXES.................................... 2,930 1,989 1,872
Minority interests.......................................... 38 360 161 124
------ ------ ------
NET PROFIT.................................................. 2,570 1,828 1,748
====== ====== ======

Earnings per Ordinary Share................................. 1.72 1.23 1.20
Fully diluted earnings per Ordinary Share................... 1.71 1.22 1.19
Dividend per Ordinary Share................................. 0.80 0.58 0.54
</TABLE>

F-8
<PAGE>
CONSOLIDATED CASH FLOW STATEMENT

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Group profit................................................ 2,930 1,989 1,872
Depreciation................................................ 800 667 542
Provision for loan losses--release from / addition to fund
for general banking risks................................. 633 839 726
Movement in provisions...................................... 516 (171) 76
Movement in interest receivable............................. (1,878) 36 (1,848)
Movement in interest payable................................ 1,356 1,058 1,540
Movement in tax on profit................................... 274 131 (75)
Other accruals and deferrals................................ 200 2,279 663
Government paper and securities, trading.................... 13,423 (21,980) (10,681)
Other securities............................................ 9,865 (4,593) (13,523)
Banks, other than demand deposits........................... (13,288) 11,936 13,703
Loans....................................................... (18,907) (15,924) (10,868)
Professional securities transactions (included in loans).... (1,441) (4,937) (22,210)
Total client accounts....................................... 13,984 12,563 16,385
Professional securities transactions (included in total
client accounts).......................................... (5,274) 6,563 19,439
Debt securities, excluding debentures....................... 5,524 (2,121) 2,504
Other assets and liabilities................................ (3,155) 20,745 14,880
-------- -------- --------

Net cash flow from operations / banking activities.......... 5,562 9,080 13,125
Purchase of securities for investment portfolios.......... (56,164) (62,582) (53,304)
Sale and redemption of securities from investment
portfolios.............................................. 49,821 56,103 42,615
-------- -------- --------
Net outflow................................................. (6,343) (6,479) (10,689)
Investments in participating interests.................... (1,355) (1,182) (2,008)
Sale of investments in participating interests............ 64 313 1,266
-------- -------- --------
Net outflow................................................. (1,291) (869) (742)
Capital expenditure on property and equipment............. (1,502) (1,245) (1,025)
Sale of property and equipment............................ 293 173 171
-------- -------- --------
Net outflow................................................. (1,209) (1,072) (854)
-------- -------- --------
Net cash flow from investment activities.................... (8,843) (8,420) (12,285)
Increase in group equity.................................... 1,198 1,049 1,310
Redemption of preference shares............................. -- -- (234)
Issue of subordinated debt.................................. 1,536 420 1,674
Repayment of subordinated debt.............................. (350) (348) (136)
Issue of debentures and notes............................... 8,851 1,401 3,831
Repayment of debentures and notes........................... (2,826) (2,560) (2,621)
Cash dividends paid......................................... (974) (439) (428)
-------- -------- --------
Net cash flow from financing activities..................... 7,435 (477) 3,396
-------- -------- --------
Cash flow................................................... 4,154 183 4,236
======== ======== ========
</TABLE>

For details refer to note 41.

F-9
<PAGE>
CHANGES IN SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
ORDINARY SHARES
Opening Balance............................................. 818 800 778
Exercised options and warrants.............................. 1 2 2
Conversion of Convertible Preference Shares................. 1 1 5
Stock dividends............................................. 12 15 15
------ ------- -------
Closing Balance............................................. 832 818 800
------ ------- -------

PREFERENCE SHARES
Balance unchanged........................................... 823 823 823
------ ------- -------

CONVERTIBLE PREFERENCE SHARES
Opening Balance............................................. 4 5 9
Conversion.................................................. (1) (1) (4)
------ ------- -------
Closing Balance............................................. 3 4 5
------ ------- -------

SHARE PREMIUM ACCOUNT RELATING TO ORDINARY SHARES
Opening Balance............................................. 2,409 2,367 2,297
Exercised options and conversion............................ 38 46 27
Conversion of Convertible Preference Shares................. 8 11 58
Stock dividends............................................. (12) (15) (15)
------ ------- -------
Closing Balance............................................. 2,443 2,409 2,367
------ ------- -------

SHARE PREMIUM ACCOUNT RELATING TO CONVERTIBLE PREFERENCE
SHARES
Opening Balance............................................. 45 55 106
Conversion.................................................. (8) (10) (51)
------ ------- -------
Closing Balance............................................. 37 45 55
------ ------- -------

GENERAL RESERVE AND STATUTORY RESERVE
Opening Balance............................................. 6,988 7,759 7,589
Retained profit............................................. 1,320 922 904
Stock dividends............................................. 520 617 486
Goodwill.................................................... (814) (2,275) (1,228)
Other....................................................... (32) (35) 8
------ ------- -------
Closing Balance............................................. 7,982 6,988 7,759
------ ------- -------

REVALUATION RESERVES
Opening Balance............................................. 314 289 301
Revaluations................................................ 6 25 (12)
------ ------- -------
Closing Balance............................................. 320 314 289
------ ------- -------

EXCHANGE DIFFERENCES RESERVE
Opening Balance............................................. (639) (317) (413)
Currency translation differences............................ 215 (322) 96
------ ------- -------
Closing Balance............................................. (424) (639) (317)
------ ------- -------

TREASURY STOCK
Opening Balance............................................. (39) (51) (156)
Increase (decrease)......................................... 10 12 105
------ ------- -------
Closing Balance............................................. (29) (39) (51)
------ ------- -------
TOTAL SHAREHOLDERS' EQUITY.................................. 11,987 10,723 11,730
====== ======= =======
</TABLE>

F-10
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1 CASH

This item includes legal tender and demand deposits with central banks in
countries in which the bank has a presence.

2 SHORT-DATED GOVERNMENT PAPER

This item includes securities issued by public authorities, such as treasury
paper, with original terms of two years or less, provided they can be refinanced
with a central bank.

3 BANKS (ASSETS)

This item includes receivables, including professional securities
transactions, from credit institutions, central banks and multilateral
development banks not already recognized in cash. Receivables in the form of
securities are included in interest-earning securities or shares.

4 LOANS AND CREDIT RISK

This item includes amounts receivable in connection with loans, including
professional securities transactions, insofar as they are not recognized in the
item banks. Securitized receivables are included in interest-earning securities
or shares.

In granting facilities and loans, ABN AMRO incurs a credit risk, i.e. the
risk that the receivable will not be paid. This is related primarily to the
balance sheet items banks, loans and interest-earning securities, and to
off-balance sheet items. Concentration of credit risk could result in a material
loss for the bank if a change in economic circumstances were to affect a whole
industry or country.

SECTOR ANALYSIS OF LOANS

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Public sector........................................... 12,097 7,334
Commercial.............................................. 130,003 110,757
Retail.................................................. 81,679 72,739
Professional securities transactions.................... 40,742 34,058
Allowances for loan losses and cross-border risks....... (4,798) (4,376)
------- -------
Loans................................................... 259,723 220,512
======= =======
</TABLE>

COLLATERAL FOR PRIVATE SECTOR LOANS

Collateral is frequently demanded in connection with lending operations. The
following table analyses private sector loans by type of collateral. Unsecured
loans also include loans for which the Bank has the right to require collateral.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
COMMERCIAL
Public authority guarantees............................. 6,109 5,474
Mortgages............................................... 18,974 15,584
Securities.............................................. 2,337 2,699
Bank guarantees......................................... 3,114 3,093
Other types of collateral and unsecured................. 99,469 83,907
------- -------
Total commercial loans.................................. 130,003 110,757
======= =======
</TABLE>

F-11
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
RETAIL
Public authority guarantees............................. 3,628 3,596
Mortgages............................................... 58,082 50,523
Other types of collateral and unsecured................. 19,969 18,620
------- -------
Total retail loans...................................... 81,679 72,739
======= =======
</TABLE>

COMMERCIAL LOANS BY INDUSTRY

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Agriculture, mining and energy.......................... 10,718 8,957
Manufacturing........................................... 30,948 26,649
Construction and real estate............................ 15,067 12,624
Wholesale and retail trade.............................. 19,257 17,536
Transportation and communications....................... 10,451 9,568
Financial services...................................... 17,639 16,348
Business services....................................... 12,290 8,477
Education, health care and other services............... 13,633 10,598
------- -------
Total commercial loans.................................. 130,003 110,757
======= =======
</TABLE>

MOVEMENTS IN ALLOWANCES FOR LOAN LOSSES

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS EUR)
<S> <C> <C> <C>
Opening balance........................................ 4,116 2,894 2,402
Currency translation differences and other movements... 178 957 233
Write-offs............................................. (771) (527) (465)
Received after write-off............................... 119 77 54
----- ----- -----
3,642 3,401 2,224
Addition from net interest revenue..................... 138 77 75
Addition from provision for loan losses.............. 1,085 1,073 870
Transfer to provision for loan losses................ (407) (435) (275)
----- ----- -----
Net increase........................................... 678 638 595
----- ----- -----
Closing balance........................................ 4,458 4,116 2,894
===== ===== =====
</TABLE>

CROSS-BORDER RISK

Loans and other exposures are often not restricted to the country in which
the facility is extended, but also involve banks, public authorities and other
clients in foreign countries, and are mostly denominated in foreign currencies.
The total cross-border exposure is very substantial but relates mainly to OECD
countries. An increased risk on these outstandings would arise if and insofar as
government measures or extreme economic conditions in specific countries were to
restrict debt servicing. Additional cross-border risk allowances are applied in
such circumstances. The following table shows both net cross-border exposure and
risk allowances. Net exposure involves all outstandings in non-local currencies
in countries with an increased exposure less credit-enhanced outstandings and
traditionally low-risk outstandings such as short-term trade finance and
pre-export finance, as well as items held in the trading portfolios. Based on
net exposure and country-specific percentages, cross-border risk allowances are
computed. In determining actual cross-border risk allowances, any specific

F-12
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

allowances for loan losses and the current value of U.S. treasury zero coupon
bonds issued as part of restructuring programs are taken into account.

ANALYSIS OF INCREASED CROSS-BORDER EXPOSURES AND RISK ALLOWANCES AT
DECEMBER 31, 1999

<TABLE>
<CAPTION>
NET RISK
EXPOSURE ALLOWANCES
-------- ----------
(IN MILLIONS OF EUR)
<S> <C> <C>
Central and Eastern Europe............................... 224 182
Latin America and the Caribbean.......................... 936 231
Asia / Pacific........................................... 146 86
Other countries.......................................... 36 34
----- ---
Total.................................................... 1,342 533
===== ===
</TABLE>

MOVEMENTS IN CROSS-BORDER RISK ALLOWANCES

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Opening Balance....................................... 494 410 418
Currency translation differences...................... 74 (23) 47
Provision for loan losses............................. (25) 303 (48)
Other movements....................................... (10) (196) (7)
--- ---- ---
Closing Balance....................................... 533 494 410
=== ==== ===
</TABLE>

Cross-border risk allowances are charged to loans, banks and
interest-bearing securities.

OTHER

The item loans includes subordinated debt amounting to EUR 57 million
(1998: EUR 90 million) and leasing operations amounting to EUR 10,910 million
(1998: EUR 8,713 million).

5 SECURITIES

The balance sheet items Short-dated government paper, Interest-earning
securities and shares include the investment portfolios, the trading portfolios,
securitized receivables such as treasury paper and commercial paper, and equity
participations. Interest-earning securities forming part of an investment
portfolio, which principally consist of central government bonds, serve as a
liquidity buffer among others. ABN AMRO attempts to maximize the return on these
instruments through a policy of active management. Equity investments held on a
long-term basis are also included in the investment portfolios.

The aforementioned balance sheet items can be analyzed as follows:

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Investment portfolios................................... 62,679 51,745
Trading portfolios...................................... 39,428 49,114
Short-dated government paper............................ 3,114 2,172
Other bank paper........................................ 4,873 15,396
Other loan-style paper.................................. 4,631 4,101
Options................................................. 3,913 4,013
Equity participations................................... 1,310 516
------- -------
Total securities........................................ 119,948 127,057
======= =======
</TABLE>

F-13
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table analyzes listed and unlisted securities:

<TABLE>
<CAPTION>
LISTED UNLISTED
------------------- -------------------
1999 1998 1999 1998
-------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Public authority paper...................... 43,579 42,877 11,271 19,160
Other interest-earning securities........... 16,109 13,343 31,999 38,407
Shares...................................... 15,542 12,367 1,448 903
------ ------ ------ ------
Total securities............................ 75,230 68,587 44,718 58,470
====== ====== ====== ======
</TABLE>

Listed securities include all securities which are traded on any stock
exchange. Third parties hold legal title to part of the securities included in
the portfolios. This is related to securities sold with repurchase commitments
(EUR 8,163 million, 1998: EUR 14,433 million) and securities lending
transactions (EUR 9,213 million, 1998: EUR 3,080 million). In addition, ABN AMRO
borrowed securities totalling EUR 7,075 million (1998: EUR 11,574 million).
These borrowed securities are not shown in the balance sheet. The item
Interest-earning securities includes securities of a subordinated nature
totalling EUR 32 million (1998: EUR 54 million) and non-subordinated
interest-earning securities issued by group companies totalling
EUR 1,028 million (1998: EUR 855 million).

As part of its securities brokerage activities, the group also trades in ABN
AMRO Holding shares. In addition, shares were repurchased on the AEX Stock
Exchange in connection with staff options granted and to cover positions with
clients. At December 31, 1999, the treasury stock position of group companies
included 2.6 million ABN AMRO Holding Ordinary Shares. The corresponding amount
of EUR 29 million has been deducted from reserves.

An amount of EUR 15,989 million is scheduled for redemption in 2000 on
interest-earning securities.

INVESTMENT PORTFOLIOS

The analysis below shows the book value and the fair value of ABN AMRO's
investment portfolios. Fair value is based on quoted prices for traded
securities and estimated market value for non-traded securities.

<TABLE>
<CAPTION>
1999 1998
----------------------------------- -----------------------------------
PREMIUMS PREMIUMS
OR OR
BOOK VALUE DISCOUNTS FAIR VALUE BOOK VALUE DISCOUNTS FAIR VALUE
---------- --------- ---------- ---------- --------- ----------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
Dutch government......................... 4,770 234 4,812 5,974 188 6,546
US Treasury and US government agencies... 7,454 (123) 7,137 7,014 117 7,269
Other OECD governments................... 18,112 560 18,396 14,670 181 15,772
Mortgage-backed securities............... 17,900 (66) 17,284 13,228 32 13,315
Other interest-earning securities........ 9,628 31 9,847 7,688 (122) 8,092
------ ---- ------ ------ ---- ------
Total interest-earning securities and
short-dated government paper........... 57,864 636 57,476 48,574 396 50,994
Shares................................... 4,815 4,815 3,171 3,171
------ ------ ------ ------
Total investment portfolios.............. 62,679 62,291 51,745 54,165
====== ====== ====== ======
</TABLE>

F-14
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
AFTER 1 YEAR AFTER 5 YEARS
AND AND
WITHIN 1 YEAR WITHIN 5 YEARS WITHIN 10 YEARS AFTER 10 YEARS
------------------- ------------------- ------------------- -------------------
YIELD YIELD YIELD YIELD
AMOUNT (%) AMOUNT (%) AMOUNT (%) AMOUNT (%)
-------- -------- -------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Dutch government.......................... 397 3.9 1,663 5.9 1,559 5.9 1,385 6.0
U.S. Treasury and U.S. government
agencies................................ 616 5.9 1,885 6.0 1,614 6.2 3,216 6.9
Other OECD governments.................... 5,405 2.7 5,110 6.8 6,121 5.4 2,036 8.4
Mortgage-backed securities (1)............ 20 6.9 1,188 6.5 7,481 6.8 9,145 6.7
Other securities.......................... 1,925 8.8 4,011 7.5 2,593 6.6 1,130 5.1
Total amortized cost...................... 8,363 4.4 13,857 6.8 19,368 6.2 16,912 6.8
Total market value........................ 8,335 14,125 18,980 16,036
</TABLE>

- ------------------------------

(1) Maturity dates have been estimated based on historical experience.

The book value of the investment portfolios developed during 1999 as
follows:

<TABLE>
<CAPTION>
INTEREST-
EARNING SHARES
--------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Opening Balance of banking business investment portfolio.... 46,235 582
Movements:
Purchases................................................. 53,474 1,616
Sales..................................................... (32,044) (1,255)
Redemptions............................................... (16,522) --
Revaluations.............................................. -- 17
Currency translation differences.......................... 4,086 14
Other..................................................... (47) 522
------- ------
Closing Balance of banking business investment portfolio.... 55,182 1,496
Closing Balance of insurance business investment
portfolio................................................. 2,682 3,319
------- ------
Total investment portfolios................................. 57,864 4,815
======= ======
Revaluations included in Closing Balance.................... 29
Diminutions in value included in Closing Balance............ 114
</TABLE>

Premiums and discounts on the investment portfolios are amortized. The
purchase price of the investment portfolios, including unamortized amounts from
replacement transactions, was EUR 172 million below the redemption value.

F-15
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

TRADING PORTFOLIOS

The following table analyzes the composition of the trading portfolios.

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Dutch government...................................... 947 3,096
U.S. Treasury and U.S. government agencies............ 4,147 5,542
Other OECD governments................................ 17,420 26,480
Other interest-earning securities..................... 9,962 8,745
------ ------
Total interest-earning securities..................... 32,476 43,863
Shares................................................ 6,952 5,251
------ ------
Total trading portfolios.............................. 39,428 49,114
====== ======
</TABLE>

OTHER SECURITIES

The following table analyzes the book value and fair value of other
securities.

<TABLE>
<CAPTION>
1999 1998
--------------------- ---------------------
BOOK BOOK
VALUE FAIR VALUE VALUE FAIR VALUE
-------- ---------- -------- ----------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Short-dated government paper............................. 3,114 3,139 2,172 2,181
Other bank paper......................................... 4,873 4,873 15,396 15,392
Other debt securities.................................... 4,631 4,535 3,781 3,647
------ ------ ------ ------
Total interest-earning securities........................ 12,618 12,547 21,349 21,220
Shares, options and corporate investment portfolio....... 5,223 5,252 4,849 4,855
------ ------ ------ ------
Total other securities................................... 17,841 17,799 26,198 26,075
====== ====== ====== ======
</TABLE>

F-16
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

6 PARTICIPATING INTERESTS

This item includes equity participations held on a long-term basis for the
purpose of business operations.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Analysis:
Credit institutions..................................... 858 189
Other participating interests........................... 1,026 868
----- -----
Total participating interests........................... 1,884 1,057
===== =====
Development:
Opening Balance......................................... 1,057 963
Movements:
purchases / increases................................. 782 209
sales / reductions.................................... (64) (193)
revaluations.......................................... (4) 8
acquisitions / dispositions (net)..................... -- 86
other................................................. 113 (16)
----- -----
Closing Balance......................................... 1,884 1,057
===== =====
Revaluations included in Closing Balance................ 27 31
</TABLE>

Participating interests with official stock exchange listings represented a
book value of EUR 794 million (1998: EUR 167 million).

F-17
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

7 PROPERTY AND EQUIPMENT

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Analysis:
Real property used in operations...................... 3,218 2,863
Other real property................................... 357 320
Equipment............................................. 1,630 1,474
----- -----
Total property and equipment.......................... 5,205 4,657
===== =====
</TABLE>

<TABLE>
<CAPTION>
PROPERTY
--------------------------------------------
USED IN
TOTAL OPERATIONS OTHER EQUIPMENT
-------- ---------- -------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Development:

Opening Balance........................... 4,657 2,863 320 1,474
Movements:
purchases............................... 1,502 537 155 810
sales................................... (293) (81) (137) (75)
revaluations............................ (13) (13) -- --
depreciation............................ (800) (187) (10) (603)
acquisitions / dispositions (net)....... 17 17 -- --
other................................... 135 82 29 24
------ ------ ---- ------
548 355 37 156
Accumulated amounts:
Replacement cost.......................... 7,581 4,263 369 2,949
Depreciation.............................. (2,376) (1,045) (12) (1,319)
------ ------ ---- ------
Closing Balance........................... 5,205 3,218 357 1,630
====== ====== ==== ======
Revaluations included in Closing
Balance................................. 172 169 3 --
</TABLE>

Legal title to property and equipment totaling EUR 75 million (1998:
EUR 121 million) is held by third parties.

8 OTHER ASSETS AND OTHER LIABILITIES

These items include those amounts which are not of an accrued or deferred
nature or which cannot be classified with any other balance sheet item. This
concerns, for example, deferred tax assets (1999: EUR 972 million), servicing
rights, precious metals and other goods, balances of payment transactions still
to be settled, as well as taxes receivable or payable, short securities
positions and market value of interest rate and currency contracts as part of
trading actvities.

9 PREPAYMENTS AND ACCRUED INCOME AND ACCRUALS AND DEFERRED INCOME

These items include revenue and expenses recognized in the period under
review but whose actual receipt or payment falls in a different period, as well
as the total net difference between contract rates and spot rates on foreign
exchange hedging operations.

10 BANKS (LIABILITIES)

This item comprises debts, including amounts on account of professional
securities transactions, to credit institutions, central banks and multilateral
development banks.

F-18
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

11 TOTAL CLIENT ACCOUNTS

This item includes total client balances held in current accounts, savings
accounts and deposits, as well as debts on account of professional securities
transactions and non-subordinated private loans.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Savings accounts........................................ 71,729 61,785
Corporate deposits...................................... 65,931 60,938
Professional securities transactions.................... 29,756 31,028
Other client accounts................................... 62,576 51,803
------- -------
Total client accounts................................... 229,992 205,554
======= =======
</TABLE>

12 DEBT SECURITIES

This item includes non-subordinated debt and other negotiable
interest-bearing debt securities.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Debentures and notes.................................... 17,277 11,125
Cash notes, savings certificates and bank
certificates.......................................... 7,795 7,660
Certificates of deposit and commercial paper............ 29,156 19,162
------ ------
Total debt securities................................... 54,228 37,947
====== ======
</TABLE>

The debentures are issued principally in the Dutch capital market and the
Euromarket and are denominated mostly in Netherlands guilders and U.S. dollars.
The commercial paper programme is conducted mainly in the United States and is
denominated in U.S. dollars. The other debt securities are instruments used in
markets in which ABN AMRO is active and are usually denominated in local
currencies. At December 31, 1999, debt securities denominated in Netherlands
guilders amounted to EUR 17,056 million and those denominated in U.S. dollars to
EUR 26,615 million.

At December 31, 1999, debt securities included EUR 700 million of variable
rate obligations. In addition, EUR 1,419 million of debt securities had been
converted into variable rate obligations through the use of asset-liability
management derivatives contracts. The average interest rate on debentures and
notes, adjusted to reflect the effect of asset-liability management derivatives
contracts at year-end 1999, was 6.6%.

MATURITY ANALYSIS OF DEBT SECURITIES

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF
EUR)
<S> <C> <C>
Within one year............................................. 31,370 21,648
After one and within two years.............................. 3,994 4,210
After two and within three years............................ 2,192 2,545
After three and within four years........................... 1,443 1,585
After four and within five years............................ 1,821 1,558
After five years............................................ 13,408 6,401
------ ------
Total debt securities....................................... 54,228 37,947
====== ======
</TABLE>

F-19
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

13 PROVISIONS

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Provision for deferred tax liabilities.................... 1,008 701
Provision for pension commitments......................... 178 64
Provisions for payments to non-active employees........... 165 226
Insurance fund liabilities................................ 8,539 6,012
Other provisions.......................................... 816 719
------ -----
Total provisions.......................................... 10,706 7,722
====== =====
</TABLE>

The provision for deferred tax liabilities relates to tax liabilities that
will arise in the future owing to the difference between the book value of
specific assets and liabilities and their valuation for tax purposes. The face
value of the provision for deferred tax liabilities amounted to
EUR 1,124 million at year-end 1999. The following analysis shows deferred tax
liabilities and assets.

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
DEFERRED TAX LIABILITIES
Buildings................................................. 154 152
Pensions and other post-retirement and post-employment
arrangements............................................ 173 171
Derivatives............................................... 160 97
Leases and similar financial solutions.................... 326 181
Servicing rights.......................................... 247 152
Other..................................................... 206 176
------ -----
Total..................................................... 1,266 929

DEFERRED TAX ASSETS
Allowances for loan losses................................ 300 205
Investment portfolios..................................... 255 152
Offsettable losses of foreign operations.................. 404 389
Other..................................................... 412 547
------ -----
Deferred tax assets before value adjustments.............. 1,371 1,293
Less: value adjustments................................... 141 287
------ -----
Deferred tax assets after value adjustments............... 1,230 1,006
====== =====
</TABLE>

Deferred tax assets are recognized, to the extent possible, net of provision
for deferred tax liabilities.

The provisions for payments to non-active employees relate to early
retirement, total disability, contributions to medical expenses and other
commitments. Insurance fund liabilities include the actuarial reserves and the
premium and claims reserves of the group's insurance companies.

Provisions are generally long-term in nature.

F-20
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

14 FUND FOR GENERAL BANKING RISKS

The fund for general banking risks covers general risks associated with
lending and other banking activities. The Fund is net of tax and forms part of
tier 1 capital; it is maintained partly in currencies other than the euro.

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Opening balance........................................... 1,140 1,127
Movements:
Release to income statement............................... (20) (101)
Tax on addition........................................... 7 35
------ -----
(13) (66)
Consolidation............................................. -- 126
Currency translation differences.......................... 98 (36)
Other..................................................... 7 (11)
------ -----
Closing balance........................................... 1,232 1,140
====== =====
</TABLE>

15 SUBORDINATED DEBT

This item includes subordinated debentures and loans which, according to the
standards applied by the Netherlands central bank, qualify for the consolidated
capital adequacy ratio. It comprises debt subordinated to all other current and
future liabilities of ABN AMRO Holding N.V. as well as borrowings of
consolidated participating interests, including EUR 10,064 million raised by ABN
AMRO Bank N.V. In general, early repayment, in whole or in part, is not
permitted.

The average interest rate on subordinated debt was 7.0%.

MATURITY ANALYSIS OF SUBORDINATED DEBT

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Within one year........................................... 261 276
after one and within two years............................ 1,423 261
after two and within three years.......................... 681 1,298
after three and within four years......................... 172 607
after four and within five years.......................... 459 164
after five years.......................................... 7,721 6,374
------ -----
Total subordinated debt................................... 10,717 8,980
====== =====
</TABLE>

Subordinated debt at December 31, 1999 was denominated in euros to an amount
of EUR 5,003 million and in U.S. dollars to an amount of EUR 5,494 million, and
included EUR 37 million of variable rate obligations.

F-21
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

16 SHAREHOLDERS' EQUITY

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Share capital..................................... 1,658 1,645 1,628
Reserves.......................................... 10,358 9,117 10,153
------ ------ ------
12,016 10,762 11,781
Treasury stock.................................... (29) (39) (51)
------ ------ ------
Total shareholders' equity........................ 11,987 10,723 11,730
====== ====== ======
</TABLE>

For further information reference is made to the section on changes in
shareholders' equity.

SHARE CAPITAL

The authorised share capital of ABN AMRO Holding N.V. amounts to
NLG 10,500,000,005 face value and consists of one Priority Share, four billion
Ordinary Shares, one billion Preference Shares and one hundred million
Convertible Preference Shares, each of which is convertible into four ordinary
shares.

The issued and paid-up share capital is made up of the following numbers of
shares:

<TABLE>
<S> <C>
Priority Share (face value NLG 5.00)........................ 1
Ordinary Shares (face value NLG 1.25)....................... 1,468,159,769
Preference Shares (face value NLG 5.00)..................... 362,503,010
Convertible Preference Shares (face value NLG 5.00)......... 1,420,089
</TABLE>

On December 31, 1999, 2,645,946 ordinary shares were repurchased in
connection with staff options granted.

The Preference Shares are registered shares; the dividend has been fixed at
9.5% of the face value. This percentage will be adjusted at January 1, 2001 in
the manner stipulated in the Articles of Association.

The dividend payable on the Convertible Preference Shares has been fixed at
EUR 1.72 (rounded) per share per annum until the end of 2003. Holders of
Convertible Preference Shares can convert their shares into 5.7 million Ordinary
Shares until October 31, 2003, on payment of EUR 0.79 (rounded) per Ordinary
Share. If all rights are fully exercised, shareholders' equity would increase by
an amount of EUR 668 million.

RESERVES

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Share premium account.............................. 2,480 2,454 2,422
Revaluation reserves............................... 320 314 289
Reserves prescribed by law and articles of
association...................................... 205 172 227
General reserve.................................. 7,777 6,816 7,532
Exchange differences reserve..................... (424) (639) (317)
Other reserves..................................... 7,353 6,177 7,215
------ ----- ------
Total reserves..................................... 10,358 9,117 10,153
====== ===== ======
</TABLE>

F-22
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The share premium account is regarded as paid-up capital for tax purposes.

Due to dispositions and depreciation, EUR 118 million of the revaluation
reserves is regarded as having been realized. The expected stock dividend
percentage for the final dividend was taken into consideration.

STAFF OPTIONS

Apart from Managing Board members and other senior executives, employees of
ABN AMRO are periodically offered the opportunity to acquire equity options
whose value is related to the option exercise price. The exercise price of staff
options is equal to the average of the highest and lowest ordinary share price
quoted on the Amsterdam Exchanges' stock market on the date of grant. The
options can be exercised for five years from the date of grant. However, the
options granted in 1998 to the Managing Board members, as well as the majority
of options granted to other staff, are not exercisable during the first three
years from the date of grant. Window periods have been established for senior
management and other designated persons. This category of staff is not permitted
to exercise its options outside the window periods, except on the expiration
date and the preceding five working days, subject to certain conditions. In
1999, approximately 19,000 employees exercised the right to take equity options.
At year-end 1999, approximately 25,000 employees held equity options.

In 1997, 1998 and 1999, the price of options exercised ranged from EUR 4.96
to EUR 24.32. If fully exercised, the options at year-end 1999 would have
increased the number of Ordinary Shares by 34.3 million (see analysis below) and
shareholders' equity by EUR 663 million.

<TABLE>
<CAPTION>
AVERAGE LOW/HIGH
STAFF OPTIONS EXERCISE PRICE EXERCISE PRICE
YEAR OF EXPIRATION (IN THOUSANDS) (IN EUR) (IN EUR)
- ------------------ -------------- -------------- -----------------
<S> <C> <C> <C>
2000................................... 905 7.19 6.67-8.21
2001................................... 2,827 10.93 10.02-12.75
2002................................... 7,557 16.58 15.38-18.60
2003................................... 15,096 22.55 17.28-23.52
2004................................... 7,921 20.19 18.10-24.32
------
Total.................................. 34,306 19.33 6.67-24.32
====== ===== =================
</TABLE>

The movement in these rights for the years 1999 and 1998 are as follows:

<TABLE>
<CAPTION>
1999 1998
------------------------------- -------------------------------
AVERAGE AVERAGE
STAFF OPTIONS EXERCISE PRICE STAFF OPTIONS EXERCISE PRICE
(IN THOUSANDS) (IN EUR) (IN THOUSANDS) (IN EUR)
-------------- -------------- -------------- --------------
<S> <C> <C> <C> <C>
Movements:
Opening Balance.......................... 28,103 17.99 19,385 13.83
Options granted to Managing Board
members................................ 322 18.13 322 21.03
Other options granted.................... 9,726 20.58 12,819 22.70
Options exercised........................ (3,818) 12.62 (4,419) 13.61
Options expired.......................... (27) 8.66 (4) 10.89
------ ------
Closing Balance.......................... 34,306 19.33 28,103 17.99
</TABLE>

Deliveries in respect of options exercised in 1999 were made from share
repurchases on the date of grant (891,000 shares) and from new shares issued on
the exercise date (2,927,000 shares).

F-23
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

17 MINORITY INTERESTS

This item comprises the share of third parties in the equity of subsidiaries
and other group companies, as well as preferred stock issued to third parties by
subsidiaries in the United States. The right to repayment of this preferred
stock is in all cases vested in the issuing institution but repayment is also
subject to approval of the supervisory authorities. If this right is not
exercised, preference shares without fixed dividend entitlement qualify for a
dividend step-up. In terms of dividend and liquidation rights, Trust preference
shares are comparable to ABN AMRO Holding N.V. preference shares.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Cumulative preference shares................................ 109 94 101
Non-cumulative preference shares
Trust preference shares with fixed dividend................. 2,488 1,070 --
Other shares with fixed dividend............................ 547 471 504
Other shares with dividend step-up.......................... 1,209 1,040 1,113
Other minority interests.................................... 592 855 336
----- ----- -----
Total....................................................... 4,945 3,530 2,054
</TABLE>

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Opening Balance............................................. 3,530 2,054 955
Currency translation differences............................ 556 (195) 191
Issue of preference shares.................................. 1,180 1,133 1,025
Redemption of preference shares............................. -- -- (234)
Other movements............................................. (321) 538 117
----- ----- -----
Closing Balance............................................. 4,945 3,530 2,054
===== ===== =====
</TABLE>

18 CAPITAL ADEQUACY

The standards applied by the Netherlands central bank for the principal
capital ratios are based on the capital adequacy guidelines of the European
Union and the Basle Committee for Banking Supervision.

These ratios compare the bank's total capital and tier 1 capital with the
total of risk-weighted assets and off-balance sheet items and the market risk
associated with the trading portfolios. The minimum requirement for the total
capital ratio and tier 1 ratio is 8% and 4% respectively of risk-weighted
assets.

The following table analyses actual capital and the minimum standard in
accordance with supervisory requirements.

<TABLE>
<CAPTION>
1999 1998
--------------------- ---------------------
REQUIRED ACTUAL REQUIRED ACTUAL
-------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C>
Total capital...................... 19,710 26,764 17,262 22,612
Total capital ratio................ 8.0% 10.86% 8.0% 10.48%
Tier 1 capital..................... 9,855 17,735 8,631 14,985
Tier 1 capital ratio............... 4.0% 7.20% 4.0% 6.94%
</TABLE>

F-24
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

19 ACCOUNTS WITH PARTICIPATING INTERESTS

Amounts receivable from and payable to participating interests included in
the various balance sheet items totalled:

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Banks (assets)............................................ 17 74
Loans..................................................... 194 240
Banks (liabilities)....................................... 84 318
Total client accounts..................................... 16 65
</TABLE>

20 MATURITY

Short-dated liabilities and demand deposits are generally matched by cash,
assets that can be realised at short notice or lending operations as part of the
interest rate risk policy. The balance sheet is already presented in descending
order of liquidity. A number of items containing assets or liabilities with
varying maturities are analysed in the table in this note. This analysis does
not include liquid assets such as cash and short-dated government paper and the
bond investment portfolios, which by their nature can be realised at short
notice. In every country in which ABN AMRO is active, liquidity satisfies the
standards imposed by the supervisory authorities.

MATURITY ANALYSIS

<TABLE>
<CAPTION>
ON DEMAND #3 MONTHS 3 M #1 YR 1 YR #5 YR > 5 YR
--------- ---------- --------- ---------- --------
(IN BILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
Banks (liabilities).................... 9 56 15 1 --
Savings accounts....................... 43 16 8 4 1
Deposits and other client accounts
(including professional securities)
transactions......................... 55 79 16 6 2
Debt securities........................ -- 19 12 10 13
Subordinated debt...................... -- -- -- 3 8
Banks (assets)......................... 9 26 11 1 --
Loans.................................. 21 85 32 48 74
</TABLE>

21 CURRENCY POSITION

Of total assets and total liabilities, amounts equivalent to
EUR 324 billion and EUR 321 billion respectively are denominated in currencies
other than the euro. Positions arising from balance sheet items are generally
hedged by foreign exchange contracts not included in the balance sheet. The
actual currency positions arising out of the bank's proprietary foreign exchange
dealing activities are of limited size. Capital invested in operations outside
the Netherlands is largely funded in euros. Part of the resulting currency
positions is used to offset movements in required capital for foreign-currency
risk-bearing assets, which is also due to exchange rate fluctuations. Similar
reasoning lies behind the policy of issuing preferred stock and subordinated
debt in foreign currencies.

F-25
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

22 COLLATERAL PROVIDED

In connection with collateral provided for specific liabilities and
off-balance sheet commitments, as well as for transactions in financial markets,
specific assets are not freely available. This relates to cash
(EUR 2.9 billion), banks (EUR 0.1 billion), securities (EUR 12.4 billion) and
loans (EUR 6.0 billion). Collateral has been provided for liabilities included
in the items banks (EUR 11.1 billion), total client accounts (EUR 6.3 billion)
and other liabilities (EUR 1.0 billion).

23 CONTINGENT LIABILITIES

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
Commitments with respect to guarantees granted........... 39,254 31,254
Commitments with respect to irrevocable letters of
credit................................................. 4,243 3,688
Commitments with respect to recourse risks arising from
discounted bills....................................... 64 158
------ ------
Total Contingent liabilities............................. 43,561 35,100
====== ======
</TABLE>

24 DERIVATIVES

Derivatives are financial instruments, the contracted or notional amounts of
which are not included in the balance sheet either because rights and
obligations arise out of one and the same contract, the performance of which is
due after balance sheet date, or because the notional amounts serve merely as
variables for calculation purposes. Examples of derivatives are forward exchange
contracts, options, swaps, futures and forward rate agreements. The underlying
value may involve interest rate, currency, commodity, bond or equity products or
a combination of these. Derivatives transactions are conducted as a trading
activity (also on behalf of clients) and as a hedge against ABN AMRO's own
interest rate and currency exposure.

The degree to which ABN AMRO is active in the respective markets or market
segments is shown in the following analysis by means of notional amounts
(including maturity profile based on remaining term). The notional amounts,
however, give no indication of the size of the cash flows and the market risk or
credit risk attaching to derivatives transactions.

The market risk arises from movements in variables determining the value of
derivatives, such as interest rates and quoted prices. The credit risk is the
loss that would arise if a counterparty were to default. This is related,
however, to the market risk since the extent of the credit risk is in part
determined by actual and expected market fluctuations. In calculating the credit
risk shown in the table below, netting agreements and other collateral have not
been taken into consideration.

F-26
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table shows the notional amounts of ABN AMRO's derivatives
portfolio at December 31, 1999.

DERIVATIVES TRANSACTIONS

<TABLE>
<CAPTION>
NOTIONAL AMOUNTS
---------------------------------------------------------
#1 YR 1 YR #5 YR >5 YR TOTAL CREDIT RISK
-------- ---------- -------- -------- -----------
(IN BILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
INTEREST RATE CONTRACTS
OTC Swaps............................... 177 324 247 748 15
Forwards............................ 183 14 -- 197 --
Options............................. 74 152 47 273 2
Exchange-traded Futures............................. 95 27 -- 122 --
Options............................. 10 -- -- 10 --
CURRENCY CONTRACTS
OTC Swaps............................... 34 60 27 121 5
Forwards............................ 426 21 1 448 8
Options............................. 42 1 -- 43 --
Exchange-traded Futures............................. -- -- -- -- --
Options............................. 1 -- -- 1 --
OTHER CONTRACTS
OTC Forwards/Swaps...................... 1 -- -- 1 --
Options............................. 5 28 -- 33 1
Exchange-traded Futures............................. 1 -- -- 1 --
Options............................. 8 8 6 22 --
----- --- --- ----- --
Total derivatives.................................... 1,057 635 328 2,020 31
===== === === ===== ==
</TABLE>

The tables below give an indication of the notional amounts and (average)
market values of the principal types of trading portfolio contracts and hedging
portfolio contracts (i.e. contracts entered into as part of the bank's interest
rate and exchange rate policies). Intercompany transactions between hedging and
trading portfolios have not been eliminated from the figures.

F-27
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

TRADING PORTFOLIO DERIVATIVES TRANSACTIONS IN 1999

<TABLE>
<CAPTION>
AVERAGE MARKET
MARKET VALUE VALUE
NOTIONAL ------------------- -------------------
AMOUNTS POSITIVE NEGATIVE POSITIVE NEGATIVE
--------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C>
INTEREST RATE CONTRACTS
Swaps............................................ 802,712 15,185 13,458 15,438 15,810
Forwards......................................... 195,552 132 134 129 129
Options purchased................................ 142,897 1,909 -- 1,759 --
Options sold..................................... 144,147 -- 2,099 -- 1,789
Futures.......................................... 106,011 319 158 -- --
--------- ------ ------ ------ ------

Total interest rate contracts.................... 1,391,319 17,545 15,849 17,326 17,728
========= ====== ====== ====== ======

CURRENCY CONTRACTS
Swaps............................................ 119,733 4,815 4,994 4,266 5,164
Forwards......................................... 445,511 8,142 7,480 7,709 6,275
Options purchased................................ 18,532 458 -- 789 --
Options sold..................................... 24,628 -- 638 -- 398
--------- ------ ------ ------ ------

Total currency contracts......................... 608,404 13,415 13,112 12,764 11,837
========= ====== ====== ====== ======

OTHER CONTRACTS
Equity options purchased......................... 29,195 1,853 -- 1,874 --
Equity options sold.............................. 25,038 -- 3,307 -- 3,416
Other equity and commodity contracts............. 2,954 257 369 21 37
--------- ------ ------ ------ ------
Total other contracts............................ 57,187 2,110 3,676 1,895 3,453
========= ====== ====== ====== ======

TRADING PORTFOLIO DERIVATIVES TRANSACTIONS IN
1998
INTEREST RATE CONTRACTS
Swaps............................................ 523,372 17,487 16,120 13,754 12,451
Forwards......................................... 154,586 238 132 108 119
Options purchased................................ 109,640 1,648 -- 1,350 --
Options sold..................................... 114,239 -- 1,501 -- 1,451
Futures.......................................... 125,701 482 42 9 11
--------- ------ ------ ------ ------

Total interest rate contracts.................... 1,027,538 19,855 17,795 15,221 14,032
========= ====== ====== ====== ======

CURRENCY CONTRACTS
Swaps............................................ 115,005 3,178 3,772 3,685 3,667
Forwards......................................... 527,272 7,832 6,700 8,122 7,358
Options purchased................................ 22,398 583 -- 1,161 --
Options sold..................................... 25,491 -- 511 -- 1,190
Futures.......................................... 1,079 -- -- -- --
--------- ------ ------ ------ ------

Total currency contracts......................... 691,245 11,593 10,983 12,968 12,215
========= ====== ====== ====== ======

OTHER CONTRACTS
Equity options purchased......................... 32,920 7,223 -- 3,983 --
Equity options sold.............................. 33,101 -- 9,049 -- 4,795
Other equity and commodity contracts............. 1,944 19 13 1 1
--------- ------ ------ ------ ------

Total other contracts............................ 67,965 7,242 9,062 3,984 4,796
========= ====== ====== ====== ======
</TABLE>

F-28
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

HEDGING PORTFOLIO DERIVATIVES TRANSACTIONS

<TABLE>
<CAPTION>
1999 1998
------------------------------ ------------------------------
MARKET VALUE MARKET VALUE
NOTIONAL ------------------- NOTIONAL -------------------
AMOUNTS POSITIVE NEGATIVE AMOUNTS POSITIVE NEGATIVE
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
INTEREST RATE CONTRACTS
Swaps............................................ 85,688 2,243 1,702 67,636 3,203 2,153
Forwards......................................... 9,720 10 10 7,449 13 13
Options purchased................................ 7,980 130 -- 8,243 186 --
Futures.......................................... 15,773 69 2 11,223 5 9
------- ----- ----- ------ ----- -----
Total interest rate contracts.................... 119,161 2,452 1,714 94,551 3,407 2,175
======= ===== ===== ====== ===== =====

CURRENCY CONTRACTS
Swaps............................................ 8,948 352 184 8,847 261 377
Forwards......................................... 24,871 400 654 22,610 904 871
Options purchased................................ 4,486 32 -- 4,644 12 --
------- ----- ----- ------ ----- -----
Total currency contracts......................... 38,305 784 838 36,101 1,177 1,248
======= ===== ===== ====== ===== =====
</TABLE>

DERIVATIVES AND CAPITAL ADEQUACY REQUIREMENTS

In determining the capital adequacy requirement, both existing and future
credit risk is taken into account. To this end the current potential loss, i.e.
the positive replacement value based on market conditions at balance sheet date,
is increased by a percentage of the relevant notional amounts, depending on the
nature and remaining term of the contract. This method takes into account the
possible adverse development of the positive replacement value during the
remaining term of the contract. The analysis below shows the resulting credit
equivalent, both unweighted and weighted for the counterparty risk (mainly
banks). The figures allow for the downward impact of netting agreements and
other collateral on risk exposure and capital adequacy.

CREDIT EQUIVALENT

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN BILLIONS OF EUR)
<S> <C> <C>
Interest rate contracts.................................... 23.8 23.1
Currency contracts......................................... 26.0 23.3
Other contracts............................................ 3.4 6.2
---- ----
53.2 52.6

Effect of contractual netting.............................. 21.1 20.4
---- ----

Unweighted credit equivalent............................... 32.1 32.2

Weighted credit equivalent................................. 8.8 8.7
</TABLE>

F-29
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

25 MEMORANDUM ITEMS

Apart from the memorandum items stated, non-quantified guarantees have been
given for the bank's securities custody operations, for interbank bodies and
institutions and for participating interests. Collective guarantee schemes are
applicable to group companies in various countries. Furthermore, statements of
liability have been issued for a number of group companies.

Legal proceedings have been initiated against ABN AMRO in a number of
jurisdictions, but on the basis of information currently available, and having
taken counsel with legal advisers, the Managing Board is of the opinion that the
outcome of these proceedings is unlikely to have a material adverse effect on
the consolidated financial position and the consolidated operations of ABN AMRO.

For 2000, investment in property and equipment is estimated at EUR
1.1 billion, of which ABN AMRO is already committed to an amount of EUR
250 million.

Though ABN AMRO has sold a part of its loan portfolio, partly through
credit-enhanced or non-credit enhanced securitisation, it still holds legal
title to some of these loans. In most cases these loans are also serviced by ABN
AMRO. Besides, the bank services loans granted by other institutions. The table
below states the outstandings at December 31, 1999.

<TABLE>
<S> <C>
Legal title to loans sold................................... 4,774
Loans serviced for third parties............................ 65,765
Loans sold with credit enhancement.......................... 8,721
</TABLE>

Future rental commitments at December 31, 1999 for long-term lease contracts
were as follows:

<TABLE>
<S> <C>
2000........................................................ 274
2001........................................................ 157
2002........................................................ 132
2003........................................................ 122
2004........................................................ 110
years after 2004............................................ 877
</TABLE>

26 NET INTEREST REVENUE

This item comprises interest revenue from loans, investments, other lending,
interest expense on borrowings by ABN AMRO and client accounts, as well as the
results from interest rate and foreign exchange contracts entered into for
hedging purposes. Also included is other revenue from loans. Interest revenue
from interest-earning securities amounted to EUR 4,746 million (1998:
EUR 3,735 million). Interest expense on subordinated debt totalled EUR
695 million (1998: EUR 645 million).

27 REVENUE FROM SECURITIES AND PARTICIPATING INTERESTS

This item includes the share in net profit or loss of participating
interests on which ABN AMRO exercises a significant influence. Also included are
dividends received from shares and other participating interests, as well as the
results from sales of shares from the investment portfolio and

F-30
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

investments in participating interests insofar as these are not treated as value
adjustments to financial fixed assets.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Revenue from shares and equity participations............. 119 99 88
Revenue from participating interests...................... 238 249 198
--- --- ---
Total revenue from securities and participating
interests............................................... 357 348 286
=== === ===
</TABLE>

28 NET COMMISSIONS

This item includes revenue from securities brokerage, domestic and
international payments, asset management, insurance, leasing and other services.
Amounts paid to third parties are shown as commission expense.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Securities brokerage................................... 1,710 1,437 1,228
Payment services....................................... 1,176 778 682
Asset management and trust............................. 560 404 325
Insurance.............................................. 176 155 136
Guarantees............................................. 139 117 112
Leasing................................................ 123 94 77
Other.................................................. 571 403 286
----- ----- -----
Total commissions...................................... 4,455 3,388 2,846
===== ===== =====
</TABLE>

29 RESULTS FROM FINANCIAL TRANSACTIONS

This item includes the results from foreign exchange dealing, securities
trading, derivatives transactions, as well as trading in LDC debt securities
which is included in the "other' item, and currency translation differences on
investments--other than those included in tangible fixed assets--in branches,
subsidiaries and participating interests in hyper-inflationary countries.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Securities trading..................................... 417 527 389
Foreign exchange dealing............................... 499 531 433
Derivatives transactions............................... 371 188 185
Other.................................................. 87 (93) 98
----- ----- -----
Total result from financial transactions............... 1,374 1,153 1,105
===== ===== =====
</TABLE>

F-31
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

30 OTHER REVENUE

This includes revenue from property development, other revenue from leasing
activities and results from the insurance companies forming part of the group.
The insurance companies achieved the following results in 1999:

<TABLE>
<CAPTION>
LIFE NON-LIFE
-------- --------
(IN MILLIONS OF
EUR)
<S> <C> <C>
Net premium income......................................... 1,534 429
Investment income.......................................... 1,206 42
Insurance expenses......................................... (2,643) (394)
------ ----
Total result of insurance companies........................ 97 77
====== ====
</TABLE>

31 STAFF COSTS

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR EXCEPT
NUMBER OF EMPLOYEES)
<S> <C> <C> <C>
Salaries (including bonuses, etc.)................. 4,516 3,605 3,214
Pension costs...................................... 140 151 77
Social insurance and other staff costs............. 1,112 900 635
------- ------ ------
Total staff costs.................................. 5,768 4,656 3,926
======= ====== ======

Average number of employees (headcount):
Netherlands........................................ 36,976 35,387 33,190
Foreign countries.................................. 71,713 47,880 39,028
------- ------ ------
Total average number of employees (headcount)...... 108,689 83,267 72,218
======= ====== ======
</TABLE>

32 OTHER ADMINISTRATIVE EXPENSES

This item includes office overhead, automation costs, advertising costs and
other general expenses.

ABN AMRO also leases premises and space in other buildings for its principal
activities. The leases generally are renewable and provide for payment of rent
and certain other occupancy expenses. Total rent expense for all contracts
amounted to EUR 262 million in 1999, EUR 244 million in 1998 and EUR
227 million in 1997.

33 DEPRECIATION

This item is made up of depreciation of buildings and equipment.

34 PROVISION FOR LOAN LOSSES

This item includes provisions for uncollectible outstandings.

35 ADDITION TO THE FUND FOR GENERAL BANKING RISKS

This item includes the addition to or release from the Fund, management's
intention being to maintain the Fund at a level equal to approximately 0.5% of
risk-weighted total assets.

F-32
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

36 VALUE ADJUSTMENTS TO FINANCIAL FIXED ASSETS

Financial fixed assets include the bond and equity investment portfolios and
participating interests on which the bank does not exercise an influence.
Diminutions in value of the bond investment portfolio may relate to a permanent
deterioration of the debtor's quality. These diminutions in value and the
diminutions in value below the purchase price of shares and participating
interests on which no influence is exercised, together with amounts released in
respect of earlier diminutions in value, are included in this item. Results from
dispositions below purchase price are likewise treated as diminutions in value.

37 TAXES

The overall effective tax rate decreased from 31.3% in 1998 to 31.1% in
1999.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
<S> <C> <C> <C>
Dutch tax rate........................................ 35.0% 35.0% 35.0%
Effect of tax rate in foreign countries............... (1.3%) (1.1%) (1.6%)
Effect of tax-exempt revenue in the Netherlands....... (3.1%) (3.1%) (4.1%)
Other................................................. 0.5% 0.5% (0.6%)
---- ---- ----
Overall effective tax rate............................ 31.1% 31.3% 28.7%
==== ==== ====
</TABLE>

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
The Netherlands......................................... 438 417 356
Foreign................................................. 882 491 398
----- --- ---
1,320 908 754
===== === ===
</TABLE>

Taxes amounted to EUR 1,320 million, including EUR 279 million (1998: EUR
83 million) in deferred tax liabilities.

38 MINORITY INTERESTS

This item comprises the share of third parties in results from subsidiaries
and other group companies, as well as dividends on preferred stock issued by
subsidiaries in the United States.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Dividends on preference shares............................ 209 123 91
Other minority interests.................................. 151 38 33
--- --- ---
Total minority interests.................................. 360 161 124
=== === ===
</TABLE>

39 SEGMENT INFORMATION

ABN AMRO is established and active in many countries but the local
operations also serve clients outside their home countries. The table below
gives an analysis by operating segment. For the purpose of this analysis, gross
revenue represents total revenue before interest expense and commission expense.
Indirect overheads have been allocated to the operating segments.

F-33
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
GROSS REVENUE TOTAL REVENUE
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
Netherlands Division........................ 10,389 9,970 9,018 3,989 3,717 3,325
International Division:
Europe (excluding the Netherlands)........ 3,603 3,752 3,120 1,590 1,455 1,229
North America............................. 10,846 9,517 6,893 3,706 3,238 2,721
Latin America and the Caribbean........... 4,824 2,257 1,293 2,289 1,073 730
Middle East and Africa.................... 336 282 235 139 119 99
Asia/Pacific.............................. 2,108 1,624 1,380 915 719 516
------ ------ ------ ------ ------ ------
21,717 17,432 12,921 8,639 6,604 5,295
Investment Banking Division................. 3,575 3,428 3,149 2,347 1,779 1,764
------ ------ ------ ------ ------ ------
35,681 30,830 25,088 14,975 12,100 10,384
ABN AMRO Lease Holding...................... 713 575 538 552 438 401
------ ------ ------ ------ ------ ------
Total....................................... 36,394 31,405 25,626 15,527 12,538 10,785
====== ====== ====== ====== ====== ======
</TABLE>

<TABLE>
<CAPTION>
OPERATING PROFIT BEFORE
TAXES RISK-WEIGHTED TOTAL ASSETS
------------------------------ ------------------------------
1999 1998 1997 1999 1998 1997
-------- -------- -------- -------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C> <C> <C>
Netherlands Division............................. 1,369 1,157 1,007 74,901 67,294 65,349
International Division:
Europe (excluding the Netherlands)............. 353 339 280 30,478 26,317 26,411
North America.................................. 1,129 976 682 74,722 60,183 57,554
Latin America and the Caribbean................ 576 235 248 12,504 13,673 6,405
Middle East and Africa......................... (52) 45 28 2,165 1,739 1,238
Asia/Pacific................................... 200 (20) 5 23,196 17,856 17,740
----- ----- ----- ------- ------- -------
2,206 1,575 1,243 143,065 119,768 109,348
Investment Banking Division...................... 502 246 399 20,473 22,362 28,655
ABN AMRO Lease Holding........................... 128 121 108 7,935 6,345 5,298
Non-allocated result............................. 25 (303) 48 -- -- --
Release from/addition to fund for general banking
risks.......................................... 20 101 (179) -- -- --
----- ----- ----- ------- ------- -------
Total............................................ 4,250 2,897 2,626 246,374 215,769 208,650
===== ===== ===== ======= ======= =======
</TABLE>

40 MANAGING BOARD AND SUPERVISORY BOARD

The following tables summarise financial data concerning current and former
members of the Managing Board and Supervisory Board.

<TABLE>
<CAPTION>
MANAGING BOARD SUPERVISORY BOARD
------------------- -------------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Remuneration (x EUR 1,000)................ 7,406 7,095 617 616
ABN AMRO options issued................... 865,343 749,851
ABN AMRO shares owned..................... 41,396 39,343 56,150 53,151
Loans (x EUR 1,000)....................... 8,837 7,248 8,018 4,931
</TABLE>

Of the overall remuneration of the Managing Board, EUR 7,020,000 related to
salaries and bonuses of current Board members at December 31, 1999. The level of
the bonus varies with dividends on ABN AMRO Holding N.V. ordinary shares. In the
first year following their appointment new

F-34
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

members are entitled to a bonus equal to 50% of the bonus of the other members.
Furthermore, all the members receive the same salary and bonus, with the
exception of the Chairman whose earnings are approximately 14% higher.

In addition to the above emoluments, the Managing Board members are also
granted, as part of the overall remuneration package, options on ABN AMRO
shares. The analysis below provides information on option holdings of the
Managing Board as a whole and of the individual Board members. The conditions
governing the options are stated in note 16. The members of the Supervisory
Board are not entitled to emoluments in the form of shares or options on ABN
AMRO shares.

<TABLE>
<CAPTION>
1999 1998
----------------------------- -----------------------------
OPTIONS HELD OPTIONS HELD
BY AVERAGE BY AVERAGE
MANAGING EXERCISE PRICE MANAGING EXERCISE PRICE
BOARD (IN EUR) BOARD (IN EUR)
------------ -------------- ------------ --------------
<S> <C> <C> <C> <C>
Movements:
Opening Balance.............................. 749,851 15.62 719,160 11.35
Options granted.............................. 322,492 18.13 322,145 21.03
Options exercised............................ (115,000) 7.95 (131,454) 8.35
Movement former and/or newly appointed
members.................................... (92,000)(1) 18.18 (160,000) 13.32
---------- ----- -------- -----
Closing Balance.............................. 865,343 17.30 749,851 15.62
========== ===== ======== =====
</TABLE>

<TABLE>
<CAPTION>
AVERAGE AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE EXERCISE
OPENING PRICE (IN PRICE (IN PRICE (IN CLOSING PRICE (IN EXERCISE
BALANCE EUR) GRANTED EUR) EXERCISED EUR) BALANCE EUR) PERIOD
-------- --------- -------- --------- --------- --------- -------- --------- --------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
P.J. Kalff................ 81,033 18.21 40,356 18.13 -- -- 121,389 18.18 2004
M.J. Drabbe+.............. 155,000 13.49 40,000 18.10 75,000 8.46 (1) -- --
R.W.J. Groenink........... 70,429 18.63 40,356 18.13 -- -- 110,785 18.45 2004
R.W.F. van Tets........... 201,927 12.06 40,356 18.13 40,000 6.98 202,283 14.27 2004
J.M. de Jong.............. 80,429 18.22 40,356 18.13 -- -- 120,785 18.19 2004
W.G. Jiskoot.............. 81,033 18.21 40,356 18.13 -- -- 121,389 18.18 2004
R.G.C. van den Brink...... 80,000 18.20 40,356 18.13 -- -- 120,356 18.17 2004
T. de Swaan............... -- -- 40,356 18.13 -- -- 40,356 18.13 2004
J.Ch.L. Kuiper............ (1) -- -- -- -- -- 28,000 18.10 2004
</TABLE>

- ------------------------

(1) The closing balances do not include outstanding rights of former members.
The opening balances do not include rights acquired by newly appointed
members prior to their appointment to the Managing Board.

41 CASH FLOW STATEMENT

The cash flow statement gives details of the source of liquid funds which
became available during the year and the application of the liquid funds over
the course of the year. The cash flows are analyzed into cash flows from
operations/banking activities, investment activities and financing activities.
Liquid funds include cash in hand, net credit balances on current accounts with
other banks and net demand deposits with central banks. Movements in loans,
total client accounts and interbank deposits are included in the cash flow from
banking activities. Investment activities comprise purchases, sales and
redemptions in respect of investment portfolios, as well as investments in and
sales of participating interests, property and equipment. The issue of shares
and the borrowing and repayment of long-term funds are treated as financing
activities. Movements due to currency translation differences as well as

F-35
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

the effects of the consolidation of acquisitions, where of material
significance, are eliminated from the cash flow figures.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Analysis:
Cash................................................ 6,806 4,478 3,816
Bank balances (debit)............................... 7,069 8,618 8,352
Bank balances (credit).............................. (1,404) (5,410) (4,310)
------ ------ ------
Liquid funds........................................ 12,471 7,686 7,858
====== ====== ======

Movements:
Opening Balance..................................... 7,686 7,858 3,245
Cash flow........................................... 4,154 183 4,236
Currency translation differences.................... 631 (355) 377
------ ------ ------
Closing Balance..................................... 12,471 7,686 7,858
====== ====== ======
</TABLE>

Interest paid amounted to EUR 19,019 million; tax payments totalled EUR
599 million.

Dividends received from participating interests totalled EUR 37 million in
1999, EUR 23 million in 1998 and EUR 16 million in 1997.

The following table analyses movements resulting from acquisitions and
dispositions.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Amounts paid/received in cash and cash equivalents on
acquisitions/dispositions (net).................... 1,352 2,939 2,060
Net movement in cash and cash equivalents............ (3) 1,757 52
Net movement in assets and liabilities:
Banks.............................................. 6 3,547 372
Loans.............................................. 1,305 7,226 11,139
Securities......................................... 122 2,520 2,905
Other assets....................................... 75 4,231 1,135
----- ------ ------
Total assets....................................... 1,508 17,524 15,551
===== ====== ======
Subordinated debt.................................. -- 30 --
Banks.............................................. 41 2,550 2,668
Total client accounts.............................. 1,220 13,951 11,751
Debt securities.................................... -- 131 384
Other liabilities.................................. 76 1,782 722
----- ------ ------
Total liabilities.................................. 1,337 18,444 15,525
===== ====== ======
</TABLE>

42 FAIR VALUE OF FINANCIAL INSTRUMENTS

Fair value is the amount at which a financial instrument could be exchanged
in transactions between two parties, other than in a forced sale or liquidation,
and is best reflected by a quoted market price, if available. Most of ABN AMRO's
assets, liabilities and off-balance sheet items are financial instruments.
Wherever possible, market rates have been used to determine fair values.

However, for the majority of financial instruments, principally loans,
deposits and OTC derivatives, fair values are not readily available since there
is no market where these instruments are traded. For

F-36
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

these instruments estimation techniques have been used. These methods are
subjective in nature and involve assumptions, such as the period the financial
instruments will be held, the timing of future cash flows and the discount rate
to be applied. As a result, the approximate fair values presented below may not
be indicative of the net realisable value. In addition, the calculation of
approximate fair values is based on market conditions at a specific point in
time and may not reflect future fair values.

The approximate fair values as stated by financial institutions are not
mutually comparable due to the wide range of different valuation techniques and
the numerous estimates. The lack of an objective valuation method entails that
approximate fair values are highly subjective. Therefore, readers should
exercise caution in using the information disclosed in this note for comparing
the consolidated financial position of ABN AMRO with that of other financial
institutions.

<TABLE>
<CAPTION>
DECEMBER 31, 1999 DECEMBER 31, 1998
----------------------- -----------------------
BOOK VALUE FAIR VALUE BOOK VALUE FAIR VALUE
---------- ---------- ---------- ----------
(IN MILLIONS OF EUR) (IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Assets (incl. Off-balance sheet items)
Cash............................................... 6,806 6,806 4,478 4,478
Short-dated government paper (1)(2)................ 10,375 10,372 7,719 7,727
Banks.............................................. 47,201 47,220 60,894 61,095
Loans to public sector............................. 12,007 12,103 7,243 7,854
Loans to private sector--commercial loans and
professional securities transactions............. 166,540 166,880 140,974 145,747
Loans to private sector--retail.................... 81,176 82,572 72,295 73,903
Interest-earning securities (1)(3)................. 92,583 92,127 106,463 108,349
Shares (4)......................................... 16,990 17,019 13,271 13,277
Derivatives........................................ 31,302 32,516 36,863 39,080
------- ------- ------- -------
Total................................................ 464,890 467,615 450,200 461,510
======= ======= ======= =======
Liabilities (including off-balance sheet items)
Banks.............................................. 80,990 81,016 104,898 105,080
Savings accounts................................... 71,729 71,651 61,785 62,295
Corporate deposits................................. 65,931 66,081 60,938 61,123
Other client accounts.............................. 92,332 92,332 82,831 82,831
Debt securities.................................... 54,228 54,628 37,947 39,318
Subordinated debt.................................. 10,717 10,778 8,980 9,742
Derivatives........................................ 30,615 31,399 35,472 37,070
------- ------- ------- -------
Total................................................ 406,542 407,885 392,851 397,459
======= ======= ======= =======
</TABLE>

- ------------------------

(1) Book values of short-dated government paper and interest-earning securities
are equal to amortised cost increased by premium (discount).

(2) Of which EUR 3,175 million was included in the trading portfolio at
December 31, 1999.

(3) Of which EUR 29,301 million was included in the trading portfolio at
December 31, 1999.

(4) Of which EUR 6,952 million was included in the trading portfolio at
December 31, 1999.

F-37
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

43 SHAREHOLDERS' EQUITY AND NET PROFIT UNDER U.S. GAAP

The consolidated Financial statements of ABN AMRO are prepared in accordance
with accounting principles generally accepted in The Netherlands (Dutch GAAP)
which vary in certain significant respects from those generally accepted in the
United States (U.S. GAAP). The following is a summary of the adjustments to net
profit and shareholders' equity that would have been required if U.S. GAAP had
been applied instead of Dutch GAAP in the preparation of the Consolidated
Financial statements.

<TABLE>
<CAPTION>
DUTCH GAAP U.S. GAAP
---------- ---------
<S> <C>
GOODWILL AND OTHER ACQUIRED INTANGIBLES

Goodwill including other acquired intangibles Goodwill represents the excess of the
arising from acquisitions of subsidiaries and purchase price of investments in subsidiaries
participating interests is charged against and participating interests over the
shareholders' equity. estimated market value of net assets acquired
at acquisition date. Goodwill is amortized on
a straight-line basis over the estimated
useful life. In ABN AMRO's case, this
amortization period does not exceed twenty
years. Other acquired intangibles, such as
the value of purchase core deposits, are
amortized over their respective useful lives,
not exceeding fifteen years.

FUND FOR GENERAL BANKING RISKS

In addition to specific allowances for loan The fund for general banking risks is
losses and country risk, Dutch banks maintain considered to be a general allowance for loan
a fund for general banking risks. This Fund losses. The level of the Fund is adequate for
is net of taxes and covers general risks absorbing all inherent losses in loans.
associated with lending and other banking
activities, which may include risks of loan
losses. The level of the fund for general
banking risks is based on management's
evaluation of the risks involved. The Fund is
part of group capital.

DEBT RESTRUCTURING

Assets, including debt instruments, acquired Assets, including debt instruments, acquired
as part of a debt restructuring, such as as part of a debt restructuring, such as
Brady bonds, are recorded at net book value Brady bonds, are recorded at estimated market
(after deduction of specific allowances) of value at the date of the restructuring.
the disposed debt. Differences between book value and market
value are recorded as a charge-off or
recovery on the restructured loan.

INVESTMENT PORTFOLIO SECURITIES

Bonds and similar debt securities included in All bonds and similar debt securities
the investment portfolios (other than included in the investment portfolio are
securities on which a large part or all of classified as "available for sale". SFAS 115
the interest is settled on redemption) are requires that investment securities available
stated at redemption value less any for sale, which are those securities that may
diminution in value deemed necessary. be sold prior to maturity
</TABLE>

F-38
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
DUTCH GAAP U.S. GAAP
---------- ---------
<S> <C>
Premiums and discounts at acquisition, as part of asset/liability management or in
accounted for as deferred items, are response to other factors, are stated at
amortized and reported as interest over the market value. Unrealized gains and losses
term of the debt securities. Net capital together with gains and losses on designated
gains realized prior to maturity date in derivatives are reported, net of taxes, in a
connection with replacement operations are separate component of shareholders' equity.
recognized as deferred interest and amortized Realized gains and losses are recognized into
over the term of the investment portfolio. income on trade date.
Shares held in the investment portfolio are All shares are classified as "available for
stated at market value. Movements in value, sale" and stated at market value with
net of tax, are taken to a separate unrealized gains and losses reported in a
revaluation reserve. If the revaluation separate component of shareholders' equity,
reserve is insufficient to absorb a decline net of taxes, unless a decline in value is
in value, this amount will be charged to the judged to be other than temporary. In that
income statement as value adjustments to case, the cost basis is written down and the
financial fixed assets. amount of the write down is charged to the
income statement.

PROPERTY

Bank premises, including land, are stated at Bank premises are stated at cost and fully
current value based on replacement cost and depreciated on a straight-line basis over
fully depreciated on a straight-line basis their useful lives.
over their useful lives with a maximum of
fifty years. Value adjustments, net of tax,
are credited or charged to a separate
revaluation reserve.

PENSION COSTS

Pensions have been established in accordance SFAS 87 prescribes actuarial computations
with the regulations in the applicable based on current and future compensation
countries. Costs of plans are accounted for levels taking into account the market value
using actuarial computations of current of the assets of the pension funds and
compensation levels, taking into account the current interest rates. ABN AMRO adopted
return achieved by the pension funds in SFAS 87 as of January 1, 1994.
excess of the actuarial interest rate.

POST-RETIREMENT BENEFITS

The expected costs of post-retirement SFAS 106 requires accrual of the expected
benefits are only provided for upon cost of providing post retirement health care
retirement. The calculations are based on benefits to an employee and the employee's
actuarial computations. beneficiaries and covered dependants, during
the year that an employee renders services.

POST-EMPLOYMENT BENEFITS

Post-employment benefits are those benefits Under SFAS 112 all contractual benefits after
provided to former or inactive employees, employment but before retirement are
their beneficiaries and covered dependents recognized when the employee's services have
after employment but before retirement. The been rendered, the rights have vested and the
cost of these benefits are provided for obligation is probable and quantifiable.
early-retirement (VUT) and disability-related
benefits upon termination of services.
Incentivized, other early
</TABLE>

F-39
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

<TABLE>
<CAPTION>
DUTCH GAAP U.S. GAAP
---------- ---------
<S> <C>
leave arrangements are accounted for on a
pay-as-you-go basis.

CONTINGENCIES

In certain situations liabilities can be set Criteria for setting up liabilities are more
up for expenditures that will be incurred in stringent and include amongst others that a
the future. liability be incurred at the date of the
financial statements for such costs.

DERIVATIVES USED FOR HEDGING PURPOSES

Derivatives which are used to manage the US GAAP requires that derivatives which are
overall structural interest rate exposure and not designated to hedge specific assets,
which are not designated to specific assets, liabilities or firm commitments, should be
liabilities or firm commitments are accounted carried at fair value with changes in fair
for on an accrual basis. Therefore, changes value included in income as they occur.
in the fair value of the positions are not Starting January 1, 1999 US GAAP recognises
recorded. The periodic cash flows are intercompany derivatives used for hedging
recorded in income as incurred. purposes only, if those intercompany
derivatives are offset by unrelated
third-party contracts.

INTERNAL USE SOFTWARE

Under Dutch GAAP internal costs incurred in US GAAP requires capitalisation of certain
connection with developing or obtaining internal as well as external costs incurred
software for internal use are expensed. in connection with developing or obtaining
software for internal use. Qualifying
software costs are capitalised and amortised
over the estimated useful life of the
software. ABN AMRO adopted this statement as
of January 1, 1999.

DEFERRED TAX

Deferred tax assets and liabilities are Under SFAS 109 both deferred tax assets and
recorded on a discounted basis. liabilities are established on a nominal
basis for all temporary differences, using
enacted tax rates. Deferred tax assets, of
which realisation is dependent on taxable
income of future years, are assessed as to
likely realisation and a valuation allowance
provided, if necessary.

DIVIDEND PAYABLE

Shareholders' equity is reported after profit Dividends are reported as a part of
appropriation. Dividends proposed by the Shareholders' equity until paid or approved
Managing and Supervisory Boards are reported by the General Shareholders' Meeting.
as a current liability.
</TABLE>

F-40
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

ACCOUNTING CHANGES: ADOPTED STATEMENTS IN 1999

In 1999, ABN AMRO adopted, for U.S. GAAP purposes, the following statements:

- "Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use" issued by American Institute of Certified Public
Accountants. The statement requires capitalisation of certain internal as
well as external costs incurred in connection with developing or obtaining
software for internal use. Qualifying software costs are capitalized and
amortized over the estimated useful life of the software.

- SEC issued regulation that intercompany derivative instruments designated
as a hedging instrument after January 1, 1999, should be offset by
unrelated third-party contracts. Intercompany derivative contracts
designated after January 1, 1999 that do not meet these requirements, will
not qualify as hedging instruments in the consolidated financial
statements and are carried at fair value with changes recognized in
income.

FUTURE DEVELOPMENTS

The following accounting pronouncements have been issued by the Financial
Accounting Standards Board:

- SFAS 133 "Accounting for Derivative Instruments and Hedging Activities".
This statement establishes accounting and reporting standards for
derivative instruments, including certain derivative instruments embedded in
other contracts, and for hedging activities. It requires that an entity
recognize all derivatives as either assets or liabilities and measure those
instruments at fair value. If the derivative is a hedge, changes in fair
value of the derivatives will either be offset against the change in fair
value of the hedged assets, liabilities or firm commitments through earnings
or recognized in other changes to stockholders' equity until the hedged item
is recognized in earnings. The ineffective portion of a derivative's change
in fair value will be recognized in earnings immediately.
Pursuant to SFAS 137 "Accounting for Derivative Instruments and Hedging
Activities--Deferral of the Effective Date of FASB Statement No. 133",
ABN AMRO is required to adopt the statement effective 1 January 2001.
ABN AMRO already recognizes the derivatives used in its trading activities
on its balance sheet at fair value, with changes in the fair value of such
derivatives included in income. With respect to those other derivatives used
as hedges of its assets, liabilities and commitments, ABN AMRO is currently
in the process of assessing the impact of this statement.
FASB recently issued a proposed amendment to SFAS 133. The final amendment
is not expected to be issued until May 2000.

F-41
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

RECONCILIATION

The following table summarizes the significant adjustments to ABN AMRO's
consolidated shareholders' equity and net profit which would result from the
application of U.S. GAAP.

<TABLE>
<CAPTION>
SHAREHOLDERS'
EQUITY NET EARNINGS
------------------- ------------------------------
1999 1998 1999 1998 1997
-------- -------- -------- -------- --------
(IN MILLIONS OF EUR EXCEPT SHARE DATA)
<S> <C> <C> <C> <C> <C>
Shareholders' equity/net profit under Dutch GAAP....... 11,987 10,723 2,570 1,828 1,748
Goodwill............................................... 5,344 4,694 (343) (215) (194)
Debt restructuring..................................... (164) (240) -- -- --
Investment portfolio securities........................ 431 2,688 83 405 152
Property............................................... (172) (206) 13 15 15
Pension costs.......................................... (48) 50 (98) 69 (39)
Post-retirement benefits............................... (55) (41) (14) (6) (14)
Post-employment benefits............................... (38) (46) 8 6 13
Contingencies.......................................... 139 208 (69) (83) (14)
Derivatives............................................ (110) 312 (453) 45 (5)
Internal use software.................................. 157 -- 157 -- --
Deferred tax liabilities............................... (366) (305) (32) (10) (39)
Taxes.................................................. (85) (991) 129 (142) (48)
Dividends.............................................. 494 212 -- -- --
------ ------ ----- ----- -----
Shareholders' equity and net profit under U.S. GAAP.... 17,514 17,058 1,951 1,912 1,575
Shareholders' equity per share under U.S. GAAP......... 11.36 11.25
Basic earnings per share under U.S. GAAP............... 1.29 1.29 1.08
Diluted earnings per share under U.S. GAAP............. 1.28 1.28 1.07
</TABLE>

F-42
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO THE ADJUSTMENTS TO CONSOLIDATED NET PROFIT AND SHAREHOLDERS' EQUITY

(a) GOODWILL

The gross amount of goodwill and other acquired intangibles before
amortization amounts to EUR 6,577 million. If facts and circumstances indicate
that unamortized goodwill and other acquired intangibles may be impaired, a
review is made to determine what amount, if any, is recoverable. If this review
indicates that goodwill will not be recoverable, as determined based on the
estimated undiscounted cash flows of the entity acquired over the remaining
amortization period, the carrying amount of the goodwill is reduced by the
estimated shortfall of cash flows.

The following acquisitions were made in 1999, 1998 and 1997 and were
accounted for using the purchase method.

<TABLE>
<CAPTION>
TOTAL
ACQUIRED COMPANIES % ACQUIRED CONSIDERATION ASSETS(1) ACQUISITION DATE
- --------------------------------------- ----------- -------------- ---------- ---------------------
(IN MILLIONS OF EUR EXCEPT PERCENTAGES)
<S> <C> <C> <C> <C>
1999:
Banca di Roma (2)...................... 10 739 -- April 15, 1999
Banco Real (3)......................... 70 395 -- Various dates in 1999
Bank of America (Consumer banking
activities in Taiwan, Singapore and
India)............................... 100 84 1,508 Various dates in 1999
Banca Nazionale Agricoltura............ 6 58 -- August 1, 1999
Interbanca SpA......................... 5 28 -- November 1, 1999
Asia Securities Trading (4)............ 40.5 14 -- September 1, 1999

1998:
Banco Real............................. 38 2,089 16,352 November 4, 1998
ABN AMRO Asia Holdings Ltd. (5)........ 100 188 -- December 23, 1998
Bank of Asia........................... 77 162 3,120 August 31, 1998
Bandepe................................ 100 132 571 November 25, 1998
Sage................................... 100 95 1,320 May 4, 1998
BZW, Australia......................... 100 81 392 March 1, 1998
Lease Plan South Africa................ 100 29 63 April 1, 1998
Huysamer Stals (6)..................... 60 10 117 March 1, 1998
Dasfleet Australia..................... 100 24 -- September 21, 1998

1997:
Standard Federal Corporation........... 100 1,497 13,857 January 1, 1997
Chicago Corporation.................... 100 109 513 January 1, 1997
Bankers Leasing Association............ 100 83 225 November 30, 1997
Lloyds NZA............................. 100 64 746 January 1, 1997
ABN AMRO Asia Holdings Ltd............. 10 63 -- April 1, 1997
Asia Securities Trading................ 35.5 49 -- June 30, 1997
Banque Demachy Worms................... 80.1 34 957 June 30, 1997
Banque du Phenix....................... 100 30 402 June 30, 1997
</TABLE>

- ------------------------

(1) Effect of total assets acquired on the Consolidated Balance Sheet.

(2) This is a purchase of a participating interest of totalling 9.7% at
December 31, 1999.

(3) The Bank acquired a 32% interest in 1999 (in addition to the 38% interest
acquired in 1998).

F-43
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(4) The Bank acquired a 5% interest in 1999 (in addition to minority interest of
35.5% acquired in 1997).

(5) The Bank acquired a 30% interest in 1998 (in addition to the 70% interest
acquired in 1994, 1995 and 1997).

(6) The Bank acquired a 60% interest in 1998 (in addition to an interest
acquired in 1997).

(b) INVESTMENT PORTFOLIO SECURITIES

The reconciliation item consists of the difference between the amortized
cost and the fair market value of interest-earning securities included in the
investment portfolio of EUR (1,024) million (1998: EUR 2,024 million), after
adjusting for EUR 1,455 million (1998: EUR 664 million) of unrecognized gains on
sales of investment portfolio securities and related swap transactions.

In the income statement, the differences in the applicable year consist of
realized gains from sales of interest-earning securities minus the amortization
under Dutch GAAP and the charge to value adjustments to financial fixed assets
of shares if the revaluation reserve under Dutch GAAP is insufficient to absorb
a temporary decline in value.

Realized gains and losses from sales of securities in the investment
portfolio are computed using the specific identification method. Gross realized
gains on sales of interest-earning securities in the investment portfolio in
1997 were calculated at EUR 363 million and gross realized losses from such
sales in 1997 were calculated at EUR 101 million. Gross realized gains on sales
of interest-earning securities in the investment portfolio in 1998 were
calculated at EUR 760 million and gross realized losses from such sales in 1998
were calculated at EUR 149 million. Gross realized gains on sales of
interest-earning securities in the investment portfolio in 1999 were calculated
at EUR 706 million and gross realized losses from such sales in 1999 were
calculated at EUR 320 million.

Personnel employed in The Netherlands are entitled to pension benefits
which, unless otherwise waived, supplement State-provided social security
benefits. The benefits of the plans are based primarily on years of service and
a final pay formula. Effective January 1, 2000, the pension plan has been
revised from a final pay system to a system based on average salaries during the
years of service. In addition, the standard retirement age has been changed from
65 to 62. Benefits for retired employees or their beneficiaries are subject to a
yearly adjustment based on the increase of compensation according to the
Collective Labour Agreement.

Most of the plans are administered by separate pension funds or third
parties / life insurance companies. The funding policy of the plans is
consistent with the requirements in The Netherlands.

The retirement plan in the United States is a noncontributory defined
benefit plan covering substantially all employees. Benefits for retired
employees or their beneficiaries of the plans are based primarily on years of
service and on the employee's highest average base compensation for the five
consecutive years of employment in the 10 years preceding
retirement/termination.

SFAS 87 was adopted effective January 1, 1994, as it was not feasible to
apply it as of January 1, 1987, the date specified in the standard. In the
reconciliation NLG 48 million of the transition asset was recorded directly to
shareholders' equity at January 1, 1994; the remaining transition asset is
amortized over an eight-year period.

In 1998 ABN AMRO adopted SFAS 132 "Employer's Disclosures About Pensions and
Other Post-retirement Benefits". This statement revised disclosures about
pensions and other post-retirement benefits.

F-44
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

Assumptions used in the pension computation as at December 31 were:

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN PERCENTAGES)
<S> <C> <C> <C>
Average discount rate
The Netherlands........................................... 5.3 5.0 6.5
Foreign countries......................................... 7.0 7.0 7.5
Average compensation increase
The Netherlands........................................... 3.0 3.0 3.0
Foreign countries......................................... 6.0 6.0 6.0
Average expected rate of return on assets
The Netherlands........................................... 7.0 7.0 7.5
Foreign countries......................................... 8.5 8.5 8.5
</TABLE>

In accordance with SFAS 87, the excess of plan assets over projected benefit
obligation, as of January 1, 1994, the transition date, is recognized as a part
of periodic pension costs on a prospective basis. The following table presents
the components of the net periodic pension costs:

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
NET PERIODIC PENSION COSTS
Service cost................................................ 321 158 170
Interest cost............................................... 327 307 287
Expected return on plan assets.............................. (427) (398) (344)
Net amortization and deferral............................... 3 (13) (2)
---- ---- ----
Net periodic pension costs under U.S. GAAP.................. 224 54 111
Net periodic pension costs under Dutch GAAP................. 126 123 73
---- ---- ----
Additional pension costs.................................... 98 (69) 38
==== ==== ====
</TABLE>

The following table presents the change in benefit obligations of the plans
under SFAS 87.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Projected benefit obligation at beginning of the year....... 6,282 4,672
Service costs............................................... 321 158
Interest cost............................................... 327 307
Actuarial gain/loss......................................... (274) 1,343
Benefits paid............................................... (199) (173)
Plan amendments............................................. 716 (2)
Settlements/curtailments.................................... 0 (1)
Acquisitions................................................ 0 0
Currency translation effect................................. 47 (22)
----- -----
Projected benefit obligation at end of the year............. 7,220 6,282
</TABLE>

F-45
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table presents the change in plan assets of the plans under
SFAS 87.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Fair value of plan assets at beginning of the year.......... 6,013 5,383
Actual return of plan assets................................ 958 755
Employer's contribution..................................... 37 77
Benefits paid............................................... (199) (173)
Acquisitions................................................ 0 0
Currency translation effect................................. 49 (29)
----- -----
Fair value of plan assets at end of the year................ 6,858 6,013
</TABLE>

The following table presents the funded status of the plans under SFAS 87.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Funded status............................................... (362) (268)
Unrecognized net actuarial gain/(loss)...................... (460) 283
Unrecognized prior service cost............................. 728 12
Unrecognized transition obligation.......................... 2 7
---- ----
(Prepaid)/accrued benefit cost.............................. (92) 34
</TABLE>

The unrecognized prior service cost refers to the additional projected
benefit obligation resulting from the revised pension plan for employees in The
Netherlands, effective January 1, 2000. The amount will be amortized on a
straight-line basis over the average term of service for the employees. For
plans in The Netherlands the accumulated benefit obligation exceeds plan assets
by EUR 34 million (1998: EUR 73 million).

(d) POST-RETIREMENT BENEFITS

ABN AMRO provides certain health care benefits for eligible retirees.
SFAS 106 was adopted as at January 1, 1994. In accordance with SFAS 106, the
transition liability for accumulated post-retirement benefits as at January 1,
1994, the transition date, is recognized as a part of periodic post-retirement
benefit costs on a prospective basis and amortized over a 20-year period.
Assumptions used in the computation of the post-retirement obligations as at
December 31 were:

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN PERCENTAGES)
<S> <C> <C> <C>
Average discount rate
The Netherlands........................................... 5.3 5.0 6.5
Foreign countries......................................... 7.0 7.0 7.5
Average health care cost trend rate
The Netherlands........................................... 4.0 3.0 3.0
Foreign countries......................................... 9.0 9.0 7.0
</TABLE>

The following table presents the components of net periodic post-retirement
benefit cost.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
NET PERIODIC POST-RETIREMENT BENEFIT COST
Services cost............................................... 13 6 6
Interest cost............................................... 15 14 13
Net amortization and deferral............................... 6 4 3
-- -- --
Net periodic cost under U.S. GAAP........................... 34 24 22
Net periodic cost under Dutch GAAP.......................... 20 18 8
-- -- --
Additional net periodic post-retirement benefit cost........ 14 6 14
== == ==
</TABLE>

F-46
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The following table presents the change in post-retirement benefit
obligations of the plans under SFAS 106.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Projected benefit obligation at beginning of the year....... 268 208
Service costs............................................... 13 6
Interest cost............................................... 15 14
Actuarial gain/loss......................................... 2 54
Benefits paid............................................... (11) (10)
Acquisitions................................................ 0 0
Currency translation effect................................. 11 (4)
--- ---
Projected benefit obligation at end of the year............. 298 268
</TABLE>

The following table presents the change in plan assets of the plans under
SFAS 87.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Fair value of plan assets at beginning of the year.......... 13 6
Actual return of plan assets................................ 6 2
Employer's contribution..................................... 7 15
Benefits paid............................................... (11) (10)
Acquisitions................................................ 0 0
Currency translation effect................................. 2 0
--- ---
Fair value of plan assets at end of the year................ 17 13
</TABLE>

The following table presents the funded status of the plans under SFAS 87.

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Funded status............................................... (281) (256)
Unrecognized net actuarial gain/(loss)...................... 56 60
Unrecognized prior service cost............................. 1 1
Unrecognized transition obligation.......................... 51 55
---- ----
(Prepaid)/accrued benefit cost.............................. (173) (140)
</TABLE>

Increasing the assumed health care cost trend rate by 1% in each year would
increase the accumulated post-retirement benefit obligation as of December 31,
1999 by approximately EUR 27 million and would increase the net periodic
post-retirement benefit cost of 1999 by EUR 8 million.

Decreasing the assumed health care cost trend rate by 1% in each year would
decrease the accumulated post-retirement benefit obligation as of December 31,
1999 by approximately EUR 42 million and would decrease the net periodic
post-retirement benefit cost of 1999 by EUR 8 million.

(e) CONTINGENCIES

U.S. GAAP does not permit provisions for contingencies, which are permitted
under Dutch GAAP. Accordingly, the release in 1999 and 1998 and 1997 provisions
of EUR 56 million, EUR 123 million and EUR 79 million, respectively, for the
adaptation of computer systems for the introduction of the Euro and for the year
2000; the release in 1997 provisions of EUR 75 million for the potential
devaluation of the Brazilian real; the provisions in 1999, 1998 and 1997 for
litigation and removals of

F-47
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

EUR 13 million, EUR 41 million and EUR 29 million, are not permitted under U.S.
GAAP and have been reversed in the U.S. GAAP reconciliation.

(f) DEFERRED TAX

In accordance with SFAS 109, the components of the net U.S. GAAP deferred
tax liability are as follows:

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
Deferred tax liabilities
Investment securities..................................... -- 705
Property.................................................. 212 202
Post-employment benefits.................................. 125 158
Derivatives............................................... 121 207
Leasing and other financing constructions................. 326 182
Servicing rights.......................................... 247 152
Other..................................................... 360 103
----- -----
Total deferred tax liabilities.............................. 1,391 1,709
Deferred tax assets
General allowance for loan losses(1)...................... 663 614
Tax losses foreign entities............................... 480 389
Investment securities..................................... 161 --
Specific allowances for loan losses....................... 300 205
Other..................................................... 179 95
----- -----
Total deferred tax assets before valuation allowance........ 1,783 1,303
Less: valuation allowance................................... 217 198
----- -----
Deferred tax assets less valuation allowance................ 1,566 1,105
----- -----
Total net deferred tax liability (asset) under U.S.
GAAP(2)................................................... (175) 604
===== =====
</TABLE>

- ------------------------

(1) This amount represents the tax effect of the gross up of the Fund for
general banking risks which is considered to be a general allowance for loan
losses for U.S. GAAP purposes.

(2) Of which EUR (211) million (1998: EUR 681 million) is a consequence of
differences between Dutch GAAP and U.S. GAAP.

ABN AMRO considers a significant portion of its approximately EUR
2.9 billion in distributable invested capital to be permanently invested. If
such capital were distributed no foreign taxes would be required to be paid on
such earnings. The estimated impact of foreign withholding tax is EUR
90 million.

(g) IMPAIRMENT OF LOANS

SFAS 114 requires loans to be measured for impairment when it is probable
that principal and/or interest will not be collected in accordance with the
contractual terms of the loan agreement. Total impairment loans of ABN AMRO are
those reported as doubtful loans and amounted to EUR 7,580 million at
December 31, 1999 (1998: EUR 6,578 million). Total impaired loans averaged EUR
5,521 million and EUR 7,079 million during 1998 and 1999, respectively. Of the
total doubtful loans of EUR 7,580 million at December 31, 1999, EUR
5,970 million (1998: EUR 5,702 million) have aggregate specific allowances for
loan losses of EUR 4,458 million (1998: EUR 4,116 million) and EUR
1,610 million (1998: EUR 876 million) have no specific allowances for loan
losses. Doubtful loans

F-48
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

included accruing loans (loans on which ABN AMRO continues to charge interest
which is included in interest revenue) of EUR 2,789 million at December 31, 1999
(1998: EUR 2,195 million). Having compared the value of the impaired loans
calculated in accordance with SFAS 114 with the carrying value under Dutch GAAP,
no adjustments were required. Net interest revenue recognized in 1999 on
impaired loans amounted to EUR 181 million (1998: EUR 151 million), and interest
revenue not recognized in 1999 on impaired loans amounted to EUR 233 million
(1998: EUR 228 million).

(h) DERIVATIVES

The reconciling item in Earnings for derivatives, amounting to EUR
(453) million, is for a major part caused by derivatives contracts which are
designated to hedge the fixed dividend payments on Trust Preferred Securities.
These Trust Preferred Securities are classified as minority interest in the
consolidated financial statements. Pursuant US GAAP the minority interest, as
such, does not represent an existing asset, liability, firm commitment or
anticipated transaction. Therefore, the application of hedge accounting is not
appropriate and the swaps concluded to hedge the fixed dividend payments on the
Trust Preferred Securities are carried at fair value with changes recognised in
income.

(i) INTERNAL USE SOFTWARE

Effective January 1, 1999 ABN AMRO adopted "Accounting for the Costs of
Computer Software Developed or Obtained for Internal Use" issued by American
Institute of Certified Public Accountants, resulting in a capitalization of
qualifying internal use software, amounting to EUR 157 million at December 31,
1999.

(j) ACCOUNTING FOR STOCK-BASED COMPENSATION

SFAS 123, "Accounting for Stock-Based Compensation," establishes financial
accounting and reporting standards for stock-based compensation plans. ABN AMRO
accounts for stock-based employee compensation plans in accordance with
Accounting Principles Board Opinion No. 25, as SFAS 123 permits. The application
of SFAS 123's disclosure requirements did not have a material impact on ABN AMRO
"s pro forma net profit, net profit per Ordinary Share or shareholders' equity.

F-49
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(k) CONSOLIDATED BALANCE SHEET AND INCOME STATEMENT ADJUSTED FOR U.S. GAAP.

CONSOLIDATED BALANCE SHEET AND INCOME
STATEMENT ADJUSTED FOR U.S. GAAP

<TABLE>
<CAPTION>
1999 1998
--------- ---------
(IN MILLIONS OF EUR)
<S> <C> <C>
ASSETS
Cash........................................................ 6,806 4,478
Short-dated government paper................................ 10,375 7,719
Banks....................................................... 47,201 60,894
Professional securities transactions........................ 40,742 34,058
Loans....................................................... 223,439 190,829
Less: Allowance for credit losses........................... (6,353) (6,130)
------- -------
Net Loans................................................... 217,086 184,699
Interest-bearing securities................................. 92,042 107,851
Shares...................................................... 16,990 13,271
Participating interests..................................... 1,884 1,057
Property and equipment...................................... 5,190 4,451
Goodwill.................................................... 5,344 4,694
Other assets................................................ 16,787 16,419
Prepayments and accrued interest............................ 10,223 7,989
------- -------
470,670 447,580
======= =======

LIABILITIES
Banks....................................................... 80,990 104,898
Professional securities transactions........................ 29,756 31,028
Total customer accounts..................................... 200,236 174,526
Debt securities............................................. 54,228 37,947
Other liabilities........................................... 51,821 53,099
Accruals and deferred income................................ 10,166 8,506
Provisions.................................................. 10,297 8,008
------- -------
437,494 418,012
Subordinated debt........................................... 10,717 8,980
Minority interests.......................................... 2,457 2,460
Guaranteed preferred beneficial interest in a subsidiary
(1)....................................................... 2,488 1,070
Shareholders' equity........................................ 17,514 17,058
------- -------
Total liabilities and shareholders equity................... 470,670 447,580
======= =======
</TABLE>

- --------------------------
(1) Guaranteed preferred beneficial interests in subsidiaries represent the 7.5%
Noncumulative Guaranteed Trust Preferred Securities (the "Trust Preferred
Securities I") issued by ABN AMRO Capital Funding Trust I (the "Trust I")
and 7 1/8% Noncumulative Guaranteed Trust Preferred Securities (the "Trust
Preferred Securities II") issued by ABN AMRO Capital Funding Trust II (the
"Trust II"), both indirect wholly-owned subsidiaries of ABN AMRO Holding.
The assets of Trust I are 7.5% Noncumulative Guaranteed Class B Preferred
Securities (the "Class B Preferred Securities I") of ABN AMRO Capital
Funding LLC I and the assets of Trust II are 7 1/8% Noncumulative Guaranteed
Class B Preferred Securities (the "Class B Preferred Securities II") of ABN
AMRO Capital Funding LLC II, both indirect wholly-owned subsidiaries of ABN
AMRO Holding, and the maturities and interest on the Class B Preferred
Securities I and II match those of the Trust Preferred Securities I and II.
The Trust Preferred Securities I and II and the Class B Preferred Securities
I and II pay interest quarterly in arrears and are redeemable only upon the
occurrence of certain events specified in the documents governing the terms
of those securities. Subject to limited exceptions, the earliest date that
the Class B Preferred Securities I can be redeemed is September 30, 2003 and
for Class B Preferred Securities II, the earliest date that they can be
redeemed is March 31, 2004. The Trust Preferred Securities I and II and the
Class B Preferred Securities I and II are each subject to a full and
conditional guarantee of ABN AMRO Holding. In terms of dividend and
liquidation rights, the Trust Preferred Securities I and II are comparable
to ABN AMRO Holding preference shares.

F-50
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

CONSOLIDATED INCOME STATEMENT INCLUDING SIGNIFICANT
U.S. GAAP ADJUSTMENTS.

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
REVENUE
Interest revenue............................................ 28,724 25,348 20,685
Interest expense............................................ 20,375 18,435 14,501
------ ------ ------
Net interest revenue........................................ 8,349 6,913 6,184
Provision for loan losses................................... 633 840 726
------ ------ ------
Net interest revenue after provision for loan losses........ 7,716 6,073 5,458
Revenue from securities and participating interests......... 357 348 286
Commission revenue.......................................... 4,947 3,819 3,186
Commission expense.......................................... 492 431 340
------ ------ ------
Net commissions............................................. 4,455 3,388 2,846
Results from financial transactions......................... 921 1,198 1,025
Net gains from available for sales securities............... 386 594 278
Other revenue............................................... 654 451 254
------ ------ ------
Total non interest revenue.................................. 6,773 5,979 4,689
Total revenue............................................... 14,489 12,052 10,147

EXPENSES
Staff costs................................................. 5,872 4,587 3,967
Other administrative expenses............................... 3,953 3,464 2,920
------ ------ ------
Administrative expenses..................................... 9,825 8,051 6,887
Depreciation................................................ 787 653 527
Amortization of goodwill.................................... 343 215 194
------ ------ ------
10,955 8,919 7,608

OPERATING EXPENSES
Operating profit before taxes............................... 3,534 3,133 2,539
Taxes....................................................... 1,223 1,059 841
------ ------ ------
Group profit after taxes.................................... 2,311 2,074 1,698
Minority interests.......................................... 360 162 123
------ ------ ------
Net profit.................................................. 1,951 1,912 1,575
====== ====== ======
</TABLE>

F-51
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

L) COMPREHENSIVE INCOME

Effective January 1, 1998, ABN AMRO adopted Statement 130 "REPORTING
COMPREHENSIVE INCOME", which establishes rules for the reporting and display of
comprehensive income and its components. Its components and accumulated other
comprehensive income amounts for the three-year period ended December 31, 1999
are summarized as follows:

<TABLE>
<CAPTION>
UNREALIZED ACCUMULATED
CURRENCY GAINS IN OTHER
TRANSLATION INVESTMENT COMPREHENSIVE COMPREHENSIVE
ADJUSTMENT PORTFOLIOS INCOME INCOME
----------- ---------- ------------- -------------
(IN MILLIONS OF EUR)
<S> <C> <C> <C> <C>
Balance January 1, 1997...................... (392) 517 125

Net Income................................... 1,575
Currency translation adjustment (net of EUR
36 million tax expense).................... 398 398
Unrealized gains arising during the year (net
of EUR 245 million tax expense)............ 452 452
Less: reclassification adjustment for gains
realized in net income (net of EUR 92
million tax expense)....................... (171) (171)
------
Other comprehensive income................... 679
------
Comprehensive income......................... 2,254

Balance December 31, 1997.................... 7 798 805
Net Income................................... 1,912
Currency translation adjustment (net of EUR
10 million tax credit)..................... (455) (455)
Unrealized gains arising during the year (net
of EUR 381 million tax expense)............ 619 619
Less: reclassification adjustment for gains
realized in net income (net of
EUR 213 million tax expense)............... (397) (397)
------
Other comprehensive income................... (233)
------
Comprehensive income......................... 1,679
Balance December 31, 1998.................... (448) 1,020 572
Net Income................................... 1,951
Currency translation adjustment (net of EUR
50 million tax expense).................... 409 409
Unrealized losses arising during the year
(net of EUR 647 million tax expense)....... (1,224) (1,224)
Less: reclassification adjustment for loss
realized in net income (net of EUR
135 million tax expense)................... (251) (251)
------
Other comprehensive income................... (1,066)
------
Comprehensive income......................... 885
Balance December 31, 1999.................... (39) (455) (494)
</TABLE>

F-52
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

(M) EARNINGS PER SHARE UNDER U.S. GAAP

Effective December 31, 1997 ABN AMRO adopted SFAS 128, Earnings per Share,
which establishes new standards for computing and presenting earnings per share
(EPS).

Basic EPS is computed by dividing income available to common stockholders by
the weighted-average number of common shares outstanding. Diluted EPS includes
the determinants of basic EPS and, in addition, gives effect to dilutive
potential common shares that were outstanding during the period.

The computation of basic and diluted EPS for the years ended December 31 are
presented in the following table:

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR, EXCEPT
SHARE DATA)
<S> <C> <C> <C>
Net profit.................................................. 1,951 1,912 1,575
Dividends on Preference Shares.............................. 80 81 82
------- ------- -------
Net profit applicable to Ordinary Shares.................... 1,871 1,831 1,493
Dividends on Convertible Preference Shares.................. 2 3 4
------- ------- -------
Net profit adjusted for diluted computation................. 1,873 1,834 1,497
Weighted-Average Ordinary Shares Outstanding................ 1,451.6 1,422.1 1,388.7
Dilutive Effect of Staff Options............................ 4.1 4.6 3.6
Convertible Preference Shares............................... 5.7 6.8 8.3
------- ------- -------
Adjusted Diluted Computation................................ 1,461.4 1,433.5 1,400.6
Basic Earnings Per Share.................................... 1.29 1.29 1.08
Diluted Earnings Per Share.................................. 1.28 1.28 1.07
</TABLE>

F-53
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

44 PARENT COMPANY ACCOUNTS

COMPANY BALANCE SHEET AT DECEMBER 31, 1999 AFTER PROFIT APPROPRIATION

<TABLE>
<CAPTION>
1999 1998
-------- --------
(IN MILLIONS OF EUR)
<S> <C> <C>
ASSETS
Banks (a)................................................ 1,204 1,167
Interest-earning securities (b).......................... 27 23
Participating interests in group companies (c)........... 11,481 10,233
Other assets (d)......................................... 728 377
Prepayments and accrued income (e)....................... 68 65
------ ------
13,508 11,865

LIABILITIES
Deposits and other client accounts....................... 27 23
Other liabilities (d).................................... 496 215
Accruals and deferred income (e)......................... 33 67
------ ------
556 305

Subordinated debt........................................ 965 837

Share capital............................................ 1,658 1,645
Share premium account.................................... 2,480 2,454
Revaluation reserves..................................... 320 314
Reserves prescribed by law and articles of association... 205 172
Other reserves........................................... 7,324 6,138
------ ------
Shareholders' equity..................................... 11,987 10,723

Own capital.............................................. 12,952 11,560
------ ------
13,508 11,865
</TABLE>

PARENT COMPANY INCOME STATEMENT

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Profits of participating interests after taxes......... 2,566 1,825 1,740
Other profit after taxes............................... 4 3 8
----- ----- -----
Net profit............................................. 2,570 1,828 1,748
===== ===== =====
</TABLE>

Drawn up in accordance with section 2:402 of the Netherlands Civil Code.

Letters stated against items refer to the notes.

F-54
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO THE PARENT COMPANY BALANCE SHEET AND INCOME STATEMENT

(a) BANKS

This item includes call loans to and other interbank relations with group
companies. An amount of EUR 708 million (1998: EUR 657 million) of this exposure
is subordinated. An amount of EUR 708 million is due for redemption in 2001 and
an amount of EUR 227 million in 2002.

(b) INTEREST-EARNING SECURITIES

The amount included in this item represents securitized receivables, such as
commercial paper.

Dividends payable by ABN AMRO Bank N.V to ABN AMRO Holding N.V. amounted to
EUR 728 million (1998: EUR 377 million). Dividends received by ABN AMRO Bank
N.V. from subsidiaries amounted to EUR 621 million (1998: EUR 221 million).

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Development:
Opening Balance................................... 10,233 11,354 11,058
Movements (net)................................... 1,248 (1,121) 296
------ ------ ------
Closing Balance................................. 11,481 10,233 11,354
====== ====== ======
</TABLE>

(d) OTHER ASSETS AND OTHER LIABILITIES

These items include those amounts which are not of an accrued or deferred
nature or which cannot be classified with any other balance sheet item. This
concerns, for example, taxes receivable or payable and dividends.

(e) PREPAYMENTS AND ACCRUED INCOME AND ACCRUALS AND DEFERRED INCOME

These items include revenue and expenses recognised in the period under
review but whose actual receipt or payment falls in a different period, as well
as the total net difference between contract rates and spot rates on foreign
exchange hedging operations.

(f) SHARE CAPITAL AND RESERVES

For details refer to note 16.

(g) GUARANTEES

ABN AMRO Holding N.V. guarantees all liabilities of ABN AMRO Bank N.V.

F-55
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

45 MAJOR SUBSIDIARIES AND PARTICIPATING INTERESTS

(UNLESS OTHERWISE STATED, ABN AMRO INTEREST IS 100% OR ALMOST 100%, AS OF
MARCH 23, 2000)

ABN AMRO BANK N.V., AMSTERDAM

NETHERLANDS

ABN AMRO Lease Holding N.V., Almere

ABN AMRO Levensverzekering N.V., Zwolle

ABN AMRO Onroerend Goed Holding B.V., Amsterdam

ABN AMRO Participaties Holding B.V., Amsterdam

ABN AMRO Projectontwikkeling B.V., Amsterdam

ABN AMRO Schadeverzekeringen N.V., Zwolle

ABN AMRO Trustcompany (Nederland) B.V., Amsterdam

ABN AMRO Verzekeringen B.V., Zwolle

AA Interfinance B.V., Amsterdam

AAGUS Financial Services Group N.V., Amersfoort (67%)

ABN AMRO Bouwfonds Nederlandse Gemeenten N.V., Hoevelaken (voting right 50%,
equity participation 50%)

Consultas N.V., Zwolle

Hollandsche Bank-Unie N.V., Rotterdam

IFN Group B.V., Rotterdam

Nachenius, Tjeenk & Co. N.V., Amsterdam

Rijnlandse Disconto Bank C.V., Utrecht

ABROAD

EUROPE

ABN AMRO Asset Management Ltd., London

ABN AMRO Asset Management (Polska) S.A., Warsaw

ABN AMRO Bank A.O., Moscow

ABN AMRO Bank (Deutschland) A.G., Frankfurt am Main

ABN AMRO Bank (Luxembourg) S.A., Luxembourg

ABN AMRO Bank (Polska) S.A., Warsaw

ABN AMRO Bank (Romania) S.A., Bukarest

ABN AMRO Bank (Schweiz) A.G., Zurich

ABN AMRO Corporate Finance Ltd., London

F-56
<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

ABN AMRO Corporate Finance (CEE) Ltd., Budapest

ABN AMRO Corporate Finance (Ireland) Ltd., Dublin

ABN AMRO Development Capital (UK) Ltd, London

ABN AMRO Equities (Hungary) Rt., Budapest

ABN AMRO Equities (Russia) ZAO, Moscow

ABN AMRO Equities (Spain) S.A. Sociedad de Valores y Bolsa, Madrid

ABN AMRO Equities (UK), London

ABN AMRO France S.A., Paris (88%)

ABN AMRO Fixed Income (France) S.A., Paris

ABN AMRO Securities (France) S.A., Paris

Banque de Neuflize, Schlumberger, Mallet S.A., Paris

Banque Odier Bungener Courvoisier, Paris

ABN AMRO Futures Ltd., London

ABN AMRO International Financial Services Company, Dublin

ABN AMRO Investment Management S.A., Luxembourg

ABN AMRO Leasing (Hellas) S.A., Athens

ABN AMRO (Magyar) Bank Rt., Budapest (95%)

ABN AMRO Portfolio Management S.A. Brno

ABN AMRO Securities (Greece) Ltd., Athens

ABN AMRO Securities (Polska) S.A., Warsaw

ABN AMRO Securities (Romania) S.A., Bukarest

ABN AMRO Stockbrokers (Ireland) Ltd., Dublin

ABN AMRO Trust Company (Denmark) A/S, Copenhagen

ABN AMRO Trust Company (Jersey) Ltd., St.Helier

ABN AMRO Trust Company (Luxembourg) S.A., Luxembourg

ABN AMRO Trust Company (Suisse) S.A., Geneva

ABN AMRO Yatyrym Menkul Degerter A.S., Istanbul

Alfred Berg Holding A/B, Stockholm

Antonveneta ABN AMRO Societa di Gestione del Risparmio SpA, Milan (50%)

Banca di Roma, Rome (10%)

CM Capital Markets Brokerage S.A., Madrid (45%)

AFRICA

ABN AMRO Bank (Maroc) S.A., Casablanca (99%)

ABN AMRO Delta Portfolio Management (Egypt), Cairo (59%)

ABN AMRO Delta Securities (Egypt), Cairo (59%)

ABN AMRO Securities (South Africa) (Pty) Ltd., Johannesburg (76%)

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<PAGE>
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

MIDDLE EAST

Saudi Hollandi Bank, Riyadh (40%)

REST OF ASIA

ABN AMRO Asia Ltd., Hong Kong

ABN AMRO Asia Corporate Finance Ltd., Hong Kong

ABN AMRO Asia Futures Ltd., Hong Kong

ABN AMRO Asia Merchant Bank (Singapore) Ltd., Singapore

ABN AMRO Asia Securities Plc., Bangkok (40%)

ABN AMRO Asset Management (Asia) Ltd., Hong Kong

ABN AMRO Asset Management (Japan) Ltd., Tokyo

ABN AMRO Asset Management (Singapore) Ltd., Singapore

ABN AMRO Bank Berhad, Kuala Lumpur

ABN AMRO Bank (Kazakstan) Ltd., Almaty (51%)

ABN AMRO Bank N.B., Uzbekistan A.O., Tashkent (50%)

ABN AMRO Savings Bank, Manilla (60%)

ABN AMRO Securities (India) Private Ltd., Bombay (75%)

ABN AMRO Securities (Far East) Ltd., Hong Kong

ABN AMRO Securities (Japan) Ltd., Tokyo

Bank of Asia, Bangkok (77%)

PT ABN AMRO Finance Indonesia, Jakarta (85%)

AUSTRALIA

ABN AMRO Australia Ltd., Sydney

ABN AMRO Capital Markets (Australia) Ltd., Sydney

ABN AMRO Equities Australia Ltd., Sydney

NEW ZEALAND

ABN AMRO Equities NZ Ltd., Auckland

NORTH AMERICA

ABN AMRO Bank Canada, Toronto

ABN AMRO Bank (Mexico) S.A., Mexico City

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

ABN AMRO North America Inc., Chicago (holding company, voting right 100%,
equity participation 60%)

LaSalle Bank N.A., Chicago

LaSalle National Corporation, Chicago

Standard Federal Bancorporation, Troy

ABN AMRO Inc., Chicago

European American Bank Inc., New York (voting right 100%, equity
participation 62%)

LATIN AMERICA AND THE CARIBBEAN

ABN AMRO Bank Asset Management (Curacao) N.V., Willemstad

ABN AMRO Bank (Chile) S.A., Santiago de Chile

ABN AMRO Bank (Colombia) S.A., Bogota (91%)

ABN AMRO (Chile) Seguros Generales S.A., Santiago de Chile

ABN AMRO (Chile) Seguros de Vida S.A., Santiago de Chile

ABN AMRO Securities (Argentina) Sociedad de Bolsa S.A., Buenos Aires

ABN AMRO Securities (Brazil) Corretora de Valores Mobiliarios S.A., Sao
Paulo

ABN AMRO Trust Company (Curacao) N.V., Willemstad

Banco Bandepe S.A., Recife

Banco ABN AMRO Real S.A.(*), Sao Paulo (voting right 94%, equity
participation 88%)

*) New name of Banco ABN AMRO S.A., as from April 2000, as a result of
the recent merger of Banco Real S.A. into Banco ABN AMRO S.A.

De Surinaamsche Bank N.V., Paramaribo (49%)

Real Paraguaya de Seguros S.A., Assucion

Real Previdencia e Segures S.A., Sao Paulo

Real Segures S.A., Bogota

Real Uruguaya de Segures S.A., Montovideo

For the investments of ABN AMRO Lease Holding N.V., the reader is referred
to the separate annual report published by this company.

The list of participating interests for which statements of liability have
been issued has been filed at the Amsterdam Chamber of Commerce.

46 POST-BALANCE SHEET EVENTS

On January 24, 2000, ABN AMRO declared the bid it made for all the shares in
Bouwfonds Nederlandse Gemeenten in August 1999 unconditional. All municipalities
have meanwhile accepted the offer. The transaction involves an amount of EUR
1.2 billion. The purchase price will be paid in instalments and financed from
own funds. The results of Bouwfonds will be incorporated in the consolidated
income statement of ABN AMRO from January 1, 2000. An estimated sum of EUR

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

0.4 billion in goodwill will be charged to shareholders' equity. Bouwfonds will
operate on an arm's length basis from the ABN AMRO group.

47 STIPULATIONS OF THE ARTICLES OF ASSOCIATION WITH RESPECT TO PROFIT
APPROPRIATION

Profit is appropriated in accordance with article 38 of the articles of
association. The main stipulations with respect to classes and series of shares
currently in issue are as follows:

1. The holder of the priority share will be paid a dividend of NLG 0.30,
representing 6% of the face value (article 38.2.a.).

2. The holders of preference shares will receive a dividend of NLG 0.475
per share, representing 9.5% of the face value. As of January 1, 2001,
and every ten years thereafter, the dividend will be adjusted in line
with the average redemption yield on the five longest-dated government
loans, plus an increment of no less than 0.25 percentage point and no
more than one percentage point (article 38.2.b.2.).

The holders of convertible preference shares will receive a dividend of NLG
3.78 per share, representing 6% of the amount paid on each share. As of
January 1, 2004, and every ten years thereafter, the dividend on shares not
converted by October 31, 2003 will be adjusted in line with the redemption yield
on government loans with an original or remaining term to maturity of nine to
ten years, plus an increment or less a reduction of no more than one percentage
point (article 38.2.b.4. and b.3.). No profit distributions will be made to
holders of preference shares and convertible preference shares in excess of the
maxima defined above (article 38.2.b.6.).

3. From the profit remaining after these distributions, such appropriations
will be made to reserves as may be determined by the Managing Board with the
approval of the Supervisory Board (article 38.2.c.).

4. The balance then remaining will be paid out as ordinary share dividend
(article 38.2.d.).

The Managing Board can make the ordinary share dividend payable, at the
shareholder's option, either in cash or entirely or partly in the form of
ordinary or preference shares (article 38.3.).

PROPOSED PROFIT APPROPRIATION

<TABLE>
<CAPTION>
1999 1998 1997
-------- -------- --------
(IN MILLIONS OF EUR)
<S> <C> <C> <C>
Appropriation of net profit pursuant to article 38.2
and 38.3 of the articles of association
Dividends on preference shares......................... 78 78 78
Dividends on convertible preference shares............. 2 3 4
Addition to reserves................................... 1,320 922 904
Dividends on ordinary shares........................... 1,170 825 762
----- ----- -----
2,570 1,828 1,748
===== ===== =====
</TABLE>

48 STIPULATIONS OF THE ARTICLES OF ASSOCIATION WITH RESPECT TO SHARES

Each ordinary share of NLG 1.25 face value in the capital of ABN AMRO
Holding N.V. entitles the holder to cast one vote. The other shares in the
capital have a face value of NLG 5 and are entitled to four votes. Subject to
certain exceptions provided for by law or in the articles of association,
resolutions are passed by an absolute majority of the votes cast.

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NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

The rights of the holder of the priority share include the right to
determine the number of members of the Managing Board, which may not be fewer
than five according to the articles of association, and the number of members of
the Supervisory Board, which may not be fewer than ten. The prior approval of
the holder of the priority share is also required for resolutions to amend the
articles of association or to dissolve the company. The priority share is
entitled to an annual distribution up to 6% of its face value. The priority
share is held by Stichting Prioriteit ABN AMRO Holding, a foundation established
in Amsterdam. The Executive Committee is made up of the members of the
Supervisory and Managing Boards of ABN AMRO Holding N.V.

Given the numbers of members of the Supervisory Board and the Managing
Board, being 15 and 8 respectively, the two Boards in their capacity of
Executive Committee of the Stichting Prioriteit ABN AMRO Holding are of opinion
that the requirement referred to in article C.9 of Appendix X to the Listing and
Issuing Rules of the Amsterdam Exchanges N.V. has been satisfied. This means
that Managing Board members do not control a majority of the votes to be cast at
the Executive Committee's meetings.

Subject to certain exceptions, upon the issuance of ordinary shares and
convertible preference shares, holders of ordinary shares have pre-emptive
rights in proportion to their holdings. Upon the issuance of convertible
preference shares, subject to certain limitations, holders of convertible
preference shares have pre-emptive rights in proportion to their holdings.

In the event of the dissolution and liquidation of ABN AMRO Holding N.V.,
the assets remaining after payment of all debts are distributed first to the
holder of the priority share, in an amount equal to the face value of the
priority share, secondly to the holders of preference shares and convertible
preference shares on a pro rata basis, in an amount equal to all dividends
accrued from the beginning of the most recent full financial year through the
date of payment and then the face value of the preference shares or the amount
paid in on the convertible preference shares respectively, and thirdly to the
holders of ordinary shares on a pro rata basis.

F-61