KfW's capital market activities - SMEs win / EUR 10 billion SME securitisation volume in 2006 / Funding need of EUR 55 billion in 2007

Frankfurt (ots) - In 2006 KfW has so far raised more than EUR 51
billion by issuing bonds in a total of 23 currencies in the
international capital markets. "With our very broad range of
currencies and products we have become well established as a
first-class issuer with AAA investors worldwide," observed Dr Günther
Bräunig at today's capital market press conference in Frankfurt. Dr
Bräunig has been in charge of the promotional bank's capital market
activities since 1 October 2006, when he was appointed to the Board
of Managing Directors of KfW Bankengruppe.

With a share of 41%, the euro is the most important currency in
KfW fund raising activities, the US dollar ranking second with 30%.
This is followed by the pound sterling with 11% and the Japanese yen
with 6%. The remaining 12% (around EUR 6 billion) covers 19 other
currencies. The euro and US dollar benchmark programmes, which
account for around 43% (EUR 22 billion) of the funds raised, are a
major instrument of KfW's funding. A further 45% was raised via other
public bonds and the remainder via private placements.

"We are observing worldwide interest among investors in currency
diversification and are benefiting from this, thanks to the fact that
we have become well established as a global player over the years.
This year we have also expanded our activities in the emerging
markets in Asia," explained Dr Bräunig. This year KfW issued its
first bond denominated in Ringgit in Malaysia and set up a local
issue programme.

For 2007 Bräunig announced that EUR 55 billion in funding will be
needed, with the benchmark programmes remaining the most important
pillar of KfW funding activities. "We are flexible with regard to
maturity and size and give due consideration to the market
environment when taking our issue decisions. Investor demand and bond
performance are our main focus," Dr Bräunig said in reference to the
strategic orientation of the benchmark programmes; in the euro
programme the minimum volume will continue to be EUR 3 billion per
bond while the minimum volume in the US dollar programme will be USD
2 billion and USD 1 billion for maturities over five years. KfW also
intends to reinforce its marketing activities for its US-MTN
programme in the USA, in an endeavour to tap the large market
potential.

In the emerging markets in Asia, the bank is expecting strong
growth in the years ahead and would therefore like to establish a
firm position as an issuer in these markets at an early stage.
Currently, work is in progress on possible first local KfW issues
particularly in Thailand and China.

Dr Bräunig signalled continuity with regard to the privatisation
activities relating to Deutsche Post and Deutsche Telekom. "Next year
we will again look at sales opportunities while maintaining our
philosophy of placing shares without upsetting the market and when
appropriate capital market windows open up," the Board Member went on
to say.

Germany has now become a major player in the European
securitisation market, a decisive contribution to this achievement
having been made by KfW. In the past six years the promotional bank
has securitised a volume of more than EUR 100 billion in SME and
housing loans in more than 60 transactions. "This year SME financing
in Germany is the clear 'winner'; besides commercial property loans,
it accounts for the bulk of German securitisation activities. With a
total volume of almost EUR 10 billion, our PROMISE securitisation
platform (for SME loans) will achieve the highest volume since its
launch at the end of 2000," was Dr Bräunig's forecast.

Again for 2007 KfW is committed to lending intensive support to
the German securitisation market. As a promotional bank, it supports
the maturing of this market through its platforms and its commitment
to TSI GmbH, in which, in response to a request from the
shareholders, Dr Bräunig has assumed the chair of the Shareholders'
Council. Furthermore, KfW is specifically promoting innovative ABS
transactions by investing under its ABS SME portfolio.

KfW welcomes the shift in SME financing towards capital
market-based financing as the SME sector will thus have access to a
larger credit supply and better conditions. "At the same time, it is
our task as a promotional bank to ensure that the entire range of
small and medium-sized enterprises can benefit from the new types of
financing," Dr Bräunig explained. KfW has therefore also set itself
the target for next year of supporting transactions with portfolios
of smaller credit institutions or portfolios in which the underlying
assets are loans to smaller SMEs. In addition, it intends to become
more active in the new markets in Central and Eastern Europe, as
lending in that region is growing rapidly.

For further figures and details of the Capital Market Press
Conference, please refer to the "Press" area on our website:
www.kfw.de.

Originaltext: KfW
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For further information: Nathalie Drücke,
Tel: +49 (0)69 7431-2098, E-Mail: nathalie.druecke@kfw.de

KfW, Palmengartenstraße 5-9, 60325 Frankfurt
Department Communication
Tel. +49 (0)69 7431-4400, Fax: +49 (0)69 7431-63266,
E-Mail: presse@kfw.de, Internet: www.kfw.de


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