General Meeting

Invitation and Agenda

Dear Shareholders,

we are pleased to invite you to our Annual General Meeting held on Tuesday, 23 May 2006, 10:30 a.m. at the ”Kurhaus“, Kurhausplatz, 65189 Wiesbaden, Germany.

We have convened this year’s General Meeting by way of publication in the electronic German Federal Gazette (Bundesanzeiger) dated 27 March 2006, publishing the complete version of the agenda set out below.

Agenda

  1. Presentation of the confirmed annual financial statements and the approved consolidated financial statements, the Company’s Management Report and the Group Management Report as well as Report of the Supervisory Board for the 2005 financial year
  2. Passing of a resolution on the appropriation of net retained profit for the 2005 financial year
  3. Passing of a resolution on the formal approval of the members of the Management Board for the 2005 financial year
  4. Passing of a resolution on the formal approval of the members of the Supervisory Board for the 2005 financial year
  5. Appointment of External Auditors
  6. Passing of a resolution on the increase of authorised capital, by way of cancellation of the existing authorised capital and creation of new 2006 authorised capital, and on the amendment of Article 5 (4) of the Company’s Memorandum and Articles of Association
  7. Passing of a resolution on the authorisation of the Management Board to issue convertible bonds and / or bonds cum warrants, on the creation of new conditional capital and on the amendment of Article 5 (5) of the Company’s Memorandum and Articles of Association
  8. Resolution on the authorisation to acquire and to sell treasury shares in accordance with section 71 (1) No. 7 of the German Stock Corporation Act (AktG)
  9. Resolution on the authorisation to acquire and to sell treasury shares in accordance with section 71 (1) No. 8 of the German Stock Corporation Act (AktG)
  10. Passing of a resolution on the approval of a spin-off and acquisition agreement regarding the divestment of a loan portfolio to Real Sechsundzwanzigste Verwaltungsgesellschaft mbH (in the future trading as Aartemis Credit Management GmbH) (spin-off for the purposes of inclusion pursuant to section 123 (3) No. 1 of the German Law Regulating the Transformation of Companies (Umwandlungsgesetz)
  11. Approval of controlling or profit transfer agreements with fully owned subsidiaries of Aareal Bank AG
  12. Passing of a resolution on the emoluments of the members of the Supervisory Board and the amendments to Articles 9 and 10 of the Memorandum and Articles of Association
  13. Elections to the Supervisory Board
  14. Change of the Company’s corporate object
  15. Further amendments to the Memorandum and Articles of Association with regard to the German Act on Corporate Integrity and Modernisation of Rescission Rights (UMAG)

Participation in the General Meeting

The German Act on Corporate Integrity and Modernisation of Rescission Rights (Gesetz zur Unternehmensintegrität und Modernisierung des Anfechtungsrechts, ”UMAG“), which entered into
force on 1 November 2005, sets new legal parameters for the participation in the General Meeting and the exercise of voting rights. Under this Act, the shareholders of our Company have the following two cumulative rights of participating in the General Meeting and exercising their voting rights:

a) Participation by depositing shares

In accordance with section 15 (2) of the Memorandum and Articles of Association, in conjunction with section 16 of the Introductory Law to the German Stock Corporation Act (Einführungsgesetz zum Aktiengesetz), shareholders wishing to attend the General Meeting and exercise their voting rights must deposit their shares by 2 May 2006, and keep them so
deposited until the end of the General Meeting, with

  • Aareal Bank AG, Paulinenstrasse 15, 65189 Wiesbaden, Germany;
  • a notary public; or
  • a securities depository.

The deposit shall also be deemed proper if, with the approval of the depository agent, the shares are blocked by another bank until the end of the General Meeting. In the event of the
shares being deposited with a notary public or securities depository, certification of the deposit must be submitted to the Company in the original, or as a certified copy, no later than 3 May 2006.

Shareholders are hereby advised that, due to the preceding statutory holiday on 1 May and the preceding weekend of 29 and 30 April 2006, the above end date of the deposit period can only be observed if the shares are deposited no later than 28 April 2006. The fact that the last date for validly depositing shares is 28 April 2006 has been taken into  consideration when determining the deadline for convening the General Meeting.

b) Participation by providing proof of shareholding

In accordance with section 123 of the German Stock Corporation Act (Aktiengesetz, ”AktG“), in conjunction with section 16 of the Introductory Law to the German Stock Corporation Act, shareholders providing the Company with special proof of their shareholding issued in written form (as defined in section 126b of the German Civil Code (”BGB“)) by their custodian bank are also entitled to attend the General Meeting and exercise their voting rights. Said proof must be forwarded to the Company at the following address:

Aareal Bank AG
c/o Computershare GmbH
Prannerstraße 8
80333 Munich
Fax: +49 89 30 90 3 624
E-Mail: anmeldestelle(at)computershare.de

Said proof must evidence the shareholding as at the commencement of 2 May 2006, and must be received by the Company at the above address no later than 16 May 2006.

Voting by proxy

Shareholders who will not be attending the General Meeting in person can exercise their vote through an authorised proxy, which may also be a financial institution or a shareholders’ association. If neither a financial institution nor a shareholders’ association has been authorised, such proxy must be issued in writing. As in previous years, the Company offers its shareholders the opportunity to authorise proxies, nominated by the Company and bound by the relevant shareholder’s instructions, prior to the General Meeting. Shareholders who wish to authorise any proxies nominated by the Company require an admission ticket to the General Meeting. Authorisations to voting proxies nominated by the Company must also be forwarded in writing. The shareholders will receive the relevant documents and information together with their admission ticket.

Motions by shareholders

Any correspondence regarding the agenda, in particular counter-motions (as defined in section 126 (1) of the AktG) to proposals by management regarding specific agenda items, as well as nominations for election pursuant to section 127 of the AktG, must be submitted in writing, by fax or e-mail, to the following address only:

Aareal Bank AG
Corporate Development
Paulinenstraße 15
65189 Wiesbaden
Telefax: +49 611 348 2965

Counter-motions and nominations for election received at this address in due time, together with any comments by management, will be made available to all shareholders, without undue delay, in accordance with section 126 of the AktG, by way of publication here on the Internet.

The full wording of the invitation to the General Meeting has been published in the electronic Federal Gazette (Bundesanzeiger) on 27 March 2006. The publication in the electronic Federal Gazette includes the Management Board’s reports regarding agenda items Nos. 6, 7 and 9, the text of the spin-off and acquisition agreement with Real Sechsundzwanzigste Verwaltungsgesellschaft mbH regarding agenda item No. 10, the material terms of the proposed amendments to the Memorandum and Articles of Association, the statutory information regarding agenda item No. 13 and the proposals for resolution regarding any and all agenda items.

The full wording of the invitation to the General Meeting will be sent to the shareholders via the relevant financial institutions and is also available from Aareal Bank AG, Paulinenstrasse 15, 65189 Wiesbaden, Germany (which is also the paying agent) free of charge.

The statutory information regarding agenda item Nos. 1, 10 and 11 will be available for inspection by shareholders at Aareal Bank AG’s offices (Paulinenstrasse 15, 65189 Wiesbaden, Germany) from the day on which the General Meeting is called. This information will also be available at the General Meeting. Upon request, the Company will immediately send a copy of this information to every shareholder, free of charge.

Aareal Bank AG

The Management Board

Wiesbaden, March 2006