Aprila Bank ASA | Company Presentation | January 2020 Disclaimer - PowerPoint PPT Presentation

Aprila Bank ASA | Company Presentation | January 2020

Disclaimer Forward-looking statements This presentation contains forward-looking statements that reflect management’s current views with respect to certain future events and potential financial performance. Although Aprila Bank believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to be correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of various factors. Important factors that may cause such a difference for Aprila Bank include, but are not limited to: (i) the macroeconomic development, (ii) change in the competitive climate, (iii) change in the regulatory environment and other government actions and (iv) change in interest rate and foreign exchange rate levels. This presentation does not imply that Aprila Bank has undertaken to revise these forward-looking statements, beyond what is required by applicable law or other applicable regulations if and when circumstances arise that will lead to changes compared to the date when these statements were provided. 2

Recognition Recognised as a leading fintech – despite low profile and very limited marketing spend Fintech Switzerland CB Insights 3

Aprila in brief Product and technology company aiming to reinvent SME banking and enable new job creation Making credit available for a large underserved SME market Key figures • Offering credit to customers where they are, when they need it • Transparent and understandable pricing; no access fees or lock-in periods • Credit assessment based on live data from online accounting systems # of SME customers 801 (31 Dec 2019) Leveraging technology to create competitive advantage Average loan per customer • ~53,000 Scalable architecture developed in-house; integrations through APIs (NOK, 31 Dec 2019) • In-house developed data warehouse; enables data-driven decision making and facilitates powerful predictive analytics Annual gross income per customer • Real-time credit scoring and pricing based on machine-learning technology ~18,000 (NOK, run-rate Dec 2019) Two products and access to ~130,000 SMEs from Q1 2020 Yield on net loans 33% • Commenced operations in Q2 2018, launching spot factoring integrated in (p.a., run-rate Q4-19) Tripletex (online accounting system) • Expanding from one product in one distribution channel to three products and Funding cost six channels during 2020 2.1% (p.a.) • Credit line up to NOK 500k launched in Tripletex on 16 Dec 2019 and in own channels (kassekreditt.no) 20 Dec 2019 4

Motivation SMEs are the backbone of the European economy, but lack of financing results in stagnant growth Share of European SMEs with bank loans 2 Acc. GDP growth since the financial crisis (%) 3 SMEs share of the European economy 1 Employment Value creation 29 % 95.5 Asia 22 % Africa Oceania America 58.0 15 % 33 % Europe 44 % 56 % 34.6 67 % 22.2 14.6 Medium Small Micro SMEs constitute 67% of …which contributes to a …but lack access to employment and 56% of the stagnant growth in the funding… value creation in Europe… European economy 5 Sources: 1) EIF European Small Business Finance Outlook December 2019. 2) EIF European Small Business Finance Outlook June 2018. 3) IMF DataMapper.

Market opportunity A large market with few challengers Market size 1 (EUR, outstanding credit) Market status TRADITIONAL BANKING Euro area consumer credit 1,3 European SME credit 1,4 12 % BUSINESSES 33 % 33% of the total 12% of total Small 2 5.9bn 3.5bn RETAIL Large Medium SME SME lending household lending 67 % market 88 % Digital, Manual and Manual and Digital, Non-existing Processes paper-based paper-based automated automated EUR ~720 bn 5 EUR ~1,200 bn Re-active, Pro-active, Self service, Self service, slow, Customer relationship Non-existing easily relationship easily available experience available banking Selected challengers Selected challengers banking Competition High High Medium Low Low 2 % Captured 14 % 25 % share of market 1 75 % 86 % 100 % 100 % 98 % Automating Automated Manual Manual processes Large funding processes where processes processes require high gap loan margins loan margins required for justified by reflect manual (EUR 450 bn) profitability large loan sizes for profitability processes Note 1: Company estimates based on EBA Consumer trends report 2018/2019, ECB Statistical Data Warehouse, OECD Financing SMEs and Entrepreneurs 2019 and The View 2019 (Euler Hermes, Allianz), Filling the bank financing gap. | | Note 2: Small (<50 FTES and 6 turnover <= EUR 10m) and Micro (<10 FTEs and turnover <= EUR 2m) | | Note 3: Credit not guaranteed by mortgages, i.e. personal loans, car finance and revolving credit. | | Note 4: Short-term SME credit estimated to 1/3 of the total SME lending market of EUR 3,500 bn, of which EUR 3,000 bn is captured. | | Note 5: ECB: EUR 717 bn in the Euro area as of Oct 2019.

Timeline Expanding from one product in one distribution channel to three products and six channels 1 2021 → 2018 2019 2020 Setup Streamline Scale up Expand Equity Funding Deposits (~2% p.a.) Spot factoring Products Credit line Pay With Aprila ERP / Online accounting systems Distribution Accounting offices Own channels Q2-20: + ~35,000 Q1-20: Customer + ~40,000 exposure through Q4-19: + ~15,000 ERPs Q2-18: ~ 40,000 7 Note 1: Five ERP systems + aprila.no/kassekreditt.no

Products Three initial products to unlock the market for SME credit Spot factoring (from Q2-18) Credit line (from ultimo Q4-19) Pay with Aprila (from Q3-20) • • • Spot sale of invoices inside online accounting Credit line up to NOK 500k Ecommerce payment solution, B2B systems, with immediate settlement and • • In Tripletex and own channels from late Q4-19 Online merchant gets paid instantly upon check- automatic bookkeeping out, the customer receives an invoice from Aprila • Backed by personal guarantee 2 • In Tripletex from Q2-18, NOK 500m purchased LTD • Basket size up to NOK 500k • No access or limit fee, no lock-in period • Product/market fit achieved; 98% of customers • Instant credit approval would be «disappointed» if feature removed, of • Monthly interest rate: 1-2% which >50% «very disappointed» • Up to 90 days deferral • Our first product to be distributed through own • Average margin Q4-19: 2.90%, implying 40% EIR 1 • channels, but will also be available inside partner MVP currently up and running in cooperation with ERP systems Arctic Securities (purchase of LEI numbers) • Leveraging latest generation machine-learning to continuously optimise pricing, risk management and take-up rates 8 Note 1: Based on 30 days to payment. | | Note 2: NO: “ Næringskausjon ”

Geographic presence and scaling European banks neglect their SME customers Short-term Mid-term Long-term Norway The Nordics Continental Europe • • • The Nordic countries are Entry to Continental Europe Highly digital home market world-leaders with respect to through existing and new • Online accounting systems digitalisation and have well- partners with established local have integrated Aprila Bank functioning financial markets – presence financing inside their systems, a great starting point for future • Aprila’s banking license can be making this the first fully digital expansion passported across the EU/EEA integration of bank financing • Aprila expects to enter new within ERP markets through distribution agreements with ERP providers International expansion plan Q2 2018 2021 2023 Commenced Expand to the first Expand to the first operations in Nordic country outside European country Norway of Norway outside of the Nordics 9