CAPITAL MARKETS UPDATE The Curtain Hotel London 29 November 2018 - PowerPoint PPT Presentation

CAPITAL MARKETS UPDATE The Curtain Hotel – London 29 November 2018

CAPITAL MARKETS UPDATE The Curtain Hotel – London 29 November 2018

Welcome Our Executive Committee is presenting today Reinout Saskia Paulus Herman Caroline Michel van Riel Hovers de Wilt Dijkhuizen Oosterbaan Kant 3

AGENDA An overview 14:00 INTRODUCTION Michèle Negen, IR 14.10 – 14.30 REFLECTIONS Paulus de Wilt, CEO 14.30 – 15.00 REBALANCING AT THE CORE OF OUR BUSINESS Reinout van Riel, CRO Caroline Oosterbaan, Corporate Banking Products 15.00 – 15.20 CORPORATE PRODUCT OFFERING Victor Ruitenberg, Leveraged Finance Saskia Hovers , Corporate Banking Clients 15.20 – 15.40 UPDATE ON OUR CLIENT FRANCHISE Sven de Veij, Offshore Energy Michel Kant, Retail Banking 15.40 – 16.00 TRENDS IN THE DUTCH MORTGAGE MARKET Frits van der Scheer, Originate to Manage Break 16:10 – 16.45 FINANCIAL DRIVERS Q3 YEAR TO DATE 2018 Herman Dijkhuizen, CFO Paulus de Wilt, CEO 16:45 – 17.15 Q&A AND CLOSING REMARKS Herman Dijkhuizen, CFO 4 Q&A

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REFLECTIONS Paulus de Wilt, CEO

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AGENDA An overview 14:00 INTRODUCTION Michèle Negen, IR 14.10 – 14.30 REFLECTIONS Paulus de Wilt, CEO 14.30 – 15.00 REBALANCING AT THE CORE OF OUR BUSINESS Reinout van Riel, CRO Caroline Oosterbaan, Corporate Banking Products 15.00 – 15.20 CORPORATE PRODUCT OFFERING Victor Ruitenberg, Leveraged Finance Saskia Hovers , Corporate Banking Clients 15.20 – 15.40 UPDATE ON OUR CLIENT FRANCHISE Sven de Veij, Offshore Energy Michel Kant, Retail Banking 15.40 – 16.00 TRENDS IN THE DUTCH MORTGAGE MARKET Frits van der Scheer, Originate to Manage Break 16:10 – 16.45 FINANCIAL DRIVERS Q3 YEAR TO DATE 2018 Herman Dijkhuizen, CFO Paulus de Wilt, CEO 16:45 – 17.15 Q&A AND CLOSING REMARKS Herman Dijkhuizen, CFO 12 Q&A

REBALANCING AT THE CORE OF OUR BUSINESS Reinout van Riel, CRO

TRENDS IN OUR MARKETS How do we deal with them Competition from Liquid markets with Turn of the cycle? Sustainability ample liquidity banks/ non-banks ▪ ▪ ▪ ▪ Build our business Team up with partners Calibrate our ISS Oekom Rating and around the three C’s: portfolios down Sustainalytics ratings ▪ Decide what on own upgrade received 2018 ▪ ▪ Client balance / what off Grow where ▪ balance opportunities lie Every corporate deal ▪ Cash flow vetted on CSR ▪ ▪ Manage our portfolios Collateral elements hands-on 14

READY AND WELL PREPARED To absorb industry-wide regulatory changes Europe Capital Asset quality Non-financial risks ▪ ▪ ▪ ▪ Brexit Well capitalised with Movements in Cyber risk 16.8% CET 1 ratio underlying sectors ▪ ▪ Italy Conduct & AML ▪ ▪ Basel IV impact Reduced equity ▪ No payment services manageable exposure ▪ All corporate clients ▪ Stress testing individually assessed ▪ Impairments ▪ Deliberate choice in ▪ Model validation products and geography 15

HOW DO WE DEAL WITH CURRENT CHALLENGES Prudent risk management taking action where and whenever needed Smaller individual tickets, overall shift towards smaller ticket businesses like leasing and structuring Growing the retail business ✓ Historically low risk with currently very low (~1bps) realised losses Rebalancing exposures on corporate business Pro-actively manage our portfolios, looking at the continuously changing markets ✓ Offshore Energy & Shipping markets stabilising to picking up; Leveraged Finance poses new challenges ✓ Well diversified Commercial Real Estate (CRE) book, solidly structured with high churn ✓ Mezzanine & Equity portfolio doing well, making use of good market to exit NIBC is not a market share player; we are not forced to grow for the sake of growing ✓ Deliberate reduction of Offshore Energy & Maritime sectors ✓ On-balance exposures in Leveraged Finance book will also be reduced Growth in Buy-to-Let, Structuring, Leasing and mortgages; building granular portfolios, well-collateralised with higher churn 16

Q&A

AGENDA An overview 14:00 INTRODUCTION Michèle Negen, IR 14.10 – 14.30 REFLECTIONS Paulus de Wilt, CEO 14.30 – 15.00 REBALANCING AT THE CORE OF OUR BUSINESS Reinout van Riel, CRO Caroline Oosterbaan, Corporate Banking Products 15.00 – 15.20 CORPORATE PRODUCT OFFERING Victor Ruitenberg, Leveraged Finance Saskia Hovers , Corporate Banking Clients 15.20 – 15.40 UPDATE ON OUR CLIENT FRANCHISE Sven de Veij, Offshore Energy Michel Kant, Retail Banking 15.40 – 16.00 TRENDS IN THE DUTCH MORTGAGE MARKET Frits van der Scheer, Originate to Manage Break 16:10 – 16.45 FINANCIAL DRIVERS Q3 YEAR TO DATE 2018 Herman Dijkhuizen, CFO Paulus de Wilt, CEO 16:45 – 17.15 Q&A AND CLOSING REMARKS Herman Dijkhuizen, CFO 18 Q&A

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CORPORATE PRODUCT OFFERING Caroline Oosterbaan, Corporate Banking Products Victor Ruitenberg, Leveraged Finance

CORPORATE PRODUCT OFFERING Rebalancing portfolios driven by our view on global trends RELEVANT GLOBAL THEMES TRENDS FINANCIAL INDUSTRY GOING FORWARD ▪ We are there for fast growing, ▪ Technological innovative companies with range of advancements relevant product solutions ▪ Technology Radical increase ▪ Building granular portfolio of (direct) Artificial intelligence / in data availability mezzanine and equity Platform Economies & Data Big Data ▪ Declining cost of ▪ Selectively enhancing our Corporate data storage Finance & Capital Markets franchise ▪ Rebalancing Leveraged Finance portfolio, investing in our growing Receivables financing business Innovation Customization ▪ Higher transparency Regulation ▪ Greater competition Aging Population Sustainability 21

ENABLING GROWTH AND INNOVATION Financing our client RatePay, established Fintech in Germany RATEPAY ▪ NIBC supporting RatePay’s impressive growth in digital factoring and payment services ▪ Founded in 2009, RatePay is a Top3 provider of E-Commerce prepayment & factoring solutions in Germany ▪ Regulated by the Bafin and part of the Concardis payment group, RatePAY has a strong financial profile and a significantly growing and granular receivables portfolio ▪ NIBC provided a Receivable Financing solution, providing a fast and tailor-made solution 22

TRENDS IN CURRENT LEVERAGED FINANCE MARKET Sustained sponsor activity and high liquidity leads to borrower friendly transaction structures WESTERN EUROPEAN LOAN ISSUANCE INCREASING EV’S & EQUITY CUSHIONS MARKET DEVELOPMENTS (excluding US borrowers and Repricings) ▪ Sustained financial sponsor activity at normalised post-crisis levels 60% 12.x ▪ EV and leverage multiples have gone up over the past years 250 50% 10.x ▪ Substantial equity contributions continue (>45%) 200 40% 8.x ▪ Transaction structures and documentation have become more borrower friendly, driven by high 150 30% 6.x liquidity 100 20% 4.x 50 10% 2.x 0 0% 0.x 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Q2 2018 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 1H18 Sponsor Projection Number of deals Equity cushion EV multiple 23 Source: Fitch Credit Opinions Database

LEVERAGED FINANCE AT NIBC Longstanding business, well diversified portfolio, serving mid-market private equity clients OVERVIEW “The acquisition of HG was a great ▪ investment opportunity for us. NIBC For over 20 years NIBC has provided financing for our financial sponsor acted as a reliable partner by clients acquiring companies in selected contributing to the financing in a geographies and industries swift and timely manner.” ▪ Focus on mid-market companies with Hiram Claus, Cobepa EV of EUR 50-500 ▪ Selective origination has resulted in a well diversified and granular portfolio ▪ Re-balancing portfolio ▪ Ca. 90 assets, for over 50 sponsor clients ▪ Average exposure around EUR 16m ▪ Increasing Super Senior, while very limited cov-lite ▪ Nordics as new geography ▪ Successful closing of NW5 CLO in Q3 2018, providing investment opportunities to our institutional 24 investor clients

LEVERAGED FINANCE Strong alignment with NIBC strategy, enabling growth for our clients Highly selective origination Pro-active Portfolio Management Well diversified and granular portfolio Experienced team, local know how, both on and off-balance 25

Q&A

AGENDA An overview 14:00 INTRODUCTION Michèle Negen, IR 14.10 – 14.30 REFLECTIONS Paulus de Wilt, CEO 14.30 – 15.00 REBALANCING AT THE CORE OF OUR BUSINESS Reinout van Riel, CRO Caroline Oosterbaan, Corporate Banking Products 15.00 – 15.20 CORPORATE PRODUCT OFFERING Victor Ruitenberg, Leveraged Finance Saskia Hovers , Corporate Banking Clients 15.20 – 15.40 UPDATE ON OUR CLIENT FRANCHISE Sven de Veij, Offshore Energy Michel Kant, Retail Banking 15.40 – 16.00 TRENDS IN THE DUTCH MORTGAGE MARKET Frits van der Scheer, Originate to Manage Break 16:10 – 16.45 FINANCIAL DRIVERS Q3 YEAR TO DATE 2018 Herman Dijkhuizen, CFO Paulus de Wilt, CEO 16:45 – 17.15 Q&A AND CLOSING REMARKS Herman Dijkhuizen, CFO 27 Q&A

UPDATE ON OUR CLIENT FRANCHISE Saskia Hovers, Corporate Banking Clients Sven de Veij, Offshore Energy