Fixed Income Investor Presentation We look to the future by - PowerPoint PPT Presentation

October 2019 Fixed Income Investor Presentation We look to the future by changing the present

Who we are Our proven track record in NPE management Who we are We are 100% owned by the Italian Ministry of Economy We start to manage the former Banco di 1996 and Finance (MEF) , with a solid Napoli ’s NPE portfolio capital structure We are a full credit We receive Fitch Special Servicer Rating 2017 management company and a (RSS2-, CSS2- e ABSS2-), confirming partner for all our stakeholders high-level performance in the recovery of in a competitive market residential and corporate loans We are a fast growing We become one of the main players in the company , completing the new 2018 Italian NPE market, thanks to the acquisition set up and changing our name of ~ €18bn of impaired loans from Veneto to AMCO banks in compulsory liquidations (LCA) We enter the global debt capital markets We manage €20.6bn NPE and with: (1) the first bond offering in February 2019 ~110.000 counterparties (€250m) and (2) the first benchmark issuance in October (€600m) 2

We changed our name to AMCO “We look to the future by changing the present.” “We value our 20 year old track record.” “We innovate, investing in technology and human capital.” “We offer new opportunities to our counterparties.” to play a role in the Italian NPE Our mission is: market for all our stakeholders to maximize the performance Our objective is: of portfolios under management 3

AMCO: key investment highlights 100% owned by the Italian Ministry of Economy and 1 Finance (MEF) 2 Investment grade rated by S&P and Fitch 3 A fast growing and scalable company Aiming to play a role in the solution of the NPE 4 problem in Italy 5 Simple B/S structure and strong capital position confirmed in 1H2019 results 4

100% owned by the Italian MEF 1 We are a Financial Intermediary ex art.106 TUB : we recover, manage and invest in NPEs and lend to counterparties Our activity is regulated and supervised Bank of Italy regulates and supervises the Financial intermediaries ex art. 106 TUB 100% We operate in the competitive Italian NPEs market We are monitored by State auditors Corte dei Conti monitors AMCO financial activities 5

Investment grade rated by S&P and Fitch 2 Confirmed on September 20 th 2019 July 23 rd , 2019 September 27 th , 2018 First rating Rating agency Long-Term IDR: BBB Long-Term IDR: BBB- Issuer Default Rating Senior Unsecured Debt: BBB Short-Term IDR: F3 Outlook negative Outlook negative These ratings apply also to the October 2019 €600m issuance “The rating on AMCO primarily reflects our view that “The rating reflects the link between Overview there is an almost certain likelihood that the Italian AMCO and the Italy’ s national government would provide AMCO with timely and government and Fitch’s expectations sufficient extraordinary support if it were in of the latter’s willingness to financial distress. S&P therefore equalizes its long- provide any extraordinary term rating on AMCO with our long-term unsolicited support.” (Fitch Ratings Report) sovereign credit rating on Italy S&P views AMCO as a key instrument for the Italian government to clean up troubled banks' balance sheets , thus preserving financial stability, helping lending resume, and fostering economic growth.” (S&P Ratings Report) 6

We are a fast-growing and scalable company … 3 2016 2017 2018 1H2019 Former Banco di Napoli High Risk Former Veneto Banca from 20.6 (1) Former Banca Pop. Vicenza 20.2 Veneto Banca del Fucino 0.3 banks 10.2 10.4 Assets under Management (€bn) 8.1 2.6 2.3 8.1 1.9 1.8 Asset type Gone concern Going concern Employees #71 #71 #144 # 211 (EoP) 7 Note (1): Assets under Management: proforma including assets related to Banca del Fucino – The deal was closed on September 14 th 2019

… with a full credit management service model … 3 We act as with a wide-ranging value proposition Recovery of gone concern assets, with different type of COLLECTOR counterparties and guarantees Management of going concern assets aimed to preserve or restore the counterparty’s business continuity through financial and industrial restructuring CREDIT Arranger, Master&Special Servicer and/or Institutional MANAGER player in securitizations with a pivotal role versus all counterparties Active management of real estate guarantees (ReoCo) Issuance of new lending to going concern worthy LENDER counterparties INVESTMENT Co-investor with full alignment of interests with the FUND originator 8

… acting as a facilitator for our stakeholders 3 Institutional Specialized investors co- industrial financing with investors providing AMCO to support capabilities to specific support corporates’ restructuring restructuring and business cases industrial relaunch acts as a pivot for private and institutional players in UTP management Companies under restructuring Banks aiming to reduce with troubled financial their UTP portfolios, position, despite while keeping exposure to solid business rationale potential upside 9

We aim to play a role in the Italian NPE market 4 Rank Player AuM NPE total Rank Player AuM Unlikely to Pay/Past Due € Bn € Bn 81,1 9,9 1 1 42,4 8,2 2 2 41,8 5,6 3 3 29,0 2,9 4 4 20,6 1,4 5 5 15,0 1,3 6 6 9,7 1,0 7 7 9,5 0,8 8 8 9,2 9 0,6 9 Intesa Sanpaolo deal contribution Banca del Fucino 8,2 10 0,5 10 contribution Source: All data retrieved from PwC «The Italian NPL Market», July 2019, excluding internal elaboration for AMCO and Prelios: AMCO AuM consider 1H2019 proforma (including assets related to Banca del Fucino); Prelios proforma includes AuM related to the deal with Intesa Sanpaolo closed on July 31 st 2019. 10

5 We manage a diversified range of assets Capital impact On/Off Balance Sheet Impact on P&L Originator Asset type On B/S Net impairment Yes Banco di Loans ( gone Loans to customers gain/losses on Napoli concern ) (NBV) credit risk Off B/S No Net fees Loans + Notes Veneto Segregated (master & special servicer) ( gone and banks accounts going concern ) €20.6bn AuM Net fees Banca On B/S Yes Junior & (master & special servicer) del Fucino (1) Financial assets Mezzanine Interests and fees Notes (+ from customers Servicing) Net result of financial activity Italian Notes, On B/S Net result of Yes Recovery Shares, Financial assets financial activity Fund Bonds €0.5bn Financial Investments Note (1) The deal was closed on September 14 th 2019 11

We leverage on a simple balance sheet structure 5 Liabilities (€m) Assets (€m) BdN Assets 2018 1H 2019 2018 1H 2019 GBV €1.8bn 1,102 1,102 (1) Cash and NBV €126m liquidity Debt 141 251 822 822 Loans to Other 126 66 customer 47 83 liabilities Financial AMCO 131 Equity assets Balance Sheet 699 Other assets 786 775 (Patrimonio Generale) 502 Off-balance 135 items 106 Off Balance € bn 18.3 18.5 18.3 18.5 (Patrimoni Destinati) 20.6 (2) Total AuM € bn 20.2 Our financial assets are mainly composed of Italian Recovery Fund (IRF) and Government bonds We have €250m of new debt issued on February 13 th , 2019 We can leverage on a strong capital structure with CET1 ratio of 17.4% versus a regulatory requirement of 8.0% We can support our growth increasing safely our leverage (current D/E ratio is ~ 0.30x) Note (1) Not including Banca del Fucino assets (c.€300m). The deal was closed on September 14 th 2019 12 Note (2) Pro forma for Banca Fucino assets. Including: €1.8bn GBV from former Banco di Napoli, €18.5bn from Patrimoni Destinati from former Veneto Banks, €0.3bn from Banca Fucino (deal closed on September 14 th 2019)

High quality performance despite one-off costs to set- 5 up an innovative and scalable model FY2018 1H2019 €m Revenues 37.4 23.3 Costs (28.5) (20.1) EBITDA 8.9 3.3 Net impairment gains/losses on credit risk 25.2 9.0 Net accruals to provisions for risks and charges (16.9) (5.5) Others 0.8 (0.2) Net result of financial activity 20.4 7.6 EBIT 38.4 14.1 Net interest from financial activity 0.6 (2.2) Income taxes 8.5 (3.7) NET PROFIT (LOSS) 47.5 8.2 Note: 1H2019 results includes the effects deriving from the first application of IFRS16. The 2018 results do not include these effects as the restatement of the comparative data is not envisaged Revenues are related to the servicing of former Veneto banks portfolios, including Master Servicing fees and Special Servicing fees relating to both non-performing loans and securitizations Costs increase is due to the setting up of an innovative and scalable structure, with 211 employees versus 144 in 2018YE. The “transformation costs” represent two thirds of total costs Net impairment gains on credit risk related to former Banco di Napoli portfolio Net result of financial activity mainly includes the capital gain on the valuation of the investment in the IRF fund (former “Fondo Atlante”) 13