Group Results – 9M2011
3Q11 Highlights � Net Interest Income was slightly up QoQ driven by: � a better lending mix with growing SMEs and decreasing Large Corporate volumes, while the total loan portfolio remained fairly stable (- 0.5% QoQ) � some repricing actions taken to offset the higher funding cost � Net Commission Income were stable QoQ (-0.5%; +3.4% vs. 1Q11) � Trading Income showed a good performance, also helped by a positive adjustments on the mark to market evaluation of some derivatives implemented to hedge assets’ volatility � Operating Costs were stable YoY and down 4% QoQ due to the lower impact coming from variable components of Payroll Costs as well as lower charges to ease early retirement agreements with employees � Cost of Risk was once again excellent (22bps annualized - 27bps annualized and normalized to exclude the non recurrent effects posted in the 1Q11). New Impaired Loans inflows lower than the industry average, thank to the conservative strategy implemented during 2008 and 2009 � Direct deposits were up 3,6% QoQ (+€528 million) thank to either some recovery in corporate deposits and the continuation of the upward trend in retail deposits. AUM volumes suffered because of the market effect and were down 7.2% QoQ � Core Tier 1 was 8.9% 2
Income Statements % QoQ 9M10 9M11 % YoY Euro, million 2Q11 3Q11 1.0 697.2 739.3 6.0 Operating Income 250.4 252.9 Operating Costs -163.1 -156.7 -3.9 -484.3 -484.8 0.1 10.2 212.9 254.5 19.5 Gross Operating Profit 87.3 96.2 Depreciation and Amortization -7.4 -8.0 -21.5 -22.6 8.1 5.1 10.4 191.4 231.9 21.2 Operating Profit 79.8 88.2 Net Adjustments to Loans -12.5 -11.7 -6.4 -38.7 -31.0 -19.9 Provisions for Risks and Charges 4.7 -11.4 -1.4 -8.9 n.a. n.a. Extraordinary Income/ Charges -5.1 -3.5 -1.7 -9.7 n.a. n.a. -8.1 149.6 182.3 21.9 Profit before Tax 67.0 61.6 Income Taxes/ Minority Interest -43.8 -29.9 -31.7 -62.9 -96.8 53.9 36.6 86.7 85.5 -1.4 Profit for the Period 23.2 31.7 � Sound QoQ performance on profitability indicators , due to a combined effect of stable incomes and reduced operating costs , also paired with lower adjustments to loans � The same trends are also confirmed YoY , with the Operating Profit up above 21% and Net Adjustments to Loans down 19% . These remarkable results are unfortunately offset (at profit for the period level) by the settlement of the fiscal claim with the Agenzia delle Entrate that occurred in 2Q11, with reference to the investigation on financial deals put in place in 2004 and 2005 3
Operating Income Net Interest Income � Further improvement of the Net Interest Income for the third quarter in a row (+0.3% QoQ; +12.0% 120 €Mil. 118.1 118.5 vs. 4Q10) 118 116 � The growth of the aggregate is driven by: 114 112.1 111.6 112 � Large Corporate lending reduction paired by 110 volumes increase on “core business” segments 108 105.9 (such as SMEs customers) 106 � the repricing actions, also correlated with the 104 102 above illustrated shift, taken in the quarter 100 98 3Q10 4Q10 1Q11 2Q11 3Q11 Non Interest Income � Non Interest Income remained stable QoQ 159.4 €Mil. 160 (2Q11 performance had been remarkable with a 132.3 134.4 140 42.3 123.9 124.6 +6,8% vs. 1Q11), despite the low seasonality of 12.7 20.2 120 14.1 17.8 13.7 Euro, Million 12.2 the 3Q 14.6 9.1 14.2 100 12.3 6.5 43.7 80 � Commission Income is in line with 2Q11 and 39.0 37.8 41.5 37.9 60 5 3.4% up on 1Q11: the contraction on AUM 40 Fees, that is mostly due to the market effect, 54.5 54.6 53.5 52.1 51.6 20 was partially offset by growing Banking Fees 0 3Q10 4Q10 1Q11 2Q11 3Q11 Asset Management Fees Performance Fees Banking Fees Insurance Fees Other Trading 4
Loans Loans +9.3% € Mil. 19,543 19,440 19,555 18,884 17,681 17,782 16,721 18,000 3,425 3,532 3,708 3,323 2,847 3,239 2,782 15,000 5,932 6,095 5,845 6,247 5,276 12,000 5,687 5,503 1,940 9,000 1,944 1,935 1,947 1,976 1,911 1,936 6,000 8,258 7,972 7,781 7,548 7,508 6,944 6,500 3,000 - 2008 9M09 9M10 FY10 1Q11 1H11 9M11 ST Loans Leasing Residential Mortgages Other LT Loans � Strong actions on loan portfolio, taken ahead of Loans breakdown by segments the recent financial markets turmoil to both protect (Credem SpA management accounting) profitability from the pressure on funding cost and ∆ vs. 4Q10 100% maintaining volumes growth, eventually resulted 90% 80% in: 48.5% 48.2% 48.4% 49.6% +1.1% 70% � 60% a Large Corporate & Financial 50% Institutions remarkable lending volumes 21.8% 21.1% 21.9% 40% 21.4% -0.5% reduction (-€ 1 mld) in the 9M11 30% 15.8% 19.9% 20.6% 20% +5.0% 20.8% � a substantial replacement of above 10% 13.8% 10.1% 9.9% -5.7% 8.1% 0% mentioned lost volumes with growing 4Q10 1Q11 2Q11 3Q11 SME’s lending Large Corporate and Financials SME's Small Business Residential Mortgage and Retail cust. 5
Spreads and Loans Quality Corporate customers credit standing � Loans portfolio new mix enhanced a 5 bps (Credem SpA management accounting) customers’ spread increase in 3Q11 (at the highest level since the beginning of 2010), while 100.0% the evolution of the aggregate is in coherence 76.6% 75.4% 73.3% 74.2% 80.0% 67.5% with the guidelines outlined in the business plan : 60.0% � To pursue a volume growth higher than the 32.4% 40.0% 26.7% 25.6% 24.6% 23.4% industry, gaining market shares (at the end 20.0% of 2010 already, the growth more than offset 0.0% the effects of the volume reduction FY09 FY10 1Q11 1H11 9M11 implemented in 2009 to “clean” the portfolio) % of loans to corporate customers in highest 4 ratings classes % of loans to corporate customers in lowest 4 ratings classes � To protect and improve the asset quality Customers’ Spread Loans market share evolution (Credem SpA management accounting) 5.0 0.98% 1.0% 4.0 0.93% 3.61 3.42 3.24 3.20 3.20 0.91% 3.12 3.12 0.89% 0.88% 3.0 * 0.9% 2.59 2.59 2.58 2.58 0.86% 2.53 2.52 2.54 % 2.0 * 0.8% 1.02 0.88 1.0 0.73 0.62 0.62 0.59 0.52 dicembre 2008 giugno 2009 dicembre 2009 giugno 2010 dicembre 2010 giugno 2011 0.0 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 spread average loan rate average deposit rate Source: internal estimates on Bank of Italy data 6
Deposits and Bonds � Deposits & Bonds were up Euro, million 2007 2008 2009 2010 1Q11 1H11 9M11 (+€528 million), outscoring the 9,520 10,444 11,443 11,604 12,062 11,131 11,661 Sight Deposits 1Q11 performance, even Time Deposits 1,785 3,275 2,637 1,064 805 737 483 though Corporate Deposits 735 2,216 158 62 58 63 95 Repos were lower Depositis & � Bonds continued to grow 12,040 15,935 14,238 12,730 12,925 11,931 12,239 Repos throughout retail issues 5,225 4,853 3,848 3,520 3,812 4,383 4,620 Bonds 3,900 3,490 2,340 1,620 1,608 1,698 1,715 -Institutional 1,325 1,363 1,508 1,900 2,204 2,685 2,905 -Retail Total Deposits 13,365 17,293 15,746 14,630 15,129 14,616 15,144 & Retail Bonds Direct Deposits Retail e Corporate customers Bonds issued in 9M11 and 4Q11/2012 maturities (Credem SpA management accounting) € Mil. € Mil. 2,000 +130 14,000 1,716 -559 1,645 2,114 12,000 2,543 1,984 1,500 10,000 825 Retail 1,193 8,000 1,000 Institutional 6,000 +172 11,161 10,989 10,736 +253 500 820 4,000 523 5 2,000 - - 9M11 Bonds 4Q11 2012 Maturities 1Q11 2Q11 3Q11 Issues Maturities 7
AUM Euro, million 2007 2008 2009 2010 1Q11 2Q11 3Q11 2,146 Insurance Reserves 1,794 2,312 2,448 2,456 2,433 2,466 4,710 3,519 4,301 4,978 4,816 4,640 4,348 Portfolio Management 5,154 3,666 3,910 3,998 3,734 3,618 3,216 Mutual Funds 3,927 3,214 5,122 4,898 4,975 4,921 4,515 SICAVs Other & Third Parties’ 514 1,077 1,718 3,015 3,319 3,492 3,385 Products AUM 14,305 11,476 15,051 16,889 16,844 16,671 15,464 3Q11 Markets and Credem AuM performances � AUM stocks went down 7.2% QoQ, mainly FTSE-ALL ML Italian because of the market effect Eurostoxx 50 SHARE Government AuM 0.0% � Observing the main market indexes in the -5.0% quarter, it is quite evident that the reduction in -4.1% -7.2% AUM stocks is in line (if not lower) with current -10.0% trends -15.0% -20.0% -25.0% -23.5% -25.5% -30.0% 8
Operating Costs Operating Costs: quarterly comparison €Mil. � Payroll Costs were down QoQ due to the lower 200 incidence of variable components as well as 163.1 156.7 lower provision for early retirement agreements 150 with employees 54.4 Other Admin. 55.7 Expenses � Other Administrative Expenses are slightly up 100 Personnel Costs QoQ 108.7 101 50 0 2Q11 3Q11 Operating Costs: yearly comparison €Mil. 484.3 484.8 � The YoY comparison shows costs fairly 500 stable , coherently with the business plan 165.3 166.7 400 guidelines Other Admin. 300 Expenses Personnel Costs 200 319 318.1 100 0 9M10 9M11 9
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