Intesa Sanpaolo S.p.a. · MIL:ISP
Intesa Sanpaolo — 9M20 Earnings Presentation
96 slides from Intesa Sanpaolo's earnings presentation, Nov 4, 2020
Slide 1: 9M20 Results
9M20 Results Resilient Profitability and Rock-Solid Capital Position Strengthened Further Combination with UBI Banca Brings Additional Value Creation A Strong Data Bank for a Digital World November 4, 2020 0
Slide 2: ISP Delivered Excellent Nine-Month Performance
ISP Delivered Excellent Nine-Month Performance with ~€3bn Minimum Net Income Target for 2020 Already Achieved… €3.1bn Net income (the second-best 9M Net income since 2008) excluding the effects of the combination with UBI Banca, €4bn excluding provisions for future COVID-19 impacts €6.4bn stated Net
Slide 3: … Is Fully Equipped for a Challenging Environment…
… Is Fully Equipped for a Challenging Environment… Common Equity ratio(1) well above regulatory requirements (~+660bps(2)) coupled with a strong liquidity position, with LCR and NSFR well above 100% and more than €280bn in Liquid assets(3) €36.5bn NPL deleveraging delivered since the September 2015
Slide 4: … and Ready to Succeed in the Future
… and Ready to Succeed in the Future Continue delivering best-in-class profitability, with ▪ Minimum ~€3bn Net income target in 2020 already achieved (assuming cost of risk of ~90bps) Profitability ▪ Minimum ~€3.5bn Net income in 2021 (assuming cost of risk of ~70bps) without considering the combina
Slide 5: The Italian Economy Is Resilient Thanks to Strong Fundamentals
The Italian Economy Is Resilient Thanks to Strong Fundamentals and Can Leverage on Government Interventions and EU Financial Support Strong Italian household wealth at €10.7tn, of which €4.4tn in financial assets, coupled with low household debt Manufacturing companies have stronger financial struct
Slide 6: Contents
Contents ISP Is Successfully Managing a Challenging Environment 9M20: Excellent Nine-Month Performance Combination with UBI Banca Final Remarks
Slide 7: ISP Has More than Halved NPL Stock While Strengthening Capital
In Recent Years, ISP Has More than Halved NPL Stock, Increased NPL Coverage while Significantly Strengthening Capital… NPL Stock NPL Coverage ratio ISP Fully Loaded CET1 Ratio Excluding UBI Banca Additional provisions Excluding UBI Banca % Impact from the combination with € bn to accelerate NPL % UB
Slide 8: Far Better Equipped than Peers to Tackle the Challenges Ahead
… and Is Now Far Better Equipped than Peers to Tackle the Challenges Ahead Best-in-class risk profile Solid capital position High operating efficiency Fully Loaded CET1/Total financial illiquid Buffer vs requirements SREP + Combined Cost/Income, 30.9.20, % assets(1), 30.9.20, % Buffer(5), 30.9.20, b
Slide 9: ISP Delivered the Second-Best 9M Net Income of the Past Eleven Years
ISP Delivered the Second-Best 9M Net Income of the Past Eleven Years ~€3bn minimum Net income target for 2020 already achieved €m Provisions for future COVID-19 impacts (€1,312m pre-tax) ~3,960 3,310 3,012 2,726 2,262 2,335 2,388 2,200 1,929 1,688 1,203 3,073 640 9M09 9M10 9M11 9M12 9M13 9M14 9M15 9
Slide 10: ISP Proactively Implemented Responses to Mitigate the COVID-19 Impact
ISP Proactively Implemented a Complete Set of Responses to Mitigate the COVID-19 Impact ISP proactive response to COVID-19 across key areas 1 2 3 Care for ISP Continuous Immediate People and support to the business Clients real economy reaction and society 4 Ready to face the new environment leverag
Slide 11: ISP Promptly Ensured Safe Working Conditions for Its People and Clients
1 ISP Promptly Ensured Safe Working Conditions for Its People and Clients NOT EXHAUSTIVE Main initiatives to ensure safe working conditions for ISP People and Clients ▪ Remote working enabled for more than 63,000 ISP People(1), with “digital coach” to support the switch to smart working and share be
Slide 12: Supporting Healthcare Priorities and the Real Economy
2 ISP Actively Committed to Supporting Healthcare Priorities and the Real Economy During the COVID-19 Emergency NOT EXHAUSTIVE Main initiatives to provide active support to healthcare priorities and the real economy to strengthen the National Health System through the Civil Protection Department thr
Slide 13: Business Continuity Ensured Thanks to Strong Digital Capabilities
3 Business Continuity Ensured Thanks to Strong Digital Capabilities …enabled immediate Strong value proposition on digital channels… business reaction 9M20 Multichannel clients ~10.1m(1), +994k vs 9M19 App users ~6.2m(1), +1,000k vs 9M19 (4.6/5.0 rating on iOS(2) and 4.3/5.0 on Android(2)) # of digi
Slide 14: ISP Can Leverage Its Competitive Advantages in the New Environment
4 ISP Can Leverage Its Competitive Advantages in the New Environment Key trends ISP’s competitive advantages Increased demand for ▪ Best-in-class European player in Life insurance and in Wealth Management health, wealth and ▪ Strong positioning in the protection business (#2 Italian player in health
Slide 15: Contents
Contents ISP Is Successfully Managing a Challenging Environment 9M20: Excellent Nine-Month Performance Combination with UBI Banca Final Remarks
Slide 16: COVID-19 Outbreak Impacted the Real Economy and Financial Markets
COVID-19 Outbreak Impacted the Real Economy and Financial Markets Italian GDP YoY evolution(1) Market volatility(2) 10-year BTP-Bund spread(1) % YoY Italy % x Market performance Bps FTSE MIB Index(3), % QoQ Italy 20 199 16.1 15 30.5 10 5 0.2 0.1 0.0 171 0 +15.1pp 160 -0.2 -5 15.4 -5.5 -10 139 139 -1
Slide 17: 9M20 Highlights: ~€3bn Minimum Net Income Target Already Achieved
9M20 Highlights: ~€3bn Minimum Net Income Target for 2020 Already Achieved ◼ Solid economic performance despite three months of a countrywide lockdown: ❑ €3,073m Net income (the second-best 9M Net income since 2008) excluding the effects of the combination with UBI Banca, €4bn excluding provisions f
Slide 18: 9M20: Strong Growth in Profitability and Balance Sheet Strengthened
9M20: Strong Growth in Profitability and Balance Sheet Further Strengthened Net income NPL stock Excluding UBI Banca Provisions for future COVID-19 impacts Excluding UBI Banca Net NPL x Gross NPL ratio, % €m € bn x Net NPL ratio, % 31.6 35.6 29.0 -8% ~3,960 3,310 +20% 14.3 13.2 17.0 30.9.19 30.9.20(
Slide 19: Our Excellent Performance Creates Benefits for All Stakeholders
Our Excellent Performance Creates Benefits for All Stakeholders Excluding UBI Banca Shareholders Employees Net income Personnel expenses, € bn € bn Excess capacity of ~5,000 people being reskilled (with ~4,050 already redeployed to priority initiatives) ~3.1 ~3.0 > 100% 4.1 9M20 2020 minimum target
Slide 20: ISP as the Engine of Sustainable and Inclusive Growth
ISP as the Engine of Sustainable and Inclusive Growth… ▪ €50bn in new lending dedicated to the Green Economy ▪ €50bn in credit available to support companies and professionals during the COVID-19 emergency ▪ More than €100m donated to provide COVID-19 relief ▪ €125m (equal to 50%) of the ISP Fund fo
Slide 21: Delivering Tangible Results for Society
SELECTED HIGHLIGHTS … Delivering Tangible Results for Society COVID-19 related initiatives Supported families and business affected by earthquakes and natural disasters by forgiving mortgages or granting moratoria of mortgages and subsidised loans (130 moratoria in 9M20 for €650m in residual loans
Slide 22: ISP Leads in the Main Sustainability Indexes and Rankings
ISP Leads in the Main Sustainability Indexes and Rankings Top ranking(1) for Sustainability The only Italian 69 A AAA 100 (3) 19.5 bank listed in the 61 A AAA 100 20.3 Dow Jones Sustainability 59 A- (3) AAA 94 21.9 Indexes, in the CDP 59 A- AA 94 23.3 Climate A List 2019 and the 2020 Corporate 58 A-
Slide 23: 9M: ~€3bn Minimum Net Income Target Already Achieved
9M: ~€3bn Minimum Net Income Target for 2020 Already Achieved 9M20 P&L (excluding negative goodwill(1) arising from combination with UBI Banca and the two-month contribution of the operations(2) of UBI Banca) €m Non-motor P&C revenues up 66%(4) Including €1,312m due to Including the Including €425m
Slide 24: Q3: Strong Recovery in Net Interest Income and Commissions
Q3: Strong Recovery in Net Interest Income and Commissions 3Q20 P&L (excluding negative goodwill(1) arising from the combination with UBI Banca and the two-month contribution of the operations(2) of UBI Banca) €m €430m due to ~€800m Including €148m provisions for excluding Levies and other future CO
Slide 25: Net Interest Income Growth on a Yearly and Quarterly Basis
Net Interest Income Growth on a Yearly and Quarterly Basis Quarterly comparison Yearly comparison Net interest income, 3Q20 vs 2Q20 Net interest income, 9M20 vs 9M19 €m €m €103m excluding NPL stock reduction impact 5,258 147 34 5,315 (99) (25) 1,750 58 7 9 1,818 Commercial (6) component Commerci
Slide 26: €1 Trillion in Customer Financial Assets
€1 Trillion in Customer Financial Assets Customer financial assets(1) Excluding UBI Banca Direct deposits € bn Δ +€32.9bn excluding Repos €547.3bn 437.8 449.0 including €1,180bn including UBI 426.7 425.5 UBI Banca(2) Banca(2) +€31bn in retail and corporate deposits in 9M (+€16bn in Q3) 960.8 962.4 9
Slide 27: Continued Strong Reduction in Operating Costs while Investing for Growth
Continued Strong Reduction in Operating Costs while Investing for Growth Operating costs Excluding UBI Banca €m Administrative costs Lowest-ever Administrative costs 1,849 1,706 -7.7% Total Operating costs 9M19(1) 9M20 Personnel costs 6,851 6,599 -3.7% 4,229 4,094 -3.2% f(x) 9M19(1) 9M20 Investing f
Slide 28: One of the Best Cost/Income Ratios in Europe
One of the Best Cost/Income Ratios in Europe Cost/Income(1) % Excluding LatAm 81.4 77.1 72.2 73.2 50.7% including 70.0 UBI Banca(3) 63.2 Peer average: 59.2 60.5 60.7 ~61.3% 57.8 55.6 55.9 51.9 53.6 50.2 50.7 51.4 45.2 46.4 Peer 10 Peer 11 Peer 12 Peer 13 Peer 14 Peer 15 Peer 16 ISP(2) Peer 1 Peer 2
Slide 29: Continuous Improvement in Asset Quality
Continuous Improvement in Asset Quality, with the Lowest NPL Stock since 2008, Together with the Lowest-ever 9M and Quarterly Gross NPL Inflow NPL stock Gross 9M NPL inflow(7) from performing loans Excluding UBI Banca Net NPL x Net NPL x Gross NPL Excluding UBI Banca Net inflow(8) ratio, % ratio, %
Slide 30: Loan Loss Provisions Down, Excluding COVID-19 Provisions
Loan Loss Provisions Down, Excluding €1.3bn Provisions for Future COVID-19 Impacts Loan loss provisions Cost of risk(1) €m Excluding UBI Banca Provisions for future COVID-19 impacts Excluding UBI Banca Provisions for future COVID-19 impacts €m bps 2,654 88 1,312 44 53 -9bps 1,396 -4% 1,342 44 9M19 9
Slide 31: Rock-Solid Capital Base even Higher
Rock-Solid Capital Base even Higher, Well Above Regulatory Requirements Fully Loaded CET1 Ratio Buffer vs requirements SREP + ISP CET1 Ratios vs requirements SREP + Combined Buffer Combined Buffer(2) 30.9.20, % Impact from the combination with 30.9.20, bps Impact from the combination with UBI Banca
Slide 32: Increased Capital Buffer vs Regulatory Requirements
Increased Capital Buffer vs Regulatory Requirements ISP Fully Loaded CET1 Ratio Buffer vs requirements SREP ISP requirements SREP + Combined Buffer + Combined Buffer(2) % bps x CET1 Fully Loaded ratio, % Impact from the combination with UBI Banca After €2.3bn deduction of accrued dividends, based on
Slide 33: Best-in-Class Excess Capital
Best-in-Class Excess Capital Fully Loaded CET1 Ratio Buffer vs requirements SREP + Combined Buffer(1)(2) bps Fully Loaded CET1 Ratio(2), % Best-in-class leverage ratio: 6.6%(3) Impact from the combination with UBI Banca ~700 ~730 ~(70) ~+250bps ~620 ~480 ~440 Peer ~380 average: ~340 ~340 ~410bps ~66
Slide 34: Best-in-Class Risk Profile in Terms of Financial Illiquid Assets
Best-in-Class Risk Profile in Terms of Financial Illiquid Assets Fully Loaded CET1(1)/Total financial illiquid assets(2) Impact from the combination % with UBI Banca 67 ~+45pp 4 51 42 34 63 27 27 25 25 Peer 23 18 average: 15 ~22% 13 12 12 12 8 7 Peer 10 Peer 12 Peer 13 Peer 14 Peer 15 Peer 16 Peer 1
Slide 35: Reconciliation Between Net Income and Stated Net Income
Reconciliation Between Net Income and Stated Net Income €m Intesa Sanpaolo Group Q3 P&L Intesa Sanpaolo Group 9M P&L P&L UBI Banca contribu- Excluding the operations of UBI Excluding the operations of UBI Stated(1) tion for the period Stated(1) Banca and negative goodwill(2) Banca and negative goodw
Slide 36: Contents
Contents ISP Is Successfully Managing a Challenging Environment 9M20: Excellent Nine-Month Performance Combination with UBI Banca Final Remarks
Slide 37: ISP Has Completed Key UBI Integration Activities
ISP Has Completed a Large Number of Key UBI Integration Activities Description Delivered ▪ Set up a core team dedicated to the integration ▪ Appointed UBI Banca's new Board of Directors ▪ Signed labour union agreement (~3 months in advance) for at least 5,000 voluntary exits and up to 2,500 hires, w
Slide 38: Outside-In Analysis Showed ~€700m of Expected Synergies by 2024
ISP Outside-In Analysis Showed ~€700m of Expected Synergies by 2024… Pre-tax annual synergies Key Considerations Outside-in synergies/integration charges estimates as stated in the Offer Document in June 2020 ▪ No social impact. All exits will €m be on a voluntary basis ▪ At least ~5,000 expected Pe
Slide 39: Exchange Offer Timing and Next Integration Steps
ISP Fully Respected the Timing to Complete the Exchange Offer and Has Already Planned the Next Steps for the Integration of UBI Banca NOT EXHAUSTIVE Delivered ISP’s Notice pursuant to Art. 102 17 February 2020 ✓ 25 June 2020 Approval of the Exchange Offer Document by CONSOB ✓ 6 – 30 July 2020 Exchan
Slide 40: Contents
Contents ISP Is Successfully Managing a Challenging Environment 9M20: Excellent Nine-Month Performance Combination with UBI Banca Final Remarks
Slide 41: ISP Is Fully Equipped to Succeed in this Challenging Environment
ISP Is Fully Equipped to Succeed in this Challenging Environment ISP is fully equipped for this challenging environment: ▪ Continue delivering best-in-class profitability with: ▪ Best-in-class excess capital, low leverage and strong ─ Minimum ~€3bn Net income in 2020 liquidity assuming cost of risk
Slide 42: 9M20 Results: Detailed Information
9M20 Results Detailed Information
Slide 43: 9M20: Key P&L Figures
MIL-BVA327-15051trim.13-90141/LR 9M20: Key P&L Figures €m Including UBI Banca(1) Excluding UBI Banca Operating income 13,733 13,158 Operating costs (6,959) (6,599) Cost/Income ratio 50.7% 50.2% Operating margin 6,774 6,559 Gross income (loss) 4,979 4,856 Net income 6,376 3,073 Net income excluding n
Slide 44: 9M20: Key Balance Sheet Figures
MIL-BVA327-15051trim.13-90141/LR 9M20: Key Balance Sheet Figures €m Including UBI Banca(1) Excluding UBI Banca Loans to Customers 489,148 403,901 Customer Financial Assets(2) 1,179,606 982,116 of which Direct Deposits from 547,328 449,007 Banking Business of which Direct Deposits from Insurance 169,
Slide 45: Contents
Contents Detailed Consolidated P&L Results Liquidity, Funding and Capital Base Asset Quality Divisional Results and Other Information 44
Slide 46: 9M20 vs 9M19: €3.1bn Net Income
9M20 vs 9M19: €3.1bn Net Income, Second-Best 9M Result since MIL-BVA327-15051trim.13-90141/LR 2008 €m 9M19 9M20 % (1) (including UBI pro-forma (excluding UBI (2) [C]/[A] [A] Banca ) [ B ] Banca) [ C ] Net interest income 5,258 5,596 5,315 1.1 Net fee and commission income 5,796 5,721 5,449 (6.0) In
Slide 47: Q3 vs Q2: Strong Recovery in Net Interest Income and Commissions
MIL-BVA327-15051trim.13-90141/LR Q3 vs Q2: Strong Recovery in Net Interest Income and Commissions €m 2Q20 3Q20 % (including UBI (excluding UBI [A] [C]/[A] Banca(1)) [ B ] Banca) [ C ] Net interest income 1,750 2,099 1,818 3.9 Net fee and commission income 1,744 2,133 1,861 6.7 Income from insurance
Slide 48: Net Interest Income: Yearly and Quarterly Growth
Net Interest Income: Yearly and Quarterly Growth Despite All-Time Low Interest Rates Data excluding UBI Banca Quarterly Analysis Yearly Analysis €m Euribor 1M; % €m Euribor 1M; % % 3Q20 vs 3Q19 and 2Q20 % 9M20 vs 9M19 5,258 5,315 1,741 1,750 1,818 -0.42 -0.46 -0.52 -0.39 -0.48 3Q19 2Q20 3Q20 9M1
Slide 49: Net Interest Income: Commercial Component Growth
Net Interest Income: Increase Mainly Due to Commercial Component Growth Data excluding UBI Banca Quarterly Analysis Yearly Analysis €m €m €103m excluding NPL stock reduction impact 5,258 147 34 5,315 (99) (25) 1,750 58 7 9 1,818 Commercial (6) component Commercial component 2Q20 Volumes Spread Hedgi
Slide 50: Net Fee and Commission Income: Strong Increase vs Q2
Net Fee and Commission Income: Strong Increase vs Q2 Data excluding UBI Banca Quarterly Analysis Yearly Analysis €m % 3Q20 vs 3Q19 and 2Q20 €m % 9M20 vs 9M19 5,796 5,449 1,966 1,744 1,861 3Q19 2Q20 3Q20 9M19 9M20 pro-forma pro-forma (5.3) +6.7 (6.0) ◼ Commissions from Commercial banking activiti
Slide 51: Profits on Financial Assets and Liabilities at Fair Value
Profits on Financial Assets and Liabilities at Fair Value: €1.4bn in 9M20 Data excluding UBI Banca Quarterly Analysis Yearly Analysis €m % 3Q20 vs 3Q19 and 2Q20 €m % 9M20 vs 9M19 1,572 1,378 480 263 121 3Q19 2Q20 3Q20 9M19 9M20 pro-forma pro-forma (74.8) (54.0) (12.3) Contributions by Activity 3
Slide 52: Operating Costs: Further Significant Reduction
Operating Costs: Further Significant Reduction while Investing MIL-BVA327-15051trim.13-90141/LR for Growth Data excluding UBI Banca Quarterly Analysis Yearly Analysis % 3Q20 vs 3Q19 and 2Q20 % 9M20 vs 9M19 Operating Costs Personnel Expenses Operating Costs Personnel Expenses €m €m €m €m 6,851 6,
Slide 53: Net Adjustments to Loans
Net Adjustments to Loans: Yearly Decline when Excluding Provisions for Future COVID-19 Impacts Data excluding UBI Banca Quarterly Analysis Yearly Analysis €m % 3Q20 vs 3Q19 and 2Q20 €m % 9M20 vs 9M19 €1,312m due to provisions for future COVID-19 impacts €882m due to provisions for €430m due to p
Slide 54: Contents
Contents Detailed Consolidated P&L Results Liquidity, Funding and Capital Base Asset Quality Divisional Results and Other Information 53
Slide 55: Strong Growth in Customer Financial Assets
Strong Growth in Customer Financial Assets Data excluding UBI Banca % 30.9.20 vs 30.9.19, 31.12.19 and 30.6.20 Customer Financial Assets(1) Direct Deposits from Banking Business € bn €1,180bn including UBI Banca(2) € bn €547bn including UBI Banca(2) 951 961 962 982 427 426 438 449 30.9.19 31.12.19
Slide 56: Mutual Funds Mix
MIL-BVA327-15051trim.13-90141/LR Mutual Funds Mix Data excluding UBI Banca Mutual funds mix % 100 100 100 100 Fixed income, 46% 48% 48% monetary and 57% other funds +9pp Equity, balanced 54% 52% 52% 43% and flexible funds 31.12.13 31.12.19 30.6.20 30.9.20 55
Slide 57: Funding Mix
MIL-BVA327-15051trim.13-90141/LR Funding Mix Data excluding UBI Banca Breakdown of Direct Deposits from Banking Business € bn; 30.9.20 % Percentage of total Wholesale Retail 449 ◼ Current accounts and 11 340 deposits ◼ Repos and securities 1 - lending 369 ◼ Senior bonds 34 7(1) ◼ Covered bonds 12 -
Slide 58: Strong Funding Capability: Broad Access to International Markets
Strong Funding Capability: Broad Access to International Markets Data excluding UBI Banca 2020-2022 MLT Maturities ISP Main Wholesale Issues € bn Wholesale 2019 Retail ◼ €1bn covered bonds, JPY13.2bn (~€105m) senior unsecured, €3.5bn senior unsecured, CHF250m senior unsecured, $2bn senior unsecured
Slide 59: High Liquidity: LCR and NSFR Well Above Requirements
High Liquidity: LCR and NSFR Well Above Regulatory Requirements Data excluding UBI Banca Unencumbered eligible assets with Central Liquid assets(1) Banks(2) (net of haircuts) € bn €283bn including UBI Banca € bn 235 221 197 €182bn including UBI Banca 150 116 127 30.9.19 30.6.20 30.9.20 30.9.19 30.6.
Slide 60: Solid and Increased Capital Base
Solid and Increased Capital Base Phased-in Common Equity Ratio Phased-in Tier 1 Ratio Phased-in Total Capital Ratio % % % 20.6 19.2 19.6 18.0 17.8 16.5 16.9 15.5 15.6 14.6 14.7 14.0 30.9.19 30.6.20(1) 30.9.20(1) 30.9.20(1) 30.9.19 30.6.20(1) 30.9.20(1) 30.9.20(1) 30.9.19 30.6.20(1) 30.9.20(1) 30.9.2
Slide 61: Contents
Contents Detailed Consolidated P&L Results Liquidity, Funding and Capital Base Asset Quality Divisional Results and Other Information 60
Slide 62: Non-performing Loans: Sizeable Coverage
MIL-BVA327-15051trim.13-90141/LR Non-performing Loans: Sizeable Coverage Data excluding UBI Banca Cash coverage; % Total NPL(1) 52.2% including UBI Banca(2) and excluding additional provisions to accelerate deleveraging to be booked in Q4 using part of the negative goodwill 54.6 53.1 54.4 31.12.19 3
Slide 63: Non-performing Loans: Lowest-ever 9M Inflows
Non-performing Loans: Lowest-ever 9M Inflows Data excluding UBI Banca Gross inflow of new NPL(1) from Performing Loans Net inflow of new NPL(1) from Performing Loans € bn € bn 12.2 Impact from the Impact from the acquisition of the two acquisition of the two 10.8 former Venetian banks former Venetia
Slide 64: Non-performing Loans: 3Q20 Lowest-ever Gross Inflow
MIL-BVA327-15051trim.13-90141/LR Non-performing Loans: 3Q20, Lowest-ever Gross Inflow Data excluding UBI Banca Gross inflow of new NPL(1) from Performing Loans €m 1,136 816 -62% 429 3Q19 2Q20(2) 3Q20(3) Bad Loans Unlikely to Pay Past Due 723 398 516 296 164 261 15 4 4 3Q19 2Q20 3Q20 3Q19 2Q20(4) 3Q2
Slide 65: Non-performing Loans: Strong Decrease in Net Inflow
MIL-BVA327-15051trim.13-90141/LR Non-performing Loans: Strong Decrease in Net Inflow Data excluding UBI Banca €m Net inflow of new NPL(1) from Performing Loans 902 643 -79% 188 3Q19 2Q20(2) 3Q20(3) Bad Loans Unlikely to Pay Past Due 576 443 320 197 117 6 3 1 70 3Q19 2Q20 3Q20 3Q19 2Q20(4) 3Q20(5) 3Q
Slide 66: New Bad Loans: Strong Decrease in Gross Inflow
MIL-BVA327-15051trim.13-90141/LR New Bad Loans: Strong Decrease in Gross Inflow vs 3Q19 € bn; data excluding UBI Banca Group new Bad Loans(1) gross inflow BdT IMI C&IB International Subsidiary Banks 0.4 0.2 0.1 0.2 0.1 0.1 0.1 0.3 0.2 0.1 3Q19 2Q20 3Q20 BdT new Bad Loans(1) gross inflow IMI C&IB new
Slide 67: New Unlikely to Pay: Strong Decrease in Gross Inflow
MIL-BVA327-15051trim.13-90141/LR New Unlikely to Pay: Strong Decrease in Gross Inflow € bn; data excluding UBI Banca Group gross inflow of new Unlikely to Pay 1.0 BdT 0.1 IMI C&IB 0.1 0.7 International 0.6 Subsidiary Banks 0.1 0.1 0.8 0.6 0.4 3Q19 2Q20 3Q20 BdT gross inflow of new Unlikely to Pay IM
Slide 68: Non-performing Loans: Twentieth Consecutive Quarterly Decline
Non-performing Loans: Twentieth Consecutive Quarterly Decline in Gross Stock Gross NPL Net NPL € bn € bn 30.9.20 30.9.20 30.9.20 30.9.20 31.12.19 30.6.20 excluding including 31.12.19 30.6.20 excluding including UBI Banca UBI Banca(1) UBI Banca UBI Banca(1) Bad Loans 19.4 17.6 17.0 20.4 Bad Loans 6.7
Slide 69: Loans to Customers: A Well-diversified Portfolio
MIL-BVA327-15051trim.13-90141/LR Loans to Customers: A Well-diversified Portfolio Data excluding UBI Banca Breakdown by business area Breakdown by economic business sector (data as at 30.9.20) 30.9.20 Repos, Capital markets and Loans of the Italian banks and companies of the Group Financial Institut
Slide 70: Moratoria Volumes
MIL-BVA327-15051trim.13-90141/LR Moratoria Volumes: Enterprises Accounting for ~73% Data excluding UBI Banca Moratoria stock as at mid-October 2020 % of total net Segments # Clients (k) Volumes (€ bn) loan portfolio Households 146 10 3% Enterprises 95 27 7% Total 241 37 9% 327 including UBI Banca(1)
Slide 71: Contents
Contents Detailed Consolidated P&L Results Liquidity, Funding and Capital Base Asset Quality Divisional Results and Other Information 70
Slide 72: Divisional Financial Highlights
MIL-BVA327-15051trim.13-90141/LR Divisional Financial Highlights Data as at 30.9.20, excluding UBI Banca Divisions IMI International Corporate Banca dei Corporate & Private Asset Investment Subsidiary Insurance (4) Centre / Total Territori Banking(2) Management(3) Banking Banks(1) Others (5) Operati
Slide 73: Banca dei Territori: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR Banca dei Territori: 9M20 vs 9M19 €m 9M19 9M20 % pro-forma(1) Net interest income 3,099 3,069 (1.0) Net fee and commission income 3,111 2,860 (8.1) Income from insurance business 2 0 (100.0) Profits on financial assets and liabilities at fair value 61 71 16.4 Other
Slide 74: Banca dei Territori: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR Banca dei Territori: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income 1,014 1,009 (0.5) Net fee and commission income 887 983 10.8 Income from insurance business (0) (0) (64.1) Profits on financial assets and liabilities at fair value 21 31 48.2 Other operating income (e
Slide 75: IMI Corporate & Investment Banking: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR IMI Corporate & Investment Banking: 9M20 vs 9M19 €m 9M19 9M20 % pro-forma(1) Net interest income 1,380 1,600 15.9 Net fee and commission income 688 728 5.8 Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 1,036 1,120
Slide 76: IMI Corporate & Investment Banking: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR IMI Corporate & Investment Banking: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income 533 570 6.9 Net fee and commission income 249 240 (3.6) Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 172 51 (70.3) Other operating in
Slide 77: International Subsidiary Banks: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR International Subsidiary Banks: 9M20 vs 9M19 €m 9M19 9M20 % Net interest income 1,030 981 (4.8) Net fee and commission income 397 368 (7.3) Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 85 89 4.7 Other operating in
Slide 78: International Subsidiary Banks: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR International Subsidiary Banks: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income 322 328 2.0 Net fee and commission income 116 128 10.6 Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 44 27 (37.9) Other operating income (
Slide 79: Private Banking: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR Private Banking: 9M20 vs 9M19 €m 9M19 9M20 % Net interest income 132 154 16.7 Net fee and commission income 1,276 1,260 (1.3) Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 33 16 (51.5) Other operating income (expen
Slide 80: Private Banking: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR Private Banking: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income 54 52 (3.5) Net fee and commission income 414 420 1.5 Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 9 5 (44.9) Other operating income (expenses) 1 3 107.
Slide 81: Asset Management: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR Asset Management: 9M20 vs 9M19 €m 9M19 9M20 % Net interest income 0 0 n.m. Net fee and commission income 527 528 0.2 Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 5 (2) n.m. Other operating income (expenses) 26 23
Slide 82: Asset Management: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR Asset Management: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income (0) (0) 4.8 Net fee and commission income 169 185 9.3 Income from insurance business 0 0 n.m. Profits on financial assets and liabilities at fair value 8 2 (74.0) Other operating income (expenses) 10 8 (2
Slide 83: Insurance: 9M20 vs 9M19
MIL-BVA327-15051trim.13-90141/LR Insurance: 9M20 vs 9M19 €m 9M19 9M20 % (1) pro-forma Net interest income 0 0 n.m. Net fee and commission income 0 1 n.m. Income from insurance business 917 962 4.9 Profits on financial assets and liabilities at fair value 0 0 n.m. Other operating income (expenses) (
Slide 84: Insurance: Q3 vs Q2
MIL-BVA327-15051trim.13-90141/LR Insurance: Q3 vs Q2 €m 2Q20 3Q20 % Net interest income 0 (0) n.m. Net fee and commission income 0 0 (2.1) Income from insurance business 332 288 (13.2) Profits on financial assets and liabilities at fair value 0 0 n.m. Other operating income (expenses) (2) (3) (22.6
Slide 85: Quarterly P&L
MIL-BVA327-15051trim.13-90141/LR Quarterly P&L Data excluding UBI Banca €m 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 pro-forma(1) pro-forma(2) Net interest income 1,756 1,761 1,741 1,747 1,747 1,750 1,818 Net fee and commission income 1,865 1,965 1,966 2,166 1,844 1,744 1,861 Income from insurance business
Slide 86: Net Fee and Commission Income: Quarterly Development Breakdown
Net Fee and Commission Income: Quarterly Development Breakdown Data excluding UBI Banca €m Net Fee and Commission Income 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 pro-form a(1) Guarantees given / received 55 56 58 60 50 49 48 Collection and payment services 119 128 123 137 114 103 106 Current accounts 308
Slide 87: Market Leadership in Italy
Market Leadership in Italy 9M20 Operating Income Leader in Italy Breakdown by business area(1) Data excluding UBI Banca Ranking Market share including UBI Banca(2) IMI Corporate & % Investment Banking 1 Loans 20.8 25% Banca 43% dei Territori 1 Deposits(3) 22.0 Insurance 7% 1 Pension Funds(4) 23.3 Pr
Slide 88: International Subsidiary Banks: Key P&L Data by Country
International Subsidiary Banks: Key P&L Data by Country Data as at 30.9.20, excluding UBI Banca (Δ% vs 9M19) Operating Income Operating Costs €m €m (3.4) (16.1) +4.8 (2.2) +3.7 (9.6) (7.0) (11.7) (8.2) (16.1) +10.1 (1.6) (4.2) +12.5 (11.2) +6.5 (1.6) +1.6 (2.6) +13.6 (6.1) +16.7 332 318 269 165 193
Slide 89: International Subsidiary Banks by Country: 8.7% of Group Loans
International Subsidiary Banks by Country: 8.7% of the Group’s Total Loans Data as at 30.9.20, excluding UBI Banca Total Total CEE Hungary Slovakia Slovenia Croatia Bosnia Serbia Albania Romania Moldova Ukraine Egypt Oper. Income (€ m) 127 332 50 318 32 193 28 31 7 11 1,129 269 1,398 % of Group tota
Slide 90: International Subsidiary Banks by Country: Loan Breakdown and Coverage
International Subsidiary Banks by Country: Loan Breakdown and Coverage Data as at 30.9.20, excluding UBI Banca Total Total CEE Hungary Slovakia Slovenia Croatia Bosnia Serbia Albania Romania Moldova Ukraine Egypt Performing loans (€ bn) 3.0 14.8 1.9 6.9 0.8 3.6 0.4 0.8 0.1 0.1 32.2 2.5 34.7 of which
Slide 91: Common Equity Ratio: from Phased-in to Pro-forma Fully Loaded
Common Equity Ratio as at 30.9.20: from Phased-in to Pro-forma MIL-BVA327-15051trim.13-90141/LR Fully Loaded ~€ bn ~bps Direct-deduction relevant items DTA on losses carried forward(1) 1.6 48 IFRS9 transitional adjustment (2.1) (61) Total (0.5) (13) Cap relevant items(*)(2) Total 0.0 19 (*) as a mem
Slide 92: Total Exposure by Main Countries
Total Exposure(1) by Main Countries Data excluding UBI Banca €m DEBT SECURITIES Banking Business Insurance LOANS Total AC FVTOCI FVTPL(2) Total Business(3) EU Countries 30,608 49,999 10,652 91,259 64,993 156,252 391,210 Austria 135 135 -89 181 4 185 1,040 Belgium 820 1,368 37 2,225 153 2,378 1,170 B
Slide 93: Exposure to Sovereign Risks by Main Countries
MIL-BVA327-15051trim.13-90141/LR Exposure to Sovereign Risks(1) by Main Countries Data excluding UBI Banca €m DEBT SECURITIES Banking Business Insurance FVTOCI/AFS LOANS Total AC FVTOCI FVTPL(2) Total Business(3) Reserve (4) EU Countries 21,224 42,716 7,986 71,926 56,983 128,909 313 11,502 Austria 0
Slide 94: Exposure to Banks by Main Countries
MIL-BVA327-15051trim.13-90141/LR Exposure to Banks by Main Countries(1) Data excluding UBI Banca €m DEBT SECURITIES Banking Business Insurance LOANS Total AC FVTOCI FVTPL(2) Total Business(3) EU Countries 1,537 4,038 682 6,257 3,405 9,662 28,707 Austria 125 46 0 171 0 171 243 Belgium 0 88 11 99 24 1
Slide 95: Exposure to Other Customers by Main Countries
MIL-BVA327-15051trim.13-90141/LR Exposure to Other Customers by Main Countries(1) Data excluding UBI Banca €m DEBT SECURITIES Banking Business Insurance LOANS Total AC FVTOCI FVTPL(2) Total Business(3) EU Countries 7,847 3,245 1,984 13,076 4,605 17,681 351,001 Austria 10 45 1 56 2 58 797 Belgium 30
Slide 96: Disclaimer
MIL-BVA327-15051trim.13-90141/LR Disclaimer “The manager responsible for preparing the company’s financial reports, Fabrizio Dabbene, declares, pursuant to paragraph 2 of Article 154 bis of the Consolidated Law on Finance, that the accounting information contained in this presentation corresponds to