Banco Comercial Portugues S.a. · EURONEXT:BCP

Banco Comercial Portugues — Investor Presentation (October 2018)

102 slides from Banco Comercial Portugues's investor presentation, October 2018

1. Slide 1: Corporate Presentation October 2018

   CORPORATE PRESENTATION OCTOBER 2018

2. Slide 2: Disclaimer

   Disclaimer This document is not an offer of securities for sale in the United States, Canada, Australia, Japan or any other jurisdiction. Securities may not be offered or sold in the United States unless they are registered pursuant to the US Securities Act of 1933 or are exempt from such registrati

3. Slide 3: Agenda

   Agenda  Macro and Business Overview  Performance 2013-2018  Strategic Plan 2018-2021  1H 2018 earnings  Other information 3

4. Slide 4: Key highlights

   Key highlights 1 • Successful fiscal consolidation in the last years in Portugal: State budget deficit at 0.9%* in 2017, with a surplus forecasted for as early as 2021. • Following the 2011-2013 recession, economic activity is now strong, with GDP up by 2.7% in 2017 (2.1% in 1Q18) from 1.6% in 2016

5. Slide 5: Fiscal consolidation creates conditions for public debt sustainability

   1 Fiscal consolidation creates the conditions for the sustainability of the public debt, leading to normalisation of yields on sovereign debt Budget deficit decreases… …with significant effort on expenditure (% of GDP) (total expenditure, % of GDP) 11.2 Including 51.8 51.8 recapitalisation 50.0 49.9

6. Slide 6: Portugal undergoing profound structural reforms

   1 Portugal has been undergoing profound structural reforms, which are already showing positive results Real GDP growth rate (yoy) Current account balance (% of GDP) +2.8 +1.9 +1.8 +1.9 +0.9 +1.5 +0.2 +0.3 +0.6 +0.6 -1.1 -2.2 -1.8 -6.0 -4.0 -10.2 2010 2011 2012 2013 2014 2015 2016 2017 2010 2011 2012

7. Slide 7: Housing prices and bank appraisals are recovering

   1 Housing prices and bank appraisals are recovering House price index (HPI) Housing bank appraisals (HPI base 100=2015) (€ /m2) Total Existing New 1500 Portugal Lisbon Area 125 1400 1300 115 1200 105 1100 1000 95 900 85 800 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13 Dec-14 Dec-15 Dec-16 Dec-17 Jun-09 Jun-10

8. Slide 8: Portuguese financial system market shares

   2 Portuguese financial system market shares Gross loans + Customers funds Core net income* (December 2017) (December 2017) 24% 34% 18% 16% 11% 19% 15% 11% 5% 3% Bank 1 Millennium Bank 3 Bank 4 Bank 5 Millennium Bank 2 Bank 3 Bank 4 Bank 5 bcp bcp Branches (December 2017)  Concentrated Portuguese ba

9. Slide 9: Portuguese financial system

   2 Portuguese financial system LTD (Loans-to-deposits ratio) CET1 ratio 13.9% 13.6% 111.8% 102.1% 12.2% 11.3% 12.4% 11.4% 96.1% 95.5% 92.5% 92.5% Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Mar 18 NPEs (Non-performing exposures) NPE coverage 49.3% 52.2% 40.8% 45.3% 17

10. Slide 10: Building the leading private sector bank in Portugal

    3 Building the leading private sector bank in Portugal and a relevant player in selected markets From foundation… 2017- … 2012–2017 Leading bank in Portugal and strong position 2005–2012 in Poland and Focus on Mozambique 2000-2005 Portugal and on Consolidation Leadership in of international affinity

11. Slide 11: The largest private sector bank in Portugal

    3 The largest private sector bank in Portugal • Main business lines directed to retail and commercial banking, investment banking, corporate and private banking/asset management • Strong focus on innovation and on Customer experience 11

12. Slide 12: Unique international presence focused on key strategic markets

    3 Unique international presence focused on key strategic markets Portugal Macao Single brand Millennium Market share: 17.3% on loans, 17.6% on deposits On-shore branch Loans to Customers (gross): €37,350 million Loans to Customers (gross): €411 million Customer funds: €53,049 million Customer funds:

13. Slide 13: Diversified shareholder base, geographically scattered

    3 Diversified shareholder base, geographically scattered Shareholder structure (Last information available) Non-PT institutionals 22% Fosun 27% Non-PT retail 1% PT institutionals 4% Sonangol 20% PT retail 24% EDP 2% Number of Shareholders Per geography (x1000) (Last information available) Portugal C

14. Slide 14: One-tier management and supervisory model

    One-tier management and supervisory model, composed by a 3 Board of Directors General Meeting of Shareholders Remuneration and Welfare Board Board for International Client Board of Directors Strategy Ombudsman • Committee for Nominations and Remunerations • Committee for Corporate Governance, Ethics

15. Slide 15: Agenda

    Agenda  Macro and Business Overview  Performance 2013-2018  Strategic Plan 2018-2021  1H 2018 earnings  Other information 15

16. Slide 16: Key highlights

    Key highlights 1 • Profitable operation with a recurring capacity to generate operating results > €1.1 billion per annum Net interest benefits from continuing reduction in cost of funding: NIM of 2.2% in 1H18 (Portugal:1.8%, up from 0.6% in 2013) Consistent track record of delivering reduction in op

17. Slide 17: Net interest income to benefit from lower cost of funding

    1 Net interest income to benefit from continuing reduction in cost of funding Net Interest Income NIM (€ mn) 1.5% 1.6% 1.8% 1.8% 808 711 736 527 1.0% 343 0.6% 329 358 390 385 1H 141 208 2013 2014 2015 2016 2017 1H18 2013 2014 2015 2016 2017 1H18 NII to improve, as cost of time deposits keeps ... lea

18. Slide 18: Consistent reduction in operating costs

    1 Consistent track record of delivering reduction in operating costs Operating costs down by 40% vs 2011 (pre- programme) ... ...with a >30% reduction in branches... Operating costs (€ mn) Branches (#) 885 774 695 671 618 578 573 1,039 853 2011 2013 2014 2015 2016 2017 Jun 18 690 644 624 * 588 ... a

19. Slide 19: One of the most efficient banks in the Eurozone

    1 Millennium bcp: one of the most efficient banks in the Eurozone Cost to core income* Cost to core income* Latest available information 80% -9pp 71% vs. peers in vs. Euro-zone Portugal banks 86% -37pp 49% 49% 49% Banco 1 58% 60% 2013 1H18 Banco 2 49% 77% Pre-provision profit Banco 3 65% 98% 1,243 B

20. Slide 20: Asset quality metrics to benefit from NPE reduction

    2 Asset quality metrics to benefit further from continued focus on NPE reduction NPEs (EBA definition) Cost of risk and loan-loss charges (€ bn) (Basis points) -1.5p.a. Impairment 743 1,021 730 1,045 533 192 12.8 charges (€mn) 10.9 9.8 266 8.5 233 Other 6.8 5.9 Cost of risk 157 175 (basis points) 14

21. Slide 21: Strong coverage levels

    2 Strong coverage levels NPE breakdown Total NPEs: €5.9bn NPE total coverage* (June 2018) (June 2018) 110% 106% 97% Individuals 34% Real estate 26% 44% collateral Other NPEs 41% 69% 20% 15% Cash, other NPLs >90d Companies 59% fin.collat., EL gap 74% 3% 56% 48% LLRs 24% Individuals Companies Total NP

22. Slide 22: Diversified international exposure delivering resilient contribution

    Diversified and coherent international exposure delivering resilient 3 contribution Key international operations Contribution to consolidated results* (€ mn) Poland Market share: 4.4% on loans, 5.1% on deposits Loans to Customers (gross): €11,924 million Customers funds: €15,835 million Employees: 5

23. Slide 23: Balance Sheet

    4 Balance Sheet Balance sheet breakdown Securities portfolio (€ bn) (€ bn) Other (net) 3.2 4.4 Securities 14.2 12.1 12.1 18.5 2.6 6.7 6.9 Equity 5.4 Debt issued 12.9 14.2 2.0 MM (net) Other 4.8 68.0 53.5 Deposits 11.6 47.5 Loans 46.9 Sovereign 7.3 debt 1 Dec 11 2 3 4 Jun 18 5 Dec 11 Jun 18 Sovereign

24. Slide 24: Stronger funding and liquidity

    4 Stronger funding and liquidity Net loans Deposits (€ bn) (€ bn) -31% +12% 68.0 62.6 56.8 53.7 52.0 48.0 47.6 47.5 49.4 49.0 49.8 51.5 48.8 51.2 53.5 46.9 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Jun18 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec 17 Jun18 Commercial gap (net loans – deposits) (€ bn) 

25. Slide 25: Credit and deposits

    4 Credit and deposits Credit Performing portfolio Customer deposits (€ bn) (€ bn) 34.8 35.3 37.5 33.9 34.4 34.0 Term 18.9 19.2 deposits 24.3 21.9 19.9 24.9 On-demand 34.5 12.9 14.1 16.4 18.3 deposits 9.0 10.1 32.9 Dec 13 Dec 14 Dec 15 Dec 16 Dec 17 Jun 18 31.8 31.2 31.4 30.8 • The performing portfol

26. Slide 26: Continued reduction of ECB funding

    4 Continued reduction of ECB funding Outstanding debt repayments (medium-long term) ECB funding (€ bn) (€ bn) Already repaid To be repaid 22.3 Total 19.9 4.9 collateral 15.7 15.6 14.2 13.9 12.1 12.8 Buffer 2.3 2.3 0.2 0.4 ECB 12.4 10.5 10.0 0.1 funding 6.6 5.3 4.4 3.0 3.1 Average 2017 1H18 2018 2019

27. Slide 27: Enhanced capital position

    5 Enhanced capital position From equity to CET1 capital* Capital ratio* (Million euros) 11.7% CET1 ratio 5,802 fully imp. 4,863 11.1% 11.9% 11.7% -107 9.3% -724 -108 6.4% Equity DTAs EL gap Other CET1 Dec09 Dec11 Dec16** Dec17 Jun18 fully imp. CT1 ratio, BoP definition CET1 ratio, fully implemented,

28. Slide 28: Capital at comfortable levels, strong leverage ratios

    5 Capital at comfortable levels, strong leverage ratios Leverage ratio Leverage ratio Fully implemented Fully implemented, latest available data 6.4% 5.7% 6.3% 6.4% 5.7% 4.5% 3.7% Jun 17 Jun 18 FR DE ES IT RWA density Texas ratio* RWAs as % of assets, latest available data 57% 93.2% 74.4% 43% 42% 26

29. Slide 29: Agenda

    Agenda  Macro and Business Overview  Performance 2013-2018  Strategic Plan 2018-2021  1H 2018 earnings  Other information 29

30. Slide 30: Five strategic priorities to launch a new growth cycle

    Five strategic priorities to launch a new growth cycle 3 Growth and leadership in Portugal 2 4 Mobile-centric Growth in digitization international footprint 5 1 Business model Talent sustainability Mobilization 30

31. Slide 31: Talent Mobilization

    1 Talent Mobilization Strengths Priorities going forward • Workforce talent as a Engagement and commitment sustained advantage in Engagement of the entire organization to proactively pursue new the market vision and strategy • Overall increase in New ways of working satisfaction Empowerment and simp

32. Slide 32: Mobile-centric digitization

    2 Mobile-centric digitization Main initiatives/levers Ambition for 2021 vs 2017 Mobile expanding day-to-day capabilities, with interactions anytime, anywhere 3x Weight of digital sales Transform top customer journeys, with advanced analytics modelling Expand (democratize) personalized solutions +20%

33. Slide 33: Growth and leadership in Portugal

    3 Growth and leadership in Portugal Maximize potential of unique position as the largest private Portuguese bank Main initiatives/levers Ambition for 2021 vs 2017 Strength mortgage position +1.2 Bn€ redesigning customer journey Mortgage new business and expanding distribution reach +3pp Market share

34. Slide 34: Growth in international footprint

    4 Growth in international footprint Capitalize on opportunities in high growth markets where we have competitive advantages Expand Customer base in Poland, capturing full 2021 aspiration for potential of relationships the international footprint Reinforce growth of Banque Privée in Support business

35. Slide 35: Business model sustainability

    5 Business model sustainability Pursue low risk retail and commercial banking, innovating in credit management and monitoring Main levers Ambition for 2021 Strong governance and management framework in place to ensure plan is delivered NPE reduction Strictly deliver on NPE plan levers 602017 ~Vis-à-

36. Slide 36: Millennium Group's ambitions for 2021

    Millennium Group’s ambitions for 2021 Consolidated 1H18 2021 Total active Customers 4.8 million >6 million Franchise Digital customers 45% >60% growth Mobile customers 26% >45% Cost-Income 47% ≈40% RoE 5.3% ≈10% Value CET1 11.7% ≈12% creation Loans to Deposits 88% <100% Dividend payout -- ≈40% ≈3 bn

37. Slide 37: Investment case

    Investment case Return to normalization allows Millennium bcp to focus on its core strengths 1 Reference private sector bank in Portugal, and well-positioned in a rapidly changing landscape, following the completion of the restructuring plan successfully implemented over the last years: one of the m

38. Slide 38: Agenda

    Agenda  Macro and Business Overview  Performance 2013-2018  Strategic Plan 2018-2021  1H 2018 earnings  Other information 38

39. Slide 39: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 39

40. Slide 40: Highlights

    Highlights •1 Improved profitability, with net earnings of €150.6 million in the 1st half of 2018 2 Improved credit quality, with NPEs decreasing by €2.1 billion from June 30, 2017 •3 Increasing business volumes, up by €2.9 billion from June 30, 2017 •4 +103,000 active Customers in Portugal from Jun

41. Slide 41: Highlights

    Highlights 1 Improved profitability 2 Improved asset quality (Consolidated net earnings, million euros) (Non-performing exposures, billion euros) -€2.1 billion 8.8 6.7 NPEs group +67.5% -€1.9 billion 150.6 7.8 89.9 5.9 NPEs Portugal 3.3 2.4 Other NPEs 4.6 3.6 NPL>90d 1H17 1H18 Jun 17 Jun 18 3 Increa

42. Slide 42: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 42

43. Slide 43: Improved profitability across geographies

    Improved profitability across geographies (Million euros) Consolidated net earnings* Net earnings from domestic activity +67.5% 150.6 59.0 89.9 1.6 1H17 1H18 1H17 1H18 Net earnings from international operations • Net earnings of €150.6 million in 1H18, a 67.5% increase from €89.9 million in the same

44. Slide 44: Profit of €150.6 million in the 1st half of 2018

    Profit of €150.6 million in the 1st half of 2018 Impact on (million euros) 1H17 1H18 YoY earnings Net interest income 678.5 687.7 +1.3% +9.2 Commissions 330.3 340.2 +3.0% +9.9 Core income 1,008.8 1,027.9 +1.9% +19.0 Other income* 40.0 28.9 -27.7% -11.1 Operating costs -450.2 -500.8 +11.2% -50.6 Of w

45. Slide 45: Net interest income driven by international operations

    Net interest income driven by international operations (Million euros) Net interest income Consolidated Portugal NIM 1.8% 1.8% NIM 2.2% 2.2% -1.4% 390.2 384.8 +1.3% 678.5 687.7 1H17 1H18 International operations NIM 3.1% 3.1% +5.1% 288.3 302.9 1H17 1H18 1H17 1H18 45

46. Slide 46: Increased commissions

    Increased commissions (Million euros) Fees and commisions Consolidated Portugal +3.9% 1H17 1H18 YoY 225.2 234.0 Banking fees and commissions 271.6 278.3 +2.5% Cards and transfers 75.2 79.8 +6.1% Loans and guarantees 78.5 81.4 +3.7% 1H17 1H18 Bancassurance 47.5 48.1 +1.3% Customer account related 52.

47. Slide 47: Other income influenced by mandatory contributions and credit sales

    Other income* influenced by mandatory contributions and credit sales (Million euros) Other income* Consolidated Portugal -27.7% 40.0 -40.7% 28.9 Equity earnings 26.5 + dividends 36.7 15.7 42.0 Includes -€22.4 Net trading million on credit sales 1H17 1H18 income 89.9 77.0 Mandatory 57.9 66.5 contribu

48. Slide 48: Recurring operating costs under control

    Recurring operating costs under control, in spite of the impact from the reversal of salary cuts (Million euros) Operating costs Consolidated Portugal Impact from reversal of salary cuts: +€7.5 million +4.0% +3.5% Recurring 473.9 492.8 Recurring 294.8 305.2 +11.2% +15.5% 500.8 271.1 313.2 450.2 28.4

49. Slide 49: One of the most efficient banks in the Eurozone

    Millennium bcp: one of the most efficient banks in the Eurozone Cost to core income* Cost to core income* Latest available information 80% -9pp 71% vs. peers in vs. Euro-zone Portugal banks 86% -37pp 49% 49% 49% Banco 1 58% 60% 2013 1H18 Banco 2 49% 77% Cost to income 67% +1pp 68% Banco 3 65% 98% -2

50. Slide 50: Cost of risk keeps normalisation trend

    Cost of risk keeps normalisation trend (Million euros) Impairment and provision charges Consolidated Portugal Cost of risk 133bp 103bp Cost of risk 118bp 88bp -34.8% 370.0 415.3 -32.6% Other 112.3 241.3 49.6 Loans 257.7 191.8 Other 110.3 279.8 1H17 1H18 Loan-loss 3,165 2,810 reserves 59.0 Internatio

51. Slide 51: Relevant NPE reduction and strengthened coverage

    Relevant NPE reduction and strengthened coverage (Million euros) Credit quality Consolidated Portugal NPE coverage by -24.3% LLRs 41% 50% NPEs 7,816 -1.9 billion -23.9% 5,913 NPEs 8,761 -2.1 billion 6,665 Other 3,721 2,633 Jun 17 Jun 18 5,040 International operations NPL>90d 4,032 -20.4% Jun 17 Jun

52. Slide 52: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 52

53. Slide 53: Strong Customer acquisition

    Strong Customer acquisition Active Customers Digital Customers (Million) (Million) +55,000 since December 17 +103,000 2.2 +79,000 since December 17 2.1 +113,000 0.9 0.8 Jun 17 Jun 18 Jun 17 Jun 18 Awards and surveys • Bank closest to its Customers; most innovative Bank; Bank of choice; Bank with the

54. Slide 54: Growing Customer funds

    Strong business dynamics results in growing Customer funds (Billion euros) Total Customers funds* Consolidated Total Customers funds* in Portugal +5.9% +7.5% 72.5 53.0 68.4 49.4 Other 14.5 15.6 17.8 Term 19.2 Off-BS 16.2 deposits 19.4 funds Demand 1.2 deposits 15.4 18.3 Other BS 1.6 funds Jun 17 Jun

55. Slide 55: Increasing performing portfolio

    Strong business dynamics, with increasing performing portfolio (Billion euros) Loans to Customers (gross) Consolidated Portugal NPE: -24.3% (-€1.9 billion) NPE: -23.9% (-€2.1 billion) Performing: +1.8% (+€0.5 billion) Performing: +2.0% (+€0.9 billion) -3.5% -2.4% 38.7 37.4 51.7 50.5 Mortgage 23.7 23

56. Slide 56: Comfortable liquidity position

    Comfortable liquidity position Net loans to deposits ratio ECB funding (Billion euros) Eligible assets 12.0 15.6 -7pp 3.6 3.1 95% 88% Jun 17 Jun 18 Liquidity ratios (CRD IV/CRR) 176% 129% Jun 17 Jun 18 NSFR (Net stable LCR (Liquidity funding ratio) coverage ratio) 56

57. Slide 57: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 57

58. Slide 58: Comfortable capital position

    Comfortable capital position Common Equity Tier 1 ratio* Fully implemented  CET1 capital ratio of 11.7% (fully implemented)  Increase from a 11.3% fully implemented ratio ECB requirement as of June 30, 2017 due to organic capital (SREP) for CET1 in 2018: 8.8% generation (+66bps on capital due to e

59. Slide 59: Capital at comfortable levels, strong leverage ratios

    Capital at comfortable levels, strong leverage ratios Leverage ratio Leverage ratio Fully implemented Fully implemented, latest available data 6.4% 5.7% 6.3% 6.4% 5.7% 4.5% 3.7% Jun 17 Jun 18 FR DE ES IT RWA density Texas ratio* RWAs as % of assets, latest available data 57% 93.2% 74.4% 43% 42% 26%

60. Slide 60: Pension fund

    Pension fund Key figures Pension fund (Million euros) Shares 13% Dec 17 Jun 18 Cash and Pension liabilities 3,050 3,056 other 44% Pension fund 3,166 3,202 Liabilities' coverage 104% 105% Bonds 35% Fund's profitability +4.2% +3.1% Actuarial differences +29 +27 Real estate 8% Assumptions Dec 17 Jun 18

61. Slide 61: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 61

62. Slide 62: Increased net income

    Increased net income (Million euros) Net income Banking income +57.5 59.0 641.9 634.4 1.6 1H17 1H18 1H17 1H18 Operating costs Includes non-usual negative Includes non-usual positive impact of €8.0 million  Net earnings of €59.0 million in 1H18, + €57.5 impact of €23.7 million million compared to €1

63. Slide 63: Net interest income

    Net interest income Net interest income (Million euros) -1.4% +18.1 +6.3 +8.5 390.2 +0.1 384.8 -16.1 -12.6 -9.8 NIM 1.8% 1.8% 1H17 CoCo Effect of cost Effect of Credit Effect of net Effect of Other 1H18 repayment of time wholesale cost volume recovery of securities effect deposits effect interest po

64. Slide 64: Continued effort to reduce the cost of deposits

    Continued effort to reduce the cost of deposits Spread on the book of term deposits Spread on the performing loan book (vs 3m Euribor) (vs 3m Euribor) 1H17 1H18 2.7% 2.7% -0.6% -0.7% 1H17 1H18 NIM  Continued improvement in the spread of the portfolio of term deposits: from -0.7% in the first half o

65. Slide 65: Commissions and other income

    Commissions and other income* (Million euros) Fees and commissions Other income* -40.7% 1H17 1H18 YoY 26.5 Banking fees and commissions 194.0 201.0 +3.6% 15.7 Cards and transfers 51.4 53.1 +3.4% Loans and guarantees 51.7 53.5 +3.4% 1H17 1H18 Bancassurance 39.3 40.7 +3.6% Customer account related 46.

66. Slide 66: Operating costs

    Operating costs (Million euros) Operating costs Employees Impact from reversal of salary cuts: +€7.5 million +3.5% Recurring 294.8 305.2 -152 +15.5% 7,303 7,151 313.2 17.9 271.1 Depreciation 16.1 107.9 Jun 17 Jun 18 Other administrative 109.9 Branches costs Includes non-usual negative Includes non-u

67. Slide 67: Very strong pace of NPE reduction since 2013

    Very strong pace of NPE reduction since 2013 (Million euros) Non-performing exposures (NPEs) • NPEs in Portugal down to €5.9 billion as of 12,783 June 30, 2018, a €841 million reduction 10,921 from year-end 2017 9,777 8,538 6,754 • This decrease is attributable to a €497 5,913 Other million NPLs> 90

68. Slide 68: Lower NPEs, with reinforced coverage

    Lower NPEs, with reinforced coverage (Million euros) Non-performing exposures (NPEs) NPE build-up -24.3% 7,816 Jun 18 Jun 18 5,913 Other NPEs 3,258 vs.Jun 17 vs.Mar 18 2,352 Opening balance 7,816 6,282 +/- Net entries -813 -134 NPL>90d 4,558 3,561 - Write-offs -531 -134 - Sales -560 -101 Jun 17 Jun

69. Slide 69: NPE coverage

    NPE coverage NPE total coverage* NPE total coverage* 105% 106% 110% 106% 97% Real estate 34% Real estate 46% 44% collateral 44% collateral Cash, other 69% 20% 15% 15% Cash, other 18% fin.collat., EL gap fin.collat., EL gap 48% 3% 56% 48% 40% LLRs 24% LLRs Jun 17 Jun 18 Individuals Companies Total NP

70. Slide 70: Foreclosed assets and corporate restructuring funds

    Foreclosed assets and corporate restructuring funds Foreclosed assets Corporate restructuring funds (Million euros) (Million euros) Valuation exceeds book value by 26% Original credit exposure: €2,006 million Book value (30 Jun 2018): €1,020 million 1,825 1,664 Total impairment (credit+restr. funds)

71. Slide 71: Increased Customer funds and performing credit portfolio

    Strong business dynamics leads to increased Customer funds and performing credit portfolio (Billion euros) Total Customers funds* Loans to Customers (gross) +7.5% 53.0 49.4 NPE: -24.3% (-€1.9 billion) Performing: +1.8% (+€0.5 billion) Decrease from €38.0 billion in March due to strong NPE reduction

72. Slide 72: Credit now growing in Portugal

    Credit now growing in Portugal (Billion euros) Performing credit portfolio • Growth of the performing credit portfolio in Portugal of 1.8% from June 30, 2017 +1.8% • Strong performance of credit activity in the first six months of 2018: 31.4 – New consumer credit increased 19.1% 30.9 compared to the

73. Slide 73: Main bank of companies in Portugal

    Main bank of companies in Portugal Results BFin 2018 DataE*, 5 largest Banks in Portugal Usage and satisfaction indicators (%) Used as primary Satisfaction with Usage of net Satisfaction net Bank primary Bank** banking Mobile: banking** • Millennium bcp is the main Bank of 25% (#1) Companies in Port

74. Slide 74: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 74

75. Slide 75: Increased contribution from international operations

    Increased contribution from international operations (Million euros) Δ% Δ% 1H17 1H18 ROE local currency euros Poland 74.3 82.3 +10.8% +11.7% 9.5% Mozambique 41.9 51.1 +22.0% +19.4% 26.1% Angola* Before IAS 29 impact 10.8 8.9 IAS 29 impact** -- -2.7 Total Angola including IAS 29 impact 10.8 6.2 Other

76. Slide 76: Poland: Increased net income

    Increased net income (Million euros) Net income Banking income ROE 9.5% 9.5% +5.4% +10.8% 297.7 313.6 74.3 82.3 1H17 1H18 1H17 1H18 Operating costs  Net earnings of € 82.3 million (+10.8%), with ROE of 9.5%  Increasing banking income, driven by net interest income +4.0% and commissions  Customer

77. Slide 77: Poland: Increased net interest income and commissions

    Increased net interest income and commissions (Million euros) Net interest income* Operating costs NIM 2.5% 2.5% Cost to income 46.5% 46.4% +6.2% +4.0% 211.3 143.8 149.6 199.0 Other 74.0 +1.0% 74.8 Staff costs 69.8 +7.2% 74.8 1H17 1H18 1H17 1H18 Commissions and other income Employees Branches Does n

78. Slide 78: Poland: Credit quality

    Credit quality (Million euros) NPL>90d Loan-loss reserves Credit ratio Jun 17 Jun 18 Coverage ratio Jun 17 Jun 18 NPL>90d 2.7% 2.7% NPL>90d 109% 133% 430.3 305.8 323.1 332.3 Jun 17 Jun 18 Jun 17 Jun 18 Loan impairment (net of recoveries)  NPL>90d accounted for 2.7% of total credit as of Cost of Jun

79. Slide 79: Poland: Growing volumes

    Growing volumes (Million euros) Customers funds Loans to Customers (gross) +5.8% +15.6% excluding FX 15,835 mortgage loans Off-BS 14,966 funds +12.2% +6.9% 2,058 11,924 1,834 93 11,154 Other BS -5.0% funds 98 +22.4% 2,898 Mortgage 2,367 5,407 Local currency Term 5,812 -7.0% deposits -10.0% 3,392 Mor

80. Slide 80: Mozambique: Growing net earnings

    Growing net earnings (Million euros) Net income Banking income +6.8% ROE 25.8% 26.1% 120.9 +22.0% 113.2 51.1 41.9 1H17 1H18 1H17 1H18 Operating costs  Net earnings of €51.1 million (+22.0%), with ROE of 26.1%  Increasing banking income (+6.8%), driven by higher net interest income and other income

81. Slide 81: Mozambique: Growing income offset by operating costs

    Growing income partially offset by the increase in operating costs (Million euros) Net interest income Operating costs Cost to income 36.9% 35.7% NIM 10.7% 10.9% +3.0% 41.8 43.1 +3.1% 89.4 92.2 23.6 +4.0% 24.6 Other Staff costs 18.2 +1.8% 18.5 1H17 1H18 1H17 1H18 Commissions and other income Employe

82. Slide 82: Mozambique: Credit performance

    Credit performance influenced by challenging environment (Million euros) NPL>90d Loan-loss reserves Credit ratio Jun 17 Jun 18 Coverage ratio Jun 17 Jun 18 NPL>90d 14.0% 15.9% NPL>90d 65% 55% 104.1 160.8 145.4 79.9 Jun 17 Jun 18 Jun 17 Jun 18 Loan impairment (net of recoveries) Cost of  NPL>90d rat

83. Slide 83: Mozambique: Growing deposits and lower credit

    Growing deposits and lower credit (Million euros) Customer funds Loans to Customers (gross) +0.5% 1,509 1,517 -20.4% 1,150 Mortgage 13 -13.3% Term 675 deposits +12.3% 758 Consumer 202 915 and other 11 -23.9% 153 Companies 936 -19.8% Demand 834 751 deposits -9.0% 759 Jun 17 Jun 18 Jun 17 Jun 18 FX ef

84. Slide 84: 1H 2018 earnings

    1H 2018 earnings  Highlights  Group • Profitability • Business activity • Capital  Portugal  International operations  Key figures 84

85. Slide 85: Key figures

    Key figures Consolidated 1H17 1H18 CET1 fully implemented 11.3% 11.7% Loans to Deposits 95% 88% Cost–Income1 45.2% 46.6% Cost-Core Income1, 2 47.0% 47.9% Cost of risk 118 bp 88 bp RoE3 4.3% 6.8% Cumulative NPE reduction -€1.9 billion -€3.9 billion from January 1, 2016 (Portugal) 1 Excludes non-usual

86. Slide 86: Appendix

    Appendix AGILE | MODERN | PERSONAL | SIMPLE| SUSTAINABLE 86

87. Slide 87: Sovereign debt portfolio

    Sovereign debt portfolio Sovereign debt portfolio Sovereign debt maturity (Million euros) >8y, ≤10y >10y 2% 2% Jun 17 Mar 18 Jun 18 YoY QoQ Portugal 5,089 4,696 5,938 +17% +26% ≤1y 24% T-bills and other 845 499 721 -15% +44% >5y, ≤8y Bonds 4,244 4,197 5,217 +23% +24% 34% >1y, ≤2y Poland 3,847 3,981

88. Slide 88: Sovereign debt portfolio

    Sovereign debt portfolio (Million euros) Portugal Poland Mozambique Other Total Trading book* 37 284 0 27 348 ≤ 1 year 0 44 0 0 44 > 1 year and ≤ 2 years 33 3 0 26 62 > 2 years and ≤ 5 years 2 196 0 0 199 > 5 years and ≤ 8 years 2 31 0 0 33 > 8 years and ≤ 10 years 0 11 0 0 11 > 10 years 0 0 0 1 1 B

89. Slide 89: Diversified and collateralised portfolio

    Diversified and collateralised portfolio Loan portfolio Consolidated Companies 46% Loans per collateral Mortgage 58% 26% 16% 46% Real guarantees Other guarantees Unsecured LTV of the mortgage portfolio in Portugal 15% 11% 13% 27% 11% 11% 11% 0-40 40-50 50-60 60-75 75-80 80-90 >90 Consumer / other 8%

90. Slide 90: Consolidated earnings

    Consolidated earnings Impact on (million euros) 1H17 1H18 YoY earnings Net interest income 678.5 687.7 +1.3% +9.2 Net fees and commissions 330.3 340.2 +3.0% +9.9 Other income* 40.0 28.9 -27.7% -11.1 Banking income 1,048.8 1,056.8 +0.8% +8.0 Staff costs -241.5 -289.8 +20.0% -48.3 Other administrative

91. Slide 91: Consolidated balance sheet

    Consolidated balance sheet (Million euros) 30 June 30 June 30 June 30 June 2018 2017 2018 2017 Assets Liabilities Cash and deposits at Central Banks 2,165.8 1,650.9 Resources from credit institutions 6,985.8 9,373.2 Loans and advances to credit institutions Resources from customers 53,454.6 50,635.7

92. Slide 92: Consolidated income statement

    Consolidated income statement Per quarter (Million euros) 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 Net interest income 346.2 344.7 368.1 344.8 342.8 Dividends from equity instruments 1.5 0.1 0.1 0.1 0.6 Net fees and commission income 169.5 164.3 172.1 167.8 172.4 Other operating income -71.4 -10.4 -5.2 -29.1 -

93. Slide 93: Income statement (Portugal and International operations)

    Income statement (Portugal and International operations) For the 6-month periods ended June 30th, 2017 and de 2018 (Million euros) Int e rna t io na l o pe ra t io ns G ro up P o rt uga l T o tal B a nk M ille nnium ( P o la nd) M ille nnium bim ( M o z.) O t he r int . o pe ra t io ns Jun 17 Jun 18

94. Slide 94: Glossary (1/2)

    Glossary (1/2) Balance sheet impairment – Balance sheet impairment related to amortised cost and fair value adjustments related to loans to customers at fair value through profit or loss. Balance sheet customer funds - debt securities and customer deposits. Commercial gap –loans to customers (gross)

95. Slide 95: Glossary (2/2)

    Glossary (2/2) Operating costs - staff costs, other administrative costs and depreciation. Other impairment and provisions - other financial assets impairment, other assets impairment, in particular provision charges related to assets received as payment in kind not fully covered by collateral, good

96. Slide 96: Agenda

    Agenda  Macro and Business Overview  Performance 2013-2018  Strategic Plan 2018-2021  1H 2018 earnings  Other information 96

97. Slide 97: Reconciliation of NPLs>90d with NPEs (EBA definition)

    The NPE reduction plan is being implemented Reconciliation of NPLs>90d with NPEs (EBA definition) NPEs down €6.9 billion from end-2013 NPLs>90d vs NPEs (EBA definition) (Billion euros) (Billion euros, June 2018) 12.8 -2.3 +0.7 5.9 +1.2 +0.2 -3.0 5.9 +0.2 -1.5 3.6 Dec13 Net new Write Sales Jun18 NPLs

98. Slide 98: Latest Rating Actions recognized progress in implementing strategic plan

    Latest Rating Actions recognized the progress made by BCP in implementing its strategic plan S&P Stand-alone credit profile (SACP) Moody’s Baseline Credit Assessment (BCA) +3 notches +3 notches BB- b2 B+ b3 B Caa1 B- Caa2 2013 2014 2015 2016 2017 2013 2014 2015 2016 2017 Fitch Viability Rating (VR)

99. Slide 99: Ratings

    Ratings Moody's Standard & Poor's Baseline Credit Assessment b2 Stand-alone credit profile (SACP) bb- Intrinsic Adjusted Baseline Credit Assessment B2 Counterparty LT/ST Ba1 / NP Counterparty Credit Rating LT/ST BB-/ B Deposits LT/ST B1 / NP Senior Unsecured LT/ST BB-/ B LT/ST Senior unsecured LT/ST

100. Slide 100: Progress recognised by the market

     Progress recognised by the market CDS 5 yr Portuguese Republic CDS 5 yr BCP b.p. b.p. 500 1000 400 800 300 600 200 400 100 200 0 0 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 CDS BCP yield curve (senior)

101. Slide 101: New Senior Bond, CB and Subordinated issues

     New Senior Bond, CB and Subordinated issues signal Millennium bcp’s return to capital debt markets 3 Yr Senior Unsecured Notes Breakdown by Investor Type and Geography Issuer: Banco Comercial Português, S.A. Insurance Switzerland Other Spain and Pension 4% Issue Rating (S/M/F/D): B (Neg.) / B1 (Neg.

102. Slide 102: Investor Relations Division

     illenniu INVESTOR RELATIONS DIVISION Rui Coimbra, Head EQUITY DEBT AND RATINGS Luis Pedro Monteiro and Paula Dantas Henriques Luis Morais and Lina Fernandes +351 21 1131 084 +351 21 1131 337 investors@millenniumbcp.pt Banco Comercial Portugués, S.A., a public company (sociedade aberta) having its re

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