Eurobank S.a. · ATHEX:EUROB

Eurobank — 9M 2013 Earnings Presentation

60 slides from Eurobank's earnings presentation, Nov 29, 2013

1. Slide 1: Nine months 2013 results

   Nine months 2013 results 29 November 2013

2. Slide 2: Disclaimer

   Disclaimer By attending the meeting where this presentation is made, or by reading the presentation slides, you agree to be bound by the following limitations: This presentation has been prepared by Eurobank. The material that follows is a presentation of general background information about Euroban

3. Slide 3: Recent developments

   Recent developments  TT and Proton integration  Acquisition of TT and Proton completed on August 30th  Legal merger with Proton completed on November 22nd. Integration merger to be completed on December 6th  Legal merger with TT expected to be completed by mid December; integration merger by Apr

4. Slide 4: Strategic transformation program

   Strategic transformation program  Built around deposit and daily banking needs of clients; current account-driven A Enhance  Strengthen fee business and revisit pricing client-  New client segmentation model relationship – Focus on profitable clients aiming to become their primary banking relatio

5. Slide 5: 3Q 2013 results review: Income statement highlights

   3Q 2013 results review Income statement highlights

6. Slide 6: 3Q13 results highlights

   3Q13 results highlights  3Q13 bottom line at -€285m (-€211m excl. one-offs vs. -€244m in 2Q13)  Pre-provision income up 53% qoq, as core income improves and non-core income swings to positive  NII up for a second straight quarter, 7% qoq (+3% qoq excl. acquisitions) mainly driven by time deposit

7. Slide 7: Net interest income (NII)

   Net interest income (NII) NII breakdown (€ m) NII per region (€ m) 373 358 310 323 303 301 108 104 277 118 Int'l 104 101 118 Operations 102 265 254 Greece 199 174 200 192 205 Loan margin 603 610 605 571 558 538 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13* NII drivers qoq Capital & bonds 15 22 10 4 23 17  EC

8. Slide 8: Spreads & NIMs

   Spreads1 & NIMs1 Lending spreads (Greece, bps) Deposit spreads (Greece, bps) 518 509 Core 494 499 Corporate -50 -47 -51 -55 -51 -51 501 501 487 482 486 475 Total Total 490 486 -220 467 -235 477 474 -248 Retail -263 -271 -279 -284 456 458 -322 Time -324 -352 -359 -353 3Q12 4Q12 1Q13 2Q13 3Q13 Oct-13

9. Slide 9: Commission income

   Commission income Commission income breakdown (€ m) Commission income per region (€ m) Total fees excluding 81 89 82 77 83 Govt. guarantees expense 71 70 71 70 65 67 8 65 67 62 8 Non-banking 10 services 62 9 9 14 13 Insurance 26 26 7 7 11 26 27 Int'l 9 6 28 Operations 7 Mutual funds 12 7 5 8 10 4 3

10. Slide 10: Operating Expenses

    Operating Expenses OpEx per region (€ m) OpEx down 27% cumulatively since 2008 (€ m) vs. 3Q12 -4% 340 vs. av.Q08 -28% 256 261 1,358 -27% 254 249 248 245 85 87 82 82 81 81 Int'l Operations 172 167 167 166 180 Greece 164 471 988 Av. Q08 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13* -31% [l-f-l] 326 Int'l Operations

11. Slide 11: Pre-provision income (€m)

    Pre-provision income (€m) +5% vs. 3Q12 +53% qoq +22 +3 -13 +39 148 141 3 37 3 0 9 -17 2 97 13 Δ Eurobank Δ TT & Proton 3Q12 2Q13 ΔNII Δfees ΔOpEx Δ non-core 3Q13* * Including TT and Proton for one month Page 10

12. Slide 12: Greek operations

    Greek operations Operating income (€ m) Net recurring profit (€ m) 275 258 260 204 207 200 -205 -207 -230 -235 -238 -257 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13* 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13* Operating expenses (€ m) Provisions (€ m) 374 376 180 172 167 167 166 366 366 164 353 328 3Q12 4Q12 1Q13 2Q13 3Q13 3Q

13. Slide 13: International Operations

    International Operations Deposit gathering outpaces loan growth 4x L/D ratio 143% 8,5 7,9 +3.5 103% +0.8 +71% 7,1 +11% 93% 93% FY07 FY11 FY12 3Q13 5,0 Δ Net loans & Δ Deposits FY07-9M13 Δ Net loans 2.167 Δ Deposit 1.036 545 398 152 250 189 242 91 -60 -97 -657 FY07 9M13 FY07 9M13 ROM BUL SER CYP UKR

14. Slide 14: International operations

    International operations Operating income (€ m) Operating expenses (€ m) 147 144 90 90 141 139 87 85 136 134 134 82 82 81 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 Provision charge (€ m) Net profit (€ m) 8 12 2 114 -5 -3 84 69 -16 55 54 45 42 -59 1Q12 2Q12 3Q12 4Q12 1Q13

15. Slide 15: 3Q 2013 results review: Balance sheet highlights

    3Q 2013 results review Balance sheet highlights

16. Slide 16: Total assets breakdown

    Total assets breakdown 9M13 Total assets breakdown (€ bn) 9M13 Loan book breakdown Consumer 14% 80,1 Wholesale 37% Mortgages 35% Net loans and advances to customers 47,1 SB 14% 9M13 Securities portfolio breakdown Other Corporate GGBs 2% Securities 7% 13% 19,2 T-Bills 14% PP&E, intangibles and other

17. Slide 17: Funding and liquidity

    Funding and liquidity Funding breakdown (€ bn) (30 September 2013) Eurosystem funding (€ bn) Interbank 70,8 Wholesale Issues sold takings funding 1,4 (securitization) 10% 34.0 -51% 24% Repos 9,2 Supranational takings ELA funding 5,4 34% Issues sold ELA 15,0 ECB funding (EMTN) 12,5 32% Pension fund R

18. Slide 18: Loans and deposits at glance

    Loans and deposits at glance Gross loans (€ bn) Deposits (€ bn) 152% 54.4 53.9 140% 136% 132% 129% 48.2 47.8 Intl Ops 47.4 8,8 8,7 Group L/D 46.2 45.5 111% 110% 9,5 9,4 9,3 9,0 8,8 42.3 42.4 Business GR 8,5 8,5 22,4 22,0 Int'l 32.2 Operations 30.8 30.2 31.0 21,4 21,3 21,1 28.9 20,5 20,0 9,1 8,5 9,2

19. Slide 19: 3Q 2013 results review: Asset quality

    3Q 2013 results review Asset quality

20. Slide 20: Asset quality

    Asset quality 90dpd formation (€ m) 90dpd ratio 3Q12 4Q12 1Q13 2Q13 3Q13* 874 Group 21.3% 22.8% 24.6% 26.4% 27.7% 811 768 757 Greece 22.5% 24.2% 26.3% 28.1% 29.2% 710 695 Int’l Ops 16.6% 17.2% 17.8% 19.2% 20.5% 601 594 563 553 805 Loan loss provisions (€ m) 730 718 696 5.2 pps improvement (70bps org

21. Slide 21: 90dpd formation per segment (Greece)

    90dpd formation per segment (Greece) 1 Corporate (€ m) Mortgages (€ m) 313 286 283 224 230 205 206 197 170 172 174 160 147 151 138 117 122 119 115 100 92 103 102 105 103 78 78 75 79 76 71 43 56 43 46 42 53 57 37 33 20 12 6 4 -31 -35 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q

22. Slide 22: Coverage per segment (Greece)

    Coverage per segment (Greece) Value of Total 90dpd As of 30 September 2013 90dpd collaterals coverage Consumer 90dpd ratio 50% Coverage 75% 8% 83% Mortgages 90dpd ratio 19% Coverage 21% 122% >100% Eurobank Small Business excluding TT & 90dpd ratio 46% Proton Coverage 41% 70% >100% Corporate 90dpd ra

23. Slide 23: Strategic initiatives for credit risk mitigation

    Strategic initiatives for credit risk mitigation  Overall portfolio strategic directions: 9M13 Restructured loans1 – Shift from unsecured to secured lending and Excluding TT & Proton shorter tenors – Reduction of consumer loan portfolio – Discretionary sector selection in business lending Corporate

24. Slide 24: Greek loan portfolio - Corporate

    Greek loan portfolio - Corporate1 9M13 Greek Corporate portfolio Breakdown by sector Sea Farming Electrical Equip. IT, Media, Public Sector 1% 1% Telecoms Supermarkets 1% 3% 1% Other 3% Industry Trade - Automotive 12% 3% Total Corporate Oil 3% Retail Trade portfolio: €13.7bn Clothes & Apparel 10% 4%

25. Slide 25: Greek loan portfolio – Small Business

    Greek loan portfolio – Small Business1 9M13 Greek Small Business portfolio Breakdown by sector Agriculture IT Health Energy 2% 1% 3% 0% Tourism 4% Retail trade Manufacturing 29% Total Small Business 8% portfolio: €6.4bn Construction 12% Small Business 17% Wholesale trade 14% Services Corporate 26% 3

26. Slide 26: Greek loan portfolio – Household

    Greek loan portfolio – Household1 9M13 Greek Consumer and Mortgage portfolio Consumer portfolio breakdown 12% 7% 4% 4% 20% Auto 32% Total Consumer 3% portfolio: €4.7bn Home equity 84% Small Business 73% 64% 17% Products with Consumer 13% forced prenotation FY09 FY11 9M13 Greek residential real estat

27. Slide 27: BlackRock diagnostic exercise

    BlackRock diagnostic exercise  Assess banks’ lending practices and processes for establishing and monitoring asset quality Asset  Loan file review s on a sample of loans across Retail and Commercial asset classes to Quality assess underwriting quality Review  Manual review and risk assessment of

28. Slide 28: 3Q 2013 results review: Capital

    3Q 2013 results review Capital

29. Slide 29: Regulatory capital

    Regulatory capital EBA CT1 ratio (%) 8,1% 0,8% 8,1% -0.7% 2Q13* Impact from operations IRB for TT and Proton** 3Q13** EBA CT1 (m) 3,185 -463 225 2,947 RWAs (m) 39,538 -2,026 -939 36,574 * Pro-forma for TT/Proton acquisition & Eurobank Properties transaction ** Pro-forma for the adoption of IRB metho

30. Slide 30: Equity to EBA CT1 reconciliation (€ m)

    Equity to EBA CT1 reconciliation (€ m) 5.455 -950 4.141 950 -364 3.735 -406 2.947 418 -84 -1,997 -75 3Q13 equity Government Hybrids & Common Intangibles Tangible BV Government DTA Bad debt Minority Other EBA CT1 preference Minorities Equity preference provision Interest, adjustments shares shares sh

31. Slide 31: Eurobank overview: Group at a glance

    Eurobank overview Group at a glance

32. Slide 32: The Eurobank group at a glance

    The Eurobank group at a glance Eurobank at a glance Key figures (€ bn)  One of the four systemic banks in Greece, with 20% and 18%* 30 September 2013 market shares in loans and deposits respectively Customer loans (net) 47.1  Established in 1990, it is 95.2% owned by the Hellenic Customer deposits

33. Slide 33: Management's strategic objectives

    Management’s strategic objectives Objectives: 1 Transform our business and operating model to focus on being our clients' primary banking relationship 2 Restore the bank's profitability 3 Integrate New Hellenic Post Bank and New Proton Bank 4 Introduce private sector capital in 1Q 2014 Page 32

34. Slide 34: Leading position in key activities

    Leading position in key activities Eurobank standalone – Greece (2012) Ranking (2012) #1 16% market share, market leader 1 Equity Brokerage Market leader #1 Treasury Sales Market leader in M&A/Advisory (27 transactions in 2007-12) #1 Investment Banking and syndicated loans issuance (€1.6bn in 2010-1

35. Slide 35: Wealth Management & Life Insurance

    Wealth Management & Life Insurance Private banking Insurance  Market leader with AUM €6.5bn  Strong position in Life and non-Life Insurance market via our two subsidiaries with c. €300m premia p.a.  Dedicated network of 8 specialised branches; quality and trained personnel  Ranks # 3 in total in

36. Slide 36: Household collection & servicing subsidiary

    Household collection & servicing subsidiary  Eurobank Financial Planning Services (‘Eurobank Eurobank FPS key metrics (2012) FPS’) is the group’s household loans collection and servicing subsidiary 717 internal FTEs and 400 FTEs in Branch network 282 FTEs in external collections  Eurobank is the o

37. Slide 37: Corporate Remedial Management unit set up

    Corporate Remedial Management unit set up The bank aims to:  enhance corporate remedial capabilities by setting up a distinct unit that will bring together the necessary know how and capabilities  release capacity of corporate RMs to pursue profitable clients Project implemented in 3 phases:  Pha

38. Slide 38: International presence

    International presence Key figures (9M13) Development of loans and deposits (€ bn)  International operations represent 17% of the Group’s assets L/D 143% 93% ratio 8,5  Presence in six countries outside of Greece 7,9 7,1 − Romania is the largest and represents 30% of 5,0 international assets as at

39. Slide 39: Eurobank overview: TT & Proton Acquisitions

    Eurobank overview TT & Proton Acquisitions

40. Slide 40: Recent M&A activity

    Recent M&A activity Transaction highlights Key benefits  Transformational acquisition, resulting  Eurobank acquired the entire share capital of TT in material increase in scale (“good bank”) for a total consideration of €681m  Funding benefits from matching  The consideration for TT has been pai

41. Slide 41: Consolidation of the Greek banking sector

    Consolidation of the Greek banking sector Market share of top 4 banks(1) Gross loans market share (9M13) Gross domestic loans (€bn) Market share Greece as of 1H 2013 91% BOP 67,7 29.6% Portugal 60% +32pps Greece as of 2005 59% Alpha 52,8 23.1% Turkey 53% Italy 51% NBG 45,9 20.1 Germany 42% Spain 41%

42. Slide 42: Comparative asset quality metrics

    Comparative asset quality metrics 90+ dpd ratio (9M13) LLP Coverage (9M13) 90+ dpd (€bn) (2) BOP 35% 26.3 NBG 55% Alpha 33% 20.9 Alpha 52% (1) (1) Euro 28% 15.1 Eurob 49% NBG 15.5 BOP 49% 22% Eurobank acquired “good banks” exclusively, following their resolution (1) Includes NHPB and Proton (2) Incl

43. Slide 43: TT and Proton acquisition highlights

    TT and Proton acquisition highlights Group gross customer loans (9M13, € bn) Group customer deposits (9M13, € bn) Market (2) Market 20% 12% 18% 16% share(1) share(1) 7,5 1,3 54,3 L/D 55% 129% 64% 111% ratio 45,5 10,3 0,9 42,3 31,0 Eurobank TT Proton Pro forma Eurobank TT Proton Pro forma BS Provisio

44. Slide 44: Consolidation in the Greek banking sector

    Consolidation in the Greek banking sector Recent acquisitions as %(1) of customer loans (2) Acquired banks Piraeus 45% 55% CPB (3) Alpha Bank 73% 27% (4) Eurobank 85% 15% (5) NBG 95% 5% Acquired loans (%) “Good” banks (1) Estimated based on customer loans of acquired businesses at time of acquisitio

45. Slide 45: Synergies

    Synergies Targeted pre-tax synergies 2015(1) (€ m) Comments  Lower deposit costs due to market consolidation and TT time deposit costs converging to Eurobank levels Funding  TT interbank funding costs decreasing to Eurobank levels 56 89 44%  Anticipated reduction of ELA funding utilising TT’s exc

46. Slide 46: Integration plan

    Integration plan Integration plan Timing Integration strategy for TT based on One Bank – Two Brands  Two separate brands will be maintained, with the optimization of the two Branch network 9 months branch networks and the integration of the product factories and back offices Full integration of Pro

47. Slide 47: Eurobank overview: 2012 vs. 2007 Financial performance

    Eurobank overview 2012 vs. 2007 Financial performance

48. Slide 48: 2012 vs. 2007 financial performance

    2012 vs. 2007 financial performance PBT: 2012 vs. 2007 (€ m)(1) Comments 1,075 -459  Sharp deterioration of profitability since 2007 peak -333 192 -1,266 mainly driven by:  Impairments: cost of risk increased from 100bps in 2007 to 369bps in 2012 -161  Lower NII: mainly driven by increased cost o

49. Slide 49: PPI comparison (€ m)

    PPI comparison (€ m) 1.455 703 581  €581m represents 3Q13 PPI of €145m x 4  Does not include expected 148 2 145 synergies of €203m from TT & Proton acquisitions -5 1 2007 2012 3Q13 PPI excluding TT & excl 3Q13 funding 3Q13 PPI - excl. 3Q13 x 4 Proton PPI synergies acquistions impact 1. Excluding P

50. Slide 50: Operating expenses

    Operating expenses Cost-to-income ratio (%) Group OpEx (€ m) 1.358 -27% 988 Group cost / income ratio -61 Greece cost / income ratio 75 69 FY08** 9M13* - annualized VES benefit 59 Comments 48  27% OpEx reduction since 2008 42  Cost reduction CAGR in the 2008-13 period at 6.1% Acquisitions , Intern

51. Slide 51: Deposit spreads evolution

    Deposit spreads evolution Eurobank Greek time deposits spreads (bps)(1)  Greek crisis provoked significant deposit outflows and subsequent pricing deterioration  Time deposit pricing deteriorated by 340bps since 4Q07 17 -41 -79  Pricing being restored due to:  Macro stabilization -204 -228 -284

52. Slide 52: Eurosystem funding exposure

    Eurosystem funding exposure Gradual run-down on a standalone basis(1) Recent acquisitions improve liquidity(2) Eurosystem funding,(€bn) Cost of 34.0 -51% Eurosystem 2.3% 1.6% 1.3% 0.8% funding (%) 15,0 17.9 16.5 30,1 5,4 4,6 27,2 19,0 12,5 12,0 23,3 22,6 21,8 21,1 Eurobank Eurobank +TT+Proton Euroba

53. Slide 53: Fee & commission income

    Fee & commission income Net fee & commission income / total assets 0,92%  Due to the crisis, fee and commission income contracted from 0.9% of total assets in 2007 to 0.4% in 9M2013 0,68% 0,57%  Commission income is highly dependent on macro 0,52% environment and markets performance (asset managem

54. Slide 54: Cost of risk

    Cost of risk Cost of risk development (Greece)  Greek provision charges increased by 280bps on average net loans between 4,5% 4,4% 2007-12 4,2%  Asset quality hinges on macro but also 3,8% regulatory environment: − New law on household insolvency to potentially reduce NPL formation 2,8% − The Gove

55. Slide 55: Appendix: Summary financials

    Appendix Summary financials

56. Slide 56: Summary financials

    Summary financials Income Statement (€ m) 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13* Net Interest Income 426.4 373.4 358.3 302.8 276.7 301.0 310.3 323.3 Net Fees & Commissions 68.5 60.5 62.4 70.6 65.3 66.5 69.9 70.3 Non Core Income 41.5 50.0 -23.4 -35.4 0.6 -23.3 14.0 15.7 Total Operating Income 536.4

57. Slide 57: Key figures of Int'l Operations – 9M13 (€ m)

    Key figures of Int’l Operations – 9M13 (€ m) Romania Bulgaria Serbia Cyprus Ukraine LUX Int’l Total Assets 3,923 3,234 1,581 2,902 735 1,068 13,239 Balance Balance Sheet Total Loans (Gross) 2,817 2,620 1,028 1,174 630 483 8,753 Sheet Total Deposits 1,833 2,232 824 2,462 342 774 8,467 Operating Incom

58. Slide 58: 9M 2013 – Summary per Segment (€ m)

    9M 2013 – Summary per Segment (€ m) Global & Capital, Other International Retail Corporate Wealth Mngt Capital & Elimination TT & PROTON Total Center Operations Markets Interest income 395.3 279.5 40.1 -92.4 -37.8 13.0 303.4 901.0 Net fee & commission income 19.9 41.3 18.1 -1.8 -1.72 0.4 69.9 146.0

59. Slide 59: 9M 2012 – Summary per Segment (€ m)

    9M 2012 – Summary per Segment (€ m) Capital, Other & Global & Capital International Retail Corporate Wealth Mngt Elimination Total Group Markets Operations Center Interest income 518.8 301.8 47.3 53.9 -67.2 303.4 1,158.1 Net fee & commission income 24.8 43.0 21.3 -11.4 -0.95 74.9 151.7 Net Insurance

60. Slide 60: Contacts

    Contacts Eurobank Ergasias, 20 Amalias Avenue, 105 57 Athens, Greece Fax: +30 210 3337 160 E-mail: investor_relations@eurobank.gr Internet: www.eurobank.gr Reuters: EFGr.AT Bloomberg: EUROB GA Investor Relations  Dimitris Nikolos Tel: +30 210 3337688 E-mail: dnikolos@eurobank.gr  Yannis Chalaris T

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