Issuer Profile

Data basis as of May 2019 Only for qualified, professional institutional investors – not for direct distribution into retail In a nutshell

DEUTSCHE HYPO… • Is one of the oldest and most renowned Pfandbrief banks in • Is the centre of competence for commercial real estate business in the NORD/LB Group • pooling of proven competence in one unit • German mortgage bank with European focus • presence in important German and foreign locations • Has a well-established capital market business • Is a renowned issuance house • responsible for the issuance of Mortgage Pfandbriefe in the NORD/LB Group • sound funding from many years of experience • Has its own independent market approach in its business activities • Has the German Pfandbrief Act as the basis for its business model • Is part of the Savings Banks’ Guarantee System

2 Owner structure and business segments

DEUTSCHE HYPO is the centre of competence for commercial real estate business in the NORD/LB Group. This makes DEUTSCHE HYPO the major issuer of Mortgage Pfandbriefe and an important value driver of the Group.

A control and profit and loss transfer agreement has been signed to ensure a closer connection of DEUTSCHE HYPO to the NORD/LB Group. Furthermore the “simplification options” in accordance with Section 2a KWG (old version, so-called “waiver rule”) apply. NORD/LB has granted a letter of comfort (Patronatserklärung) in favour of DEUTSCHE HYPO (Cf. pg. 258 of NORD/LB’s Group Annual Report 2018). NORD/LB Group

Private and Corporate Customers Energy and Ship and Aircraft Real Estate Banking Commercial & Markets Infrastructure Customers (until Customers Customers Customers further notice) . Corporate Customers . Private customer business . Agricultural banking . Renewable energy finance . Ship finance . Private banking . Housing . Infrastructure finance . Aircraft finance . Commercial customer . Acquisition finance . Leasing business . Municipal and public- . Export and trade finance . Commercial real estate . Insurance services sector customers finance . Savings Banks . Financial institutions

3 Security and credit protection as part of the Savings Banks sector

• Solid integration in the Savings Banks Finance Group (market share in Germany > 35%) • Strong Joint Liability Scheme (Deutscher Sparkassen- und Giroverband / DSGV) • Over 400 Savings Banks, 8 Landesbanks, DekaBank, as well as Landesbausparkassen and Pfandbriefbanks • Unlimited deposit protection – i.e. more than the EU-wide protection amount (€ 100,000) • Protection of affiliated institutions, i.e. safeguarding of solvency and liquidity • No loss of any deposit, no default, no insolvency since the establishment of the Guarantee System in 1975 • Ratings DSGV (www.dsgv.de, English version also available): • Moody‘s: Corporate Family Rating Aa2 • Fitch: Group Rating A+ • DBRS: Long-Term Issuer Rating A • Access to the Savings Banks Sector liquidity (high level of customer deposits in Germany) • Access to NORD/LB Group liquidity • Risk weighting 0% within the Saving Banks Sector 4 The year 2018 in a nutshell

• Result from normal operations at € 74.4 mn (2017: € 62.7 mn) due to stable earnings and the continuous good risk profile in commercial real estate financing • New business volume at € 2,869.8 mn (2017: € 3,798.3 mn) • Net interest income slightly reduced at € 177.4 mn (2017: € 193.4 mn) • Increase of administrative expenses due to investments in further strengthening of the market presence and of the technical infrastructure at € -84.0 mn (2017: € -83,8 mn) • Risk result of the whole bank improved to € -20.3 mn (2017: € -41.3 mn) • The real estate finance risk result improved to € +16.3 mn (2017: € -5.7 mn) • Cost income ratio at 49.5 % (2017: 42.3 %) due to investments in technical infrastructure and because of an increase in the bank levy.

5 Financial figures

in € mn 31.12.2018 31.12.2017 Net interest income 177.4 193.4 Net commission income -0.1 0.3 Administrative expenses -84.0 -83.3 Risk result commercial real estate business 16.3 -5.7 Risk result for overall bank -20.3 -41.3 Result from normal operations 74.7 62.7 Cost-income ratio 49.5 % 42.3 % Balance sheet total 21,072.8 23,698.3 Equity 1,232.1 1,252.1

6 Current Ratings

Credit ratings

Moody's Mortgage Pfandbriefe Aa1* Public Pfandbriefe Aa2* Senior Unsecured (preferred) Baa2* Junior Senior Unsecured (non preferred) Ba1* Short-term Bank Deposits P-2

Sustainability ratings imug oekom research Uncovered Bonds positive BB Overall Score C+ Mortgage Pfandbriefe positive BBB Investment Status “Prime“ Public Pfandbriefe positive BBB “Industry Leader“

Various information about credit ratings and sustainability ratings are available for download on the website www.deutsche-hypo.de. 7 * on review for upgrade

Strategy and targets

• Focus on direct business with professional and financially sound real estate investors • Tailor-made financing concepts and individual, qualified advice for our customers • Customers are institutional investors like real estate funds, real estate companies/REITs, leasing companies, financial investors, developers, banks, affiliated companies and institutions and professional private investors • Asset classes: office and retail properties, apartment buildings, hotels and logistics • Focus on strategic core markets: Germany, France, Benelux, UK, and Spain • Products: medium to long-term financing transactions, project financing, leasing finance, portfolio finance, acquisition finance, structuring, syndication, underwriting, guarantees or derivatives

8 Presence in Europe

• We are where our customers are! • Focus on core Europe: • Domestic locations in Germany • Foreign locations in , , , and • Target markets offer high transaction volumes, high market maturity and intense concentration on our target customers. • High market expertise, excellent language skills and a comprehensive know how of the legislative framework of each target country.

9 References

Logistics portfolio Galeria Baltycka Marieninsel Woodwork Seven German Danzig Paris locations

Logistics centre Shopping centre Office building Office building EUR 64 million EUR 81 million EUR 133 million EUR 37 million

Energy performance DGNB Gold certificate LEED Platin HQE Très Performant certificates with high CU Award (expected) energy efficiency „Best Shopping Centre Development“

Green Bond-ability Green Bond-ability Green Bond-ability Green Bond-ability 10

New business by region (in € mn)

5,000 4,541 4,500 114 4,075 79 22 4,000 749 3,798 3,610 42 69 Other 731 59 113 194 3,500 272 466 Poland 204 260 653 3,000 2,870 299 400 96 572 85 UK 2,500 658 489 347 275 France 2,000 369 Benelux 1,500 2,832 2,449 Germany 1,000 2,118 2,181 1,698 500

0 2014 2015 *) 2016 *) 2017 *) 2018*)

11 *) The years 2015, 2016 and 2017 have been calculated according to a new methodology. In change to the methodology of the prior years, extensions of existing financing were included if the extension periods were at least one year. Portfolio

Regional breakdown Breakdown by property type

Total exposure of € 12,264 mn as at 31.12.2018

USA 1,2% Others 4,9% Residential France 8,5% real estate 18,3%

UK 12,9% Office premises 36,7% Europe 42.7%

Spain 0,6%

Germany 56,1% Poland 2,8% Retail Other 2,3% premises Benelux 15,6% Hotels 7,9% 32,2%

12 Restructuring / unwinding of special loans portfolio (rating categories 16 to 18 according to DSGV)

1,200 9%

7.78% 8% 1,000 7%

800 5.76% 6%

5.16% mn.

€ 5%

600 3.85%

4%

3.09%

951

Volume in Volume 2.97%

400 3%

2.37%

2.10%

666 in %of the realtotal estate finance portfolio

583 2%

537

1.31%

1.31%

1.27% 1.20%

200 1.12%

395

0.81%

0.80%

0.73% 0.71%

326 1%

280

289

182

179

177

166

152

96

110 107 0 100 0%

13 High risk portfolio in % of all real estate loans (EAD) Collateral pool without auxiliary collateral under Section 19 PfandBG

Collateral pool by region Collateral pool by property type

Total exposure € 8,338 mn as of 31.12.2018

USA 1,5%

France 8,6% Others 1,1% Residential Office real estate premises 20,3% UK 12,1% 35,1%

Europe 45,9%

Austria 1,1% Germany 52,6% Spain 0,7% Netherlands 17,8% Poland 3,7% Hotels 6,9% Retail Belgium 0,3% premises Ireland 1,4% 36,6% Luxemburg 0,2% 14 Outlook commercial real estate

• A stable economic situation is expected for the next years. Germany will stay an attractive investment location. • Excess demand for core-segments: B and C locations are more attractive. Historical low yields of real estates. • The low-interest-rate policy enhances the rising trend. There is no real estate bubble in spite of excessive prices. • Deutsche Hypo follows its conservative risk policy. A continuous analysis of its core markets helps to identify turnarounds and overheatings immediately, if any. • Further positive outlook for the portfolio quality.

15 Investor participation as a competitive advantage

• Expansion of business activities • Close cooperation with selected investors • Deutsche Hypo as originator of commercial real estate loans • Participation of investors in both risk and return of the (joint) reference portfolio • Advantages for both sides:

Investor Deutsche Hypo • Direct credit claim(s) • Access to new market segments • Real Estate collateral • Can originally opt for larger bids • Increase of the portfolio return • Increase of the market presence • Agreed quality characteristics • Splitting of credit risk incl. equity relief • Direct influence on investments • Investor participation by vertical risk structure

16 Strategic cooperation: direct investor participation

Initiation of transaction Investment decision Exposure management

• Proposal of suitable loans by • Joint decision making • Continuous monitoring Deutsche Hypo (following • Consensual investment of the investments predefined criteria) decision • Servicing • Structuring of the transaction • Shared interest between (diversification by product investor and Deutsche Hypo and location) due to the participation of • Joint due diligence the bank in each financing • Investor access to the • Attractive and stable return origination of Deutsche Hypo

17 Strategy and targets

• Consecutive reduction of the Bond- and loan (“Schuldschein”-) portfolio • Reduction of the public sector portfolio • Focus on issuing Mortgage Pfandbriefe • Selective new business for the purpose of liquidity, collateral pool and general bank management • Safeguarding the liquidity by supplying the corresponding liquidity portfolios

18 Collateral pool for public sector covered bonds

Collateral pool by borrower Collateral pool by rating *)

Total exposure € 3.958 mn as of 31.12.2018

Public-sector companies 4.5% Public-sector banks 3.2% AAA 22.1% Municipalities, non-profit organisations 1.4% Federal Rep. (incl. KfW) 1.6% Austria 12.0% Poland 0.8% BB 0.4% AA+ 27.5% Switzerland 1.7% BBB 8.2% USA 2.4% Canada 3.0% Spain 0.4% A- 0.8%

Japan 0.2% Italy 7.8% A 8.3% France 0.8% A+ 0.3% German federal states EU 3.6% AA- 7.3% incl. governmental Other 3.6% financial institutions Belgium 6.3% 46.7% AA 25.1% Low risk due to horizontal (international/regional) and vertical (State/Region/City) diversification

*) partial use of internal ratings 19 Funding philosophy and structure • Issuance business driven by demand • High reliability, especially for issuing spreads • Benchmarks are an important part of the product range • High visibility by continuous market presence as a regular issuer of Pfandbriefe • Permanent broadening of investor base • NEW: Green Bond

=> Competitive advantage of DEUTSCHE HYPO in the lending business by cost-effective funding

Funding mix (in € mn) Structure breakdown (in %)

Mortgage Pfandbriefe Unsecured Benchmark Structured Private Placement 4,500 100% 4,000 90% 28 3,500 80% 3,000 70% 59 5 2,138 73 70 68 1,970 60% 2,500 2,198 1,238 50% 2,000 728 40% 3 1,500 67 30% 4 1 2 1,000 20% 1,614 1,602 1,800 1,730 38 1,328 28 28 500 10% 26 0 0% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 20 Fulfilment of MREL-Requirements*

80% Indication MREL ratio

70% MREL ratio incl. Deposits & Senior preferred (of RWAs) 60% MREL ratio incl. Deposits (of RWAs)

50% MREL ratio (of RWAs)

MREL ratio incl. Deposits & Senior preferred (balance sheet) 40% MREL ratio incl. Deposits (balance sheet)

30% MREL ratio (balance sheet)

20% 8% TLOF

25% RWA ratio 10%

0% 31.03.2019 31.03.2021 31.03.2024 31.03.2029

* Calculated on the basis of all currently-known supervisory releases. 21 As of 31.03.2019 Fulfilment of MREL-Requirements*

6,000

mn. Indication MREL eligible assets €

5,000

4,000 Deposits (allowance expected for 2019) Senior preferred (2,5% of RWAs) Senior Non-Preferred 3,000 Subordinated debt Owner's equity 25% RWA ratio 2,000 8% TLOF ratio

1,000

0 31.03.2019 31.03.2021 31.03.2024 31.03.2029

* Calculated on the basis of all currently-known supervisory releases. 22 As of 31.03.2019 Liquidity situation

LCR-Ratio as of 31.03.2019: 389,6% LCR-Requirement NORD/LB: 115,0% LCR-Requirement DSGV: 107,5%

In addition to that it is essential to fulfil other internal liquidity stress tests.

Deutsche Hypo NORD/LB

DSGV 23 Capitalisation

For Deutsche Hypo as a subsidiary of NORD/LB, use is made of the waiver option of art. 7 para. 1 of the CRR, which allows the parent institute to exempt subsidiary institutes from some requirements at individual institute level in accordance with art. 6 para. 1 of the CRR. There is therefore no disclosure requirement at individual institute level for Deutsche Hypo (Cf. pg. 258 NORD/LB Group Annual Report 2018) Capitalisation Deutsche Hypo Capital Ratios NORD/LB1

Capital Ratio Deutsche Hypo 18.54% Temporarily decline due to annual loss

AT1 210.9

CET1 TC

20.0% 18.1% CET1 843.9 20% 16.7% 16.3% 12.8%

10% 13.1% 14.0% 11.3% 12.4% 6.8% 0% Total eligible capital 1,054.8 31.12.15 31.12.16 31.12.17 31.12.18 2019

1) Cf. NORD/LB Group Presentation April 2019 24 https://www.nordlb.de/fileadmin/redaktion/branchen/investorrelations/praesentationen/NORDLB_Konzernpraesentati on.pdf Benchmark transactions

EUR 500,000,000 GBP 355,000,000 EUR 500,000,000 EUR 750,000,000 EUR 500,000,000 Green Pfandbrief Mortgage Pfandbrief Green Pfandbrief Mortgage Pfandbrief Mortgage Pfandbrief (Tap)

6 years 3 years 6 1/4 years 10 years 8 years Maturity 23.11.2023 Maturity 22.03.2021 Maturity 10.12.2024 Maturity 05.03.2029 Maturity 29.06.2026 ISIN DE000DHY4887 ISIN DE000DHY4937 ISIN DE000DHY4994 ISIN DE000DHY5025 ISIN DE000DHY4960

Lead Managers Lead Managers Lead Managers Lead Managers Lead Managers ABN Amro, Crédit Deutsche Bank, HSBC, ABN Amro DZ Bank, Helaba, Commerzbank, Crédit Agricole CIB, DZ Bank, JP Morgan, Toronto Bayern LB, NATIXIS, NATIXIS, NORD/LB, Agricole CIB, Helaba, NORD/LB, UniCredit Dominion NORD/LB, UniCredit UniCredit NORD/LB, UniCredit + NORD/LB (Co-Lead)

2017 2018 2018 2019 2018/2019

25 25

Benchmark maturities

Current Benchmark Volume Hypfe in bn EUR (total volume 7.651 bn EUR) 1,4 1.250 1.250 1,2

1.000 1 0.901*

0,8 0.750 0.750 0.750

0,6 0.500 0.500

0,4

0,2

0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 26 * Including one GBP-issuance Good reasons for buying DEUTSCHE HYPO bonds

• Well-established name “DEUTSCHE HYPO“ • Reliable, stable issue levels + flexible handling of issue platforms and products (i.e. consistent funding strategy) • “Core“ segment of Covered Bond market • Relatively low spread volatility • High issue volume, if needed • Benchmark issues • Large private placements • Inherent part of the NORD/LB Group • Letter of comfort of the NORD/LB • Control and profit and loss transfer agreement to ensure a closer integration of DEUTSCHE HYPO into the NORD/LB Group • Part of the Savings Banks’ Guarantee System (“Haftungsverbund der Sparkassen-Finanzgruppe“) • Unlimited guarantee volume • Liquidity and solvency protection

27 Deutsche Hypothekenbank Dirk Schönfeld Head of Treasury (Actien-Gesellschaft) Telephone +49(511) 3045-204 Osterstraße 31 [email protected] D-30159 Hannover www.deutsche-hypo.de [email protected] FAX: +49(511) 3045-209 Jürgen Klebe Senior Director Funding and Investor Relations Telephone +49(511) 3045-202 [email protected]

Philipp Bank Funding und Investor Relations

Telephone +49(511) 3045-206 [email protected]

28 The “debt fund“ as a special case of direct investor participation

• Participation in financings of commercial real estate business of Deutsche Hypo • Good to very good premium property qualities, generally eligible as cover assets • Participation in large transactions • Proven credit process and due diligence is clearly defined and documented • Investment company as a platform for investment in • good LTVs • good ratings and coverage • Classification as debt security according § 2 (1), no. 8 of the Investment Guidelines possible • Low work intensity on the investor side • Attractive returns • Good rating as main target • Regular rating reviews ensure sustainable quality • Financings must meet specified quality standards defined in advance • Audit by an external and independent asset manager • Neutral investment decision • Direct influence of core investors on all significant investments • Independent investment committee • Transparent risk assessment and investment decision • Clear investment criteria ensure high quality of the introduced financings 29 DEUTSCHE HYPO’s Debt Issuance Programme

• Volume € 15 bn • Multi-currency DIP (€ and GBP) • Prominent dealers are involved • All other banks can take part as “dealer of the day“ • No “covered bond programme“, but designed for issuing Pfandbriefe and senior unsecured notes • Type of cover pool: • Mortgage Pfandbriefe => mortgage collateral pool • (Senior unsecured bonds => “the bank itself“, i.e. no explicit cover pool) • Pools are not mixed, but strictly separated • Ratings of the bonds as mentioned in Moody’s reports • For benchmarks as well as for private placements • Up to date documentation • Legal framework for international bond placement

30 NORD/LB – portrait of a leading regional bank with international business approach

• One of the biggest banks in Germany • Business focus on northern Germany • Landesbank for Lower-Saxony (Niedersachsen) and Saxony-Anhalt (Sachsen-Anhalt) • Savings Banks’ central bank in Lower-Saxony, Saxony-Anhalt and Mecklenburg-Vorpommerania (Mecklenburg- Vorpommern) • One of the leading German Banks in national and international Bond Syndication • Broad variety of products for private, business, institutional and public clients • Business focus of NORD/LB: • Structured Finance • (Ship Financing) • (Aircraft Financing) • Agricultural Banking • Financial Markets • Private and Commercial Customers • Savings Bank in Brunswick area (Braunschweig) • International bank • Presence in all relevant financial and business centres • World-wide network of branches and service offices • Contact to 1,500 banks world-wide 31 This presentation and the information contained herein, as well as any additional documents and explanations (together the „material“), are issued by Deutsche Hypothekenbank (Actien-Gesellschaft), “DEUTSCHE HYPO”.

The material is provided to you for informational purposes only, and DEUTSCHE HYPO is not soliciting any action based upon it. The material is not intended as, shall not be construed as and does not constitute, an offer or solicitation for the purchase or sale of any security or other financial instrument or financial service of DEUTSCHE HYPO or of any other entity. Any offer of securities, other financial instruments or financial services would be made pursuant to offering materials to which prospective investors would be referred. Any information contained in the material does not purport to be complete and is subject to the same qualifications and assumptions, and should be considered by investors only in light of the same warnings, lack of assurances and representations and other precautionary matters, as disclosed in the definitive offering materials. The information herein supersedes any prior versions hereof and will be deemed to be superseded by any subsequent versions, including any offering materials.

DEUTSCHE HYPO is not obliged to update or periodically review the material. All information in the material is expressed as at the date indicated in the material and is subject to changes at any time without the necessity of prior notice or other publication of such changes to be given. The material is intended for the information of DEUTSCHE HYPO´s institutional clients only. The information contained in the material should not be relied on by any person.

In the this communication is being issued only to, and is directed only at, intermediate customers and market counterparties for the purposes of the Financial Services Authority’s Rules ("relevant persons"). This communication must not be acted on or relied on by persons who are not relevant persons. To the extent that this communication can be interpreted as relating to any investment or investment activity then such investment or activity is available only to relevant persons and will be engaged in only with relevant persons.

Receipt of the material involves no obligation or commitment of any kind by any person. Recipients of the material are not to construe information contained in it as a recommendation that an investment is a suitable investment or that any recipient should take any action, such as making or selling an investment, or that any recipient should refrain from taking any action. Prior to making an investment decision, investors should conduct such investigations as they consider necessary to verify information contained in the relevant offering materials and to determine whether the relevant investment is appropriate and suitable for them. In addition, investors should consult their own legal, accounting and tax advisers in order to determine the consequences of such investment and to make an independent evaluation of such investment. Opinions expressed in the material are DEUTSCHE HYPO´s present opinions only. The material is based upon information that DEUTSCHE HYPO considers reliable, but DEUTSCHE HYPO does not represent, guarantee, or warrant, expressly or implicitly, that the material or any part of it is valid, accurate or complete (or that any assumptions, data or projections underlying any estimates or projections contained in the material are valid, accurate or complete), or suitable for any particular purpose, and it should not be relied upon as such. DEUTSCHE HYPO accepts no liability or responsibility to any person with respect to, or arising directly or indirectly out of the contents of or any omissions from the material or any other written or oral communication transmitted to the recipient by DEUTSCHE HYPO.

Neither the material nor any part thereof may be reproduced, distributed, passed on, or otherwise divulged directly or indirectly by the party that receives it, to any other person without the prior written consent of DEUTSCHE HYPO.

The distribution of the material in certain jurisdictions may be restricted by law and persons into whose possession the material comes are required by DEUTSCHE HYPO to inform themselves about, and to observe, any such restrictions.

By receiving the material, the recipient acknowledges, and agrees to abide by, the aforementioned. 32