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Erste Group Research Credit Markets Weekly | Credit | & CEE July 29, 2021

Credit Markets Weekly Sovereign Austria, Sub-Sovereigns & Agencies, Financials & Covered Bonds, Corporate Bonds

Analyst: Elena Statelov, CIIA Spreads expected to move sideways over summer [email protected]

IMF regards inflation pressure as transitory As expected, the ECB adjusted its forward guidance last week to the new EUR Market overview sorted by yield strategy (please also see our Short Note ECB from 22 July 2021). However, Ø Ø ASW this makes no difference to the very favourable financing conditions on the Debt Type Ø Rating Ø Term Yield (in BP) capital market. The ECB sticks to its ultra-loose monetary policy despite the DE Sovereign AAA 8.4 -0.33% -42.4 recent rise in inflation. At the beginning of this week, the IMF updated its Covered Bonds AAA 5.3 -0.16% 3.2 AT Agencies AA+ 5.5 -0.09% 7.7 forecast. While rising rates of inflation are being expected on a global scale, Bank Senior A 4.4 0.14% 44.3 the IMF regards the inflation pressure as transitory and has also warned the SSAs AA+ 8.7 0.19% 20.5 central banks against ending their expansive monetary stance too soon AT Sovereign AA+ 13.1 0.24% 24.1 before the picture becomes clearer with respect to the underlying price IG Corporates A- 6.3 0.33% 51.2 movements. The initial estimate for July inflation in the Eurozone will be IG Corp Hybrids BBB 5.2 1.41% 173.1 released on Friday. HY Corporates BB- 4.7 2.77% 307.5

Source: Market data provider, Erste Group Research (own calculations) Outlook for Austrian companies becoming gradually more positive The 2Q earnings trend remains positive for European companies. The

Major Markets & Credit Research average earnings figures across all sectors are 61% above consensus Gudrun Egger, CEFA (Head) estimates at this point; aggregate actual earnings growth is up 44% y/y. The companies are starting to be more upbeat about FY 2021. For example, Sovereign Austria some Austrian companies increased their outlook for the full year of 2021, Margarita Grushanina among them Telekom Austria, Andritz, AMAG, Österreichische Post, and Sub-Sovereigns & Agencies . In the coming days, ams, OMV, , and Ralf Burchert, CEFA are scheduled to report their results.

Financials & Covered Bonds Heiko Langer Fewer issues and calm secondary market expected Carmen Riefler-Kowarsch The ongoing summer break and the current 2Q reporting season can be noticed on the primary market. The issue momentum has dropped Corporate Bonds Peter Kaufmann, CFA significantly across all asset classes. On the secondary market, we also Bernadett Povazsai-Roemhild, CEFA expect spreads to move sideways. Elena Statelov, CIIA We will be taking a short break as well and will be back with the next edition

of our Credit Markets Weekly on 18 August, 2021.

Last updates: Corporate Credit Monitor Austria (available in German only) Special topics of the week Corporate Credit Monitor CEE

ESG / Green Bonds Week Ahead EU increases pressure on fossil fuels sector 4

Financials & Covered Bonds All data as of July 26, 2021 BAWAG Group: Noticeably higher quarterly result 7

Note: Past performance is not necessarily indicative of future results.

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Market overview

Sub-Sovereigns & Agencies

Benchmark yields remain low The benchmark yields remain low. The 10Y German government bond yield has recently fallen below -0.4% not the least on the back of the disappointing ifo business climate index. In the peripheral region of the Eurozone, the Italian 10Y yields have fallen back to around 0.6%. US Treasuries have not broken their downward trend sustainably yet and have recently dipped below 1.2% for a short while. On the SSA secondary market, transactions took a short respite due to the surprisingly sharp decline of benchmark yields, which led to a temporary spike of spreads. Meanwhile, spreads have fallen back again, as a result of which the trend remains in a sideways channel.

SSA primary market starting The SSA primary market seems to be transitioning into its summer break. summer break, Moody’s After the French labour agency Unédic (Aa2/AA) and its EUR 2bn issue that confirms ’s Aa1, stable came as social bond (2031) and was priced at mid-swap +8bps, the market rating entered a phase of calm. The same is true for domestic issuers. Moody’s broke the silence with its confirmation of Vienna’s rating of Aa1 (stable outlook).

Financials & Covered Bonds

Still no new issues The primary market of covered and senior bonds remains in holiday mode. Neither of the two segments has seen an issue during the recent two weeks. Despite the suspended transactions, senior bonds have recorded a higher aggregate issue volume in the year to date than in the referential period of 2020.

Regime following TLTRO3 will Covered bonds, on the other hand, remain at their many-year low of around be decisive for covered bond EUR 50bn on aggregate. We do not expect any significant uptick in issues activities in 2022 or a closing gap vis-à-vis last year’s volume in the coming months. The main reason for the restrained primary market activity seems to remain the provision of attractive finance by the TLTRO3 facility of the ECB. This means the expected issue activity in 2022 will largely depend on the regime following the TLTRO3 facility. The last TLTRO3 tranche under the current regime will be allocated in December 2021.

Senior bonds maintain positive The positive tendency of last week continued on the secondary market for tendency senior bonds. Spreads continued to narrow slightly, both in the core markets and in the peripherals. Here, the reduced supply we have seen in some cases in recent weeks seems to make itself felt. In the covered bond segment, on the other hand, spreads recorded no significant movement.

Corporate Bonds

Primary market heading for With the summer break approaching, the corporate bond primary market is summer break as well quieter than in recent weeks. We saw only one jumbo-sized issue: Alstom (Baa2) placed EUR 1.2bn in two tranches. Some high-yield companies also used this window of opportunity, e.g. Ideal Standard (B3/B-) with a EUR 325mn issue. Metropolitano de Tenerife (A) issued a green bond of EUR 130mn.

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With the exception of a few sporadic issues, activities on the primary market should be very subdued in the coming weeks.

Upward trend of high-yield On the secondary market, the slight upward trend of high-yield spreads that spreads over (for now) had been in place since mid-June came to an end (for the time being), despite the fact that the German business climate index (ifo) for July was below its June counterpart. In the year to date, the high-yield segment has benefited the most from the recovery of the economy, posting a total performance of +3.2% (Investment Grade +0.3%; Investment Grade Hybrids +2.0%). Many high-yield companies have been able to refinance their financial liabilities at more attractive conditions on the primary market. In the year to date, High-Yield bonds account for 27% of total issue volume, which is significantly above the 5Y average of 15%.

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ESG / Green Bonds Ralf Burchert, CEFA [email protected] EU increases pressure on fossil fuels sector

Focus on energy generation The EU is increasing pressure with respect to the conversion of value and consumption chains based on fossil fuels. With the provisional adoption of the EU ‘climate law’ (actually a regulation) by the Commission and Council in April 2021, the goal of climate neutrality by 2050 and the interim target of reducing greenhouse gases until 2030 by 55% of the levels prevailing in 1990 has become binding EU law. In mid-July, the Commission has launched a comprehensive and complementary package of measures with specific proposals in line with this, as well as its Strategy for Sustainable Finance (see also Credit Markets Weekly of 21.7.21). It is not surprising that fossil energy generation and consumption, which account for 75% of greenhouse gas emissions in the EU, are a major focus.

Illustrative emissions pathways to achieve net-zero Direct and indirect energy consumption: the target in the EU 2050 sectors most affected in gigatons CO2-equivalents per year Erste Global-1000 Index – Europe, in gigajoules per EUR 1mn of revenues

Source: Stiftung Wissenschaft und Politik, market data providers, Erste Group Research

Pricing and increasing scarcity Apart from nationally implemented reduction targets (‘burden sharing’), the of emissions certificates: The most effective steering measures in this context consist of pricing and emissions trading system increasing the scarcity of CO2 emission certificates, which can be used as a production factor in manufacturing of goods or can be resold on the market. The European Emissions Trading System (EU ETS) is a cap-and-trade system that caps emissions from around 10,000 energy-intensive facilities (power plants and manufacturing sites) and around 500 airlines. The ETS covers approximately 41% of EU greenhouse gas emissions.1

At the beginning of the last trading period 2013-2020, 80% of the manufacturing industry’s certificates were allocated to it free of charge. This proportion was gradually reduced every year until it reached 30% in 2020. Electricity producers have essentially no longer received any free certificates since 2013, but have to buy them. However, a certain number of

1 The reduction targets for the remaining 59% of emissions are set through the Effort Sharing Regulation, 2018, under national emission reduction targets for road transport, building heating, agriculture, small industrial facilities and waste management. Major Markets & Credit Research Page 4

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free certificates will remain available for the modernization of the electricity sector in several member countries.

Emissions trading also for road The Commission's new proposals envisage the consumption of fossil fuels, transport and buildings which was previously covered by nationally regulated burden sharing, to be integrated into the ETS: For road transport (i.e., gasoline, diesel, about 20% of emissions or about 835 million tons in the EU2, of which 15% are motor vehicles and light trucks, the rest heavy duty vehicles) and the building sector (heating oil, gas, proportionally around 12% of emissions), a separate new emissions trading system will be introduced for the fuel supply to these sectors. This is to be implemented ‘upstream’ at the level of fuel suppliers (around 11,400 companies), which will require an emissions license starting from 2025.

This is to be added as a complement to existing reduction targets in order to counteract an increase in consumption as a result of improved efficiency. Thus the two sectors are to remain under national responsibility in parallel (burden sharing). The reduction target in the framework of burden sharing until 2030 is to be increased EU-wide to at least 40% from the current 29% starting from the level of 2005 (the targets vary from 10 to 50% between member countries, see EU Memo).

CO2 (EUA) future contract In any event, from 2026 a maximum emission level is to be set and a (in EUR/t) reduction factor of 5.4% per year is to be applied. According to the impact assessment, assuming a CO2 price of EUR 48/t, this results in a price increase for heating oil of 10-21% depending on the member country (Austria: 21%), 10-33% for natural gas (Austria: 15%) and 7-12% for gasoline (Austria: 10%). However, in 2030 CO2 prices for the ETS are expected to be significantly higher. The average of the estimates is currently EUR 71/t, within a range of EUR 42-89/t. The EU Commission's estimates are based on assumptions of an average of EUR 45/t in the period 2021- 2025 and EUR 55/t in the period 2026-2030.

Source: Market data providers, Erste Group Research Concurrently the caps for all emissions in the existing ETS will be reduced further and the annual reduction (‘linear reduction factor’) will be increased from 2.2% to 4.2%. This is expected to increase the reduction of all installations covered by the ETS to 61% by 2030 compared to 2005 levels.

2035 ban on internal Stricter CO2 emission standards for passenger cars and light-duty vehicles combustion engines in are to simultaneously reduce average annual emissions from new vehicles passenger cars and light by 55% from 2030 and by 100% from 2035 compared to 2021 levels. In the commercial vehicles buildings sector, public authorities (share of 5-10% of EU-wide energy consumption) will be required to double the rate of building renovation (measured by floor area) to 3% per year. Under the proposed Energy Efficiency Directive, requirements for energy suppliers will also be increased. The proposals envisage a higher target for the generation of energy from renewable sources by 2030. Pursuant to the Renewable Energy Directive, the share is to be increased from 32% to 40% (2019: 20%).

Stricter regulation of aviation Further proposals of the Commission focus on the tourism, maritime and air and shipping transport sectors: free emission certificates for aviation are to be phased out and brought into line with the international Carbon Offset and Reduction Scheme for International Aviation (CORSIA). Shipping emissions (3-4% of EU emissions, but growing rapidly) are to be included in the EU ETS for the

2 2019, excl. UK, Source: EEA Report 5/21, European Environmental Agency. Major Markets & Credit Research Page 5

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first time as well. Aircraft and ships at major ports and airports are to get access to clean electricity. More sustainable aviation fuels are to be progressively blended into the turbine fuel offered at airports in the EU, including synthetic low CO2 fuels referred to as e-fuels. This also concerns sustainable marine fuels and zero-emission technologies. Another important sector receiving more attention is information and communications technology (ICT), which accounts for 5-9% of global electricity consumption and more than 2% of all emissions. In this area higher reporting or transparency requirements are to be fulfilled from March 2024.

Border adjustment mechanism By way of a new CO2 border adjustment mechanism, a CO2 price for to avoid ‘carbon leakage’ for imports of certain products (e.g. iron and steel, electricity, fertilizers, cement) certain industries will be introduced in order to reduce the risk that ambitious climate policies in Europe lead to carbon leakage. This will ensure that European emissions reductions contribute to global emissions declines, rather than CO2- intensive production capacity moving out of Europe. Within the Union, greater harmonization of the taxation of energy products, including electricity, is planned as part of an amendment of the Energy Taxation Directive (2003).

Proceeds to benefit green In order to complement the substantial climate expenditures of the EU transformation and social budget, member countries are supposed to allocate the entirety of their impact mitigation revenues from emissions trading to climate- and energy-related projects. A certain portion of the revenues from the new emissions trading system for the road transport and buildings sectors is to be earmarked for the mitigation of the social impact on vulnerable households, micro-enterprises and transport users. In this context a new social climate fund with an endowment of EUR 72bn over the period 2025-2032 was proposed concurrently. Auction proceeds from 2026 onward are estimated to average EUR 47bn per year. By comparison, the ETS in its existing scope is expected to generate around EUR 20bn in the period 2021-2025.

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Financials & Covered Bonds Heiko Langer BAWAG Group: Noticeably higher quarterly result [email protected]

Risk costs down 68% The BAWAG Group increased its net profit in Q2 2021 by 94.3% y/y to EUR 119.1mn. The main reason for this significant improvement was the 68.1% fall in risk costs, which amounted to EUR -23.8mn in Q2 2021 (Q2 2020: EUR -74.6mn). The bank points out that it has not released any reserves despite the improving economic environment. The operating core revenues were up 6.5% to EUR 301.7mn and thus also contributed to the improved quarterly result. At +25.6%, the increase was particularly pronounced for fee and commission income. Net interest income rose by 1.8%.

CET1 ratio increases to 14.4% Operating expenses in Q2 2021 fell by 2.8% to EUR -121.2mn. The cost/income ratio was at 40.3% (Q2 2020: 43.0%) at the end of the first half. The balance sheet total increased by 1.9% to EUR 54.1bn in the first half (N.B. in Q1 2021, that number had been down by 0.3%). Customer receivables increased in the first half of 2021 by 1.1% to EUR 32.4bn, while customer deposits rose by 2.3% to EUR 33.0bn. The CET1 ratio was at 14.4% at the end of the first half.

NPL ratio unchanged at 1.5% The NPL ratio of the bank remained unchanged from Q1 at 1.5%. The share of loans in the retail and SME segment that had been granted a moratorium due to COVID-19 decreased further to 0.3% in Q2 2021 (Q1 2021: 0.6%). In the Corporates & Public segment, the share of deferred loans remained unchanged in Q2 2021 relative to Q1 2021 at 0.1%.

Outlook

Targets for 2021 revised The bank expects the positive development of the operating income to upwards continue in the second half. For the full year, it envisages risk costs of below EUR -100mn. The outlook does not contain any release of reserves. The bank changed its targets for 2021 on the basis of the outlook. BAWAG now wants to achieve an RoTCE of about 15% (previously >13%) and a cost/income ratio of about 40% (previously <41%).

In July, BAWAG signed an agreement to purchase the retail broker “Hello bank! Österreich”. The bank expects to close the takeover in Q4 2021 or Q1 2022. Around the same time BAWAG wants to close the takeover of Depfa Bank plc, which was announced in February.

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EUR primary market

Total market Issue volume in annual comparison 2016-2021 YTD, in EUR bn 1,600 1,400 1,200 1,000 800 600 400 200

0

2018 2016 2017 2019 2020 2021

Agency Corporate Financial Muni/Local Gov't Sovereign Supra

Total market Issue volume, by rating … and by country 2019-2021 YTD 2019-2021 YTD

Other Other; 9% HY 1% CAN; 2% DEU; 20% 10% AAA FIN; 2% 20% BBB- AUT; 2% 7% LUX; 2% SWE; 3% BEL; 3% BBB 10% AA+ NLD; 5% 9% FRA; 16%

GBR; 5% BBB+ 8% AA 8% ITA; 6% USA; 9% AA- Multi-Nationals; A- A+ 4% ESP; 7% 11% A 7% 7% 5%

Source: Market data provider, Erste Group Research (own calculations)

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Total market EUR issues Launch Volume Current Spread Issue Spread/ ISIN Issuer Industry Rank Date Tap (in m) Currency Coupon Maturity S&P Moody's Fitch (ASW) (Mid) Yield XS2369020644 IDEAL STANDARD Manufacturing Senior 23.07.2021 N 325 EUR 6.375 30.07.2026 B- B3 B- 744 0.000% DE000NWB0AN7 NRW.BANK Agency Senior 21.07.2021 N 500 EUR 0.000 28.07.2031 AA Aa1 AAA -2 MS-1 DE000A2LQSH4 KfW Agency Senior 20.07.2021 N 4,000 EUR 0.750 28.06.2028 AAA Aaa - -14 MS-14 FR0014004R72 ALSTOM Utilities & Power Senior 20.07.2021 N 700 EUR 0.500 27.07.2030 NR Baa2 NR 61 MS+70 FR0014004QX4 ALSTOM Utilities & Power Senior 20.07.2021 N 500 EUR 0.125 27.07.2027 NR Baa2 NR 41 MS+45 FR0014004QI5 COVIVIO HOTELS Consumer Goods & Services Senior 20.07.2021 N 500 EUR 1.000 27.07.2029 BBB+ NR NR 105 MS+125 FR0014004QY2 UNEDIC Agency Senior 20.07.2021 N 2,000 EUR 0.010 25.11.2031 NR Aa2 AA 5 OAT+11 FR0014004QH7 VILOGIA Industrials Senior 19.07.2021 N 400 EUR E+75 27.07.2023 NR A2 NR 38 E+45 DE000A3KS5R1 SIGNA PRIME SELECTION Industrials Senior 16.07.2021 N 300 EUR 5.500 23.07.2026 B NR B+ 623 DBR+642 XS2367107856 SANI IKOS Consumer Goods & Services Senior 15.07.2021 N 300 EUR 5.625 15.12.2026 NR Caa1 B- 590 B+626 XS2366741770 LEASYS Consumer Goods & Services Senior 15.07.2021 N 500 EUR 0.000 22.07.2024 NR NR BBB+ 36 MS+47 XS2363989273 LAR ESPANA Industrials Senior 15.07.2021 N 400 EUR 1.750 22.07.2026 NR NR BBB 176 MS+205.4 XS2367228058 BELDEN Industrials Senior 14.07.2021 N 300 EUR 3.375 15.07.2031 BB- Ba3 NR 343 B+370 XS2367103780 DOVALUE Financial Services Senior 14.07.2021 N 300 EUR 3.375 31.07.2026 BB NR BB 362 B+401 XS2359929812 PUBLIC POWER Utilities & Power Senior 14.07.2021 N 500 EUR 3.375 31.07.2028 B+ NR BB- 336 B+390 XS2366277056 APCOA Consumer Goods & Services Senior 14.07.2021 N 365 EUR E+500 15.01.2027 B B3 NR 459 E+500 XS2366276595 APCOA Consumer Goods & Services Senior 14.07.2021 N 320 EUR 4.625 15.01.2027 B B3 NR 481 B+523 XS2366703259 DEKABANK Banking Covered 14.07.2021 N 250 EUR 0.010 22.07.2026 NR Aaa NR 0 MS flat DE000RLP1320 LAND RHINELAND-PALATINATE Municipality/Local Government Senior 14.07.2021 N 500 EUR 0.010 15.07.2024 NR NR AAA -8 MS-8 PTNOBIOM0014 Banking Senior 13.07.2021 N 300 EUR 3.500 23.07.2024 NR Caa2 NR 399 MS+396.4

EU000A3KT6B1 EUROPEAN UNION Supra Senior 13.07.2021 N 10,000 EUR 0.450 04.07.2041 AA Aaa AAA 2 MS+7 EU000A3KT6A3 EUROPEAN UNION Supra Senior 13.07.2021 N 5,250 EUR 0.000 22.04.2031 AA Aaa AAA -11 MS-6 DE000LB2V7C3 LBBW Banking Senior 13.07.2021 N 500 EUR 0.250 21.07.2028 NR A2 A- 38 MS+45 DE000A1RQD50 LAND HESSEN Municipality/Local Government Senior 12.07.2021 N 500 EUR 0.000 19.07.2028 AA+ NR NR -6 MS-6 XS2364593579 JAGUAR LAND ROVER Manufacturing Senior 09.07.2021 N 500 EUR 4.500 15.07.2028 B B1 NR 462 B+498 XS2364001151 MOTOR OIL Basic Materials Senior 08.07.2021 N 400 EUR 2.125 19.07.2026 NR NR NR 239 B+290 XS2365097455 BANCO BPM Banking Senior 08.07.2021 N 500 EUR 0.875 15.07.2026 NR Ba2 NR 120 MS+130 FR0014004KP3 CREDIT MUTUEL HOME LOAN Banking Covered 08.07.2021 N 1,000 EUR 0.010 20.07.2028 AAA Aaa AAA 2 MS+3 XS2364756036 IDASFH Supra Senior 08.07.2021 N 2,000 EUR 0.000 15.07.2031 AAA Aaa NR 2 MS+3 FR0014004JA7 ACTION LOGEMENT SERVICES Agency Senior 08.07.2021 N 1,000 EUR 0.750 19.07.2041 NR Aa2 AA 42 FRTR+30 DE000A3E5UU2 DZ HYP Banking Covered 08.07.2021 N 750 EUR 0.010 15.11.2030 AAA Aaa NR 1 MS+2 DE000A14JZT4 LAND BADEN WUERTTEM Municipality/Local Government Senior 08.07.2021 N 750 EUR E+100 20.07.2026 AA+ Aaa NR -5 E-6 DE000A289LU4 AAREAL BANK Banking Senior 07.07.2021 N 300 EUR 0.250 23.11.2027 NR NR A- 45 MS+66 XS2363203089 PROSUS Media & Telecoms Senior 07.07.2021 N 850 EUR 1.985 13.07.2033 BBB- Baa3 NR 186 MS+185 XS2360853332 PROSUS Media & Telecoms Senior 07.07.2021 N 1,000 EUR 1.288 13.07.2029 BBB- Baa3 NR 142 MS+140 XS2363235107 LUFTHANSA Transport & Logistics Senior 07.07.2021 N 500 EUR 3.500 14.07.2029 BB- Ba2 NR 355 MS+385.6 XS2363244513 LUFTHANSA Transport & Logistics Senior 07.07.2021 N 500 EUR 2.000 14.07.2024 BB- Ba2 NR 255 MS+266.9 XS2363719050 BANCA POP DI SONDRIO Banking Senior 07.07.2021 N 500 EUR 1.250 13.07.2027 NR NR BB+ 155 MS+160 XS2364754098 ARION BANKI Banking Senior 07.07.2021 N 300 EUR 0.375 14.07.2025 BBB NR NR 73 MS+80 XS2363232930 AUTODIS Transport & Logistics Senior 07.07.2021 N 380 EUR E+400 20.07.2027 B- B3 NR 354 E+400 XS2363982344 SR-BANK Banking Senior 07.07.2021 N 500 EUR 0.375 15.07.2027 NR Baa1 NR 65 MS+75 DE000A3KPTG6 JAB HOLDINGS Consumer Goods & Services Senior 07.07.2021 N 500 EUR 1.000 14.07.2031 BBB+ Baa2 NR 92 MS+102 XS2364001078 A2A SPA Utilities & Power Senior 07.07.2021 N 500 EUR 0.625 15.07.2031 BBB Baa2 NR 52 MS+65 ES0000090888 JUNTA ANDAL Municipality/Local Government Senior 07.07.2021 N 500 EUR 0.700 30.07.2033 BBB+ Baa2 NR 54 SPGB+22 XS2337703537 GRUNENTHAL Consumer Goods & Services Senior 06.07.2021 N 250 EUR 4.125 15.05.2028 B+ B1 BB 387 B+463 XS2362968906 WESTPAC NZ Banking Senior 06.07.2021 N 750 EUR 0.100 13.07.2027 AA- A1 NR 35 MS+42 XS2363117321 AMERICAN HONDA Manufacturing Senior 06.07.2021 N 1,150 EUR 0.300 07.07.2028 A- A3 NR 42 MS+50 FR0014004J31 FRANCE Sovereign Senior 06.07.2021 N 5,000 EUR 0.750 25.05.2053 AA Aa2 AA 45 FRTR+3 EU000A1G0EL5 EFSF Supra Senior 05.07.2021 N 3,000 EUR 0.000 20.01.2031 AA Aa1 AA -9 MS-11 FR0014004I65 CFF Banking Covered 05.07.2021 N 1,500 EUR 0.010 15.07.2026 AAA Aaa AAA 1 MS+3 XS2359953283 TITAN HOLDINGS Manufacturing Senior 01.07.2021 N 375 EUR 5.125 15.07.2029 CCC+ Caa2 CCC+ 498 B+541.5 XS2360381730 ELIOR Consumer Goods & Services Senior 01.07.2021 N 550 EUR 3.750 15.07.2026 BB- Ba3 NR 328 B+437 FR0014004GE5 SOCIETE GENERALE Banking Senior 01.07.2021 N 1,000 EUR 0.250 08.07.2027 A A1 A 38 MS+45 XS2360599281 COVENTRY BS Banking Covered 01.07.2021 N 750 EUR 0.010 07.07.2028 NR Aaa AAA 12 MS+14 FR0014004EJ9 CA HOME LOAN SFH Banking Covered 01.07.2021 N 1,000 EUR 0.010 12.04.2028 AAA Aaa AAA 1 MS+2 DE000SHFM808 LAND SCHLESWIG HOLSTEIN Municipality/Local Government Senior 01.07.2021 N 650 EUR 0.050 08.07.2031 NR NR AAA -5 MS-4 XS2362416617 SOFTBANK Media & Telecoms Senior 30.06.2021 N 600 EUR 3.875 06.07.2032 BB+ NR NR 402 MS+371.3 XS2361255057 SOFTBANK Media & Telecoms Senior 30.06.2021 N 800 EUR 3.375 06.07.2029 BB+ NR NR 370 MS+341.1 XS2361254597 SOFTBANK Media & Telecoms Senior 30.06.2021 N 800 EUR 2.875 06.01.2027 BB+ NR NR 331 MS+309.5 XS2361253862 SOFTBANK Media & Telecoms Senior 30.06.2021 N 750 EUR 2.125 06.07.2024 BB+ NR NR 253 MS+252.1

Source: Market data provider, Erste Group Research (own calculations)

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Sovereigns/Sub-Sovereigns & Agencies Issue volume in monthly comparison … and by country 2019-2021 YTD, in EUR bn 2019-2021 YTD 70

60 Other; 8% NLD; 5% 50 LUX; 7% 40 DEU; 39%

30 FRA; 13% 20

10

0 Multi- Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Nationals; 28% 2019 2020 2021 5Y average

Banks Senior (Financials) Issue volume in monthly comparison … and by country 2019-2021 YTD, in EUR bn 2019-2021 YTD 35

30 Other; 9% DNK; 2% USA; 19% 25 CAN; 3% AUS; 4% 20 SWE; 4% 15 CHE; 5% 10 FRA; 15% ITA; 5% 5

0 ESP; 6% GBR; 10% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec NLD; 7% DEU; 9% 2019 2020 2021 5Y average

Source: Market data provider, Erste Group Research (own calculations)

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Covered Bonds Issue volume in monthly comparison … and by country 2019-2021 YTD, in EUR bn 2019-2021 YTD

40 Other; 9% BEL; 3% 35 DEU; 21% AUT; 4% 30 AUS; 4% 25 NOR; 4% 20 GBR; 4% 15 FRA; 16% 10 ESP; 5% 5 ITA; 6% 0 NLD; 7% CAN; 8% Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec SWE; 7% 2019 2020 2021 5Y average

Corporate Bonds Issue volume in monthly comparison ... and by sector 2019-2021 YTD, in EUR bn 2019-2021 YTD 80 Consumer 70 Technology Other 5% 7% Goods & 60 Basic Services Materials 24% 50 6% 40 Utilities & 30 Power 20 11% 10

0 Media & Manufacturi Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Telecoms ng 13% 21% 2019 2020 2021 5Y average Industrials 13%

Source: Market data provider, Erste Group Research (own calculations)

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EUR secondary market

EUR market International spread comparison Country Type 1-3Y 3-5Y 5-7Y 7-10Y >10Y Total AUSTRALIA Covered 4.0 4.7 4.0 8.5 9.1 5.0 Banks Senior 2.1 55.4 30.8 39.7 - 28.5 Corporates Senior 21.4 32.1 48.2 70.0 77.4 45.9 AUSTRIA Sovereign -22.9 -29.2 -26.6 -14.4 27.3 -3.7 SSA -7.1 -3.4 0.1 - 15.0 2.1 Covered -0.9 0.2 1.0 1.5 3.6 1.1 Banks Senior 29.0 63.9 67.7 26.0 - 52.8 Corporates Senior 74.2 166.4 90.9 34.1 47.6 92.4 BELGIUM Sovereign -26.0 -29.0 -25.3 -13.2 22.1 -1.0 SSA - 1.0 -3.5 5.7 40.7 28.8 Covered -1.6 -1.7 0.0 0.9 - -0.8 Banks Senior 11.9 45.1 47.1 49.0 - 35.9 Corporates Senior 18.5 86.6 145.4 38.4 81.7 84.5 CANADA SSA 0.0 2.1 7.6 15.1 23.1 7.8 Covered 1.7 2.8 4.4 6.6 - 2.7 Corporates Senior 352.6 152.7 154.5 139.6 - 201.1 DENMARK Banks Senior 34.8 66.2 65.5 - - 51.7 Corporates Senior 198.8 46.0 52.7 39.9 - 108.1 FINLAND Sovereign -25.5 -30.3 -28.3 -19.6 -8.8 -20.0 SSA -8.6 -6.6 -5.5 -1.9 4.7 -3.8 Covered -4.4 -4.1 -4.2 -2.4 0.5 -3.9 Banks Senior 8.2 39.4 32.0 42.2 - 25.8 Corporates Senior -53.2 37.3 207.7 47.9 - 39.2 FRANCE Sovereign -22.3 -25.4 -20.4 -12.8 27.2 -2.3 SSA -6.1 -6.7 -4.4 3.8 42.0 7.0 Covered -1.6 -0.6 0.2 1.4 5.9 0.6 Banks Senior 17.7 46.2 58.5 63.8 62.6 44.1 Corporates Senior 32.8 114.6 95.2 64.1 50.7 77.1 Sovereign -28.1 -38.1 -44.3 -43.8 -43.0 -38.3 SSA -9.3 -8.8 -8.9 -5.7 12.1 -4.2 Covered -3.0 -2.7 -1.8 -1.0 0.7 -2.1 Banks Senior 23.2 47.5 53.6 58.8 - 45.7 Corporates Senior 89.4 144.9 109.3 50.8 49.2 97.2 IRELAND Sovereign -16.7 -21.4 -15.8 -7.4 13.1 -3.5 Banks Senior 30.6 53.1 60.4 - - 40.3 Corporates Senior 27.3 77.8 119.7 47.9 74.5 76.6 ITALY Sovereign 8.0 27.6 44.5 63.9 119.6 57.4 Covered 6.8 5.1 8.1 5.9 8.9 6.5 Banks Senior 32.7 60.8 67.3 99.8 - 54.8 Corporates Senior 12.6 175.9 192.6 76.9 108.7 128.9 JAPAN Banks Senior 18.9 31.5 44.9 49.6 60.0 33.2 Corporates Senior 179.6 129.3 167.2 118.3 91.2 140.8 JERSEY Corporates Senior 37.8 181.7 137.3 95.1 117.1 147.2 LUXEMBOURG Corporates Senior 201.3 192.1 218.9 96.4 68.1 166.1 MEXICO Sovereign 47.5 72.1 123.2 160.3 252.5 164.2 NETHERLANDS Sovereign -29.1 -32.7 -32.0 -25.7 -29.2 -29.5 SSA -7.0 -7.3 -4.8 -2.7 3.9 -4.0 Covered -0.5 3.7 3.5 3.4 3.5 2.9 Banks Senior 26.2 42.1 49.6 45.6 53.7 38.1 Corporates Senior 54.2 109.3 86.9 68.7 58.6 80.0 NEW ZEALAND Covered 4.8 7.8 11.1 11.6 - 7.4 NORWAY Covered -0.8 1.2 2.2 3.8 - 1.2 Banks Senior 14.2 31.7 39.3 - - 24.2 Corporates Senior 51.0 92.8 73.6 45.5 43.3 66.5 Sovereign -0.1 9.1 11.1 12.8 52.7 10.4 PORTUGAL Sovereign -15.4 -13.1 -5.4 10.2 50.0 15.1 Sovereign 43.8 66.3 111.5 178.3 251.5 173.8 Sovereign -34.5 -29.3 -19.2 -15.7 8.2 -16.3 SLOVENIA Sovereign -20.3 -19.3 -7.8 0.8 27.2 3.0 SPAIN Sovereign -8.1 -5.3 5.5 19.5 83.2 30.0 SSA 6.0 4.8 19.3 35.2 36.0 16.1 Covered 7.8 6.9 7.1 4.2 9.1 7.1 Banks Senior 35.5 55.3 60.9 118.8 - 51.1 Corporates Senior 44.6 151.7 111.0 91.7 64.5 109.0

Source: Market data provider, Erste Group Research (own calculations) Major Markets & Credit Research Page 12

For the exclusive use of Erste Group Client (Erste Group) Erste Group Research Credit Markets Weekly | Credit | Austria & CEE July 29, 2021

Sovereigns/Sub-Sovereigns & Agencies: Austria Spread development … and spread overview 2015-2021 YTD, ASW in BP EUR benchmark bonds, ASW in BP 50 60

40 50 40 30 30 20 20 10 10 0 0 -10 -10 -20

-20

30.04.21 30.09.21 28.02.22 31.07.22 31.12.22 31.05.23 31.10.23 31.03.24 31.08.24 31.01.25 30.06.25 30.11.25 30.04.26 30.09.26 28.02.27 31.07.27 31.12.27 31.05.28 31.10.28 31.03.29 31.08.29 30.06.20 30.11.20

09.2016 03.2017 06.2017 12.2017 09.2018 03.2019 06.2019 12.2019 03.2020 06.2020 12.2020 12.2015 03.2016 06.2016 12.2016 09.2017 03.2018 06.2018 12.2018 09.2019 09.2020 03.2021 06.2021 EUR Austria SSA Poly. (EUR SSA) Poly. (EUR Austria SSA) EUR Sub-Sovereigns EUR Austria SSA

Sovereigns/Sub-Sovereigns & Agencies: Austria Outstanding EUR benchmark bonds

Volume Minimum Current Spread Issue ISIN Issuer (in m) Piece Coupon Maturity S&P Moody's Fitch (ASW Mid) Spread XS0542825160 AUTOBAHN SCHNELL AG 1,500 50,000 3.375 22.09.2025 AA+ Aa1 - -3 - XS0790003023 AUTOBAHN SCHNELL AG 1,000 100,000 2.750 11.06.2032 AA+ Aa1 - 5 85 XS1291264775 AUTOBAHN SCHNELL AG 1,000 100,000 0.625 15.09.2022 AA+ Aa1 - -7 - XS1484645616 KAF KAERTNER AUSGLEICHSZ 1,107 1 0.000 14.01.2032 - Aa1 AA+ 25 - XS0520578096 OEBB-INFRASTRUKTUR AG 1,500 1,000 3.875 30.06.2025 AA+ Aa1u - -2 55 XS0691970601 OEBB-INFRASTRUKTUR AG 1,000 1,000 3.500 19.10.2026 AA+ Aa1u - 0 65 XS0782697071 OEBB-INFRASTRUKTUR AG 1,350 1,000 3.375 18.05.2032 AA+ Aa1u - 10 95 XS0949964810 OEBB-INFRASTRUKTUR AG 1,000 1,000 2.250 04.07.2023 AA+ Aa1u - -7 29 XS0984087204 OEBB-INFRASTRUKTUR AG 1,000 1,000 3.000 24.10.2033 AA+ Aa1u - 20 30 XS1138366445 OEBB-INFRASTRUKTUR AG 1,000 1,000 1.000 18.11.2024 AA+ Aa1u - -3 8 XS1689595830 OEKB OEST. KONTROLLBANK 1,500 100,000 0.250 26.09.2024 AA+ Aa1 - -5 - XS2152924952 OEKB OEST. KONTROLLBANK 1,750 100,000 0.000 06.04.2023 AA+ Aa1 - -7 -

Source: Market data provider, Erste Group Research (own calculations)

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Banks Senior (Financials): Austria Spread development … and spread overview 2015-2021 YTD, ASW in BP EUR benchmark bonds, ASW in BP 250 250

200 200

150 150

100 100

50 50 0

0

30.11.20 30.04.21 28.02.22 31.07.22 31.05.23 31.10.23 31.03.24 31.01.25 30.11.25 30.09.26 28.02.27 31.12.27 31.10.28 30.06.20 30.09.21 31.12.22 31.08.24 30.06.25 30.04.26 31.07.27 31.05.28 31.03.29 31.08.29

03.2016 06.2016 09.2016 12.2016 06.2017 12.2017 03.2018 09.2018 03.2019 06.2019 09.2019 12.2019 06.2020 12.2020 06.2021 12.2015 03.2017 09.2017 06.2018 12.2018 03.2020 09.2020 03.2021 EUR Banks Senior EUR Austria Bank Senior EUR Austria Banks Senior Poly. (EUR Banks Senior)

Banks Senior (Financials): Austria Outstanding EUR benchmark bonds

Volume Minimum Current Spread Issue ISIN Issuer (in m) Piece Coupon Maturity S&P Moody's Fitch (ASW Mid) Spread XS2049584084 BAWAG P.S.K. 500 100,000 0.375 03.09.2027 - Baa1 - 63 - XS1982725159 ERSTE GROUP BANK AG 500 100,000 0.375 16.04.2024 A A2 A 14 - XS2000538343 ERSTE GROUP BANK AG 500 100,000 0.875 22.05.2026 A- Baa1 A- 23 - XS2083210729 ERSTE GROUP BANK AG 500 100,000 1.000 10.06.2030 BBB+ Baa1 BBB+ 104 - AT0000A2GH08 ERSTE GROUP BANK AG 750 100,000 0.875 13.05.2027 A A2 A 28 - AT0000A2J645 ERSTE GROUP BANK AG 500 100,000 1.625 08.09.2031 BBB+ Baa1 BBB+ 108 - AT0000A2JAF6 ERSTE GROUP BANK AG 500 100,000 0.050 16.09.2025 A A2 A 19 - AT0000A2KW37 ERSTE GROUP BANK AG 750 100,000 0.100 16.11.2028 A A2 A 37 - AT0000A2N837 ERSTE GROUP BANK AG 500 100,000 0.250 27.01.2031 A A2 A 26 - AT0000A2RAA0 ERSTE GROUP BANK AG 500 100,000 0.125 17.05.2028 A A2 A 29 - XS1807409450 HYPO NOE LB NOE WIEN AG 500 100,000 0.875 16.10.2023 A - - 34 - XS2193956716 HYPO NOE LB NOE WIEN AG 500 100,000 0.375 25.06.2024 A - - 31 - XS2320789014 HYPO NOE LB NOE WIEN AG 500 100,000 0.125 30.06.2026 A - - 32 - XS0981632804 RAIFFEISEN BANK INTL 500 100,000 6.000 16.10.2023 BBB Baa3 - 35 385 XS1917591411 RAIFFEISEN BANK INTL 500 100,000 1.000 04.12.2023 - A3 - 22 - XS2049823763 RAIFFEISEN BANK INTL 500 100,000 1.500 12.03.2030 - Baa3 - 119 - XS2055627538 RAIFFEISEN BANK INTL 750 100,000 0.375 25.09.2026 - A3 - 24 - XS2106056653 RAIFFEISEN BANK INTL 750 100,000 0.250 22.01.2025 - A3 - 26 - XS2189786226 RAIFFEISEN BANK INTL 500 100,000 2.875 18.06.2032 - Baa3 - 145 - XS2353473692 RAIFFEISEN BANK INTL 500 100,000 1.375 17.06.2033 - Baa3 - 148 - XS2065593068 RAIFFEISEN LB NIEDEROEST 500 100,000 0.250 16.04.2024 - Baa1 - 32 - XS1720806774 RLB OBEROESTERREICH 500 100,000 0.750 22.05.2023 - Baa1 - 36 - AT000B122080 VOLKSBANK WIEN AG 500 100,000 0.875 23.03.2026 - Baa2 - 81 -

Source: Market data provider, Erste Group Research (own calculations)

Major Markets & Credit Research Page 14

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Covered Bonds: Austria Spread development … and spread overview 2015-2021 YTD, ASW in BP EUR benchmark bonds, ASW in BP 35 40

30 35 30 25 25 20 20 15 15 10 10 5 5 0 0 -5 -10 -5

-10

30.06.20 30.11.20 28.02.22 31.07.22 31.12.22 31.05.23 31.10.23 30.04.26 30.09.26 28.02.27 31.07.27 31.12.27 31.03.29 31.08.29 30.04.21 30.09.21 31.03.24 31.08.24 31.01.25 30.06.25 30.11.25 31.05.28 31.10.28

EUR Austria Covered Poly. (EUR Covered)

06.2016 09.2016 12.2016 03.2017 06.2017 06.2018 09.2018 12.2018 03.2019 06.2019 03.2020 06.2020 09.2020 12.2020 03.2021 12.2015 03.2016 09.2017 12.2017 03.2018 09.2019 12.2019 06.2021 Poly. (EUR Austria Covered) EUR Covered EUR Austria Covered

Covered Bonds: Austria Outstanding EUR benchmark bonds table 1/2 Current Volume Minimum Spread (ASW ISIN Issuer (in m) Piece Coupon Maturity S&P Moody's Fitch Mid) Issue Spread XS1551294926 BAWAG P.S.K. 500 100,000 0.750 18.01.2027 - Aaa - 0 - XS2013520023 BAWAG P.S.K. 500 100,000 0.625 19.06.2034 - Aaa - 2 - XS2058855441 BAWAG P.S.K. 500 100,000 0.010 02.10.2029 - Aaa - 0 - XS2106563161 BAWAG P.S.K. 500 100,000 0.010 21.01.2028 - Aaa - 0 - XS2234573710 BAWAG P.S.K. 750 100,000 0.010 23.09.2030 - Aaa - 1 - XS2259776230 BAWAG P.S.K. 500 100,000 0.010 19.11.2035 - Aaa - 3 - XS2320539765 BAWAG P.S.K. 500 100,000 0.375 25.03.2041 - Aaa - 8 - XS2340854848 BAWAG P.S.K. 500 100,000 0.100 12.05.2031 - Aaa - 2 - XS1181448561 ERSTE GROUP BANK AG 500 100,000 0.750 05.02.2025 - Aaa - -2 6 XS1346557637 ERSTE GROUP BANK AG 750 100,000 0.625 19.01.2023 - Aaa - 0 16 XS1550203183 ERSTE GROUP BANK AG 750 100,000 0.625 18.01.2027 - Aaa - -1 - XS1750974658 ERSTE GROUP BANK AG 1,000 100,000 0.750 17.01.2028 - Aaa - -1 - XS1807495608 ERSTE GROUP BANK AG 750 100,000 0.625 17.04.2026 - Aaa - -2 - XS1845161790 ERSTE GROUP BANK AG 750 100,000 0.250 26.06.2024 - Aaa - -2 - AT0000A286W1 ERSTE GROUP BANK AG 500 100,000 0.875 15.05.2034 - Aaa - 2 - AT0000A2A6W3 ERSTE GROUP BANK AG 500 100,000 0.010 11.09.2029 - Aaa - -1 - AT0000A2CDT6 ERSTE GROUP BANK AG 750 100,000 0.100 15.01.2030 - Aaa - 1 - XS1590565112 HYPO NOE LB NOE WIEN AG 500 100,000 0.375 04.04.2023 - Aa1 - 0 - XS1875268689 HYPO NOE LB NOE WIEN AG 500 100,000 0.500 04.09.2025 - Aa1 - 1 - XS2057917366 HYPO NOE LB NOE WIEN AG 500 100,000 0.010 01.10.2026 - Aa1 - 0 - XS2176710510 HYPO NOE LB NOE WIEN AG 500 100,000 0.010 18.06.2027 - Aa1 - 4 - AT0000A2RY95 HYPO NOE LB NOE WIEN AG 500 100,000 0.125 23.06.2031 - Aa1 - 5 - AT0000A2AYL3 HYPO TIROL BANK AG 500 100,000 0.010 19.10.2026 - Aa1 - 2 - AT0000A2QDQ2 HYPO TIROL BANK AG 500 100,000 0.010 11.03.2031 - Aa1 - 4 - XS1188081936 HYPO VORARLBERG BANK AG 500 100,000 0.750 11.02.2025 - Aaa - 0 7 XS1613238457 HYPO VORARLBERG BANK AG 500 100,000 0.375 17.05.2024 - Aaa - -3 - XS1856342560 HYPO VORARLBERG BANK AG 500 100,000 0.625 17.07.2026 - Aaa - 4 - XS1999728394 HYPO VORARLBERG BANK AG 500 100,000 0.250 21.05.2027 - Aaa - 4 - XS2086861437 RAIFFEISEN BANK INTL 500 100,000 0.125 03.12.2029 - Aa1 - 2 - XS0827597351 RAIFFEISEN LB NIEDEROEST 500 1,000 2.125 12.09.2022 - Aaa - -1 42 XS1196405556 RAIFFEISEN LB NIEDEROEST 500 100,000 0.625 03.03.2025 - Aaa - 0 1 XS1681119167 RAIFFEISEN LB NIEDEROEST 500 100,000 0.375 13.09.2024 - Aaa - -2 - XS1756364474 RAIFFEISEN LB NIEDEROEST 500 100,000 0.875 24.01.2028 - Aaa - 1 - XS1871114473 RAIFFEISEN LB NIEDEROEST 500 100,000 0.625 28.08.2026 - Aaa - 0 -

Source: Market data provider, Erste Group Research (own calculations)

Major Markets & Credit Research Page 15

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Covered Bonds: Austria Outstanding EUR benchmark bonds table 2/2

Current Volume Minimum Spread (ASW) ISIN Issuer (in m) Piece Coupon Maturity S&P Moody's Fitch (Mid) Issue Spread XS1942629061 RAIFFEISEN LB NIEDEROEST 500 100,000 0.875 30.01.2029 - Aaa - 2 - XS2100569552 RAIFFEISEN LB NIEDEROEST 500 100,000 0.375 15.01.2035 - Aaa - 3 - XS1495631993 RLB OBEROESTERREICH 500 100,000 0.375 28.09.2026 - Aaa - 1 10 AT0000A228U7 RLB OBEROESTERREICH 500 100,000 0.875 12.07.2028 - Aaa - 2 - AT0000A2CFT1 RLB OBEROESTERREICH 500 100,000 0.500 22.01.2035 - Aaa - 3 - AT000B092622 RAIFFEISEN LB STEIERMARK 500 100,000 0.625 20.01.2023 - Aaa - 1 21 XS0942965525 RAIFFEISEN LB STEIERMARK 500 100,000 2.375 14.06.2028 - Aaa - 4 28 AT000B093273 RAIFFEISEN LB STEIERMARK 500 100,000 1.375 11.05.2033 - Aaa - 5 - AT000B066675 RAIFFEISEN LB VORARLBERG 500 100,000 0.500 17.09.2025 - Aaa - 3 - AT000B049465 BK AUSTRIA AG 500 100,000 2.375 22.01.2024 - Aaa - -1 35 AT000B049572 UNICREDIT BK AUSTRIA AG 500 100,000 0.750 25.02.2025 - Aaa - -1 3 AT000B049598 UNICREDIT BK AUSTRIA AG 500 100,000 0.750 08.09.2022 - Aaa - 0 5 AT000B049739 UNICREDIT BK AUSTRIA AG 500 100,000 0.625 16.01.2026 - Aaa - -1 - AT000B049754 UNICREDIT BK AUSTRIA AG 500 100,000 0.625 20.03.2029 - Aaa - 1 - AT000B049788 UNICREDIT BK AUSTRIA AG 500 100,000 0.250 04.06.2027 - Aaa - 0 - AT000B049796 UNICREDIT BK AUSTRIA AG 500 100,000 0.250 21.06.2030 - Aaa - 1 - AT000B049846 UNICREDIT BK AUSTRIA AG 500 100,000 0.050 21.09.2035 - Aaa - 2 - AT000B122031 VOLKSBANK WIEN AG 500 100,000 0.375 04.03.2026 - Aaa - 2 - AT000B122049 VOLKSBANK WIEN AG 500 100,000 0.125 19.11.2029 - Aaa - 3 -

Source: Market data provider, Erste Group Research (own calculations)

Major Markets & Credit Research Page 16

For the exclusive use of Erste Group Client (Erste Group) Erste Group Research Credit Markets Weekly | Credit | Austria & CEE July 29, 2021

Last publications

Important events ahead: is the sentiment about to turn on the capital market? (July 22, 2021) ▪ Package of measures for sustainable finance ▪ Platform for Sustainable Finance delivers

ECB revises its strategy - Credit Markets Weekly (July 15, 2021) ▪ Cover pool reporting 1Q 2021 – Austria ▪ Moody’s upgrades unsecured ratings of banks in Austria and CEE ▪ CSSD market: Recovery only sets in slowly ▪ Interest coverage: Recovery in cyclical sectors

Corporate Schuldscheindarlehen: Recovery only sets in slowly – Credit Markets Special (July 12, 2021)

Climate Change and Financial Stability – Credit Markets Weekly (July 8, 2021) ▪ City of Vienna: 2020 Closed Accounts ▪ Issuer in Focus: OMV

Inflation and Volatility as Faithful Companions – Credit Markets Weekly (July 1, 2021) ▪ Province of Lower Austria: 2020 closed accounts ▪ NET4GAS: Solid business model, credit metrics still to improve

Rising Demand for ESG Bonds – Credit Markets Weekly (June 24, 2021) ▪ Issuer in focus: AG ▪ Issuer in focus: PKO Bank Polski

High Yield Spreads at New Lows for the Year – Credit Markets Weekly (June 17, 2021)

Will the ECB surprise the markets – Credit Markets Weekly (June 9, 2021)

New impetus expected for bond market – Credit Markets Weekly (June 2, 2021) ▪ Issuer in Focus: MFB ▪ Issuer in Focus: SPP distribúcia

Real economy exercising cautious optimism? – Credit Markets Weekly (May 27, 2021)

Rising government bond yields: How to position oneself? – Credit Markets Weekly (May 20, 2021) ▪ Issuer in Focus: Bausparkasse Wuestenrot AG

The base effect – Credit Markets Weekly (May 13, 2021) ▪ Issuer in Focus: EP Infrastructure

Unmistakable signs of an economic upswing – Credit Markets Weekly (May 6, 2021) ▪ ASFINAG: Annual results 2020 ▪ Hypo Vorarlberg: Earnings decline in FY 2020 ▪ Verbund: Credit metrics and ESG goals well on track

AT banks are braving the crisis in 2021 as well – Credit Markets Weekly (April 29, 2021) ▪ BIG: 2020 Annual Result ▪ BAWAG Group: Stable trend in the Core Business ▪ Issuer in Focus: Kommunalkredit Austria AG ▪ Corporate Hybrid Bonds: Issuance Boom Continues

CCC-rated Bonds Overheating? – Credit Markets Weekly (April 22, 2021)

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Contacts

Group Research Corporate Treasury Product Distribution AT Head of Group Research Head: Christian Skopek +43 (0)5 0100 84146 Friedrich Mostböck, CEFA +43 (0)5 0100 11902 Fixed Income Institutional Sales CEE Macro/Fixed Income Research Head: Juraj Kotian (Macro/FI) +43 (0)5 0100 17357 Group Securities Markets Katarzyna Rzentarzewska (Fixed income) +43 (0)5 0100 17356 Head: Thomas Einramhof +43 (0)50100 84432 Malgorzata Krzywicka (Fixed income, Poland) +43 (0)5 0100 17338 Institutional Distribution Core / Head: Jürgen Niemeier +49 (0)30 8105800 5503 Alen Kovac (Head) +385 72 37 1383 Mate Jelić +385 72 37 1443 Institutional Distribution DACH+ Ivana Rogic +385 72 37 2419 Head: Marc Friebertshäuser +49 (0)711 810400 5540 Bernd Bollhof +49 (0)30 8105800 5525 Czech Republic Andreas Goll +49 (0)711 810400 5561 David Navratil (Head) +420 956 765 439 Mathias Gindele +49 (0)711 810400 5562 Jiri Polansky +420 956 765 192 Ulrich Inhofner +43 (0)5 0100 85544 Michal Skorepa +420 956 765 172 Sven Kienzle +49 (0)711 810400 5541 Nicole Gawlasova +420 956 765 456 Rene Klasen +49 (0)30 8105800 5521 Christopher Lampe-Traupe +49 (0)30 8105800 5523 Karin Rattay +43 (0)5 0100 84118 Orsolya Nyeste +361 268 4428 Michael Schmotz +43 (0)5 0100 85542 Klaus Vosseler +49 (0)711 810400 5560 Romania Slovakia Ciprian Dascalu (Head) +40 3735 10108 Šarlota Šipulová +421 2 4862 5619 Eugen Sinca +40 3735 10435 Monika Směliková +421 2 4862 5629 Dorina Ilasco +40 3735 10436 Iulian George Misu +40 758484043 Institutional Distribution CEE & Insti AM CZ Head: Antun Burić +385 (0)7237 2439 Slovakia Jaromir Malak +43 (0)5 0100 84254 Maria Valachyova (Head) +421 2 4862 4185 Katarina Muchova +421 2 4862 4762 Czech Republic Head: Ondrej Čech +420 2 2499 5577 Major Markets & Credit Research Milan Bartoš +420 2 2499 5562 Head: Gudrun Egger, CEFA +43 (0)5 0100 11909 Ralf Burchert, CEFA (Sub-Sovereigns & Agencies) +43 (0)5 0100 16314 Institutional Asset Management Czech Republic Hans Engel (Global Equities) +43 (0)5 0100 19835 Head: Petr Holeček +420 956 765 453 Margarita Grushanina (Austria, Quant Analyst) +43 (0)5 0100 11957 Petra Maděrová +420 956 765 178 Peter Kaufmann, CFA (Corporate Bonds) +43 (0)5 0100 11183 Martin Peřina +420 956 765 106 Heiko Langer (Financials & Covered Bonds) +43 (0)5 0100 85509 David Petráček +420 956 765 809 Stephan Lingnau (Global Equities) +43 (0)5 0100 16574 Blanca Weinerová +420 956 765 317 Carmen Riefler-Kowarsch (Financials & Covered Bonds) +43 (0)5 0100 19632 Petr Valenta +420 956 765 140 Rainer Singer (Euro, US) +43 (0)5 0100 17331 Croatia Bernadett Povazsai-Römhild, CEFA (Corporate Bonds) +43 (0)5 0100 17203 Head: Antun Burić +385 (0)7237 2439 Elena Statelov, CIIA (Corporate Bonds) +43 (0)5 0100 19641 Zvonimir Tukač +385 (0)7237 1787 Gerald Walek, CFA (Euro, CHF) +43 (0)5 0100 16360 Natalija Zujic +385 (0)7237 1638 Hungary CEE Equity Research Head: Peter Csizmadia +36 1 237 8211 Head: Henning Eßkuchen +43 (0)5 0100 19634 Gábor Bálint +36 1 237 8205 Daniel Lion, CIIA (Technology, Ind. Goods&Services) +43 (0)5 0100 17420 Ádám Szönyi +36 1 237 8213 Michael Marschallinger, CFA +43 (0)5 0100 17906 Romania and Bulgaria Nora Nagy (Telecom) +43 (0)5 0100 17416 Head: Ruxandra Lungu +40 373516562 Christoph Schultes, MBA, CIIA (Real Estate) +43 (0)5 0100 11523 Thomas Unger, CFA (Banks, Insurance) +43 (0)5 0100 17344 Group Institutional Equity Sales Vladimira Urbankova, MBA (Pharma) +43 (0)5 0100 17343 Head: Brigitte Zeitlberger-Schmid +43 (0)50100 83123 Martina Valenta, MBA +43 (0)5 0100 11913 Werner Fürst +43 (0)50100 83121 Josef Kerekes +43 (0)50100 83125 Croatia/Serbia Cormac Lyden +43 (0)50100 83120 Mladen Dodig (Head) +381 11 22 09178 Czech Republic Anto Augustinovic +385 72 37 2833 Head: Michal Řízek +420 224 995 537 Magdalena Dolenec +385 72 37 1407 Jiří Fereš +420 224 995 554 Davor Spoljar, CFA +385 72 37 2825 Martin Havlan +420 224 995 551 Pavel Krabička +420 224 995 411 Czech Republic Poland Petr Bartek (Head) +420 956 765 227 Head: Jacek Jakub Langer +48 22 538 62 65 Marek Dongres +420 956 765 218 Tomasz Galanciak +48 22 538 62 12 Jan Safranek +420 956 765 218 Przemyslav Nowosad +48 22 538 62 66 Stepien Grzegorz +48 22 538 62 11 Hungary Wysocki Wojciech +48 22 538 62 17 József Miró (Head) +361 235 5131 Croatia András Nagy +361 235 5132 Damir Eror +385 (0)72 37 2836 Tamás Pletser, CFA +361 235 5135 Hungary Nandori Levente + 36 1 23 55 141 Poland Krisztian Kandik + 36 1 23 55 162 Tomasz Duda (Head) +48 22 330 6253 Balasz Zankay + 36 1 23 55 156 Cezary Bernatek +48 22 538 6256 Romania Konrad Grygo +48 22 330 6254 Liviu Avram +40 3735 16569 Emil Poplawski +48 22 330 6252 Marcin Gornik +48 22 330 6251 Group Fixed Income Securities Markets Head: Goran Hoblaj +43 (0)50100 84403 Romania Caius Rapanu +40 3735 10441 FISM Flow Head: Aleksandar Doric +43 (0)5 0100 87487 Margit Hraschek +43 (0)5 0100 84117 Group Markets Christian Kienesberger +43 (0)5 0100 84323 Ciprian Mitu +43 (0)5 0100 85612 Head of Group Markets Bernd Thaler +43 (0)5 0100 84119 Oswald Huber +43 (0)5 0100 84901 Zsuzsanna Toth +36-1-237 8209 Poland: Group Markets Retail and Agency Business Pawel Kielek +48 22 538 6223 Head: Christian Reiss +43 (0)5 0100 84012 Michal Jarmakowicz +43 50100 85611 Markets Retail Sales AT Head: Markus Kaller +43 (0)5 0100 84239 Group Fixed Income Securities Trading Head: Goran Hoblaj +43 (0)50100 84403 Group Markets Execution Head: Kurt Gerhold +43 (0)5 0100 84232 Group Equity Trading & Structuring Head: Ronald Nemec +43 (0)50100 83011 Retail & Sparkassen Sales Head: Uwe Kolar +43 (0)5 0100 83214 Business Support Bettina Mahoric +43 (0)50100 86441 Major Markets & Credit Research Page 18

For the exclusive use of Erste Group Client (Erste Group) Erste Group Research Credit Markets Weekly | Credit | Austria & CEE July 29, 2021

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Major Markets & Credit Research Page 19

For the exclusive use of Erste Group Client (Erste Group)