BANK FÜR TIROL UND VORARLBERG AKTIENGESELLSCHAFT ANNUAL REPORT 2019 Annual Report Contents

BANK FÜR TIROL UND VORARLBERG AKTIENGESELLSCHAFT ANNUAL REPORT 2019 Annual Report Contents Group 4 Preface from the Board of Directors 16 History 6 Heads of BTV head office and market chiefs 18 Strategy and brand 11 Highlights 2019 Management report 22 Economic environment 33 Report on the internal control system for the financial 23 Business development reporting process 31 Compliance and anti-money laundering 35 Shares and shareholder structure 32 Non-financial report 37 Outlook Consolidated Financial Statement 39 Consolidated Financial Statement 2019 187 Declaration by the statutory representatives 42 Balance sheet 188 Report from the independent auditors 43 Comprehensive income statement 194 Report from the Supervisory Board 44 Statement of change in equity 45 Cash flow statement 196 Imprint 46 Annex BTV Group 2019 Important dates for BTV shareholders Annual General Meeting 10/06/2020, 10:00 am, Stadtforum 1, Innsbruck The dividend will be published on the BTV homepage and in the gazette of the Wiener Zeitung the day after the Annual General Meeting. Ex-dividend date 16/06/2020 Payment of dividend 18/06/2020 Interim report as at 31/03/2020 Published on 29/05/2020 (www.btv.at) Half-Year Financial Report as at 30/06/2020 Published on 28/08/2020 (www.btv.at) Interim report as at 30/09/2020 Published on 27/11/2020 (www.btv.at) 2 BTV Annual Report 2019 BTV Group at a glance Profit and loss in EUR million 31/12/2019 31/12/2018 % change Net interest income 139.9 123.0 +13.7% Risk provisions in the credit business –0.9 4.4 >–100% Net commission income 49.4 51.8 –4.5% Revenue from companies valued at-equity 53.0 51.7 +2.5% Operating expenses –191.1 –181.0 +5.6% Other operating income 83.8 81.1 +3.3% Annual net profit before tax 144.5 139.8 +3.3% Group annual net profit 126.7 107.1 +18.3% Balance sheet figuresin EUR million 31/12/2019 31/12/2018 % change Balance sheet total 12,549 11,630 +7.9% Loans to clients after risk provisions 7,938 7,754 +2.4% Primary funds 8,937 8,162 +9.5% of which savings deposits 1,391 1,260 +10.4% of which own issues 1,421 1,357 +4.7% Equity 1,749 1,639 +6.7% Managed deposits 15,717 14,195 +10.7% ReportManagement Group Regulatory capital (CRR) in EUR million 31/12/2019 31/12/2018 % change Total amount at risk 8,300 7,728 +7.4% Capital 1,293 1,222 +5.8% of which common equity (CET1) 1,087 1,015 +7.1% of which total core capital (CET1 and AT1) 1,087 1,029 +5.6% Common equity Tier 1 ratio 13.1% 13.1% –0.0 pp Core capital ratio 13.1% 13.3% –0.2 pp Equity ratio 15.6% 15.8% –0.2 pp Financial Statement Consolidated Change in Key indicators in pp 31/12/2019 31/12/2018 percentage points Return on equity before tax (RoE) 8.5% 9.3% –0.8 pp Return on equity after tax 7.5% 7.1% +0.4 pp Cost/income ratio 57.9% 58.9% –1.0 pp Risk/earnings ratio +0.7% –3.6% +4.2 pp Number of resources 31/12/2019 31/12/2018 Change figure Weighted average number of employees 1,455 1,438 +17 Number of branches 36 36 +0 Key indicators for BTV shares 31/12/2019 31/12/2018 Number of ordinary no par value shares 31,531,250 31,531,250 Number of preference shares 2,500,000 2,500,000 Highest price of ordinary/preference share in EUR 29.60/28.00 26.00/24.60 Lowest price of ordinary/preference share in EUR 23.80/21.80 23.00/19.40 Closing price of ordinary/preference share in EUR 29.00/26.60 23.80/22.20 Market capitalisation in EUR million 981 806 IFRS earnings per share in EUR 3.65 3.31 P/E ratio, ordinary share 7.9 7.2 P/E ratio, preference share 7.3 6.7 BTV Annual Report 2019 3 Preface from the Board of Directors Ladies and Gentlemen, With an annual net profit before tax of EUR 144.5 million, Internally, we dealt with two issues more intensively than ever 2019 was a very successful year for the Bank für Tirol und in 2019: strategy and sustainability. In order to more firmly Vorarlberg Aktiengesellschaft. Thanks to our customers, we embed sustainable action within the company, the issue was are reporting the highest numbers ever in BTV history for both included in our new Strategy 2030 which we compiled in deposits and loans to customers. In total, BTV is managing minute detail over the course of several months and across over EUR 15 billion of customers’ money. Equity also increased various different levels. These two issues will continue to once again and totals EUR 1,749 million. guide us in the coming years. One issue that we have been and are dealing with intensively is When it comes to innovation, we have moved towards strong the attack by UniCredit on the autonomy of the 3 Banken partnerships. In conjunction with the Leopold-Franzen Group (Oberbank AG, BKS Bank AG and BTV) and therefore University of Innsbruck, BTV founded the company Innfolio- on our autonomy. Three intermediate victories in court lytix, a spin-off headquartered in Innsbruck, that will develop confirm our opinion that the arguments presented by Uni- capital market strategies based on the findings of the latest Credit are legally untenable, and we are confident about the academic research. BTV also became a commercial partner in remainder of the proceedings. the corporate innovation hub weXelerate which, in the autumn of 2019, opened a second location in Dornbirn to complement On the market, we were confronted by many uncertainties: its Vienna office. The aim of weXelerate is to network start-ups the trade war between the USA and China, the effects of with established companies on joint innovation projects – an Brexit, the first appearance of coronavirus and an economy in ideal approach for a traditional bank like BTV. decline. Despite all of these developments, however, our financial performance as a whole was solid and our securities As much as we are looking to the future with both of these recorded large increases in value, triggered by the historically partnerships, we are concentrating just as much on the here low interest environment. and now, on what it really all comes down to: our customers. They are the ones who make our successes possible. Together with our employees, we want to find the best solutions for them, both for today and tomorrow, and to use our business to strengthen the entire region. Yours sincerely, Michael Perger Gerhard Burtscher Mario Pabst Member of the Board Chairman of the Board Member of the Board 4 BTV Annual Report 2019 Group Consolidated Financial Statement Report Management Consolidated Executive Board member Michael Perger, Chairman of the Executive Board Gerhard Burtscher and Executive Board member Mario Pabst (from left to right). BTV Annual Report 2019 5 Director of BTV Stadtforum headquarters and regional business areas BTV Stadtforum Headquarters Corporate customers Institutional clients and Retail customers Thomas Gapp banks Dr. Jürgen Brockhoff Silvia Vicente – Foreign trade and markets in – Institutional clients and client – Branch business Germany, Switzerland trading Norbert Peer MMag. Simon Knitel – Treasury – Package service marketing (retail) – Structured financing and funding Bernhard Huber – MiFID/Sales organisation Günter Pfurtscheller – Asset investments – Sales management Mag. Martin Mausser – Payment transfers and support – Asset management Rudolf Oberleiter Dr Robert Wiesner – Sales management – Housing construction Mario Scherl Service centre Finance and controlling Risk management Mag. Paul Jäger MMag. Daniel Stöckl-Leitner Christoph Meister – Enforcement – Consolidated accounting – Risk manager in the sense of Sec. 39(5) – Bond service – Accounting Austrian Banking Act Sabine Dadak-Nedl – Strategy and Sales Controller – Reporting – Payment and commerce Mag. Hannes Gruber – Risk controlling Christine Schurl Corporate audit Credit management Marketing, Communication, Mag. Rainer Gschnitzer Mag. Robert Walcher Executive Board matters – Brands and events – Corporate customers Germany and Switzer- Mag. Markus Wieser land with KSB retail customers – Marketing & Communications – Austria and South Tyrol corporate customers Thomas Zipprich, MA – Retail customers and finance law Mag. Martin Schwabl – Risk management and valuation Mag. Arno Saxer Legal and corporate Compliance and Human resources investments money laundering prevention Mag. Ursula Randolf Dr. Stefan Heidinger Mag. Martin Rohner Mag. Elisabeth Seywald Manfred Unterwurzacher – Human resources support – Human resources development Mag. Sandra Jorda Effectiveness and efficiency Chairman of the Michael Draschl Central Works Council Harald Gapp 3 Banken Insurance Brokers BTV Leasing Walter Schwinghammer Gerd Schwab Johannes Wukowitsch 6 BTV Annual Report 2019 BTV regional business areas Tyrol, retail Vorarlberg, retail Mag. Stefan Nardin Christof Kogler – Ausserfern – Unterinntal and Zillertal – Bludenz Alpine region Urs Schmid Thomas Naschberger Dipl. (FH) Markus Amann, MBA – Hall/Schwaz – Asset investments Italy – Lake Constance Kurt Moser – Asset investments and liberal professions Dominik Schuchter – Innsbruck Innsbruck – Montfort Mag. (FH) Eva-Maria Ringler Edi Plattner Hubert Kotz – Innsbruck Stadtforum – Asset investments and endowments – Rhine Valley Marc Schönberger, BSc Karl Eder Stephan Kirchmann, MBA Group – Seefeld/Garmisch-Partenkirchen – Co-support Innsbruck, retail Stefan Glas Mag. Kerstin Schuchter – St. Johann Markus Lanzinger EAST TYROL – Telfs – East Tyrol, retail Florian Neuwirt Manfred Steurer – Tyrolean Oberland, retail Wilfried Gabl Innsbruck and South Tyrol, Tyrolean Oberland and Ausserfern, Tyrolean Unterland, corporate corporate corporate Bernd Scheidweiler Mag. Christoph Wenzl Michael Falkner – Corporate customers and co-support – Key accounts and special financing, Innsbruck – Corporate customers Imst Mag.

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