FINANCIAL STATEMENTS 31 December 2009 BANCA MARCHE situation at 31 December 2009 1 BANCA MARCHE situation at 31 December 2009 2 Financial Statements and Reports as at 31 December 2009, 16th operating year. Directors’ report on operations for financial year 2009 009 Reclassified financial statements of the company 010 The Economic and Regulatory Scenario 011 1. The International and National Economic Scenario 011 2. Performance of the Italian banking system 012 3. The economic scenario in the bank’s area of operations 014 4. Regulatory changes 015 Overall operating results 020 1. Corporate policies 020 2. New products and commercial initiatives 021 3. Funding activities 024 4. Lending 027 5. Capital adequacy and the solvency ratio 030 6. Earning performance 031 7. Treasury activities and financial operations 035 8. Multi-channelling and payment systems 037 9. Equity investment operations and results of subsidiaries 042 The operational structure 047 1 Organisational changes and IT upgrades 047 2 Governance and internal control systems 056 3 Human resources 062 4 Shareholders and transactions in treasury shares 064 5 Subsequent events and outlook for the future 067 Proposed allocation of net profit 068 Report of the Board of Statutory Auditors on the Financial Statements for the year to 31 December 2009 069 Annual Financial Statements Certification pursuant to Art.81ter of Consob regulations N° 11971/99, as emended 075 Financial statements at 31 December 2009 077 Balance Sheet 078 Income Statement 079 Statement of Comprehensive Income 079 Statement of Changes in Shareholders’ Equity at 31 December 2009 080 Statement of Changes in Shareholders’ Equity at 31 December 2008 081 Cash Flow Statement 082 Reconciliation 082 Notes to the Financial Statements at 31 December 2009 083 Part A Accounting Policies 085 A.1 General Information 086 Section 1 – Declaration of compliance to international accounting standards 086 Section 2 – General preparation principles 086 Section 3 – Significative events subsequent to financial statement 086 Section 4 - Other aspects 086 A.2 Main aggregates of the financial statements 087 1 Financial assets held for trading 088 2 Financial assets available for sale 089 3 Financial assets held to maturity 089 4 Loans and receivables 089 5 Financial assets designated at fair value through profit and loss 091 6 Hedging transactions 091 7 Equity investments 092 8 Property, plant and equipment 093 9 Intangible assets 093 10 Non-current assets held for sale 094 11 Current and deferred taxes 094 12 Provisions for risks and charges 094 13 Debt instruments and Debt securities in issue 095 14 Financial liabilities held for trading 095 15 Financial liabilities designated at fair value through profit and loss 095 16 Foreign currency transactions 096 17 Other information 096 A.3 Information on fair value 100 BANCA MARCHE situation at 31 December 2009 3 Part B Information on the Balance Sheet 103 Assets 104 Section 1 – Cash and cash equivalents – Item 10 104 Section 2 - Financial assets held for trading - Item 20 105 Section 4 – Financial assets available for sale – Item 40 109 Section 6 – Due from banks – Item 60 111 Section 7 – Loans to customers - Item 70 112 Section 8 - Hedging derivatives - Item 80 114 Section 10 - Equity investments – Item 100 115 Section 11 – Property, plant and equipment – Item 110 117 Section 12 – Intangible assets – Item 120 120 Section 13 – Tax assets and liabilities – Item 130 of the Assets and Item 80 of the Liabilities 122 Section 14 – Non-current assets and disposal groups classified held for sale– Item 140 of the assets and Item 90 of the liabilities 125 Section 15 – Other assets – Item 150 127 Liabilities 128 Section 1 – Due to banks - Item 10 128 Section 2 – Due to customers – Item 20 129 Section 3 – Debt securities in issue – Item 30 130 Section 4 – Financial liabilities held for trading – Item 40 131 Section 5 – Financial liabilities designated at fair value through profit and loss – Item 50 133 Section 6 - Hedging derivatives - Item 60 135 Section 10 – Other liabilities – Item 100 136 Section 11 - Provisions for staff termination pay—Item 110 137 Section 12 - Provisions for risks and charges – Item 120 138 Section 14 – Shareholder’s equity - Items 130, 150, 160, 170, 180, 190 and 200 141 Other information 143 1 Guarantees granted and commitments 143 2 Assets lodged in guarantee for own liabilities and commitments 143 4 Management and broking for customer accounts 143 Part C – Information on the income statement 145 Section 1 – Interest – Items 10 and 20 146 Section 2 – Commissions – Items 40 and 50 149 Section 3 - Dividends and similar income - Item 70 151 Section 4 – Net result from trading – Item 80 152 Section 5 – Net result from hedging – Item 90 153 Section 6 – Gains/(losses) from disposal or repurchase – Item 100 154 Section 7 – Net result from financial assets and liabilities designated at fair value – Item 110 155 Section 8 - Net value adjustments / writebacks for impairment - Item 130 156 Section 9 - Administrative expenses – Item 150 157 Section 10 – Net provisions for risks and charges – Item 160 159 Section 11 – Net value adjustments / writebacks to property, plant and equipment – Item 170 160 Section 12 - Net value adjustments / writebacks to intangible assets – Item 180 161 Section 13 – Other operating expenses and income - Item 190 162 Section 14 – Gains/(losses) on equity investments – Item 210 163 Section 17 – Gains/(losses) on disposal of investments – Item 240 164 Section 18 - Income taxes for the period on continuing operations – Item 260 165 Part D Comprehensive income 167 Analytical Statement of Comprehensive Income 168 Part E Information on risks and related hedging policies 169 Introduction 170 Section 1 - Credit risk 173 Qualitative information 173 1 General aspects 173 2 Credit risk management policies 173 2.1 Organisational aspects 173 2.2 Management, measuring and audit systems 174 2.3 Credit risk mitigation techniques 175 2.4 Impaired financial assets 176 BANCA MARCHE situation at 31 December 2009 4 Quantitative information 177 A. Credit quality 177 B. Breakdown and concentration of crediut exposure 182 C. Securitisation and asset sale transactions 187 Qualitative information 187 Quantitative information 189 Section 2 – Market risks 193 2.1 Interest rate risk and price risk – Regulatory trading book 193 Qualitative information 193 A. General aspects 193 B. Processes of managing and methods of measuring interest rate risk and price risk 194 Quantitative information 198 2.2 Interest rate risk and price risk – Banking book 203 Qualitative information 203 A. General aspects, procedures for managing and methods of measuring interest rate risk and price risk 203 B. Fair value hedging activities 205 C. Cash flow hedging activities 206 Quantitative information 207 2.3 Exchange rate risk 216 Qualitative information 216 A. Exchange rate risk: general aspects, management processes and measurement methods 216 B. Exchange rate risk hedging activities 216 Quantitative information 216 2.4 Derivative financial instruments 217 A – Financial derivatives 217 B – Credit derivatives 222 Section 3 – Liquidity risk 224 Qualitative information 224 A. Liquidity risk: general aspects, management processes and measurement methods 224 Quantitative information 226 Section 4 – Operational risks 233 Quantitative information 233 A. Operational risks: general aspects, management processes and measurement methods 233 Part F Information on the capital 235 Section 1 – Company capital 236 A – Qualitative information 236 B – Quantitative information 236 Section 2 – Capital and capital ratios 239 2.1 Regulatory Capital 239 A – Qualitative information 239 B – Quantitative information 239 2.2 Capital adequacy 240 A – Qualitative information 240 B – Quantitative information 241 Part H Transactions with related parties 242 1 Subsidiaries and associates of Banca delle Marche S.p.A. 243 2 Information on Directors’, Statutory Auditors’ and Managers’ remuneration 244 3 Information on transactions with related parties 244 4 Other Information 251 Part L Segment information 252 Notes on segment information 253 Appendices 256 Details of revaluation of assets 257 Statement of staff pension funds 269 List of equity investments 271 Disclosure of fees paid for external auditing pursuant toArt. 160, paragraph 1-bis of Lgs. Dec. 58/98 271 The Report of independent auditors PricewaterhouseCoopers S.p.A. for the year to 31 December 2009 273 BANCA MARCHE situation at 31 December 2009 5 BANCA MARCHE situation at 31 December 2009 6 Banca delle Marche The Board of Directors CHAIRMAN Michele Ambrosini (*) VICE CHAIRMEN Tonino Perini – Vicar(*) Lauro Costa (*) DIRECTORS Giuliano Bianchi (*) Bruno Brusciotti (*) Pio Bussolotto Francesco Calai Massimo Maria Cremona Walter Darini Eliseo Di Luca Germano Ercoli Marcello Gennari Mario Volpini Board of Statutory Auditors CHAIRMAN Piero Valentini BANCA DELLE MARCHE S.p.A. STATUTORY AUDITORS Register of banks no. 5236.5 Franco D’Angelo BANCA DELLE MARCHE Banking Group Marco Pierluca Register of banking groups no. 6055.8 SUBSTITUTE AUDITORS REGISTERED OFFICE IN ANCONA Vincenzo Alviti Via Menicucci, 4/6 Pietro Paccapelo HEAD OFFICE at the Centro Direzionale General Manager di Fontedamo in JESI, Via Ghislieri, 6 Massimo Bianconi Area head offices in Jesi, Macerata, Pesaro and Rome Vice General Managers Share capital of Euro 552,661,881.72 Leonardo Cavicchia (vicar) fully paid-in Stefano Vallesi Tax and VAT number 01377380421 Manager responsible for preparing the Listed in the